Innovation

By Fiona Czerniawska.

If the consulting industry has been really good at one thing, then it’s at taking perfectly decent words and loading them up with so much promise and ambition that they crack under the strain. “Transformation” is teetering dangerously close to the edge of this at the moment: Digital technology offers so much in terms of potential impact on organisations’ top and bottom lines, but clients are increasingly demanding proof, evidence that work is, in fact, being transformed.

Another such word is innovation. As a concept it’s of critical importance to the consulting industry. Our data has repeatedly highlighted not only the extent to which a firm can demonstrate how an innovative approach will determine whether it will be short-listed for work, but also the significant shortfall between the level of innovation clients are looking for and what firms are delivering in practice. One of the most important factors in deciding which firm to use, innovation is also one of the areas where consulting firms perform worst. In fact, there are only three areas in which firms are perceived to be even weaker: price (which we’ll discount for present purposes—we’ve never met a client who didn’t want a reduction in fee rates); responsiveness and flexibility; and speed of delivery. Those latter two are interesting because we think they link to innovation. Most clients we speak to aren’t interested in blue-sky thinking: When they write in the RFP that they’re looking for an innovative approach, they’re really saying that they want a firm that can bring fresh ideas from other industries and/or countries, one that isn’t so hide-bound by process and organisational baggage that it can’t change the way it works to accommodate a client’s unique set of circumstances and deliver tangible improvements more quickly than clients can do by themselves.

By Fiona Czerniawska.

I used to think that the consulting industry had a problem with innovation. But I was wrong.

New technology has unleashed an explosion of activity as client organisations work out how best to harness big data, the Internet of Things, the cloud... and… and… and… And the consultants who work with them have been responding in kind, pulling capabilities from different practice areas, combining it with industry knowledge and the kind of rapid development you only get if you can get small teams of people to focus on one issue at a time. Right across the consulting industry, from the very largest consulting firms to the positively petite, we see examples of creative thinking. Everyone is alert to the potential for leveraging solutions developed for one client to many. Tools developed for a single organisation can be applicable to entire markets.

By Edward Haigh.

Incumbent suppliers appear to have more of an advantage than you might think. Not only are they the ones with both feet inside the door–and therefore in a fairly decent position to slam it shut on anyone trying to get one of their feet in, but they’re also thought, by their clients, to be better than anyone else.  

Fiona Czerniawska’s recent blog set out the size of this advantage, revealing that existing clients are significantly more likely than prospects to describe the quality of a consulting firm’s work in positive terms. Behind which you can’t help wondering if the broader reputation of the consulting industry is coming into play: Clients suspect they’ve been lucky and got the one firm that’s really good. The problem, as Fiona put it, is that “nothing you can do can communicate what you do as well as doing it.