• PwC’s “Bundler” Outlives His Usefulness

    By • Sep 12th, 2009 • Category: Latest, The Big 4 And Consulting

    R. Carter Pate is no longer the US Advisory Leader at PwC.  There was no announcement.  I can’t even find an announcement of his replacement, Dana McIlwain, on the PwC US website.  Only this short snippet in the September 2009 Faculty Newsletter:

    “Continuing PwC’s decades long tradition of working together with educators, we are committed to staying connected to you and we look forward to an exciting year. Also, we recognize that the current challenging times make both our roles more difficult, but we are optimistic that our continuing collaboration will bring good results for your students and our profession…”

    No mention of Mr. Pate, so I reached out to my highly placed contacts.  I was told Mr. Pate remains on the Advisory Leadership Team doing “special projects.” He continues, therefore, to receive his huge payout without having to work with clients. The PwC I know does not admit failures and they made a big mistake when they gave the US Advisory Leadership job to Carter Pate last October.

    As I mentioned in a blog post at the time, Mr. Pate is a big booster for the Republican Party and worked very hard campaigning for John McCain.  Who lost.  To Barack Obama.  The Democrat.

    It may have seemed “logical” at the time to put Mr. Pate in charge of not only reviving PwC’s Advisory (Consulting) practice but to expect him to also turbocharge it with lots of government contracts once Mr. McCain, the Republican, was elected President. When Mr. McCain lost, Mr. Pate lost his ability to dial for Federal government engagement dollars.  

    Once Mr. Obama was inaugurated, Mr. Pate came up with another brilliant plan to grow business in the Advisory practice. That’s when the rumors of PwC buying BearingPoint, the whole enchilada, started.  I reported that strong rumor in early February. By the end of March, PwC had changed course and agreed to buy only BearingPoint’s commercial consulting practice.  They left, or rather Mr. Carter left, perhaps via some ineptitude, arrogant boorishness, or lousy negotiation skills, the BearingPoint government consulting business on the table for Deloitte to snatch and grab for a bargain price.

    That must have sealed Mr. Pate’s fate.  He was out of the ivory tower in time for the new fiscal year that started July 1. When PwC announced on June 16, 2009 that they had completed the purchase of BearingPoint’s North American assets, Mr. Pate’s name was not listed. Joe Duffy is shown as the US Consulting leadership contact. By July 1, Mr. McIlwain was in place.

    Not official but heard through the grapevine is that Carter will be taking over the XLOS leadership role for the Capital Projects and Infrastructure (CP&I).  That’s an initiative to capture some of the work related to local governments’ use of stimulus money – secure funds, do the deal and advise.  Sort of like “nation building” but right here in the good old U S of A.

    McIlwain’s lieutenants are old stalwarts Joe Duffy and Dave Pittman in Chicago (who reports to Duffy).  Jacqueline Olynyk, partner and national leader of the firm’s SAP Advisory practice is the force behind the bulk up of SAP and systems implementation activity – which, judging by the number folks I know let go and the difficulties integrating the BearingPoint SMEs (the job of a Bearing Point MD, Tom De Garmo,) is not going as well as she deserves.  She’s one of the good “guys.”  Duffy’s strength is in acquisitions and deals. He has a poor people and ethical behavior reputation, from what I hear. 

    Mike Koehnaman is someone I did not have a great impression of when I was at PwC. He did so much to stifle innovation and growth and continues in that role and as a hatchet man.  People like Tom Puthiyamadam, the partner responsible for design and implement of Transform methodology, may start looking for greener pastures.

    Interestingly enough, PwC must have heard my best and strongest admonition from the post last October:

    “Is PwC staking the future of its Advisory practice on Mr. Pate’s Republican Party connections?   They’d better check the polls.  

    Or maybe they are looking for his “world-class expertise in restructuring and troubled companies?”  Well, we may be getting warmer.  Between PwC’s clients and PwC Advisory itself, there’s going to be a lot of work for him, but I’m not sure how lucrative it will be.”

    In their selection of Mr. McIlwain,  PwC senior leadership could not have chosen someone more politically opposite of Mr. Pate. Mr. McIlwain is a strong, $5000 plus strong, supporter of Barack Obama.

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    10 Responses »

    1. Nice work, if you can get it. So I can’t say I feel sorry for Mr. Pate.

      Looks like McIlwain gives PwC the opportunity to schmooze in any administration, though I imagine that’s an expensive hedge. I’d be curious to see how that works out on the gov’t contract front.

