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8 of the Hottest Industries Ready for Disruption According to Experts

Working with consultants can bring in tremendous benefits, but if you don’t know how to manage the procurement process, the results might be far from satisfactory. A first scan of your expenses, where the observation period will be the previous fiscal year, will give you a good basis for slicing and dicing the information. Having this structured data will allow you to understand the patterns of your Consulting Spend. You can capture quick gains, get the buy-in of your employees and embark on a self-funded journey.

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This Week in Consulting: Managing Risk in an Agile Organization

This Week in Consulting

Wednesday, July 17th , 2019

Managing Risk in an Agile Organization

THIS WEEK’S MUST READ
“As organizations move to agile delivery, control functions, including risk, compliance and business control teams, will need to rethink their interaction models for executing credible challenge and advising the business in near real-time methods.”
In this paper, Protiviti shares its Agile Risk Management philosophy. Risk management has to be designed appropriately to keep pace with agile organizations. They define practices for next-generation risk management that are more agile and better aligned, allow for operational excellence, and are focused on customer satisfaction.
This Week’s Must Read is an insight piece from Protiviti on the foundations of agile risk management.
Read on to Find out More: “Managing Risk in an Agile Organization“

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THIS WEEK’S VIDEO:

Dr Salim Al-Harthi and Dr David Hillson explain the purpose of the “100 Risk Questions” video project, and outline the structure of the video series.

THOUGHT LEADERSHIP

What is enterprise risk management? How to put cybersecurity threats into a business context– “Security is growing in significance to effective enterprise operational risk management Tight alignment with both the ERM and crisis management programs is essential.” Many companies still have a traditional approach to enterprise risk by assessing financial, regulatory and operational risks. But cyber risks are an increasing part of the equation. Are ERM program mature enough to assess these new risks?  | Maria Korolov
The future of risk management: “Firms should focus as much on risk response as on risk mitigation,” advises John Drzik, president of global risk and digital at Marsh, one of the report sponsors.” From cyber attacks to physical risks, are all low-probability/high-consequence events truly beyond our ability to identify and manage? | Helen Yates
Confronting the risks of artificial intelligence: “With great power comes great responsibility. Organizations can mitigate the risks of applying artificial intelligence and advanced analytics by embracing three principles.” We have all acknowledge the potential of artificial intelligence. But are we prepared to manage the risks that will arise from a broader application of AI in our organizations?   | Benjamin Cheatham, Kia Javanmardian, and Hamid Samandari, McKinsey
2019 The state of Risk Oversight: “An increasing number of organizations have embraced the concept of enterprise risk management (ERM), which is designed to provide an organization’s board and senior leaders a top-down, strategic perspective of risks on the horizon so that those risks can be managed proactively to increase the likelihood the organization will achieve its core objectives.” The portfolio of potential risks is increasingly complex. How do leaders identify, assess, and manage these risks? The article presents an overview of enterprise management practices.  | Mark Beasley, Bruce Branson and Bonnie Hancock, North Carolina State University
The Global Risks Report 2019: “Profound political, economic, societal, technological and environmental transformations are occurring at an unprecedented scale and pace and have become a part of day-to-day business life.” Is your company responding effectively to the risks it is facing? The 14th edition of the Global Risks Report, prepared by the World Economic Forum, is compulsory reading if you are interested in risk management. | John Drzik, Marsh & McLennan

TRENDS

On the same theme,here is a selection of conferences that you might find useful
 
What Keeps You Awake at Night? :Discover proactive risk management strategies to overcome recession fears, emerging risks, and reputational risk.
 
Risk USA : Re-inventing risk management in a radically changing financial landscape.

CONSULTING INDUSTRY NEWS

New Studio Blockchain Accelerator by IDEO Gets Amazon, Fidelity, Deloitte and Messari Backing: DEO CoLab, which is a subsidiary of IDEO, has found companies such as Fidelity, Amazon, Deloitte, Messari, the Ethereum Foundation and the Stellar Foundation as important partners in this enterprise.  | BitcoinExchangeGuide
A.T. Kearney Research on In-Store Consumer Retail Technology Finds Retailers Missing Opportunity to Meet Consumer Expectations Around In-Store Technology: The 2019 Consumer Retail Technology Survey, found that while 75 percent of consumers are aware of at least one retail technology, only 33 percent have experienced any. When it comes to in-store technologies, most retailers are lagging behind consumer awareness of them in terms of providing an experience involving one or more. | Cision PR Newswire
Capgemini launches first technology venture capital fund: International professional services firm Capgemini has announced it will expand its offering to start-ups with a new technology venture capital fund. Firms which successfully court the fund will receive an investment between €1 million and €5 million, as well as access to assistance from Capgemini’s consultancy business.  | Consultancy.uk

Estée Lauder Expands OMD Hong Kong Remit : Estée Lauder in Hong Kong & Macau has appointed OMD Hong Kong to manage the media brief for its portfolio of prestige skincare, makeup, and fragrance brands. | Bobby McGill, Branding in Asia

DIRECTORY

The Consulting Quest Global Directory is the largest professionally-managed directory in the consulting industry. Searchable by consultancy , name or by region, capability or industry it lists and describes more than 6000 consultancies worldwide with links to their websites and social media channels.
 
