Category Intelligence on Management Consulting covers the following
This service improves the effectiveness of the buyer’s value chain by improving each of the major processes in client operations.
Financial and risk advisory services reduce risk exposure for clients by assuring and justifying business decisions and assuring regulatory compliance. They also support identification, reduction and management of business risk
This service is aimed at managing employee lifecycle. It also involves consulting with regard to the people component of change management
Need for the operational efficiency, compliance to regulations, and technological advancements are driving the demand for consulting services. On the other hand, freelance consulting industry and in-house consulting groups are posing threat to traditional consulting business model
Organizations are constantly trying to reduce costs and increase their efficiency, so that the cost savings can be transferred to the customer as a means to withstand intense competition. This is leading to growth in demand for business process improvisations and consulting related to operational efficiency.
MNCs are actively seeking consulting advice on following technology skill sets: Agile, Artificial Intelligence, and analytics. Both product and service corporations are increasingly investing on user experience design, customer-focused data analytics, and customer engagement strategies, so that corporate buyers have greater demand for digital marketing and transformation consulting.
Regulatory changes, like the US Tax Reform, BREXIT, EU GDPR (General Data Protection Regulation) and others, have led to an increase in demand for consulting across all major service lines. In order to stay compliant to regulations, multinationals will seek high-value advice, thereby fueling the demand for the management and regulations consulting
Business Model re-inventions
To adapt to changing customer requirements and advancing technology, businesses are re-inventing business models for which they require skill and expertise of category management consultants.
Pricing and flexibility offered by independent/freelance consultants has led to rapid expansion of freelance consulting segment. For e.g., in the UK, independent consulting industry account for 10 percent of £10 billion consulting market. Freelance consulting sector is hence expected to eat up traditional consulting firm/industry revenues, in the near future
Large organizations are setting up in-house consulting groups and recruiting former consultants into management positions, thereby reducing the usage of external consultants.
Few other reasons hampering consulting industry growth, revenues, and clientele are time crunch for nurturing client relationships, consultant's need to provide more value to clients at the same cost, and unavailability of sufficient time to effectively respond to client RFIs/RFPs
The tools, templates, and models of consultants regarded as intellectual capital can no longer be kept a secret in the internet age. The democratization of knowledge affects the consulting industry.
Industry profit margins have varied over the past five years, but have generally shown a trend toward expansion, as consultants have enjoyed lessening price competition in a high-demand environment
The industry's largest players are Accenture, Deloitte, and McKinsey & Company
Over the next five years, industry profitability is expected to remain steady, as rising global business sentiment and profit drive new businesses
Due to the intense competition in the industry, operators have placed a premium on hiring highly skilled consultants to provide superior service
Employees often earn high wages, which has increased relative wage spending
Industry operators have hired more consultants with skills (such as Big Data analysis), which has exerted upward pressure on relative wages