epq final essay

© Bradley Agnew 2014 April 2014

THE VALUE OF MANAGEMENT CONSULTANCY

IN RELATION TO

CLIENT ORGANISATIONS

An analysis of the value added by management consultancy to client organisations

The Value of Management Consultancy | 2

epq.agnewsolutions.co.uk

CONTENTS

Executive summary

3

What is added value and how is it measured?

5

How do management consultants add value?

8

How much value do management consultants add?

11

Why do organisations use management consultants?

12

What are the barriers to achieving added value?

14

How can the value added by management consultants be increased? 16 References

18



EXECUTIVE SUMMARY The value of management consultancy is subject to extensive debate and, based on current research, the value

added by consultants is often unclear as it is difficult to measure their impact. The consulting industry is vast

and complex, with limited barriers to entry and no single definition of what is and what is not management

consultancy. For the purpose of this study, management consultancy will be defined as:

The creation of value for organisations – through improved performance, achieved by providing objective

advice and implementing business solutions.1

The ultimate aim of this project is to assess the value of management consultancy to client organisations. The

value added by consultancy is widely disputed and can be attributed to a diverse range of factors. The aim of

this initiative has been:

To clarify how added value is defined and measured, the ways in which consultants may add value

and to quantify the value consultants add to client organisations.

To explore factors which may be attributed to an organisation’s use of management consultants

and to investigate the barriers to achieving added value in relation to the client’s needs.

To develop an action plan for increasing the value added by management consultancy in relation to

client organisations at both a client and system level.

In order to do this, I developed an objective methodology, adopting a research and experience-based

approach utilising a wealth of primary data, current industry insights and a live consulting engagement, with

each area of research focussed on a specific question:

1. What is added value and how is it measured?

2. How do management consultants add value?

3. How much value do consultants add?

4. Why do organisations use management consultants?

5. What are the barriers to achieving added value?

6. How can the value added by management consultants be increased?

My research findings indicate that:

There are a number of challenges inherent in defining ‘value added’ which may be attributed to the

variety of perspectives from which an outcome may be perceived, which requires clear specification

of the level of analysis including timescale and whether the benefits are measured in terms of the

client interface or the client organisation. The measurement of the impact of consultants is becoming

more important as there is an increasing focus on the return on investment from using consultants.

1 The Value of Consulting, Management Consultancies Association, 2010



The ways in which management consultants may add value to client organisations are wide ranging

and significant. They are constantly changing and evolving as the client-consultant relationship

develops. It is evident that the benefits of management consultancy when used appropriately and

practised effectively can have a considerable impact in terms of assisting the client in achieving their

objectives. Consultants may operate in a number of different models and the approach taken

determines the way in which the consultant adds value.

The extent of ‘value added’ by management consultancy is directly determined by the way in which

value is defined and measured which in itself presents an inherent issue in assessing the impact of

consultants. However, it is clear that the forms of added value are diverse and seem to be determined

by the knowledge, skills and experience of individual consultants, in addition to the consulting model

utilised and the ‘perceived’ and ‘real’ needs of the client. There is no single mechanism for

determining the value of consultancy as each engagement is unique and must be assessed on its own

merits.

The motives for client organisations using consultants are wide ranging and subject to extensive

debate, from the perspective of both managers and management consultants. However, it is clear

that the client-consultant relationship is constantly evolving, and in recent years is developing into a

more value-based relationship which involves redefining what is and what is not management

consulting.

In adding value there are a number of barriers which may be created by either the consultant or the

client, or alternatively issues may arise as a result of external factors outside of the client-consultant

relationship, which in itself may also cause problems. Any number of challenges may occur at any

point during a consulting engagement; starting with the procurement and management of

consultants through to the evaluation of projects to assess and measure the return on investment.

With the UK consulting industry valued at £9 billion2, and the value added to client organisations estimated to

be around £56 billion to UK clients in 20083, the issue of the value of management consultancy is a prominent

one which needs further clarification. This report will provide the answers to these key issues and set out a

clear action plan for increasing the value added by management consultants both to client organisations and

the wider economy.