 

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CONSULTING SOURCING TIPS

The Specialization Dilemma, Degrees of Specialization, and Differentiation – How to Select the Best Consultant?
If you are trying to get the best and most accurate snapshot of the various degrees of specialization in Consulting ...Read More

Challenges of Open Innovation and How Consulting Can be a Catalyst for Open Innovation
"For good ideas and true innovation, you need human interaction, conflict, argument, debate." - Margaret Heffernan Open innovation is the use ...Read More

8 Biggest Reasons Why Organizations Need a Consulting Firm and How Consultants Cater to Clients’ Needs
Businesses today are facing a growing number of challenges. And as an executive, you are often under pressure to find ...Read More

About Consulting Quest

Consulting Quest is a global, performance-driven consulting platform founded in 2014 by former members of top 10 consulting firms with the objective of reinventing consultancy performance. With a worldwide presence and a range of proprietary performance measurement tools, we help companies navigate the consulting maze. We work with Consulting Clients to increase their performance through consulting and Consulting Providers to help them acquire new clients and to improve their performance.

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Challenges of Open Innovation and How Consulting Can be a Catalyst for Open Innovation

“For good ideas and true innovation, you need human interaction, conflict, argument, debate.” – Margaret Heffernan

 
Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively.
Beyond the extended role given to R&D, the concept also requires a contribution for all stakeholders in the company. Rendering the innovation process much more collaborative and guess what … open.
As we discussed in a previous blog post, the main sources of Open Innovation are:

Academia – universities, labs, and research centers
Customers, Suppliers and Business partners – their unmet needs, issues, and suggestions for product improvements
Industry Groups and Professional Associations where sharing of thought leadership and newest developments, is happening.

Optimize your Consulting Spend

Consultants are selling their time, or more precisely, the access to expert knowledge and execution workforce during a certain period. The potential of production of a Consulting firm is the amount of time available for billing. Every day not billed is lost, just like an empty airplane seat.

Read More

And now here are some of the new challenges:
 
– Implementation of Open Innovation –
Recent reports revealed that about 80% of organizations are engaged in some kind of open innovation. But only a few would qualify those efforts as successful
 
– Balancing Act –
Cooperation of large companies & small start-ups. It’s a known fact that many small companies have reservations about Open Innovation collaboration with large corporations. It’s a matter of building trust and identifying common interests and mutual benefits.
The Virtual Technology Cluster (VTC) Group program provides a complementary platform for all existing accelerators, incubators, Academic programs, etc. as we focus primarily on connecting the innovation within each VTC to revenue.
 
– The Benefits of Curated Innovation –
The VTC Group attempt to take a much more curated approach to innovation. They aim to provide companies with a customized ecosystem of startups, academics, and government agencies to help bring the latest innovations that are happening in their field.
This curation process is crucial as there are considerable, and often unforeseen costs involved with open innovation.
 

How Can Consultants Become a Catalyst of Open Innovation for Your Organization? 
The outside world offers a plethora of opportunities in using Consultants as your “agent” in successful Implementation of Open innovation.
– Facilitating collaboration between large and small companies – Here is a challenge that both large and small companies face –  Large companies are often struggling to explore disruptive ideas as they focus on their core business. Small companies can be fast and agile in developing new ideas, but often struggle bringing these to the market as they lack the means and capability to do do, but if you find ways to combine their resources, the results can be quite interesting!
– Act as your sparring partners –
It can be beneficial to keep the line of communication open with a limited set of partners and bounce ideas as sparring partners. Besides, in those conversations, you manage what you want to disclose or not.
Last, when it comes to getting ideas, don’t underestimate the power of your procurement processes. Leveraging RFIs (Requests For Information) is a way to gather some elements before launching a full-fledged project.
Obviously, some RFIs have to turn into projects at some point. Otherwise, consultants could see it as brain picking, and the source and quality of what you gather will dry.
– Being a source of ideas –
As one of the senior partners from a large consultancy puts it: “We were developing the big idea and selling it.” Consultants were pitching strategy ideas and helping to bring them to fruition.
Today projects have evolved in sizes and shapes, but the scheme where consultants are pitching their ideas remain.
Consultants are also screening and processing a huge amount of information to stay current in their industry of specialization. With the emergence of dynamic start-up ecosystems, consultants have also started to maintain a mapping of the most recent and relevant ones. Oliver Wyman produces on a regular basis an interesting mapping of the start-ups in the procurement field.
– Facilitating innovation task forces –
If you are re-inventing your business or a business unit, the first step will be to help you determine what you expect from your innovation but also what are the limits that you are placing for the exercise.
Facilitation can be very useful to create the conditions to spur innovation. You can find in the market all kind of facilitation services. It ranges from the innovation consulting firms to futurists, that can help you project yourself a few years down the road, taking into account megatrends and technological progress to look at what the future holds. 
– Connecting you with third parties –
New technologies have made it possible to leverage the power of crowdsourcing. Companies like Innocentive and Nine Sigma, for instance, are pioneers in crowdsourced innovation. They help companies to define the problem they are trying to solve. They then organize challenges that can be internal to the company or leveraging their huge network of experts. They can also create specific galleries where clients are exposing their main challenges for experts to solve.
Beyond Crowdsourcing, consulting firms have experience with multiple customers on the same subjects but through different angles. They can also help establish connections when discussions between their clients would prove valuable and beneficial.

If your organization aspires to grow, you need to incorporate open innovation, build an innovation machine or innovate in your operations. The right consultants can be the catalysts you need to spur your innovation. To find out how we can help you, please connect with us today to discuss further.

