After two years of suspended animation, the board of Arthur D. Little places CEO Lorenzo Lamadrid on “leave of absence” and “relieves” him of all substantive duties.

Why can’t they use the f-word?

That’s not the way the world’s oldest management consultancy (115 years young) handles such things. Lamadrid was brought in to purposely shake up the staid ADL culture two years ago. With eight early years at Boston Consulting Group to his credit, he was the quintessential outsider. Most of his business experience was in the utility industry as head of Western Resources International. It was there that Lamadrid was credited with creating China’s only Sino-foreign joint venture with the Ministry of Electric Power’s China Power International. ADL, which was treading water in the United States but strong in Europe, saw Lamadrid as a leader who could add a robust Pacific Rim practice.

There’s a vague déjà vu feeling to this current ouster. Charles LaMantia, ADL’s previous CEO, had offered his resignation after a schism developed between the firm’s European and North American partners. In 1998, both groups separately petitioned ADL’s board of directors concerning their lack of confidence in LaMantia. The trouble: ADL’s Memorial Trust (the firm is a hybrid partnership/company) had suffered a reported per-share drop of 37 percent. Long-time partners appealed to the board after watching their pensions wither.

Apparently, a similar no-confidence vote was behind Lamadrid’s departure. The fact is, ADL has done little to capture the e-business wave and, by comparison, looks even more out-of-touch than other old-guard firms. The only way Lamadrid could build the firm was to tear it down.

ADL offers the militaristic dress-down language rather than just kicking his butt out the door because both sides are culpable. For a firm that has seen a lot over the years, you would think it saw this one coming.

Heard on the street
Word is that one of the best-known Chicago e-consultancies has hired investment bankers to explore its options. The company won’t officially comment on rumors, but our sources say the investment banking folks came on board last week. We still don’t believe a consolidation wave will sweep the industry. But it’s apparent that the clock is ticking for some of the e-firms.
Inside Consulting is written by Tom Rodenhauser as a free weekly supplement to The Rodenhauser Report. The report informs senior advisors and business executives of consulting trends and best practices. Subscription cost is $295 per year for 10 issues. Copyright 2001, Consulting Information Services, LLC. Reproduction is prohibited. Quotation with attribution is encouraged.