This section provides a brief overview of the value proposition in the context of its value network2 and key activities in management consulting. These activities are discussed in more depth in Chap. 3 and across the book. Note that neither this sec- tion nor Chap. 3 delve into the different chronological phases of an assignment, because this has more to do with developing a client-consultant relationship than developing operational capabilities. The client-consultant relationship is the focus of Chap. 4, and for this reason the chronological phases of an assignment will be covered in Chap. 4 (Sects. 4.4, 4.5 and 4.6).
A customized service Management consultants serve a distinctly personalized function. One consequence is that the client cannot know in advance what she is exactly buying before she gets it. Conversely, she may expect from her consultant to dedicate and appreciate the peculiar intricacies of the problem at hand and develop a tailored solution. Management consultants are problem-solvers; agents of change [7] whose value proposition responds both to functional and cultural (a.k.a. psycho- logical) needs from their clients (Fig. 1.2). So this is what the client pays for.
Supply The industry is labor-intensive [8–12, 49]. Because consultants are the pri- mary assets of a consulting firm, the firms invest considerable amounts on formal training, mentoring and professional development programs (Fig. 1.2). They also invest in the purchase of information technologies: databases, libraries and intranet systems that hold reports from past assignments and enable a knowledge-based intellectual property to build up.
2 The concept of value network [18] is described in Sect. 1.1 and Chap. 7.
5% - Strategy Generalists (McKinsey, BCG, Bain)
15% - Diversified Conglomerates (Deloitte, Accenture, PwC, ...) 80% - Service / Industry Specialists
Fig. 1.1 Aggregate 2017 market share of generalists, conglomerates and specialists
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Demand Depending on the scope of the organization, new clients may be sourced through domestic or international networks. So-called Partners (and/or Principals) in consulting firms are the agents whose role is to initiate and maintain client rela- tionships. The client relationship (discussed in Chap. 4) involves a high degree of personal interaction with the client including daily communications and frequent visits on-site.
Policies The management consulting industry is seldom regulated by governmen- tal bodies, except in developing countries where governments frequently tamper with the decision-makings of local corporate organizations [9]. In advanced econo- mies, policies applied to management consulting may come in the form of accredi- tation to recognized institutions such as the AMCF [50], but the type of credibility bolstered through proprietary brand development and personal networking by part- ners and principals is the most common and effective form of accreditation (Fig. 1.2).
Personal networks substitute to the type of credibility offered by formal accredita- tion. Still, given that 45% of management consultants are freelancers or newborn startups [10], an AMCF’s license to operate can give a significant push to recent nascent consulting ventures.
Processes Consulting activities may be organized in three categories – organizational development (OD), consumer/stakeholder market research (CMR) and competitive intelligence (CI). The most common activities are listed in Table 1.1. The first cat- egory regards issues internal to the client organization, the second issues with external stakeholders and the third issues with market players (who may represent competitors, partners, or acquisition targets). These three categories will be used to organize the discussion in Chap. 3 where each activity is introduced with an item- ized action-plan. Of course the merit of defining such categories is purely peda- gogic, since any activity may be adapted to fit the need of a particular case and
Trained problem solvers Knowledge- based IP
Organizational development Market research Competitive intelligence
Partners and principals networks Accredited institutions Governments
Organization management issues Organization functional and cultural needs Processes Policies
Supply Demand
Fig. 1.2 The management consulting value network 1.4 Operations and Value Network
client, and coming up with new ways to approach a problem is just good practice in management consulting. Table 1.1 lists 20 key consulting activities. Each of these will be described in more detail in Chap. 3 (Table 1.1).
Table 1.1 Sample of consulting activities: organizational development (OD), consumer/stake- holder market research (CMR) and competitive intelligence (CI). Each activity is described in detail in Chap. 3
OD activities CMR activities CI activities
• Brainstorming
• Scenario planning
• Strategic planning
• Innovation
• Re-engineering
• Resource allocation
• Cost optimization
• Downsizing
• Documentary research
• Customer segmentation
• Surveys
• Focus group
• Interviews
• Big data analytics
• Pricing
• Supply chain management
• Due diligence
• Benchmarking
• Outsourcing
• Mergers and acquisitions
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© Springer International Publishing AG, part of Springer Nature 2018 J. D. Curuksu, Data Driven, Management for Professionals, https://doi.org/10.1007/978-3-319-70229-2_2
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Future of Big Data in Management Consulting
This chapter discusses the outlooks of management consulting, the interface with data science and the disruptive impact that new information technologies will have on the management consulting industry. The first part of this chapter presents key insights from the literature. The second part engages the reader into a scenario anal- ysis that builds on these insights and starts imagining what the future of manage- ment consulting might look like.