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Understanding consulting fees to make smarter decisions

You might be nonchalantly asking yourself, why do companies hire Consultants?
Great question!
To improve a process, to save money, or to get a fresh perspective, but most of all, to get access to very specialized skills that great Consultants can bring in.
And as the business environment constantly evolves, it’s safe to say companies need to evolve as well.

“The biggest risk is not taking any risk. In a world that’s changing really quickly, the only strategy that is guaranteed to fail is not taking risks.” Mark Zuckerberg

Now let’s have a look at Consulting Economics – 
Consultants are selling their time, or more precisely, the access to expert knowledge and execution workforce during a certain period. The potential of production of a Consulting firm is the amount of time available for billing. Every day not billed is lost, just like an empty airplane seat.
They charge per time spend.
So the fee structure is usually geared to optimize the utilization rates. As for products or services you might be more familiar with, this ranges from Cost Plus to Value Based.

Know the Consulting Category

Businesses today are facing a growing number of challenges. And as an executive, you are often under pressure to find solutions to multiple problems. What value can Consultants bring your organization?

Read More

Consulting Project Fees Framework –
Daily Rate: For smaller projects or exploratory phases, the Consultant can propose a negotiated daily rate. The total fee is then calculated based on the real number of days spent on the project.
Flat Fee: The most common fee structure for large projects. The Consultant will evaluate the work to be done and the deliverables to be prepared, and define the expertise and time needed to deliver the project. Afterward, two approaches are possible. Taking the workload based approach using daily rates or use this as a reference but price based on the value to the end client.
While the following breakdown is standard, remember to focus on the benefits and the value, as that’s the most important!
Performance-Based Fees: This fees structure, also called success fees, is linked to the achievements of pre-defined objectives. It is particularly effective for projects when the results can be easily measured, such as cost reduction, or top-line improvement. This often takes place as a bonus on top of a flat fee structure.
There are also other occasional fee structures:
Retainer: A retainer is a monthly fee negotiated with a client, based on a certain number of hours of support per month. This fee structure is mainly used by coaches or trusted advisors. It is often combined with spot projects since a retainer is usually the best way to be the first one aware of projects to come.
Equity-based Fees: This fee structure is often used with fast-growing start-ups that have little cash upfront or in case of turnaround situations. It is then up to the Consulting Firms to adjust the resources to balance risk and value creation.

Percentage-based Fees: The fees here are calculated as a percentage of a project or transaction amount and often used for M&A projects, for instance, where the consulting firms play a facilitation and brokerage role too.
Hybrid Type Fees: And finally, some project fees structure can be a hybrid of various fee structures such as a retainer with a negotiated daily rate when the amount of monthly hours is reached, a flat fee with an additional success fee, etc.
The best parameters to define a project price –
Since Consultants are primarily selling their time, the time spent on a project is the main cost driver. Usually, the price is calculated as the product of the daily rate per the number of days spent on the project.
But another essential parameter is the team composition. The experience can make a huge difference. You can expect a multiplication factor of 5 or more between an experienced partner and a newly-graduated analyst.
Another element is the share of time spent on the project. A full-time assignment is pretty straightforward: the consultant is supposed to be on site most of the days. Any part-time assignment can be vague, and very difficult to verify.
Pyramid structure to explain fees –
Part-time assignments of very experienced consultants can have a significant impact on the bill and can be extremely hard to track. Many of you have probably experienced the team of experts in the proposal at 10% of their time that you have actually never used. In the same fashion, ramp-up and ramp-down of team members should be linked to clear phases.
The specific industry where clients operate is an overlooked driver of the price for Consulting Projects. You will have the high-end of the spectrum – the Financial Services or Energy, where Consultants apply a premium, and at the low-end the Public Sector or Non-Profit Sector.
Finally, don’t forget the expenses when you are evaluating your budget. On certain projects, clients have agreed to up to 30% of expenses. Some Consulting Firms prefer a flat fee, expenses included, to avoid such discussions with clients.
Understanding the Consulting Industry is a pre-requisite to optimizing your Consulting Spend. Knowing your options can allow you to reach for innovative solutions, and to get more for your budget.

Ready to get started on your next project?
Need a fresh point of view?
We will be happy to help.
Please give us a call today, at no obligation.
Let’s get the conversation started.

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Most Recent

6 Great Advantages of the Gig Economy That Will Affect the Future of Independent Consultants

“The gig economy is empowerment. This new business paradigm empowers individuals to better shape their own destiny and leverage their existing assets to their benefit.” – John McAfee

Whether you are a fan of the Gig economy or not so much, these trends are here to stay. There are a number of reasons to embrace the Gig economy mainly for the freedom and flexibility it brings to both Clients and Contractors, but there are also downsides to it, such as ethics or regulation issues.
Let’s take a closer look at the Consulting industry.
Disruptions in the Consulting Value Chain are creating interesting new opportunities.
One of the more notable changes due to disruption in the Consulting value chain today is the demand for very specialized expertise. And when such talent and resources are not available at the right location or at the right time, Clients are eager to hire talent per project basis. 

Know the Consulting Category

If we merely follow the projections provided by economists, we should see a significant shift in the balance of power by 2025 in the global market. How does that impact the Consulting Industry?  What does the market look like in North America?
Read More

The freelance platforms offer plenty of choices, in addition to new partnerships forged between firms that would not have collaborated in the past, are now more willing to share risks and benefits.
The Gig economy has opened a completely new set of substitutes to traditional players. They can be clustered into four categories: Professors, Platforms, Integrators, and Networks.
If you are familiar with the genesis of consulting boutiques, you have probably noticed that a significant number of them were created by famous academic professors:

Michael Porter created Monitor
John Kotter creator the Kotter Inc.
David Nadler created the Delta Consulting Group
Clayton Christensen created Innosight
Dr Michael Watkins created Genesis

The pattern here is quite simple, professors are teaching executives, executives want to get support on their projects, and professors create consulting boutiques to offer consulting services. Today, with or without a dedicated consulting boutique in their name most MBA professors are also offering freelance consulting services to support the executive population wishing to benefit from their expertise on specific projects.

