The evolving world of strategy consulting

To cite one example, we can examine the Big 4 Accountancy Firms. In the past 15 years, three of these Big 4 Consultancy’s have acquired a well-known Strategy House in the hope that they can dictate the narrative and more effectively control the parameters of execution and implementation services for which they are typically more well-known for. For years they have been “boxed in’ by clients who see their strengths aligned to the Implementation of a roadmap typically created by a Top Tier Strategy House. Implementation services, that have often been associated as something that is easier to carry out and therefore should command a lower rate card.

Some argue that walking the client through a roadmap and assisting them in achieving their optimum operating model can be even more difficult, than the creation of that roadmap. Therefore, it is somewhat of a paradox that these services have typically been carried out by consultants at a cheaper rate. There could be a number of reasons for this, the two most obvious are that implementation projects tend to be significantly longer in duration and the landscape of consultancy’s offering these services is much broader and therefore much more competitive.

The outcome, if end-clients choose the wrong consultancy focusing only on price, can become a long painfully drawn-out process whereby the program is extended for much longer than they initially planned for, simultaneously bleeding their budgets before realizing it would have made more sense to opt for the consultancy who could have got it right the first time (albeit for a higher price).

When speaking to candidates about the differences between delivering strategy vs execution engagements we were somewhat surprised that the general consensus was that the execution and change management process of work was equally and, in some cases, more challenging than the strategic and diagnostic assessments. Candidates cited that there was nowhere to hide, and results had to be seen in order for any execution to be deemed successful. Clients often had scarce capabilities inhouse and therefore relied extensively on consultants to undertake the idealist roadmap.

Top Tier Strategy Firms have recognized the vacuum here and begun to aggressively target this market share. We’ve seen the creation of numerous sub-brands focusing on execution and implementation, perhaps, because the creation of a Strategy Roadmap is no longer able to maintain the same desirability as it once enjoyed. The realization that this immaculately presented slide deck is essentially worthless without proper assistance to implement and execute has suddenly empowered clients to become more demanding in what they expect. Consequently, the same Strategy firms have been rethinking and repackaging their offerings, particularly those commending 5k – 10k USD daily rate cards for senior staff members. With many offering a one-stop-shop where ideas, innovations, and roadmaps are created, then implemented and executed. The benefit to the client is that consulting firms can be held accountable to the strategies they create and are naturally in the best position to achieve the desired outcome, having worked with that client from day one. In addition, the access to their global talent pool also allows them to offer a much broader knowledge toolkit, increasing the probability that they can enlist a consultant who has experienced a similar challenge or project scenario at some point in his/her historical career. 

The major downfall of the one-stop-shop is that it is heavily reliant on the service of one firm and unless the client has strong enough in-house capabilities, they leave themselves completely exposed to advisory services from a select number of individuals who are commercially incentivized to optimize revenue streams. It is therefore imperative for clients to build their inhouse expertise so they can impartially decide what path to take.