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Consulting exulting

by Fraser Mason August 25, 2011

​So it seems the consulting industry is dusting itself off after the recession and getting back on its feet.

Having contracted by over 9% in 2009 (its worst performance since the early 80s recession),  UK consulting saw growth of 10% in private sector fee income during 2010. Firms that were forced to prune expensive consultants’ advice during the recession have begun to stir into life again.

But, as it has in so many industries, the financial crisis has led customers to re-evaluate the service they get from consultants, shifting the focus increasingly onto delivery. As The Economist recently pointed out, clients are becoming more picky.

Strategy consultants have a (perhaps undeserved) reputation for presenting clients with wonderfully neat solutions which never actually solve anything. Having emerged from a bruising couple of years, companies are keen to see serious, tangible, operational improvements: what use is a devilishly cunning growth-share matrix if the business never profits from it?

The numbers reflect this. Spending on operations management is expected to grow by 5.1% a year up to 2014 - led principally by IT consulting - whilst spending on strategy will only manage a weak 1.1%.

Of course, strategy consulting is still very much alive: the Boston Consulting Group grew by 12% in 2010, and forecasts even stronger growth next year. However, it is now clear that the heyday of the blue-sky, strategy-heavy top-tier firms is passing, and that a more operational, change-oriented style of consulting is in hot demand.

Fraser Mason is a consultant on the FreshMinds Talent Interim team.

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