6 Great Advantages of the Gig Economy and the Future for Independent Consultants –

Growing Number of Independent Workers –

According to McKinsey, independent workers now make up to 30% of the working population in the US and EU, or approximately 162 million people. For better or worse, innovation and flexibility also come with a “price tag” of a certain amount of instability, legal and financial security as well, in general. But we should differentiate between the two main groups of freelance workers: the lower-end  (such as Uber drivers, TaskRabbit workers, and various other Contractors) and at the higher-end of the spectrum, or Gig consultants, who are offering niche expertise and are redefining today’s role of consultants. Consulting clients are slowly adopting this new model but the disruption will only grow over time on specific niche consulting projects.

Prospects for the Gig Consultant – 

When PwC launched its “PwC Talent Exchange” initiative in 2016, they boosted the legitimacy of Independent consulting. The online work intermediation platform finds independent professionals with relevant expertise and hires them on internal PwC projects. It was also a strong sign that the traditional consulting model of keeping a permanent talent, was changing. The biggest drive for such change where the firm’s clients and their evolving needs for more specialized skills. With time, we might see other big firms creating similar initiatives. Consulting Quest launched in 2018 a teambuilder to give access for consulting firms that do not have the critical mass of a big 4 to a vetted population of experienced consultants as team members. 

Higher Incomes – 

According to a McKinsey report (from 2016)  75% of surveyed Gig consultants were making more or the same amount of money than they did in their previous traditional roles. That proves that flexibility and independence don’t mean working for a lower paycheck. Great example include consulting platforms such as Go Catalant, CoMatch, Talmix, Business Talent Group, where thousands of professionals, users of the platform can charge very fair rates. For the clients this does not rhyme with higher fees as you can remove the cost of expensive offices in central Manhattan or the 8th arrondissement in Paris and the 30% returns expected by the shareholders. 

New Opportunity for the Aging Workforce –

Baby Boomers’ generation looking towards retirement might find great opportunities in the new Gig Consulting economy as well. Many experienced professionals are putting their decades of knowledge into good use today by being hired as advisors. This can also benefit clients looking for experience rather than the schoolbus from major consultancies. Think about Robert de Niro in the intern and skip the question about career expectations during the interview.

Digital Freelance Platforms Make Hiring Easy – 

The most visible development in recent years has been the blossoming of dozens of marketplaces proposing access consulting services. We have identified 40 different marketplaces ranging from horizontal marketplaces offering all kinds of services, to vertical ones with a specific focus on consulting. They provide access to a very large pool of independent consultants distributed across the globe. Those resources can be perfect for small to medium size projects or interim assignments to reinforce teams during periods with peaks in activity. An intriguing alternative to large consultancies, those marketplaces in recent years have raised millions of dollars from venture funds. Interesting to note that even when Clients need a team combining several competencies distributed across the globe,  a company like A-connect have that covered. They act as integrators, helping you, leverage their network of freelance consultants to select a team that will have all the competencies you need and to organizes them as an integrated team.

Global Network of Consultants –

An alternative to freelance marketplaces and integrators is the utilization of Global Networks of Consultants. Those Networked consultancies like Eden McCallum, 2PS or ICG, have been created with three ideas in mind directly addressing the limitations of the independent consultant model:

Ability to work “a la carte”: flexibility in the organization of their workload and focus on projects they are interested in
Possibility to be part of a team reducing the feeling of isolation that can be daunting when you are alone in your solo consulting practice and connecting you with people of similar interests
Access to a brand that will increase customers confidence and provide a flow of inbound opportunities

For clients those networked organizations provide a greater confidence in the quality of the consultants as they perform a continuous assessment of their members.Clients today have an abundance of opportunities to source talent, expertise, and offerings tailored to their specific needs and situations. As these models are still evolving, pivoting and progressively finding their way, we can look at the key elements that make them a great proposition.

If you are considering hiring or trying to get hired, and need our assistance, please contact us at your earliest convenience.
We will be happy to find the best solution in your particular situation.

Book your call

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Global Economic Trends, Top Industries Driving the US Economy, the Effect on the Consulting Market

“Ask five economists, and you will get five different answers – six if one went to Harvard. ” – Edgar Fiedler

If we merely follow the projections provided by economists, we should see a significant shift in the balance of power by 2025 in the global market.
Here are a few interesting facts:

Emerging Markets and Developing economies are growing at 2.5X faster rate than Advanced Economies (USA, Euro Area, Japan).
If we take a look back, in 1995 the E7 (China, India, Indonesia, Brazil, Russia, Mexico, Turkey) was half the size of G7 (US, UK, France, Germany, Japan, Canada, Italy) at GDP level.
By 2040, it could be double. Today the two groups are around the same size. Yet consulting in E7 is growing fast but nowhere near the extent it has achieved in the G7 countries.

Know the Consulting Category

If you are trying to get the best and most accurate snapshot of the various degrees of specialization in Consulting today, they are three main types: Generalists, Specialists, and Niche Players.

