Understanding disruptions can help you take advantage of the powerful new trends and position your company to optimize for the trends that will shape the future.

On this week’s Smart consulting Sourcing podcast, Consulting Sourcing Expert Hélène Laffitte talks about the future of consulting.

Key Takeaway: Both Clients and Consultants need to understand the new dynamics and utilize the latest developments, while building their relationship on transparency and mutual interest. The consulting industry is evolving and many opportunities will arise for both consultants and clients. But the real question remains: are clients ready to change their ways of working with consultants?

Transcript

 

Hello and welcome to episode 46 of our podcast: Smart Consulting Sourcing, THE podcast about Consulting Procurement.

My name is Hélène, and I’ll be you host today.

Each week I’ll give you the keys to better use, manage and source consulting services.

This week, I’ll talk about The Future of Consulting (Consulting 4.0)

Last week, I explained How to Get the Best Performances from Your Consultants

We saw that many executives blame the consultants when things go wrong. But sometimes, there are the guilty ones. The trick is to keep your eyes on the prize. Be ambitious, clarify your expectations, demand impeccable performance and put the consulting firm in the right conditions to deliver.

The disruption in the Consulting value chain can benefit clients in many ways. Due to the digital transformation affecting modern industries, we see disruption unfolding in major areas such as Marketing & Sales; Knowledge; Data Analysis; Methodologies & Solutions; Services and Resources. Clients today have an abundance of opportunities to source talent, expertise, and to use offerings tailored to their specific needs.

Understanding disruptions can help you take advantage of the powerful new trends and position your company to optimize for the trends that will shape the future.

If we take a quick look back, we will see that the Consulting industry is pretty resilient and adaptable. It started with a value proposition around work optimization, and then shifted swiftly to more value and a focus on strategy.

Since then, consulting firms have shown a high capacity in embracing the top trends in management. They developed specific offerings to help their clients to implement new management concepts such as: total quality, globalization, voice of the customer, design to X, value pricing, lean six sigma, and succession planning.

Today is all about digital –

Pretty much every Consulting firm today has incorporated a digital layer in its offering.

The recipe for success until now was rather simple. Consultants had to accumulate experience, gather knowledge and data, organize information, process information at light speed, and organize findings into superior looking reports. Sounds simple, right? Let’s see how digital seems to be reshuffling the cards.

The Consulting Value chain is constantly evolving, in all its sectors, from Marketing & Sales, to Knowledge and expertise, Data and Data analytics capability, Management tools & Methodology, Proliferated Talent pools, and much more.

It’s important to mention that Clients are evolving simultaneously as well, expanding their knowledge and expertise, access to Data, and are relying on in-house Consultants more than before.

In that line of thought, the Consultants’ role is shifting too.

The Consultant added value becomes their capacity to frame the problem and analyze the data provided by the expert.

 

Companies such as Evalueserve are offering outsourced knowledge services to management consultancies such as knowledge management, business intelligence, market-specific or clients insights to support business development. Until recently most companies had none or very scarce resources dedicated to data analytics.

With all the hype around Artificial Intelligence, Big data and Machine learning, that situation is about to change. Major companies are building teams of data scientists to take advantage of their data and even for some of them to create new business models.

Now let’s take a look at the future of Consulting –

We are now entering the era of Consulting 4.0 – a term borrowed from the industrial revolutions’ stages – industry 1.0 to industry 4.0.

New technological developments, or digitalization to be more exact, have affected the Consulting category as well.

The fundamental business model based on solving problems, whether developing a new strategy, cost-cutting solutions, or implementation of new technologies, guaranteed the Consulting industry’s success.

But in the aftermath of the 2008 economic downturn, things have dramatically changed.

Declining revenues, growing competition, and market consolidation are among the main factors that make Consulting firms worry.

However, a better perspective to look at this, is to frame it as the beginning of a new era – Consulting 4.0

The consulting industry has to reshape itself with new business models, new growth areas, and innovative products and services to be created. We can confidently say that Digital transformation is at the core of Consulting 4.0

Main Characteristics:

– Consulting 4.0 is more than the digitalization of the industry. It includes a fundamental change in almost all sectors.

– Some of the factors behind it include volatility and uncertainty, as the global economic environment is constantly changing, and to a big extend has created to the disruptive forces we are witnessing.

– Clients-Consultants relationship has changed – a complex and uncertain global economic environment created many new challenges for Client organizations.

– Clients today have more information – with the launch of many new platforms and information services in the past ten years, clients have access to quality and quantity of information, giving them a strong preference for which consultants they want to hire.

– The demand for Consulting services has changed as well- and Clients today are less dependent on Consultants. They are either doing in-house consulting or prefer very niche and specific services rather than general management Consulting services.

– Low cost and high-end expertise services – as Client perceptions evolve, they are reshaping the consulting industry, driving it into two distinct directions – One one hand, Low-cost consulting fixing problems and discovering solutions. And on the other end of the spectrum – high-end, specific consulting solutions to problems that Clients don’t have the confidence or expertise for.

 

So how to be a winner in this new Consulting Industry domain?

Both Clients and Consultants need to understand the new dynamics and utilize the latest developments, while building their relationship on transparency and mutual interest.

The consulting industry’s market leaders – strategy consultants, IT consultants and system integrators or the Big Four – have the chance to position themselves as multi-specialists, sometimes by eagerly acquiring smaller specialist consulting firms.

Smaller consulting boutiques, with their deep specialist know-how and innovative business models, could be well-positioned to make a remarkable amount of work in nearly all sectors as clients realize the possibilities for wide-ranging change, major transformation, and are rethinking their business models.

So we see, the consulting industry is evolving and many opportunities will arise for both consultants and clients. But the real question remains: are clients ready to change their ways of working with consultants?

That’s it for today. Next time, I’ll talk about the US Consulting Market.

In the meantime, if you have any questions, or want to learn more about what we do at consulting quest, just send me an email at helene.laffitte@consultingquest.com

You can also have a look at our website smartconsultingsourcing.com to know more about our book and download free templates & guides to improve your consulting sourcing.

Bye and see you next week! Au revoir!

CEO and Co-Founder at | Author\'s website

Hélène Laffitte is the CEO of Consulting Quest, a Global Performance-Driven Consulting Platform and author of “Smart Consulting Sourcing”, a step by step guide to getting the best ROI from your consulting. With a blend of experience in Procurement and Consulting, Hélène is passionate about helping Companies create more value through Consulting.

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