Management Consultancy firms are cropping up left, right and centre these days. It’s easy to find one willing to help, but how do you go about finding the right fit for your business? Below Mark Peters, Managing Director at Protiviti, talks Finance Monthly through the process of sourcing management help.
As the market environment continually shifts, businesses face an increasing need to make fundamental changes to their strategies if they want to continue to grow profitably, manage risks effectively and optimise the opportunities brought about by change. Both emerging and mature businesses need to navigate digital technological advancements; disruptive innovations threatening core business models; soaring equity markets; uncertainty brought by political disruption (e.g. Brexit); cyber breaches on a massive scale; increasing regulatory scrutiny; adjustments to corporate culture; and changing economic conditions.
These critical concerns are in abundance for boards and executives, and the expectations amongst key stakeholders for greater transparency about the nature and magnitude of risks undertaken in executing a businesses’ corporate strategy are high. Simply put, hiring more people is no longer sufficient to maintain growth; instead, today’s challenges are driving increased demand for management consulting expertise.
Management consulting can include a broad range of business advisory or implementation services. It consists of providing third-party independent expertise in areas such as business strategy; management organisation; financial management; risk and regulatory requirements; HR; and technology to solve business problems. There are many types of consulting firms in the market. Strategy firms focus on one or two of the areas outlined above, while large accounting firms offer a broad range of services, to name two examples. However, market demand for greater insight and choice has seen both the emergence of more specialist knowledge, and an increasing requirement for consulting firms to provide a ‘full service platform’ offering. At one end of the spectrum, potential clients are looking for high-value consulting services (e.g. realising opportunities of strategic change) for critical areas, while at the other end, they are also looking for more traditional commodity and lower cost consulting services (e.g. staff augmentation). Overall, the market is seeing increased demand for a cross-spectrum offering as well as a rise in independent consultants offering more niche services.
With this backdrop, to find the best consultants to support them, organisations need to develop their own criteria for selection. Factors might include the extent to which the consultant can show:
- An ability to discover value – The best consultants demonstrate an ability to clarify the stated need within the context of the client’s business and work collaboratively with the client to identify the ‘real problem’.
- An ability to deliver external insight and value – Executives that hire consultants often have their own perspectives on the problems they are facing but turn to consultants for help to make sure they aren’t missing the obvious or a better answer. The best management consultants team together with their clients to see beyond the surface of the initial changes and problems to discover opportunities that the client might otherwise miss.
- Specialism related to your ‘real problem’ – The most effective consultants provide a combination of consulting professionals and people who have held management positions to bring a wider perspective. They also demonstrate that they have worked with many different companies and may have worked through this problem in the past with another organisation. This breadth and depth of experience enables them to provide an informed perspective and bring both pragmatic and innovative solutions that the client would not have been able to discover alone.
- A desire to sustain a relationship – The best consulting firms can demonstrate a track record of success and will provide the client with a consistent experienced team with ‘skin in the game’ for the long-term and not just the ‘sales pitch’. The best firms focus on building strong relationships with the people in the organisations they are supporting, creating an exceptional working experience.
- Demonstrate value delivered –The best advisors don’t just provide a view on how they will solve problems at a price, but also provide hard numbers and statistics to show how the cost of their advice has generated value to the organisation. Finding the best consultant and value often doesn’t equate to the cheapest compared with one that might be more expensive but more effective. The top firms can measure their value in terms of risk reduced, improvements delivered or opportunities realised as a result of their work.
Experience tells us that no one competency or consulting firm is ever enough to solve today’s complex business problems. Most clients want to work with a consulting firm that can demonstrate the qualities described above, solve business-critical problems and offer an alternative, fresh perspective. Consulting firms that develop the expertise of their people in the areas of digital transformation, data analytics, robotics, risk, regulatory change and front-to-back office improvements, and tailor solutions to fit the unique business problems of every client, are seeing unprecedented demand from companies wanting help to face the future with confidence.