Read More

And a few interesting questions: 

Is there a cultural tendency to rely more on Consultants in the Advanced Economies?
As most decisions are made in central offices located often in Advanced Economies, is it safe to say more money is being spent on Consultants there?
Are organizations in Advanced Economies spending more on Consulting to keep an edge over competition?

Let us take you on a global tour and explore some regional market specificities along the way
We are heading towards a shift in the balance of powers. The global economic growth is expected to dip closer to 3% in the coming years.
After overtaking UK and France, India will be passing Germany and Japan successively. It seems to be only a matter of time for India and China take the top spots. Investors will soon see Emerging markets presenting the highest GDP growth, as attractive opportunities for international businesses.
As they mature, they will become less attractive for offshore manufacturing but will present B2B opportunities. Next, walking in the steps of China, they will become investors themselves.
Meanwhile, mature economies will continue to experience lower growth as they are forced to deal with this new paradigm.

How does that affect the Consulting market?

When mapping GDP vs. Consulting Growth we can observe a moderate correlation (r= XX). According to Marc Baaji, three factors can help explain the differences across geographies.

The economic development of the region will drive the ability to invest.
The structure of the economy will show what sectors are the most likely to spend in consulting.
The local culture will influence the willingness to work with outsiders.

How major Consultancies define their set of megatrends shaping the future of society and the economy – PWC for example, predicts that despite the volatility of the economy, most of the additional growth will take place in medium-sized cities of developing countries.
Digital revolution is impacting almost every industry and geography. As a result, regional regulators are now trying to place some limits to regain some form of control (think GDPR or internet access in China).
Global Consulting market today – North America and Europe combined represent close to 80% of the consulting market, followed by Asia Pacific, Middle East, Latam, and Africa.
Even though growth is twice as fast in Asia as in North America, the North American Market is roughly three times the size of the Asian one. At the current pace, it will probably take another 30 years for the Asian market to catch-up.
Global market with local players – While most of the clients are, or becoming a part of global corporations, the consulting sector remains scattered.

Preference to work with Local Consultants – Clients tend to appreciate projects delivered by local consultants as they understand local culture easier. In fact, a significant share of consulting projects are performed by teams of 2 to 5 consultants and do not require a global presence or even a global footprint.
North America remains strong and resilient economically
Even though Emerging Economies are catching up, North America remains the largest economy in the world. Spearheaded by the U.S., the region represents close to 25% of the global economy. States in the US such as California, Texas or New York having an equivalent output to the UK, France, Italy or Brazil.
The Economy is at the same time enjoying a robust services sector and an abundant supply of natural resources. We can expect a slight slowdown in the years to come.
Two major trends are impacting the economy durably for the years to come. Unconventional Oil has opened access to low-cost energy. Subsequently, consumers are experiencing cheaper products and lower transportation costs. Digital is transforming almost all industries. New technologies such as Artificial Intelligence and automation are opening endless possibilities.
Top Economic Sectors driving the growth –

Financial Services, far ahead with close to 20% of GDP output.
Government related activities. Including military as well as federal and local expenses.
Health Care, impacted by an aging population and regulatory evolution. There has been a 20% growth in health care sector jobs since 2008, while the average rate for the economy was only 3%. Health care jobs are expected to grow at a rate of 18% from 2016 to 2026.
Technology, reaping the benefits of the Digital wave to go forth. Employment among computer and IT is projected to grow 13% from 2016 to 2026, faster than the average for all occupations. Demand for additional workers is stemming from cloud computing, the collection, and storage of big data and information security.
Construction, unexpected fifth, benefiting from a growing population and an increased need for infrastructures. Construction occupations are projected to grow by 11% from 2016 to 2026. The growth is stemming from overall economic and population growth, which is increasing demand for new buildings, roads, and other structures.
Retail, remaining the largest employer of the U.S since it includes both online and brick and mortar stores. 

The largest and most mature consulting market –
Given the strength of its economy, it is no surprise to find North America as the largest market for management consulting. According to most market research firms, the market is estimated at around $100 billion with a CAGR at 4%, slightly higher than GDP.
The US market is by far the largest and represents close to 90% of the North American Market. Canada is about 6%, and Mexico completes the picture. The main activity is concentrated on both coasts with sizeable pockets in the Mid-West and Texas.
From an industry perspective, we can find the sectors leading the GDP as major spenders in Consulting:

Financial Services, facing the same new regulations and Fintech disruption
Healthcare with an energetic Pharma sector and the aftermaths of the healthcare reform
Energy with the consolidation of Energy providers and the Shale Gas opportunities
Media & Technology facing consolidation and high-speed innovation and,
Government

Integration of digital in most services –
IBM, Accenture, Huron and the Big 4 but also McKinsey, BCG and AT Kearney have started supporting their clients in Digital transformation, and more specifically:

Integrating digital into the strategy exercise to elaborate and implement new channels strategies,
Building new business models,
Covering cybersecurity risks
Leveraging digital to increase operations’ efficiency

As you can see, the North American Consulting market is mature and dynamic. It is also the birthplace of many management trends such as Lean and innovation. Being a few years ahead of other markets, North America has also embraced very early the specialization of consulting services. The region shows the largest population of independent consultants in the world and at the same time the consolidation of all services into mammoth global one-stop shops. Without much risk, we can affirm that you can find in North America a company specialized in almost any management issue.

Planning to start a new Consulting project soon? We will be happy to offer you an outside perspective and guide you in the right direction. Please feel free to get in touch and tells us more about your organization and project needs.

