Strategy From the Viewpoint of Management Consultants

Introduction

The role of management consulting firms continues to undergo transformation as clients face an entirely new series of challenges and complexities in keeping their businesses viable. The intent of this analysis is to evaluate the key consultancies and the four major areas they are actively selling to potential clients. Five of the leading management consultancies are included: Accenture, Bain & Company, Boston Consulting Group, McKinsey & Company, and Monitor. Unifying the value propositions and services all of these firms offer is a common thread of growing businesses in stagnant and slow-growth markets, penetrating new global markets — with China mentioned most often — and aligning information technology strategies to business goals. These three areas dominate the services offered by all five consulting firms. A secondary set of factors also emerges in the areas of analytics, business intelligence, and pricing, all critical for keeping an existing business on track to profitability during turbulent economic times.

Analyzing the Value Being Promised by Management Consultancies Today

Inherent in any services-based business is the promise of value to be delivered in the future based on a consulting agreement put in place in the present. This dynamic is well-documented in management consulting literature, and is most often referred to as management consultancies aspiring to be trusted advisors for their clients (Visscher & Visscher-Voerman, 2010). All five of the management consultancies mentioned in this analysis concentrate on the depth and breadth of industry expertise to underscore the trustworthiness of their services. How each packages and presents these areas of expertise varies significantly, as each firm maintains a unique consulting and services model.

Despite these differences in how they promote and sell their services, all five share a common foundation: providing the greatest breadth and depth of customer success stories in the areas of growing businesses in stagnant and low-growth markets. This theme of guiding companies seeking to gain market share profitably in challenging markets is so pervasive across all five consultancies that individual practices have been designed around this area of strategic planning. The larger firms — including Accenture, Boston Consulting Group, and McKinsey & Company — have partners writing books on the topic, promoting frameworks and concepts to further underscore their potential to deliver value.

All firms included in this analysis have extensive social media and social networking programs to promote content produced, including videos from their conferences and programs. All firms also rely on senior partners to blog about their latest research, further promoting new studies. The largest firms differentiate their social media content between customer success stories and frameworks derived from empirical research. Taken in aggregate, all of this content is deliberately positioned to strengthen each firm's role as a trusted advisor to potential clients. The approach each consultancy takes toward growing businesses in stagnant and slow-growth markets, however, varies based on industry expertise, depth of implementation and strategic planning staff, and previous results attained across industries.

Growing Businesses in Stagnant and Slow-Growth Markets

Management consulting firms such as Accenture combine their core strengths in enterprise mobility strategies and IT planning and development to provide prospective clients with assurance of new market development using their existing IT architectures. Bain & Company, Boston Consulting Group, and Monitor also take this synergistic approach to defining new business development strategies in stagnant and slow-growth markets. The focus on using IT strategies as the foundation for revamping selling strategies across multiple distribution channels is unique to Bain & Company within this first major attribute area. McKinsey & Company attempts to demonstrate how its global expertise and depth of economic research insight are critically important for growing a business in challenging times.

All of these varying approaches to selling management consultancy expertise in growing businesses in stagnant markets revolve around trust and proven execution. It is doubtful any CEO or board of directors would entrust such a daunting task as stabilizing the growth of their business to an unknown or unproven management consultancy. The continual development and publication of content, including thought leadership studies, is critical for any management consultancy to continue growing. In the particularly challenging task of selling clients on helping them turn around their businesses in stagnant and low-growth markets, budget dollars allocated to consultancies are also often at a premium.

Conclusion

All management consultancies are attempting to position themselves as trusted advisors to firms looking to stabilize existing sales while growing into emerging markets. Of the five included in this analysis, all also maintain social media channels well-populated with content meant to convey their thought leadership in specific areas. Yet in the area of equating strategies to IT investments, the majority take the position that increased IT spending is potentially the path out of underperforming strategies. Only Boston Consulting Group takes a more fundamentally strategic view of systematic business change, choosing to layer in IT after the frameworks have been created. Its legacy strengths in the BCG and Growth/Share Matrices may well be the impetus for this approach. Despite that, Boston Consulting Group tends to concentrate more on measuring strategic outcomes across its 19 core vertical industries, with greater emphasis on making strategies succeed without IT being absolutely essential to their execution. Accenture, on the other hand, is entirely focused on IT first and strategy second, consistent with its core strength in system integration.

The value of this analysis lies in observing how these management consultancies attempt to base their current value propositions on their legacy strengths while striving to remain relevant to clients' emerging needs. It is a never-ending cycle of innovation and renewal, as each firm must continuously create frameworks and new approaches to conveying thought leadership through value delivered. None of these firms could be retained for less than a $100,000 commitment at minimum — and that would represent less than a month's work. Major strategic initiatives, such as redefining a firm's innovation and new product development strategies, would most likely carry fees well above $500,000. This study has also shown that these firms seek to provide strategic insights aimed at reaching the CEO and board of directors early in the selling process, gaining their trust and commitment to ensure program success. Finally, thought leadership is an ongoing imperative for each of them, as they must continually fuel their brand position and market direction with fresh ideas and insightful analysis.

References

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Mors, M. (2010). Innovation in a global consulting firm: When the problem is too much diversity. Strategic Management Journal, 31(8), 841.

Visscher, K., & Visscher-Voerman, J. I. A. (2010). Organizational design approaches in management consulting. Management Decision, 48(5), 713–731.