2 The Value of Consulting, Management Consultancies Association, 2010 3 The Value of Consulting, Management Consultancies Association, 2010



Question 1: What is added value and how is it measured? If management consulting is defined as the creation of value for organisations, what does ‘added value’ mean,

and how can the value added by consultants be measured to assess their impact?

Defining added value

There are a number of challenges in defining added value which has caused the meaning of value in the

context of consulting to become increasingly broad as the definition of management consultancy begins to

incorporate other forms of consultancy which in turn requires clarifying what added value is. Jamieson claims

that today consulting is almost any “help”4 that is contracted, and suggests that the definition of consultancy

should be restricted to certain types of consultancy.

Newton’s concept of “client-centric consulting”5 requires the consultant to operate based on a true

understanding of the clients’ needs which is essential in order to add value and provide advice appropriate to

the client’s situation. By applying a client-centric consulting approach the consultant will benefit from an

increased understanding of the client’s “perceived need”6 and “real need”7 which will assist the consultant in

defining added value in the early stages of the consulting engagement which in turn will enable them to add

value by providing advice based on an increased understanding of the client’s needs. The client’s willingness to

work with the consultant and provide sufficient information including underlying needs is very much

dependent on the client-consultant relationship, which is often a key challenge in defining added value,

particularly where the consultant lacks understanding of the client’s needs.

In assessing value added there are a number of perspectives by which value may be assessed. Duncan Hare

(XMCS) contracts in a “deliverables based away”8 and claims that value added is the value of the deliverables

within the client’s change process. In contrast to this, Keith Bissett (Bourton Group) identifies “return on

investment”9 as the primary value consideration. In defining added value the consultant’s perspective is

important, as both deliverables and objectives-based measurement will provide different results, although it is

true that either could be value added – the way in which value will be measured should be clearly defined and

agreed between the client interface and the consultant in the early stages of the engagement. This relates to

4 “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009 5 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 6 “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009 7 “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009 8 Survey for Consultants, Duncan Hare (Experienced Management Consultants Ltd), 25 March 2014 9 Survey for Consultants, Keith Bissett (Bourton Group Ltd), 26 March 2014



Czerniawska’s theory of “value from effectiveness”10 where the outputs of a project are clear and measurable,

as opposed to “value from efficiency”11 which depends on the results delivered by the consultants whose roles

are clearly defined.

In the planning stage of Agnew Solutions’ project with an ecumenical organisation the client did not identify

any clear measurable objectives and this required a deliverables-based approach by the consultant managing

the project. From the planning stage right through to implementation it was clear that the focus of the project

would be delivering a solution which met the requirements specified in the project plan – the general aim of

the project was to raise the client’s profile and promote awareness of its presence within the community in

which it served. However, it was also clear from the consultant’s point of view that there were opportunities

to add value at an individual client level by providing training to staff, reducing client anxiety and providing

new ways of working through innovative processes using information technology.

Measuring added value

It is often difficult to measure the impact of consultants. There is no single way in which the value added by

consultancy may be measured, due in part to the many forms of added value, some of which cannot be easily

quantified and are therefore subject to interpretation.

In measuring the value added it is necessary, in the first instance, to identify the level at which value is

intended to be added within the client organisation. Whilst it is true that management consultants are usually

used to meet an organisational need, there are a number of needs to be met and opportunities to add value at

an “individual/group level”12 – most likely with the client interface through transfer of skills, changes in culture

or meeting the client’s perceived need.

Jamieson identifies a number of “forms of added value”13, including evidence of the value and how this may be

measured. This clearly presents how varying forms of added value may be measured differently, and may not

necessarily be quantifiable, and thus the impact of consultants must be measured based on the type of value

added – which may rely on using qualitative data to measure the outcome of an engagement.

Using Czerniawska’s theory of “value from efficiency”14 as a way of measuring the value of consultancy seems

to assume that, based on provision of deliverables alone, consultancy may add value. However this may not

necessarily be the case, especially where the deliverables produced do not lead to change. Although

deliverables themselves may not create change, Hare aims to ensure that deliverables are a part of a “clear

roadmap to deliver the change”15.