Book your call

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The Specialization Dilemma, Degrees of Specialization, and Differentiation – How to Select the Best Consultant?

If you are trying to get the best and most accurate snapshot of the various degrees of specialization in Consulting today, they are three main types: Generalists, Specialists, and Niche Players. Also Consulting firms vary by business structure, ownership types, areas served, location, and in more dimensions.
Let’s discuss each type in more detail.
As you probably know, Consulting started with a specific focus on manufacturing optimization, then encountered a period of growth on strategy work. The capability dimension was the driver, and the industry served, was a secondary dimension. However, companies are getting more and more specialized. And the industry specialization is becoming a must for a lot of clients.

Create Value Through Consulting

Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. Beyond the extended role given to R&D, the concept also requires a contribution for all stakeholders in the company. Rendering the innovation process much more collaborative and guess what … open.

Read More

1. Degrees of Specialization-
There are 3 Main Types of Positioning for consulting firms. And each type has some specific pros and cons

Generalist Consulting Firms offer a vast scope of consulting services. They usually cover most of the matrix Industry vs. Capabilities. … working with almost all industries on topics such as Strategy, Sales&Marketing, Operations, Organization or Finance.
Specialist Consulting Firms are focused on a narrow scope of consulting services. They concentrate efforts and abilities in a limited set of capabilities or industries. For instance, they can specialize in one capability across industries or one industry across capabilities.
Niche players are Consulting Firms that offer a specific service in a particular industry. Contax Partners for instance is a Niche Consultancy focused on Strategy in the Energy Vertical in the Middle East and Africa.

Generalists – Pros & Cons
Their clients can find broad-based knowledge that can adapt flexibly to the client’s needs. They will also realize economies of scale and scope. They often have experience in several industries and capabilities, making them adaptable.
But they sometimes have a superficial knowledge of a given industry or function. It is not uncommon in large Consulting Firms to see the same consultant move from a strategy project in the Financial Services into a operations project in Manufacturing.
Specialists – Pros & Cons
Specialists build knowledge and capabilities at a faster rate than generalist consultants. They keep current on new findings and industry news and understand the competitive pressures within their specialized industry. They tend to see all the issues through their area of expertise, which can be narrow-minded. When working with industry specialists, “Chinese walls” to ensure data confidentiality are more difficult to enforce.

3rd. Niche Player – Pros & Cons
Niche Players know their sector better than Generalist consultants that work in multiple industries and better than Specialist consultants that offer one service in various sectors. But they don’t work well on projects that cross-industry or capability lines. Like Specialist consultants, they see everything through their expertise prism and might not come up with out-of-the-box ideas.
2. Business Structure – Hybrid vs. Pure Consulting players
If you step back one level, you can observe that Consulting is not always the only service provided. Pure Players are companies that only provide Consulting Services. Most major consulting firms such as McKinsey, BCG, Bain & Company, and Oliver Wyman, can be considered pure players. Hybrid companies offer consulting services on top of their primary business. They can be providing services in Audit, Legal, Accounting or Systems. Famous Hybrid Companies are Deloitte (Audit and Tax), EY (Audit and Tax), PWC (Audit and Tax), Accenture (Systems), and Huron Consulting (Systems).
Pure Players – Pros & Cons
They are specialized Consultants that master project management, deliverables, and problem-solving skills. They might have an understanding of the company limited to their scope of skills.
Hybrids – Pros & Cons
They offer integrated solutions from advisory to implementation. They are often less expensive than pure players of the same size. They leverage their high-level relationships to cross-sell. They are sometimes pushing services where they are not the best. There can also be some conflicts of interests. Digital is now rising and becoming a must of any company strategy. Most consulting firms are either embedding digital capabilities or developing digital ecosystems. Accenture is particularly active on this front. In the same way, former pure IT players are now acquiring consulting firms as a way to spur their IT activities. In the 90’s, EDS had pioneered this move in acquiring AT Kearney. But the partnership never really delivered and ATK leaders struck a management buy-out ten years later. In recent years, a good example would be the series of acquisitions performed by IBM. Or the acquisition of Innosight by Huron.
3. Other Dimensions & Differentiation –
Beyond the expertise area of a company, other factors will help you to understand what you can expect from a given company.
Size & Geographic Footprint
Size and footprint are usually quite correlated. Consulting is still a business where people sell to people. Thus if you want to grow, at some point you need to scale and open offices in new geographies. Similar to other industries, the footprint of a company is important. For Consulting Services, it can impact the ability to understand local ways of doing business. Besides the original location of your consulting team weight heavily on the travel expenses budget. Imagine a team commuting to Singapore from Germany for six months.
Global Consulting Firms – Pros & Cons They know how to navigate an international environment and can serve their clients in several countries.Particularly interesting for projects requiring on the ground presence all over the globe. They often work with regional P&Ls, which means they may try to optimize their regional utilization rate rather than bring the best global team in front of the client. Global presence, brand, and scale usually come at a cost.
Local Consulting Firms – Pros & Cons You are getting the partners you deal with anywhere you need them. Can be exactly what you need from a culture standpoint for local projects. If travel is required, you will need to add a premium for travel expenses. Might be lacking some clues to mesh with the local culture when working abroad.
Ownership Structure
Majority of Consulting firms are structured as partnerships, like law firms. The organization structure is based on a little group of equity partners, often “rain-makers,” that bring in the clients and the projects. The traditional career path is to climb the internal ladder before making it to partner after usually 10 to 15 years. You will find in this category blue chip players like McKinsey or BCG as well as most boutique consultancies. However, as they grow (and often get acquired), more and more consulting firms go public, are owned by larger traditional companies or by other service companies developing a consulting branch. Being a Partner in this case mostly describes the role and seniority of individuals. Last but not least, it’s important to mention the services delivery model.
Delivery Model
There are two main categories of Delivery models:

“Study and Recommend” – it can be performed remotely, with a limited number of interactions.
“Teach and Facilitate” – this requires a presence on the ground. And the fees tend to be quite different as well, as it requires a fuller involvement

With this information you can now establish a rather good profile of any consulting firm. That will help you appreciate the potential fit with your project’s needs and your teams.

