Mick James reports on the recent meeting of MCA members and leading clients.
The 2017 MCA Consultancy Buyers Forum conference brought together the UK’s leading purchasers of consulting services with the country’s top consulting firms to review and debate the rapidly changing consultancy landscape. They met at Warwick University’s new London campus.
Under the heading “Who’s Disrupting Who?” the conference offered a varied programme of presentations and panel discussions, featuring a distinguished group of presenters including; Paul Vincent (VP and Global Lead: Talent Supply Chain Strategy & Contingent Workforce Solutions, KellyOCG),
Paul Connolly (Director of the MCA Think Tank), Chris Hudson (Co-Chair of the Consultancy Buyers Forum and Head of International Procurement at Bupa), Sarah-Jayne Aldridge (Head of Procurement and Supply Chain, Prudential Assurance), William Johnson, Managing Director, Psychological Skills for Professional Services, Sunil Patel, Head of Clients and Markets, PwC, Lucinda Peniston-Baines, Owner & Managing Partner, The Observatory International and David Yardley, author of Practical Consultancy Ethics.
Here are ten key lessons for consultants and client organizations from the Conference– plus one more that we should never have forgotten:
CLIENTS…face a new world
There is a “new world of work” and a “new world of technology”. Today’s consultancy landscape is far more diverse and agile. Consultancy can now be bought from a complex ecosystem with a vast number of different providers: consultants are moving into digital marketing services as fast as digital marketing agencies move into the consultancy space.
Clients need to get to grips with this diversity and embrace the shift from buying inputs to buying outputs and outcomes …whoever supplies them.
CONSULTANTS…are being disrupted too
Consultants are no longer just facilitating disruption: they are also being disrupted themselves. And this disruption is changing the way consultancy is done. Automation is replacing the “armies of analysts” and reducing the base of the consultancy pyramid. Many people in this space now hesitate to call themselves “management consultants” as new entrants come in from other disciplines and consultancies become service providers.
CLIENTS…are now “co-creators”
The complexity of client needs is driving new, partnership-based delivery models and new commercial structures. Consultants and clients now “co-create” their way to value and this is changing the buying environment.
Opacity is dead: clients want to see more openness over commercial terms and more diversity in team composition. These needs mark a fundamental change—collaboration and co-creation occur all the way through projects: the “silver cloche” moment has gone.
CONSULTANTS…face more savvy and demanding clients
Clients are now much better buyers –there are thousands of consultancy alumni in the global workforce. Buying processes are becoming more fluid: as we move towards a “gig economy”, clients are spreading the net wider and looking beyond the big consultancy firms. Some are using aggregators who offer experienced consultants direct to clients or pitching work directly to subcontractors for price comparison.
CLIENTS…are buying in a modular, organic way
Clients are now more confident to buy consultancy in a modular way, blending internal and external resources in a highly selective manner. Multi-sourcing consultancy models are on the rise: buying processes and structures therefore need to be “organic” to cope with the new demand for speed and fluidity, but also give accountability where multiple vendors are involved.
CONSULTANTS…need to look again at SMEs
Smaller clients are a new competitive battleground. New entrants are targeting smaller firms as legal firms become advisors, and marketing specialists exploit the links between strategy and brand and behaviour. Consultancy is becoming more attractive for SME clients but this will require a different cost model—which could pose challenges for the commercial models of consultancy firms
CLIENTS...are changing how they measure and assess performance and value
Consultancy must be actionable, but stakeholders within clients can’t always articulate what success will look like in advance. Performance management is important but you can’t always set performance measures at the outset of a project: the whole process can be one of discovery. The value of consultancy to clients has shifted to include knowledge transfer.
CONSULTANTS…need to focus on user experience
Knowledge and IP are being embedded into technology to offer clients insight and solutions before work has even commenced. As algorithms and machine learning come more and more into play, consultants will often need to refocus their mindset from problem-solving to reframing the problem. Unless consultants focus on the user experience as much as technology and the business case, adoption will fail.
CLIENTS…need to look in the mirror
Performance management needs to be 360 degrees: clients need to assess how well they are performing as clients. Buyers need to assess how well they understand both the internal and external factors that influence consultancy spend. Are you buying brains, bodies or brand?
CONSULTANTS…need to measure themselves against external standards
Consultancy is no longer a “black box” where clients judge value using proxy indicators such as price. Ethics is now a key differentiator, and the forthcoming Chartered Management Consultant Award could play an important role in future.
But the absence of established industry standards still inhibits buyers, which is why they have welcomed the MCA’s Consulting Excellence scheme, based on the three pillars of: ethical behaviour, client service and value, and professional development.
And finally, one thing we must never forget:
CONSULTANTS and CLIENTS…need to talk about value
Consulting firms still need to do much more to communicate the value of what they do and how that value is realised. And clients need to respond to this openness and transparency by moving away from using price as the overwhelming yardstick when evaluating consultancy efforts. Otherwise we will all be short changing ourselves.
Mick James is a business writer. More information on the MCA Consultancy Buyers Forum can be found here: http://www.cbfblueprint.co.uk