10 Maximizing the value of consultants, Fiona Czerniawska, 2003 11 Maximizing the value of consultants, Fiona Czerniawska, 2003 12 “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009 13 “Adding Value in the Changing World of Consulting, David W. Jamieson, 13 April, 2009 14 Maximizing the value of consultants, Fiona Czerniawska, 2003 15 Survey for Consultants, Duncan Hare (Experienced Management Consultants Ltd), 25 March 2014



In cases where it is not possible to quantify the value of consultancy, the consultant may use qualitative data

obtained through surveys, questionnaires, focus groups or direct client feedback to measure the success in

meeting the client’s needs which will be used to measure the value added. SOGETI uses “OTACE”16 to measure

the success of its engagements, which documents each stage of the project so that the client may review their

performance throughout the project and provide feedback.

A similar process is used by Agnew Solutions which documents all planning, proposals, meeting agendas and

project-related documentation which can be accessed by client through their website. This includes a ‘Project

Review’ form in which the client assesses the consultant on a range of factors including communication,

planning, implementation and an overall judgement. This is the primary method of measuring added value as

Agnew Solutions’ projects are often deliverables-based and difficult to quantify, particularly in the case of

start-up projects in which there cannot be a clear improvement.

In the case of Agnew Solutions’ engagement, in the review stage the client evaluated the effectiveness of the

solution and commented that the “design of the website was innovative”17 and that it was “fresh and

modern”18 – the same criteria used to describe the specification of the website in the initial planning stage as

stated in the “Project Planner”19 document. This process provided by Agnew Solutions added value to the

project by enabling effective planning and measurement of the success of the project by assessing the

consultant’s ability to meet the client’s needs.

16 Survey for Consultants, Barry Weston (SOGETI UK), 04 April 2014 17 Project Review, Thirsk Churches Together, 03 February 2014 18 Project Review, Agnew Solutions project for ‘Thirsk Churches Together’, February 2014 19 Project Planner, Agnew Solutions project for ‘Thirsk Churches Together’, October 2013



Question 2:

How do management consultants add value? It is clear that there is a considerable demand for management consultancy, and therefore consultancy must

be able to add value in certain circumstances – the aim of this question is to identify how management

consultants add value and what they can offer client organisations.

Models of consulting

There are a number of approaches which consultants may take in order to solve a problem and add value,

depending on the nature of the project. At its most basic level, Newton discusses two common consulting

approaches: “expert consulting”20 and “process consulting”21. Although separate concepts, many projects will

require the consultant to use these approaches interchangeably, as each approach relates closely to different

forms of added value. Expert consulting relates to the provision of specialist knowledge and expertise, which

may lead to forms of added value such as improved financial performance and increased operational

efficiency. Process or facilitation consulting could be seen as a type of coaching where the consultant assists

the client in solving the problem themselves, thus adding value though client learning and transfer of skills

which is a key demand from clients who seek to increase the capabilities of their in-house staff.

Schein segments management consultants into three key categories based on their role in the client-

consultant relationship. Schein’s “purchase-of-expertise”22 and “process-consultation”23 models represent

expert and process consulting in their purest forms, from provision of expertise in a hands-off relationship to

working closely with the client to facilitate change. Schein’s third model, the “doctor-patient model”24, could

be seen as an intermediary between the two. In this instance, the client-consultant relationship is very “trust-

based”25 as the consultant uses both their intimate knowledge of the client organisation with their experience

and facilitative skills to ‘diagnose’ problems and recommend solutions.

Each of these models in itself has significant potential to add value, and there is no single approach which is

proven to work in each instance. The approach which is taken by the consultant will be very much dependent

on the nature of the project and the client-consultant relationship. In order to maximise added value the

20 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 21 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 22 The Logic of Management Consulting (Part One), Staffan Canback, 1998 23 The Logic of Management Consulting (Part One), Staffan Canback, 1998 24 The Logic of Management Consulting (Part One), Staffan Canback, 1998 25 The Logic of Management Consulting (Part One), Staffan Canback, 1998



consultant must consider the needs of the client before deciding upon an appropriate model, which should

also be a key consideration of clients in the procurement of management consultants.