Planning your next Consulting project?
We will be happy to offer you an objective point of view, and any assistance you might need to launch and execute the project.
Please contact us today to learn more.

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8 Biggest Reasons Why Organizations Need a Consulting Firm and How Consultants Cater to Clients’ Needs

Businesses today are facing a growing number of challenges. And as an executive, you are often under pressure to find solutions to multiple problems, from adding value to your offering to improving revenues, profitability and productivity. And if you have worked with Consultants, you already know they can provide invaluable support and expertise. And as the great quote above suggests, Consultants can help you address your biggest challenges and reach your goals.

“When it’s obvious that the goals cannot be reached, don’t adjust the goals, adjust the action steps.” – Confucius

In many situations, working with consultants can help companies create better value and move faster. As an outside vendor, a Consultant often can see issues that stakeholders and those too involved in your organization, can’t provide.
 
So what are the most important needs that Clients gets help with from Consultants?
We have comprised a List of Top 8 Needs, or Situations that might apply to your organization too:
1. Considering New Strategic Options  –
In today’s fast-paced and developing economic conditions, many organizations are motivated to explore new opportunities. Yet, they often struggle with a lack of technical expertise embarking on a new course. A carefully selected Consultancy can be the support needed.

Source Consultants

A script to a movie, is what the RFP to the Consulting project is. And the Master of Film suspense can provide us with sound advice on how important that document is. The RFP holds the same weight when it comes to setting your project on the path to success, and in creating the value you expect..

Read More

2. Expanding into a New Territory   –
Globalization offers plenty of opportunities, and new challenges as well. But emerging markets are at the top of the list of interest to many organizations. A Consultancy with experience in a specific geographic region will bring you precious insights on the legislation, the infrastructure, and of course the local culture.
3. Increasing Revenues  –
You already know that when revenues stagnate, or when a more powerful competitor threatens your market share and affects your sales and profitability, the most viable solution is to power up growth and expand. Consulting firms who specialize in these areas will be your best bet.
4. Dealing with Competition   –
One of the strategic approaches for an organization can be to merge with or acquire a competitor. Consultants, who boast a wealth of experience in that capacity, can ease the process and provide invaluable advice. It is extremely useful when embarking on a new course of action, to have an independent party examine the choices and validate the approach.
5. Boosting Your Competitiveness  –
Product quality is a central concern for Companies. Consultants can help you break down your process in specific stages, and identify potential improvements in the product.
6. Powering up Cost Reduction  –
Cost reduction is a major area of concern for all organizations today. Clients are often working with consulting firms to reduce costs and boost revenue and profitability by applying Lean Management, Lean thinking, and Lean processes. Some non-strategic areas of operations that do not deliver expected results and are problematic are better off outsourced to other vendors.

7. Retaining and Developing Talent  –
Top performers and most skilled employees are commonly driven to achieve new goals. They are also the ones who are most able to find new positions and more attractive compensation offered by other companies. It is not an easy task to understand, motivate, and inspire your top employees to stay with the company if they see opportunities elsewhere.
8. In-house Shortage of Specific Expertise  –
As Consultants acquire years of specialization in a narrow field, they can offer a wealth of knowledge in an area where no other team member can provide. It is one of the most common areas where businesses hire Consultants.
Consultants commonly have solid experience in project management. And many organizations prefer to use outside expert’s to tackle important projects. Detailed planning, task management, adherence to deadlines, and many more aspects of a project, need an expert’s overseeing.
A fundamental part of each problem your business faces is to define it correctly. As a very experienced professional, a Consultant will be able to see and define the problem better. And it’s imperative to make sure the problem is truthfully identified, before start searching for solutions.
Often hiring a Consultant is the most feasible option to a specific job. When there is extra work for a short period to be done, and your organization lacks the proper resources, the Consulting firm can bring in the much-needed support.

Struggling with an issue? And in need of an expert’s advice? We’ll be happy to offer you a fresh perspective. Do not hesitate to contact us today.

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The Perfect Consulting RFP or the Fun of Creating a Blueprint for the Right Consultant

A script to a movie, is what the RFP to the Consulting project is. And the Master of Film suspense can provide us with sound advice on how important that document is. The Consulting RFP holds the same weight when it comes to setting your project on the path to success, and in creating the value you expect besides the general scope.

“To make a great film, you need three things – the script, the script, and the script.” – Alfred Hitchcock

How to craft the best and most effective Consulting RFP?
The single biggest objective of the RFP is to provide your prospective consultants with a clear picture of your needs and issues, and the desired outcomes.
To ensure the success of the project, we comprised a List of the Top 10 Secrets of the Perfect RFP.
The goal, of course, is to find the right and the best provider uniquely suited to you.
1. Don’t rush it, and include all the elements in your RFP –
Many RFPs for Consulting are rushed in their development. Sometimes the details or the context are insufficient to understand the business problem you are facing.
Maybe some key requirements are missing, or the language is ambiguous. You also might have omitted the common pricing framework to be followed, or given too little time for the candidate consultants to respond RFI/RFP. However, the result is always the same: it is difficult for Consulting Firms to send a solid proposal, in particular, if they are newcomers.

