Management consulting is an advisory service contracted for and provided to organizations by specially trained and qualified persons who assist, in an objective manner, the
client organization to identify management problems, analyze such problems, recommend solutions to these problems, and help, when requested, in the implementation of solutions (Greiner and Metzger, 1983). As identified by Clark (1995), in a service relationship where business advice is consumed over the course of a series of interactions, the presence of ambiguity creates uncertainty. Clark (1995) also states that management consulting is an example of a complex service activity whose success is dependent on the nature of the interaction between the actors.
Evolution of Management Consulting:
Efficiency of workers and production
Emerson, Bedaux, “Big Four”, Maynard
Strategy and Organization
Decentralisation and portfolio planning
Booz Allen, McKinsey, A.T. Kearney, BCG
Internal and external co-ordination
“Big Five”, EDS, CDS, Gemini
Source: Clark and Fincham (2002)
It was at the end of 19th century, Frederick W. Talylor, the grandfather of consulting, based on a systematic observation, optimum organisation and stimulation of individual activities developed a new approach towards the management of workers. The second generation of management consultancies emerged in the mid of 20th century due to the increased diversification and high market pressures. Clark and Fincham (2002) recounts that the focus of management concern was on the large shifts in the size of the organisations and client companies. These shifts from production oriented companies led to diversified corporate to network organisations which created opportunities for consulting companies to expand their business. The increasingly global financial markets have continued to pressure companies to concentrate on the core competencies. The development of IT has enabled the managers to data efficiently over the networked organisation. This resulted in the three generations of management consultancies as scientific management, Strategy and Organization and IT-based networks. Over a period of time, the production centred consultancies have vanished. Clark and Fincham (2002) concludes that over the last decade, the three features of consulting businesses have been identified as the source of consultancy’s reputation, the skills of consultants in relationship to their tasks and the internal organisation leading to project profits. But it is hard to predict the future as there is an increase in the IT-based implementation change projects in the present time.
According to Schein (1988), consulting process can be classified into three types
The consulting process involves a lot of risk when the consultants design the service that will meet the client’s interests without full knowledge of the client’s requirements and expectations; clients undertake the risk of entering into a business contract with the consulting firm without full knowledge of whether the consultants will meet their expectations (Clark, 1995). This risk can be managed by addressing the client-consultant relationship where the trust is highly regarded as significant concept to help understand the mechanisms by which the interdependencies are managed (Roberts 2003, citied by Clark 1995). The inter-organizational and interpersonal relationships, between consultant and client, involve a host of complex social, political, and economic dynamics. Although these have generated much attention in the literature, there is a critical understanding of the social dimensions contributing to the management of inter-organizational and interpersonal partnerships (Bhattacharya et. al., 1998, citied by Clark 1995).
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‘Culture’ in the client-consultant relationship is multi-faceted. It is represented in forms of organizational structures, policies and procedures as well as in values and assumptions that are embedded and justified in the belief-system of organizational actors. Clark (1995) argues that consultants are equipped with the ideology, guidelines and methodology of the parent consulting firm which provide the lens through which the clients’ needs are interpreted. Whereas, the clients’ cultural spheres can extend to their personal anticipations of how consultants should address a given business situation. Furthermore, a client’s ‘personal’ cultural sphere might differ according to whether consultants are seen as a positive asset from a ‘corporate’ culture, or are seen as an unnecessary cause of expenditure to be avoided. Equally, client workplaces may have distinct ‘cultures’.
Clark (1995) highlights that trust can be fostered or hindered from the way in which cultural spheres are managed between the two parties. Consultants need to be aware of how their service needs to be tailored to the assignment but also more general, related demands of the client. The consultant’s process of entering into the client’s culture, and creating legitimation for their services in the client’s mind, requires the competency to address a host of issues that concern: a) the business problem appreciation and the client interpretation b) consulting service design that addresses the problem at the same time manages to generate the targeted revenues for the parent consulting firm c) the ability to address the interpersonal issues between the organizational actors and the emergence of conflict during the delivery of the business assignment. Trust and culture constitute such social elements because it reveals the micro interpretive processes by which such interaction is produced, managed, and maintained.
Clark (1995) analyses data from case study which gives an overview of the collective practices between consultants and clients of how to work together during a strategic review exercise. They can be broadly classified as developing shared understanding, sharing knowledge sources, networking, aligning resources and capabilities and facilitating learning.
