Here's a look at the different types of consulting firms out there:
Strategy Consulting
Working with a client’s senior management, strategy consultants help create and develop a company’s strategy and long-term plans. But more than just pointing figures in identifying strategic problems, strategy consulting firms aim to provide practical and cost effective solutions that can generate bottom-line results and improve a client’s competitiveness. But once the problem is identified, strategy consultancies don’t just take the money and run, they also assist in the implementation of their suggestions.
Depending on the industry and the client’s shortcomings, strategy consultants can find themselves working on a range of different projects. These could be anything from analysing why an online retailer is losing market share to helping a fizzy drinks manufacturer rebrand and price its products for a new market. Leading strategy consultancies, such as Boston Consulting Group, Bain & Company, Roland Berger may evaluate a company’s value and potential acquirers or assist a brand in staying abreast of changes in consumer spending.
Operations Consulting
If a strategy consultant’s remit is to set a firm’s long-term goals, an operations consultant is charged with making sure those targets are met. Evaluating the inner workings of its clients, operation consultancies will fine tune operations to enhance the overall efficiency of a company.
Beginning by examining the workflow structure of a business, operation consultants will then go on to look at areas such as production processes, distribution, order fulfilment and customer service. At a more granular level, the investigation could cover anything from a client’s resource allocation to its customer service response times.
Due to the intrinsic link between strategy and operation consulting, the majority of the major firms now offer their clients both services. Sitting at the top of the operations’ tree are Accenture, Capgemini and Deloitte.
Information Technology Consulting
Information technology consulting has more than its fair share of alternative names. It can be known as IT advisory, computer consulting, technology consulting, business technology services, or the much simpler IT consulting. But no matter the designation, IT consultants advise their clients how best to leverage information technology in their company. So it’s computers basically? Well, not quite…
In addition to providing advice to clients on how best to use IT at their firm, IT consultancies design customer software, provide network solutions, test current systems for efficiency, etc. etc. In summary, IT consultancies do the whole shebang; they advise, estimate, manage, implement, deploy and administer IT systems on a client’s behalf.
More specifically, IT consultants may test an organisation’s vulnerability to hackers – an increasingly pertinent issue with the advent of subversive hacker groups over the last few years – troubleshoot a firm’s software installation, or oversee a company’s upgrade to the latest version of Microsoft Office. The industry’s most prominent players include Accenture, Computer Sciences Corporation (CSC) and Electronic Data Systems (EDS).
Human Resources Consulting
‘A company is only as good as its people.’ It’s the belief in this adage that has led to the emergence of human resources consulting. By investing in its people, organisations aim to maximise the value of its employees and place the right people with the right skills in the right roles. Human resource consultants can help its clients to do just this.
Also known as organisational development or change management, human resource consulting is concerned with:
- Human capital – including remuneration, talent acquisition and management
- Health and benefits – e.g. optimising health plans, restructuring benefits packages
- Mergers and acquisitions – examining cross company cultural fit, transaction costs, etc.
- Communication – such as employee satisfaction and engagement
- Retirement
- Outsourcing
Human resource consultancies also offer the services of their actuaries. An actuary is a number cruncher who applies their skills in maths and statistics to create theoretical models to increase an organisation’s efficiency. In addition to economical and mathematical awareness, actuarial consultants have to pass a number of certification exams every so often to remain eligible to ply their trade. Some of HR’s most eminent firms include Towers Perrin and Mercer Human Resources Consulting.
Boutique Consulting Firms
There are a number of fallacies floating around about boutique consulting. The first is in regards to the firms’ size. A boutique consultancy is not labelled a boutique on the basis of its size; it is determined to be boutique because of its specific area (or areas) of focus. For instance, a consultancy would be considered to be boutique if it focussed on M&A and business strategy. To be clear, a firm’s designation as boutique isn’t a reflection of its size or prestige. That said, a lot of boutiques are at the lower end of the personnel scale. Boutique consulting firms will normally range from 200 or so employees right down to a single consultant.
Aside from their area or industry-specific expertise, boutique firms remain an attractive choice for prospective clients due to their prices. The benefits of being relatively small include lower overheads and less extra ‘capacity’ (i.e. consultants). Some of the largest of this esoteric bunch are L.E.K. Consulting, revered amongst its peers for its M&A practice, and OC&C, a leader in European private equity.
Some of the work undertaken by boutique firms might include establishing value metrics for a retailer, structuring the privatisation of utilities, assisting in establishing a new supplier or restructuring an organisation to avoid insolvency. And if you’re able to find a boutique that operates in an area or industry you particularly enjoy, you may well find yourself doing the type of work you always dreamt of doing during your working hours!
Internal Consulting Firms
Hiring a consulting firm doesn’t come cheap. Recognising that a consultant’s billing rates far exceed internal salaries, some organisations have set up what are essentially subsidiary offshoots to supply a third party perspective. Although providing the same outsider view as an external consultant would, the consultant is paid on a comparatively lower corporate pay scale.
Reporting to a central consulting division, internal consultants assist on areas such as corporate strategy, business development and project management. An internal consultant will perform similar tasks to an external consultant, with the difference being that they’re permanently working for the same client. Among the pros are less travelling and less face time pressures, with the cons being a lack of exposure to different industries and lower remuneration than at a consulting firm. These positions are also few and far between, especially for new graduates. Instead, internal consultancies tend to hire high achievers from within or more experienced professionals from other firms. Some firms that have taken their consulting in-house include American Express Strategic Planning Group and JPMorgan Internal Consulting Services.