Know the Consulting Category

In this post, we would like to talk about two extremely important elements that determine the project’s success. Passion and value created.The type of Consultant you decide to hire should not only be based on the right expertise and experience, but their passion and commitment to deliver the best value.

Read More

2. The most important elements in the Consulting RFP  –
The RFP will be the reference document for the consulting providers you invite to the competition. Don’t forget to include elements on the RFP process such as timeline, criteria of choice and requirements. It will help the candidates to be laser-focused on your needs.
3. Looking for the right Consultants –
With your RFP in hand, you can start identifying the potential candidates. You might be impressed by some Consultants expertise or interesting projects they have been part of, but the most relevant question, remains to find out if they are right for you and best fit for your project?
4. Adapt your short-list to the project’s Budget and Timeline  –
Look closely at the scope of the project, the budget, and the internal procurement policies to define your criteria of selection for the short-list. Be mindful of your time and adapt the length of your short-list to the level of priority and the budget of your project.
Small and Large projects –
When you have a very tight timeline or for small projects with limited impact on your business, prefer a small short-list too so you can spend enough time on the proposal and the references checking. We recommend to not go beyond three prospective providers.
For larger projects-
you can broaden the first round (briefing/proposal phase) to up to ten consulting firms (depending on the project and the stakes) but keep at most four-five companies for the final round (pitching phase).
When your short-list is ready, contact your suppliers and check their interest by sending your Consulting RFP

5. Secure Confidentiality –
It is important always to protect your confidential information. Don’t hesitate to make your candidates sign a confidentiality agreement at the beginning (even at RFI or RFP stage) to protect proprietary information and make sure the consulting firms will not be sharing your project’s details with your competitors.
If the proposal includes collaboration and sub-contracting, make sure that an NDA legally binds all the contributors on the project.
If your project is particularly confidential, you should even consider working with a third-party sourcing company, like Consulting Quest, that will handle the process anonymously. They will keep your company and your project confidential until the short-list stage.
6. Simplicity Always Wins –
And it’s best to make things simple. Unless you are handling a multi-million dollar project, don’t organize extravagant tenders. Looking through proposals and listening to consultants’ pitches can be extremely time-consuming. It will also considerably slow down your project. Make sure that your RFP process is adapted to the scope and the budget for your project.
If you only have a small number of consulting firms, or if the project is specifically complex, you might want to organize briefings to discuss the details of the project and make sure the consultants have well-understood what is at stake.
If you have a large number of candidates, a clear Consulting RFP, and little time on your hands, you can just send the RFP and assess the written proposals to identify the most promising one for the next step.
7. Assessing the written proposals –
Once you have received the proposals, take the time to review them with the other stakeholders. Always keep your objective in mind: maximizing the chances of success of your project. You need the candidates to submit their best proposals, and for that, they need to understand the problem very well.
Level the ground, so all companies have a fair chance in the competition. It is in your best interest to do so too. Don’t hesitate to explain in length the background of your company, and the context of the assignment, and to take some time to polish the Q&A documents.
8. Evaluate the fit with your RFP –
Make sure the candidates have responded to the most important elements in your RFP. Their proposals should help you answer the following questions:

Has the consultant understood our objectives?
Do the deliverables answer our questions?
Do we trust the approach the consulting provider proposes?
Does the team have the required experience?
Is this consultant the right fit for you?
Does the budget fit the value we expect?

Note if there are any gray areas and potential for misunderstanding.
9. Identify the most promising proposals –
When you are working on a large cohort of Consulting Providers, you should focus at first on the most promising proposals to save time and energy. You can always go down your list if you are not satisfied with your first batch.
Start ranking your proposals based on your assessment of the proposals. You can use these five dimensions: objectives, deliverables, approach, experience, fit and budget.
10. Discover and resolve any uncertainties –
You should also be able to put your finger on the uncertainties in the proposals and articulate them into questions. The list of questions will be the basis for the pitch session with the most promising Consultants: an excellent opportunity to clarify the Consulting RFP if necessary and assess the fit with your teams.

Ready to get started on your next project? Need a fresh point of view?
We will be happy to help. Please give us a call today, at no obligation.
Let’s get the conversation started.

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  • Know the Consulting Category
  • Source Consultants
  • Optimize your Consulting Spend
  • Create Value Through Consulting
  • Leverage disruption to create more value through Consulting

7 Effective Steps to successfully launch your Consulting Project

The importance of information in planning and managing your Consulting projects cannot be overstated. Information is essential for the success of any endeavor. And naturally, whoever has the upper hand in the game, has the best chance of winning. However, at the center of successful Consulting lies mutual respect and mutually beneficial business. It has always been our credo at Consulting Quest that it is the most productive approach to all types of projects.

Understanding consulting fees to make smarter decisions

You might be nonchalantly asking yourself, why do companies hire Consultants? Great question! To improve a process, to save money, or to get a fresh perspective, but most of all, to get access to very specialized skills that great Consultants can bring in.

Challenges of Open Innovation and How Consulting Can be a Catalyst for Open Innovation

Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. Beyond the extended role given to R&D, the concept also requires a contribution for all stakeholders in the company. Rendering the innovation process much more collaborative and guess what … open.