This exercise allowed consultants and clients to routinely and recurrently enact a collective knowing. Firstly, to implement these five practices, consultants may have to spend a substantial amount of time socialising with clients. Secondly, the competence of developing and performing these practices need to be learned and employed in the daily context of a client’s engagement, in order to appreciate how the deployment of these practices may vary across different clients, consultants and teams.
Shared Practices, Activities and Knowing between Consultants and Clients:
Source: Clark, T. and Schwarz, M. (2009)
Schein (1997) briefs that consultation principles in respect of clients is the most important point to be made about clients is that the consultant must always be clear who the client is at any given moment in time, and must distinguish clearly among contact, intermediate, primary, unwitting and ultimate clients. The consultant must be aware at all times that the unwitting and ultimate clients in particular may shift according to the level of problem being addressed. If the consultant feels that the recommendations given will have implications for others that the client may not have considered, it is important to highlight those implications and ensure that the client is fully aware of them and willing to own them.
A typical consulting process:
Based on the research by Stumpf (1999), these phases of development for consultants include: Each phase has at least one area of major challenge, turmoil, and excitement – and each area has a set of skills, competencies, emotions, and perspectives to be understood and mastered.
Source: Carucci and Tetenbaum (1999)
Carucci and Tetenbaum (1999) explained that being an equal partner is one of the characteristics of the value creating consultant’s role. The consultant establishes the relationship with the client by explicitly requiring an equal investment in the process. The true partnership is interdependency, the consultant provides the organisation with needed expertise and in exchange receives pay and an opportunity to test his models, apply his theories and challenge his thinking in the real environment. It is an understanding that the participants learn together; work together, make mistakes together and succeed together.
Building capability is another constraint of value creating consultant. Carucci and Tetenbaum (1999) tell about the primary goal of the consultant is to be competent in solving problems without help from consultants. To accomplish the goal, one must share the knowledge, skills, ideas and processing. It is critical to have a learning objective that develops the client’s capability. As a capability builder, the consultant facilitates, coaches or supports but doesn’t work for people in the organisation. Solving problem is just a half job of the consultant. Ensuring that clients do not create a dependency on the consultant to their thinking and problem solving is the other half of the consultant’s job.
Being the truth teller is the last characteristic for the value creating consultant. As per the research by Carucci & Tetenbaum (1999), the most difficult task faced by the consultant is to deliver a bad news to the client. This might result in estranging the client relationship. It is an uphill battle to devise strategy to circumvent the unpleasant message. To establish a honest relationship, the consultant has to make the client appreciate for his straight unfiltered feedback.
Schein (1997) points out the overarching principles for consultants.
The first principle is being helpful. Consultation is providing help; therefore, every contact should be perceived as helpful. The second in the list is to deal with reality. Schein (1997) tells that the consultant cannot be helpful if he do not know the realities of the client system; therefore, every contact should bring to the surface diagnostic information about the state of the client system. Access your ignorance is the third principle. The consultant cannot determine what the current reality is if he does not get in touch with what he does not know about the situation and have the wisdom and the courage to ask about it. Fourth principle is to do everything as an intervention. Schein (1997) elaborates that even though the goal of exploratory inquiry through accessing ignorance is diagnostic information, the reality is that every question or inquiry is at the same time an intervention and must be treated as such. The client owns the problem and the solution. The reality is that only the client has to live with the consequences of the problem and the solution, so the consultant must not take the monkey off the client’s back. Go with the flow, but seize targets of opportunity. All systems develop cultures and attempt to maintain their stability through maintenance of those cultures. Therefore, one must “go with the flow”. At the same time, all systems have areas of instability where motivation to change exists. One must build on existing motivations and cultural strengths, and seize targets of opportunity. Schein (1997) suggests to be prepared for surprises, and learn from them. Everything that happens is a source of new data, and everything you think you know about the client system is only a hypothesis to be tested through further interventions. Share the “problem” Neither the client nor the consultant can fully understand the reality of the situation; defining that reality is an ongoing joint effort in terms of what to do next.
Rasiel (1999) highlights some of the secrets of working with the client and building the relationship by making effective use of consulting skills during his tenure in Mckinsey.
Firstly, always keep the client on your side.
