Strategy consulting

By Fiona Czerniawska.

How much do you have to discount your consulting fee rates for if you want to have an impact on buying behaviour? 5%? 10%? 20%?

Research we carried out five years ago suggested that small price cuts make no difference, except perhaps to the procurement manager who has the lonely and thankless task of demanding a price reduction just at the point when they’re going to sign the contract. Five-percent is neither here nor there to most end-users of consulting services, because their purchase decisions are based on other, more important factors. How credible is the firm they’ve chosen in this particular area? What’s its depth of expertise, or its track record of success? What’s the client-consultant chemistry like? Can they all work together in practice?

By Fiona Czerniawska.

Walk down the main street in Noto, in south-eastern Sicily, and you’d be forgiven for thinking you’re in one of the Baroque capitals of Europe, not a relatively modest city of just 24,000 people. Ornate façades, studded with balconies, line the sides of the street; wide steps sweep up to the cathedral doors. But turn any corner and you start to realise that it’s more like a film set, an architectural veneer in front of unremarkable streets.

There’s always a risk in taking a metaphor and stretching it too far, but I do think there’s a parallel here with strategy consulting, about which we’ve just published a new report. Strategy is the baroque jewel of the consulting industry, consulting at its most complex and decorative, where utility is sometimes overwhelmed by the desire to put just one more flourish in your PowerPoint deck. By comparison, operational improvement work is a sturdy Romanesque style, and technology consulting positively Bauhaus. But, our report argues, behind the glorious edifices of strategy consulting, the reality is increasingly Noto-like.

By Fiona Czerniawska.

… But he’s not your everyday, brain-on-a-stick strategy consultant. No, he feels real empathy for the difficult situations in which clients find themselves, and is genuinely sad that they don’t have an expensive fountain pen like his. Which is why he’s finding his conversation with Carl so distressing.

Carl is a client. He’s got two decades of senior management experience under his belt, and he really couldn’t care two hoots about Martin’s fountain pen. No, he’s talking to Martin, because Martin and his team have been carrying out a refresh of Carl’s corporate strategy. Of course, they haven’t been doing that by themselves: As someone who’s used almost every major consulting firm under the sun, Carl is aware of the importance of working closely with the consulting firm. Martin calls this co-creation, but Carl simply wants to ensure that his staff pick up the skills and knowledge they need to help them do strategy work in the future. Carl is also not a fan of management speak.

“… so, this could be ground-breaking collaboration,” Martin is saying.

“Great.” Carl finds Martin faintly amusing and doesn’t want to hurt his feelings. He does, however, want to interrupt Martin’s smooth and apparently unending monologue by asking an important question. “But I’d also like to talk about how we measure the value you add.”