Why do clients use more than one consulting firm at a time?

By Fiona Czeniawska

Consultants love the idea of client loyalty: the notion that someone will come back to them time and time again, and will use them in preference to any other firm.  In consulting heaven, clients are monogamous. 

What a shame, then, that that’s so rarely the case. 

As our latest report, on the evolving relationship between management and technology consulting, reveals, two thirds of clients would like to use a different firm to help them plan and/or design changes to their technology, and to help them implement those changes.  That’s not news to anyone, but it will certainly be a disappointment to those firms whose future growth depends on being a one-stop-shop.  There’s a modicum of comfort to be had from the fact that the proportion who want to use different firms falls among big and very big organisations, so that only half of those with more than 5,000 employees want to use multiple firms – but that still leaves half that do.  But before you relax, you should take note of the fact that the people who say their expenditure on consulting services overall will increase are also more likely to prefer to use different firms.  Indeed, in one of those rare but terribly satisfying charts that emerges in our research, there’s a direct correlation between the level of increase expected and respondents’ desire to use multiple suppliers.

But why’s that the case?  Why is the idea of the one-stop-shop apparently falling on so many deaf ears? 

Part of the answer lies in habit: this is just what clients have always tended to do, and there’s clearly not enough of an incentive to change.  Part lies in skills: clients in every area of the consulting industry think that planning/design, and implementation require different types of people and, because these people have different backgrounds and experience, and because they gravitate towards working with like-minded people, like oil and water, they rarely mix.  But the other factor that’s driving a wedge though the whole idea of client loyalty is price.  Clients want different price points for different services and they think that firms that offer multiple services will cross-subsidise one with the other.  In other words, you can’t (in clients’ eyes) have two price points within a single business model.