A new Management Consultancies Association (MCA) report released today reveals that the UK consulting industry generates annual benefits worth £56bn to UK clients. The MCA’s report ‘The Value of Consulting’, based on pioneering research involving analysis of 1800 consulting projects and in-depth interviews with 30 clients, found that the majority of projects in both the public and private sectors generate financial returns of between two and 20 times their cost.
The MCA report provides a simple yet meaningful and authoritative way to quantify the value consultants add, to both their clients and the wider economy.
Key findings from the MCA report indicate that in 2008:
- The UK consulting industry spent more than £180million on innovation, £85million on training and £80million on pro bono work for charities.
- 58% of clients say they are very satisfied with the work their consultants do; 41% are satisfied.
- For these very satisfied clients, the value of the benefits of using consultancy was between two and 20 times its cost or, on average, around 10 times the fees paid. This suggests that the benefits of using consultants are worth around £56bn to UK clients, a return of £6 for every £1 invested.
Alan Leaman, Chief Executive, Management Consultancies Association (MCA) said:
“Too many conversations about consulting start and end with the assumption that it is just a cost; we can now see that there is a significant return on this investment as well. This work is based exclusively on the views and experience of clients and the methodology was cautious. The UK is substantially better off because it has a vibrant and competitive consulting industry. ”
Experts involved in the development of the report
The MCA worked with a steering committee of industry experts to develop a robust and objective research methodology for this project. The steering committee was made up of senior representatives from the consulting industry, from both MCA member and non-member firms, and Tim Morris, Professor of Management Studies at Oxford University, who specialises in professional service firms.
Tim Morris, Professor of Management Studies at Oxford University, commented:
“This was an important but difficult project to carry out. It has involved clarifying how we can understand the ways in which consultants can add value to clients, developing a robust model to reflect this and then operationalising it to generate results, which as far as we can tell, stand up to critical review. As a result, the findings and implications are worth taking seriously.”
The MCA Report is the first step towards developing a comprehensive understanding of the contribution consultants make. The MCA’s conceptual framework, developed to help analyse and explain the value that consultants bring, will also be a useful tool for clients to assess their reasons for using management consultancy, and help set expectations about the outcomes that are being sought.
Alan Leaman concluded:
“The results of this initiative will help consultancies engage in the sort of dialogue they need to have with their clients, and help clients to be demanding and intelligent customers.”
For further information about ‘The Value of Consulting’, or to receive a copy of the report, please contact email@example.com or call 020 7321 4810.