The management consulting industry has experienced tremendous growth over the past few years, however, there are a number of things impacting the future of management consultancy and the old paradigm of consulting work is changing and it’s no surprise that Covid-19 has had a large part to play in that.
Covid-19 forced companies to rapidly digitalise internal operations, personalise customer interactions, and dramatically transform supply chains. Disruptive technologies have also played a large role in this. These developments are in turn redefining traditional consulting industry models.
What is shaping the future?
Across the industry, it appears there are several top trends shaping the future of management consultancy. How consultancy firms adapt to these trends will have an impact on their success as the landscape continues to change and evolve.
Covid-19 pretty much changed how the entire world worked overnight, many businesses who had always seen themselves as strictly office based in 9 to 5 positions, quickly realised they could successfully do their roles, from, well anywhere.
The move to remote working has offered organisations a unique opportunity to tap into a new pool of consultant talent, which may have previously been inaccessible due to their location. This will continue in the next normal, with consultants expected to deliver transformation projects with project member in multiple geography locations using a hybrid working model.
Without the barriers of time zones and travel limitations, traditional models will shift to on-demand consulting services at scale – deploying staff from any location into any project based on skill needs and availability. In conjunction with the dramatic uptake in remote work, digital delivery is now going accelerating beyond video conferencing and collaboration tools; programmes are becoming immersive and interactive, utilising avatars and disruptive technologies for virtual breakout sessions, one-to-one interactions and management connect.
Ethical AI and automation
A “digital-first agenda” is now the number one priority for businesses, and organisations will look for a partner that can showcase their own innovations and translate savings to the project. Inevitably, a large portion of administrative consulting work will be automated in the near future, enabling teams to focus on higher value and customer facing tasks.
But with increased automation comes the need for self-regulation, and consultants will also be expected to lead on the ethical considerations of these new technologies: how to deploy smart AI while ensuring privacy safeguards, preventing bias in algorithmic decision-making, and meeting guidelines in highly regulated industries. Consultants of the future will deliver tools to employees, customers, and partners for developing and using AI responsibly, accurately, and ethically.
Large-scale digital transformation will be a critical enabler for businesses to run smoothly and to drive continued value in the future. However, leadership will have to find the balance between positioning their business for long-term growth while also remaining reactive and agile in a rapidly changing market. In response, organisations will require traditional transformation projects to be broken down into smaller, bite-size engagements that prove value early on.
This will see more agile, sprint-focused offerings based on proof-of-concepts and microservices in both technology engagements and change management. At the same time, businesses require a partner that can share both the benefits and risks of a programme. ‘Consulting as a Service’ – embedding consultants at pace within client teams from day one – offers this ‘de-risking’ element.
Recruiting and Retaining Talent
With the introduction of new ways of working and models in place, management consulting firms are keen to bring in fresh talent and skillsets. On the flip side however, a common issue among management consultancies today is their ability to retain the talent they already have.
Due to the number of opportunities out there for graduates and experienced consultants alike, if a business fails to provide career progression, this can cause problems when trying to retain staff. It’s found that 92% of junior consultants are more attracted to firms that have clear progression, and want work that not only incentives them, but also allows them to grow within their field. Firms should constantly strive to be innovative both for their clients and employees.
Enterprises have traditionally used legacy enterprise resource planning (ERP) tools and systems, but large-scale customizations have made them increasingly complex, reducing their speed of deployment. Additionally, manual processes can create unique challenges such as the inability to access real-time data and increased demand on resources, ultimately lowering the optimal utilization of billable hours.
The use of more modern integrated project management tools powered by artificial intelligence (AI) and machine learning (ML) such as professional services automation (PSA) is also becoming more common. Whilst PSA solutions have the ability to collect information digital tools to provide updates in real time and help speed along the decision-making process from, but organisations must establish its deployment speed, interoperability and integration abilities like plug-and-play before onboarding it. Otherwise, switching tools can disrupt day-to-day functioning as well as derail project timelines and, consequently, bottom lines.
So, what does the future hold?
Management consulting’s fundamental business model has not changed in more than 100 years and has always involved outsiders into organisations for a period and asking them to recommend solutions for the most difficult problems confronting their clients.
However, business-as-usual no longer meets the challenges of the post-pandemic world, coupled with the speed at which digital transformation is happening. The uncertainty created by Covid-19 reinforced new models for consulting. From ideation and strategy to execution and delivery, consultants will be expected to help businesses solve their most complex challenges leveraging the power of disruptive technology – with sustainable and lasting change coming from within the clients themselves.
Furthermore, the pace of change being managed by the traditional clients of consulting firms will continue to accelerate, with devastating effects on providers that don’t keep up.
Do you work within a consultancy? Is your firm changing as rapidly your most demanding clients?! We’d love to hear your thoughts – get in contact to share your point of view!