    2. Fran,

      Not sure I can agree with you on all points in your post. Mr. Pate was put in to replace Mr. Pujadas, whose leadership left PwC’s Advisory practice in relative tatters when compared to the others’ practices. Mr. Pate was put in that position (so I’ve been told) because he had grown the Wash. Federal Practice and promised to grow the national Advisory practice based on his “proven” leadership skills. If his ties to the GOP played any role, I never heard anything to that effect. I’ve heard how ungood last year’s Advisory numbers were and how doubleplus ungood this year’s Advisory budget numbers are, so it is not especially surprising that Mr. Pate was reassigned to focus on special projects. Remember, at PwC it is all about the metrics.

      In contrast, Deloitte’s leadership turned in acceptable budget numbers (based on fantasies such as 125% staff utilization) and kept their positions. Guess they know something that R. Carter does not, huh?

      Dana is a young fast-tracker, lucky to get out of PwC Advisory’s SoCal practice and make a nice transition to NYC before the Pujadas reign came crashing down. Thus, he was unscathed and moved up when the vacancies occurred. Will he do any better than Juan or Carter? No reason to expect him to, but maybe he’ll surprise people.

      Joe Duffy has been the subject of some of your other posts, nothing for me to add. I’ve heard quite a bit about Mr. Dave Pittman; he is a master of self-dealing, perfectly willing to screw over his other partners for personal advantage. On the other hand, I’m told he is aware of leadership problems and would actually like to improve things, if only Leadership would let him — which they haven’t, heretofore.

      Your comments on Mike K. are, if anything, understated and overly refined. I’m told that he is completely out of touch with what’s happening in the practices, yet his edicts on headcount reductions and personnel matters come down from on high to the practice leaders and must be followed without question, even when they are nonsensical, which is often the case. Mike K. may be the poster child for ill-managed accounting firms. Why he survived when those around him were losing their positions is a mystery, maybe he has some dirt on somebody?

      Dang I have so little respect for the PwC leadership team, you’d think I work there … and I do not. I have, however, many friends who still deposit PwC paychecks, at least until they find a better workplace.

      — Tenacious T.

    3. @TT

      Not sure what you disagree with… If your point is you have a much less favorable impression of everyone but Mr. Pate than I do then we are close. All I can say is that my continuing interest in Mr. Pate’s career and my knowledge of his management skills and abilities is directly related to how I spent my time at PwC. I could say more but then I’d have to shoot you. Or myself. Or both of us. Whatever…

      Francine

    4. Wow – it amazes my how uninformed you are. Juan was the Advisory Leader before Dana, and he has taken on a global role. Carter Pate was never Advisory leader – he was the operations guy.

      It sounds like you are just a disgruntled employee who was let go.

    5. @PwCer

      You are wrong. It’s very easy to erase history. Just remove any trace of it from websites, etc and then pretend like it never happened. But it did. When Juan Pujadas was elevated to Global , Carter Pate got the job. And he only lasted a year in it. Check your facts. I know a lot more about the firm from this vantage than you will ever know inside as a junior spreadsheet jockey.

      http://retheauditors.com/2008/10/16/pwc-advisory-leadership-the-bundler-ascends/

      Francine

    6. Fran @ 2,

      What I disagree with, basically, is the linkage of Pate’s ascension and fall with the election of Obama. I don’t believe they are as related as you make them out to be. In my view, Mr. Pate was assigned the mission of turning around PwC’s Advisory LoS in the U.S., and couldn’t pull that off in a year (not sure if anybody could have). Now it’s Dana’s turn in the barrel.

      Otherwise we seem to be in violent agreement regarding other members of the Advisory LT.

      — Tenacious T.

    7. @TT
      I did not mean to imply that his rise and fall was purely as a result of the election outcome. Results are results and we agree PwC Consulting’s have been dismal. I just find it quite interesting they went from one political extreme to the other when choosing leadership. Just goes to show that not everyone in the firms does think alike and that the firms are chameleons when it comes to which side they’re on. Reminds me of the joke about the accountants: CEO to CFO: What is our EPS this quarter? CFO to CEO: What do you want it to be?
      Francine

    8. Hi Fran,
      Very interesting update I must say..a question on one of your favorite topics. How is PwC’s takeover of the Bearing Point pieces progressing? Have they started going to the market together as yet? I read that BP had a couple of GDCs in India and China..do you know what if anything PwC plans to do with those centers?
      -P

    9. FM,

      Juan was Global and US Advisory Leader. Carter was US Advisory Managing Partner. Lets be honest, the titles dont matter. Carter did a great job with PwC’s healthcare and Federal Practice, stepped in to a pretty bad situation and couldnt do the normal “Carter Pare saves the world act”. PwC global got mad, replaced him, kept him on to do “special projects”. My guess would be that hes gone within the next 1-2 years to go start a new business or be a managing partner somewhere else.

    10. tom p is a great guy and am glad to here that he is partner and still there. how far he’s come since telecom.

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