When a consultant is working with a client team, the consultant and the team have to work together or the consultant won’t work at all. Make sure that members of the client team understand why their efforts are important to the consultant and beneficial for them. Rasiel (1999) through his experience says that the first thing to do when working with a client team is to get them on the consultant’s side. At McKinsey, the consultant learns that the key to keep the client teams on his side was to turn their goals into his goals. The consultants have to remember that if their mission fails, the McKinsey mission fails and if the McKinsey mission fails, their mission fails. Members of the client team must also realize that working with McKinsey will be a positive experience for them.
Secondly, engage the client in the process.
If the client doesn’t support the consultant, the project will stall. Keep the clients engaged by keeping them involved. Rasiel (1999) further adds that to succeed as a management consultant, the consultant must keep the client engaged in the problem-solving process. Being engaged in the process means supporting consultant’s efforts, providing resources as needed, and caring about the outcome. With engagement thus defined, it is hard to imagine how any project could succeed without an engaged client. The first step in keeping your clients engaged is to understand their agenda. Clients will support the consultant only if they think the efforts contribute to their interests. Frequent contact and regular updates even if it’s just by memo will help the consultant keep in touch with the clients and keep the projects “top of mind” for them. Get on a client’s calendar up front. Schedule progress meetings with tentative topics. Early “wins” will generate enthusiasm for the project-the bigger, the better. The long-run returns on the consultant’s work will be much greater if the clients feel that they were involved in reaching the solution and that they understood it, rather than being handed the solution neatly wrapped and tied with pink ribbon. This brings one of the ironies of consulting. If it is an outside consultant, one will never get credit for ones best work. If the solution is truly effective, the client organization will claim it for its own.
Thirdly, get buy-in throughout the organisation.
Rasiel (1999) recommends that if the solution is to have a lasting impact on the client, the consultant has to get support for it at all levels of the organization from the board on down. After the presentation to the board, presentation to middle-level managers is more important. They will probably have day-to-day responsibility for implementing, so let them know what’s going on. Don’t neglect the people on the line, either. The changes you recommend may have the greatest effect on them, so their buy-in is vital to a successful implementation. Finally, serial presentations give the junior members of your team a good opportunity to hone their presentation skills.
Finally, be rigorous about implementation.
Making change happen takes a lot of work. Being rigorous and thorough helps. Making sure someone takes responsibility for getting the job done. Implementing recommendations for change is a big subject. These are some of the ground rules that McKinsey consultants have
learned for implementing change. To implement major change, the consultants must operate according to a plan.
As McLarty (1998) says that management consultancy has the capability of changing the culture in client firms and has the potential to enhance the added value in terms of turnover and profitability. The practice is complex as it relies on analysis, methods and solutions. I believe consultants should have profound knowledge in assessing market opportunities, especially when they manage assignments. The supreme goal of a successful engagement is a process which is objective and subjective in nature.
The model by Schein (1988) highlights an effective procedure where the process consultation will develop and expand in the future. Finally, the model concludes by stressing the necessity of evaluation, particularly at each of the stages of the model, with all being amended in the light of experience. The process embodies intentions, contract agreement, clarification, values and skills, consensus and follow-up. The identification of this process establishes the “core skills” which in turn are reflected in the process responses. I agree with Stumpf (1999) as he goes on to explain the practice development being the key to a successful consultancy. The way in which consultants put together the consulting process will affect the relationship with the client and possible future employment. The task processes are found in almost all consulting situations and include – contract role, clarification, data generation, prioritisation, actions and follow-up. Carucci and Tetenbaum (1999) listed out three value-creating consultant’s characteristics as being an equal partner, a truth teller and building capability by sharing the knowledge, skills, ideas. In contrast to the current management consulting engagement, Rasiel (1999) conveys through his findings to keep the client on the consultant’s side by engaging the client in the process and at the end buy-in throughout the organisation. The client-consultant interaction is a classic example of boundary-spanning relationship where the consultant has to demonstrate his skills to win the trust of the client. The stages of building towards a successful solution involve the exchange of information and knowledge sharing. A number of dimensions which includes models of consultancy, client expectations, consultant capabilities, and consultant type give a perfect fir between client and consultant. Finally, as Clark (2010) analyses few characteristics such as low dogmatism, open-mindedness, flexibility, neutrality, and objectivity adaptive information processing ability, intuitive and politically astute are required by consultant in the third generation of management consulting. It is difficult to predict what the fourth generation consulting skills would shape.
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