The approach taken by Agnew Solutions in managing the client’s project was primarily an expert model, using

the consultant’s specialist knowledge and expertise to implement the solution which a relatively small

understanding of the client’s organisation, although based on a productive client-consultant relationship.

However, the project management tools provided by Agnew Solutions facilitated the client’s own learning by

assisting them in the planning and management process to ensure that their needs were met. In this regard,

the approach taken would primarily be expert consulting with some facilitation to support the client’s success.

Contribution of consultants

Client organisations may use consultants for their unique ability to add value in ways that in-house staff are

unable to. Consultant’s independent nature means that they have a broad range of experience with a number

of organisations, which means that consultants can use their “experience in project management”26 to help

the client to achieve their objectives within a specified timescale and budget. As consultants are hired to

deliver short-storm projects they are more efficient and are able to bring resources to support the client’s

success.

The ACCA identifies three key attributes which enable consultants to add value to client organisations, their

“knowledge, experience and skills”27. Although the value of consultancy is subject to much debate, in theory

this seems to be a source of significant value for clients. However in practice this seems difficult to achieve,

considering that the consulting industry has “little, if any, barriers to entry”28 and the various challenges in the

procurement of management consultants. Indeed, although it is more likely that the consultant will have

specialist knowledge and expertise which is outside of the client’s usual remit, the client will always have a

greater understanding of the client organisation and how the consultant should be utilised.

Newton argues that consulting is “inherently a networking business”29, as consultants develop long-term

relationships with their clients and other consultants, especially as relationships are becoming more value and

trust-based. Additionally, in working with a wider range of organisations, consultants develop an extensive

network of contacts which in itself can be a huge source of value to the client. In an interview with Doug

Agnew, the Sales Director for Country Choice, he explained their model for procuring consultants was based

primarily on winning new business from prospective customers. As a part of this model, the consultant’s

“contacts with the customer”30 was a key criterion for selecting the consultant, as they used consultants to

gain greater access to potential customers and develop their relationship with them. This reinforces the value

26 Management consultants and public sector transformation, ACCA, 2010 27 Management consultants and public sector transformation, ACCA, 2010 28 Essential Tools for Management Consulting, Simon A. Burtonshaw-Gunn, 2010 29 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 30 Interview with Client Organisations, Doug Agnew (Country Choice), April 2014



of management consultants through the extensive network which they build by working with a wide range of

organisations and alongside other consultants.

A key benefit to client organisations of using consultants, particular in large firms, is the information that they

are able to access and use to support decision making. Czerniawska’s interviews with clients show that one of

the ways in which consultants add value is their ability to access “otherwise inaccessible information”31.

Strategic consultancy is a dominant type of consultancy, this could be attributed to client’s need to obtain the

extensive market research and insights that large consultancy firms are able to collate using teams of

researchers and highly skilled consultants to attain a greater understanding of what is happening in the market

and how the client organisation can increase its competitiveness in the market. This understanding is further

reinforced by the in-depth market expertise of individual consultants who will typically be specialised in a

certain industry and have worked with a range of client organisations within their sector.

However, the true value of consultancy is not in the firm but in the specialist knowledge, experience and skills

of individual consultants who are a part of the consulting engagement. Whilst the limited barriers to entry

means that the quality of consultants is wide-ranging which in turn causes challenges in the procurement of

management consultants, the right team of individuals can add significant value to the client organisation. By

using consultants, the client has the potential to take better decisions, execute their plans more efficiently and

improve the capability of its in-house staff. The challenge is in procuring the right consultants for the

engagement and managing these effectively to achieve a high quality outcome.

31 Maximizing the value of consultants, Fiona Czerniawska, 2003



Question 3:

How much value do consultants add? The financial value of management consultancy is subject to much debate, this is only further complicated by

the nature of many engagements which are difficult to measure or yield results which cannot easily be

quantified e.g. changes in organisational culture – or may lead to a long-term outcome which only becomes

apparent after a certain period of time. This is of course directly influenced by how added value is defined and

measured which will be unique to each engagement. There is therefore no single mechanism for quantifying

the value of management consultancy.

