Large consulting firm in recent time are facing challenges to justify the spent by clients on the services over the value delivered by its consultants. Which is making clients jittery to engage with them.
Research from Harvard Business Review “Consulting on the cusp of disruption” by Dr. Clayton Christensen sheds some light, that there seems to be disconnect on 4 fundamental levels that are not aligned from a consulting cost Vs value perspective:
- Siloed Structures: Consulting firms operate in silos, for e.g. A tier 1 strategy firm which has 2 units in the same geography, both units work on different P&L’s (As Profit & Loss Centres). This is a direct reflection of the expertise the firm has on-board.
- Depth of Expertise: There is no single large consulting firm in the world, that seems to have the depth and breadth to support EVERY business initiative today.
- Overhead Costs: Maintaining a great pool of resources requires top salaries, perks, facilities, insurance etc for employees and large consulting firms are good at it, however the burden of these overhead costs can affect client proposals.
- Skill Shortage in Enterprises: The other challenge lies with enterprises globally, as they are unable to hire the right employees, who can bring the required expertise & skills to the table in an ever-changing business world.
One of the solutions to skills shortage from Harvard Business Review was “Aligning Your Organizations With An Agile Workforce”; the talent companies bring in for short term fixes, when business needs them for specific projects.
The only pool in the world today that can to a large extent provide any business expertise required, seems to be the scattered set of independent business consultants & boutique / specialized consulting firms formed by ex-employees of large firms.
United States alone has more than 1 Million independent business consultants, and the number is growing quite rapidly every passing year.
Independent consultants are a set of individuals along with boutique firms, that are affected far lesser by siloed structures & overhead costs. At the same time they bring deep expertise on specific business problems and can bridge the skills gap that are required by enterprises today.
The key insight here is that, high levels of expertise can be found within independent consultants & small boutiques firms. Consulting clients may find more capability in these communities than in the larger consulting firms, especially for very specialized skills.
However the major constraint to date has been to identify these hidden expertise and bring them on-board, may it be for an hour’s advisory work over the phone or weeks of consulting work. However sophisticated technology & algorithms adopted by Expert Marketplaces seem to solve this problem of getting work done at enterprise level in a much faster and agile manner.
By using independent consultants & industry experts from around the world, many companies like GE, Pfizer, Singapore Government etc. have realized the benefits what globalization, innovation and new technology can bring, in this ever changing and constantly evolving business world.