CEO CFO CMO CIO have different business consulting needs?
How can we offer an integrated approach to consulting when every executive out there seems to have completely different needs?
The world of business advisory services and management consulting is changing in an evolutionary way, such that the popular practices of the past decades are now becoming obsolete with every passing day! The classic strategies which were employed by traditional business consulting firms in the past are now barely used - only 20% of firms are seeking traditional consulting advice. That's a 70% decrease over the past 30 years!
As the needs of clients have evolved and become more complex, the demand to offer them exactly what they need has increased drastically and rapidly. The consulting industry must recognize the changing needs of the diverse customer markets, and know that a more flexible and dynamic approach is exactly what is needed when dealing with complicated and sophisticated business requirements. With this in mind, the real question is: how to offer an integrated approach when every executive out there seems to have completely different needs?
Four Practice Areas
In a modern organisation, there are 4 fields that can differentiate the organisation and affect their bottom line greatly. These fields are: Strategy, Finance, Marketing and Information Technology. Historically, business advisory services are also aligned to these fields. An executive in each field can get advisory services from a specialist of his field in the consulting industry.
For instance, CEOs use strategists. They are equipped to recognize the various trends in the market, critically examine the different operational elements of an enterprise, and come up with the best strategy to ensure profits and a high rate of return for the company. While CEOs have the knowledge about their company, strategists are experts who facilitate in devising plans of action, which are beneficial for the company. Similarly,CMOs would turn to marketing consultants for advice, CIOs to IT consulting firms, and CFOs to financial consultants (including the famous Big 4).
However, the flaw in this model is that the four fields are interconnected. Each of the fields needs the help of other specialists' views and insights to ensure that the company evolves consistently. This is the reason why there is a trend of mergers and acquisitions in the business management industry. Firms want to provide integrated business solutions not only to address the complex and specific needs of large companies, but because to ensure overall success of a client's business, it makes more sense to offer advisory services in more than one field.
Is Money Talk Too Loud?
Today, mergers and acquisitions in the consulting industry are led by the Big 4. As always, money talks! But is it good for the customers? While being highly interconnected fields of an enterprise, the key components of the strategy, IT, marketing and finance fields are very different. So is it best that financial consulting firms acquire other firms to be able to offer services in other fields as well? Of course, money is always the main concern. However, it is only through expert attention to all fields, that a comprehensive action plan can be produced. Are financial specialist the right experts to coordinate the efforts across different fields for better development of the entire business? Sometimes the answer is clearly yes, especially when the price is the ultimate factor in deciding what to prioritize for the enterprise. However, in the most cases, making the right decision requires more than just analyzing the figures - the opinion of many experts from various fields is required.
Evolution of management consulting industry is a good thing - it has to evolve to offer integrated services and allows executives to collectively identify challenges and opportunities. But the increasing interdependence of business activities within the company will force more changes. In the near future, firms offering consultancy services will have to drastically change their operations, in order to create 'dream teams' of diverse experts based on their customers needs. This will require consulting firms to drastically reinvent their business models and use more technology to automate operations. We predict that this will be a challenge for the Big 4, who are known to be conservative institutions.