Quantifying value added

The impact of consultants is often difficult to measure, this can be attributed to a wide range of factors

including, but not limited to: lack of clarity in the definition of added value and measurement, unclear role of

the consultant in the client-consultant relationship, and poor procurement and management of consultants by

the client interface to name a few. However, even if the consultant’s impact on the client organisation is

measurable, the issue of quantifying this value remains – as many consulting engagements yield results which

cannot be easily quantified.

Jamieson explores the various forms of added value and explains that for certain types of added value,

“measurement is difficult”32, and suggests including new measures in project evaluations in order to measure

their outcome. For each form of added value Jamieson identifies potential outcomes, the evidence for this

outcome and how it may be measured. Generally, value which is added at an organisation level tends to be

measurable and quantifiable as they typically lead to increased performance across the organisation –

although there are some exceptions such as changes in culture – but even this could be measured in terms of

change in workforce productivity, staff turnover and absenteeism. Value which is added at an individual/group

level is often subject to interpretation as they are generally measured using self-evaluations and observations

where there may be potential bias for any number of reasons.

Therefore, assigning a financial value to every consulting engagement is not always possible – and determining

the value of consultancy cannot be measured purely in financial terms – the wide ranging quantitative and

qualitative impacts of consultancy should be considered rather than return on investment.

32 “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009



Question 4:

Why do organisations use management consultants? The role of a consultant as an “independent advisor”22 can be a source of value in itself. Clients highly value the

external perspective that consultants can offer, and see their wider range of experience working with a range

of clients as a significant benefit. The independent nature of a consultant also enables them to challenge an

organisation’s culture and raise issues that in-house staff may not be willing to voice. In central government

there are complaints of using management consultants to “say things that civil servants don’t want to say”33,

which is a prime example of how consultants can create change by using their external perspective and

objective, independent nature to challenge existing culture. Indeed, it is not uncommon for senior

management to hire consultants simply to “[say] things which they already know”34, using an expert to

reinforce their position means that consultants are sometimes used in company politics due to their ability to

build consensus internally within the client organisation.

Due to the nature of a consultant’s role, they develop experience in project management and are able to

deliver projects to meet specific requirements within a defined timescale and budget – this is a significant

source of value for the client organisation. In other words, the client organisation has the specialist knowledge

and expertise to achieve their business objectives but needs assistance in “bringing all the pieces together”35.

Consultants, particular larger firms, will have established a clear project process the ensure that the consulting

engagement delivers results for the client – such as SOGETI’s OTACE and Agnew Solution’s project

management process. The facilitative tools provided by the firm and the project management skills of

individual consultants help the client to achieve their goals in a very specific period of time, often to tight

deadlines.

Many organisations use management consultancies for “staff augmentation for specific projects”36 which they

are unable to staff internally – because individual consultants are highly skilled in project management and

have the specialist knowledge to add significant value to short-term projects. Outsourcing to a consultancy

reduces the client organisation’s fixed costs by reducing long-term contracts; however using consultants can

be expensive, so it is important in the procurement of management consultants to select the right individual

and only if a position cannot be filled internally. However, this is interim management so would not come

under our definition of management consultancy – it is a key benefit of using consultants nonetheless.

33 Management consultants and public sector transformation, ACCA, 2010 34 Survey for Consultants, Duncan Hare (Experienced Management Consultants Ltd), 25 March 2014 35 The Value of Consulting, Management Consultancies Association, 2010 36 Survey for Consultants, Barry Weston (SOGETI UK), 04 April 2014



Clients typically identify two areas where they may consider the use of management consultants; in “specific,

specialist projects”37 and “large-scale change projects”38. In specialist projects using consultants represents a

significant benefit for the client as they can access specialist knowledge and expertise through an “expert

consulting”39 approach without having to train their in-house staff, which serves as both a time and cost

constraint. This is further reinforced by the need for client organisations to “reduce fixed costs”40 – although

consultants are able to charge high fees for their expertise, this enables clients to operate more efficiently

which represents significant value for them. Alternatively, organisations may also use consultants to assist in

long-term, complex projects which require a facilitative approach, using consultant’s experience in project

management and facilitative skills to “manage and sustain complex projects”41. Both of these areas will involve

the use of consultants for a very specific and tightly defined issue where consultants can add value.

