BHG Articles

Consultants can bad a negative reputation - charging $2 million-plus for 10 weeks work that results in a lot of fancy PowerPoint presentations, all of which are archived away soon after BCG or Monitor leaves the client.

Below, Ill paint a more positive (and somewhat more realistic) view on the 6 reasons why companies need management consultants. By reading this article, youll have a better understanding of the consulting industry as a potential career.

1) Staff augmentation - the least value-added role that consultants offer. Companies often have short-term staffing needs (in the case of government work, this can extend for several years) due to a variety of factors (eg, company downsizings, unplanned growth). While expensive, it can be commonplace for operational consulting firms (eg, Deloitte) and, to a lesser extent, public sector consulting firms (eg, Booz)

2) External change force aka political cover. It can be hard for companies to do whats right (sacred cows and all that jazz) ” especially when it comes to job layoffs, reductions in benefits, major operational shifts. Hiring management consultants can be a way to reach the desired conclusions with political cover in case key parties are unhappy (eg, disgruntled employees or a displeased Board) or things go awry (Despite the major cost increase, we implemented Mercers recommendations ” theres little that what we could have done better)

3) Best practices across industries and functions - consultants have the helpful experience of:

a) Serving different clients in the same sector (eg, Consumer Goods, Semiconductors) b) Serving different clients facing similar problems in different industries (eg, Eastern European expansion, Central Asia outsourcing)

This enables them to identify common characteristics of effective solutions.

4) Analytical manpower

A corollary to staff augmentation, companies often require help to address problems where their knowledge and skillsets are lacking. Consultants can be of great value given their training - a big reason why consulting jobs are hard to find!

5) Fresh perspectives

Companies often need an external perspective - youd be impressed by the amount of value consultants can add based on seemingly obvious observations. Critics contend that this is an example of consultants selling glorified common sense, but for front-line workers, it can be easy to fall into daily routines and overlook mistakes and inefficiencies.

6) Employee training and buy-in

Every consulting project - particularly the ones with heavy client interaction - incorporates employee training as a central component. The best recommendations are worthless if clients cant implement and maintain suggested changes after consulting teams leave. Thus, a central part of what business consultants do is teach client employees the necessary skills, knowledge, and mindsets.