Changes in the client-consultant relationship

The client-consultant relationship is constantly changing and evolving, throughout the consulting industry

there are “changing demands from clients”42 that are beginning to focus more on the return on investment

from consulting engagements. Not only are there changing requirements as a result of technological

advancements and the economic crisis, but we are seeing the client-consultant relationship become more

value-based as consultants are increasingly taking ownership of their recommendations and focusing on the

long-term success of their client. Canback explains how the client-consultant relationship is developing from a

traditional “arms-length supplier status”43 where the consultant provides objective advice and may assist in

the implementation of their recommendations, to a “higher value-added”44 relationship involving more long-

term activities including building internal consensus, transfer of skills and working to continuously improve the

effectiveness and efficiency of the client organisation.

37 Maximizing the value of consultants, Fiona Czerniawska, 2003 38 Maximizing the value of consultants, Fiona Czerniawska, 2003 39 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 40 Maximizing the value of consultants, Fiona Czerniawska, 2003 41 Maximizing the value of consultants, Fiona Czerniawska, 2003 42 The consulting firm of the future, Source for Consulting, 2013 43 The Logic of Management Consulting (Part One), Staffan Canback, 1998 44 The Logic of Management Consulting (Part One), Staffan Canback, 1998



Question 5:

What are the barriers to achieving added value? In order to determine the value of consultancy, we must assess its limitations and how these may be reduced

to maximise the value of management consultancy.

Client-consultant relationships

The personal qualities of individual consultants are an important factor in adding value. Therefore, if a

consultant lacks relevant experience, specialist knowledge or has not undertaken appropriate training this will

serve as a barrier to adding value. The basic principles of effective communication are absolutely essential in

adding value, as Paul Clarke puts it; a consultant needs to be “very good at the basic stuff”45. The skills and

experience of individual consultants can be a barrier to effective communication if they are not qualified or

trained, however this can be the case due to the limited barriers to entry in the consulting industry. This only

reinforces the importance of effective procurement and management of management consultants.

Some clients argue that consultants apply a “formulaic solution”46 that is not appropriate to the client’s needs.

Many consultancies are accused of using standard tools or ‘cookie-cutter solutions’ to sell their services with

very little consultancy. Failure to understand the client’s needs and use a “client-centric”47 approach will result

in a solution which does not meet the client’s needs and therefore will be limited in adding value. In the

planning stage of Agnew Solution’s project a standard “Project Planner”48 template was used which meant

that key information about the client organisation was missing which required changing the scope of the

project during the implementation process which could have been avoided.

Procurement and management of management consultants

The client plays a key role in the client-consultant relationship and must take ownership of the final outcome.

The “inexperience of staff who procure consultancy services”49 can be a key barrier to achieving added value

as they may lack a fundamental understanding of why they are hiring a consultant, or they may use

consultants to fulfil a perceived need as opposed to a real need. Lack of strong project management by the

client can result in the consultant taking control and misunderstanding the client’s needs.

45 Survey for Consultants, Paul Clarke (Develin Consulting Ltd), 25 March 2014 46 Maximizing the value of consultants, Fiona Czerniawska, 2003 47 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 48 Project Planner, Agnew Solutions project for ‘Thirsk Churches Together’, October 2013 49 Management consultants and public sector transformation, ACCA, 2010



The importance of communication between the client and consultant is essential in adding value. Client-

consultant relationships should be an “active communications channel”50 and as such the client should clearly

express their needs and expectations – if a client fails to communicate effectively the consultant will be limited

in the value they are able to add as they will be unable to understand the client’s needs.

In the client-consultant relationship, a key source of value is the outcome of the project and how the

consultant’s recommendations are implemented and developing within the client organisation. Clients report

that sometimes the consultant “disconnects from the client”51 once the deliverables have been provided, this

would relate to the traditional “arms-length supplier status”52 relationship presented by Canback where the

consultant is not involved with the client beyond the implementation process. This traditional relationship is a

barrier to achieving added value in itself, a clear change is needed in client-consultant relationships to reduce

these barriers and to maximise the value added by management consultants.

50 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010 51 Management consultants and public sector transformation, ACCA, 2010 52 The Logic of Management Consulting (Part One), Staffan Canback, 1998



Question 6:

How can the value added by management consultants be increased? The majority of current research on the issue of maximising the value of management consultancy focuses

predominantly on the client’s responsibilities, instead of approaching the issue as a partnership between client

and consultant. We will be looking at the bigger picture to identify a clear action plan for increasing the value

of management consultancy.

Standardising the consulting industry

The consulting industry is currently fragmented with no independent body to govern and regulate it. In an

industry where there are limited barriers to entry, there are an increasing number of individuals which call

themselves management consultants with wide ranging qualifications and experience. The UK consulting

industry needs to be “governed by a central but independent body”53, said one client. This would increase the

barriers to entry by providing provision for a ‘Code of Practice’ by which consultant’s relevant experience and

specialist knowledge can be formally assessed and verified before the client hires them. Standardising the

consulting industry is a necessary step in increasing the professionalism of consulting and enabling clients to

connect with the correct people.

Developing client-consultant relationships

Ensuring that consultants and clients work together to achieve a greater understanding of how client-

consultant relationships can add value will increase the value of consultants. This means that clients need to

increase their understanding of management consultants: how to procure and manage consultants, evaluate

project outcomes and ensure that they continue to add value beyond project delivery through transfer of

skills. Consultants need to adopt a “client-centric”54 approach and consider the needs of the client, take

increased accountability for their recommendations and be more transparent in the way they operate.

53 Maximizing the value of consultants, Fiona Czerniawska, 2003 54 The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010



“Communicating activities strengthen client relationships”55, so by focusing on increased communication

between the consultant and client this will develop productive relationships which maximise added value.

Increasing accessibility of networks

The issue of the procurement of management consultants is a prominent issue in the industry. Clients want to

“compare different consulting firms on a more reliable basis”, this requires use of technology to connect

clients to the correct consultants for their project – this may even require using consultants from different

firms collaboratively.

To increase client’s access to consultants and to enable more effective procurement, the industry needs a

directory of consultants or an ‘online marketplace’ to compare management consultants, firms and individual

consultants, share best practice and compare clients’ experience of using consultants. The key to the success

of this tool is providing clients with access to relevant and accurate information about consultants including

skills, experience, case studies and client testimonials. As consulting is essentially a networking business, this

solution is the way forward to more effective communication and maximising the value of management

consultancy.

Word count: 5,023

55 Orchestrating for a winning performance: Re-thinking Strategy in Professional Service Firms, Michael Smets, Tim Morris, Stuart Carroll, Namrata Malhotra



REFERENCES “Adding Value” in the Changing World of Consulting, David W. Jamieson, 13 April, 2009

Essential Tools for Management Consulting, Simon A. Burtonshaw-Gunn, 2010

Interview with Client Organisations, Doug Agnew (Country Choice), April 2014

Management consultants and public sector transformation, ACCA, 2010

Maximizing the value of consultants, Fiona Czerniawska, 2003

Orchestrating for a winning performance: Re-thinking Strategy in Professional Service Firms, Michael Smets,

Tim Morris, Stuart Carroll, Namrata Malhotra

Project Planner, Agnew Solutions project for ‘Thirsk Churches Together’, October 2013

Project Review, Agnew Solutions project for ‘Thirsk Churches Together’, February 2014

Survey for Consultants, Barry Weston (SOGETI UK), 04 April 2014

Survey for Consultants, Duncan Hare (Experience Management Consultants Ltd), 25 March 2014

Survey for Consultants, Keith Bissett (Bourton Group Ltd), 26 March 2014

Survey for Consultants, Paul Clarke (Develin Consulting Ltd), 25 March 2014

The consulting firm of the future, Source for Consulting, 2013

The Logic of Management Consulting (Part One), Staffan Canback, 1998

The Management Consultant: Mastering the Art of Consultancy, Richard Newton, 2010

The Martin Letter, MGI Fund Raising Consulting, Inc.

The Value of Consulting, Management Consultancies Association, 2010

epq final essay

Documents

value consultants

added value

management consultants

value of consulting

creation of value

client organisations

impact of consultants

client interface