Are Management Consulting firms still relevant?

In a recent article published in the Financial Times, Henry Mance writes about Mariana Mazzucato’s new book “The Big Con”. While the article's title is “The McKinseys and the Deloittes have no expertise in the areas that they’re advising in”, the article is not really discussing management firms' capability to add value as much as discussing the idea of big government, its role as a motor for economy and state action. But this is not really where I would like to take the discussion here. 

The article quote from the book: “The reality has long been more complex. What do these outsiders — strategy consultants, such as the ‘Big Three’ of McKinsey, Bain and Boston Consulting Group — really know? Critics say their ideas are often ones that the hiring organization has already thought of. There are some complete disasters, such as McKinsey’s work promoting opioids. Yet consultants, supposedly brought in for short projects, never seem to leave”. Also the article says: “Consultancies and outsourcers, Mazzucato argues, know less than they claim, cost more than they seem to, and — over the long term — prevent the public sector developing in-house capabilities.”

As a practicing management consultant who has delivered more than 250 client’s engagements in the last 25 years and still, the above statements didn’t get me surprised as I know very well the good, the bad and the ugly about the industry.  Also, I can tell you stories about success and stories about when things got wrong. Stories where management consultants really turned around a company and positioned it for success and other stories in which management consultants ruined a company or hindered its growth while charging ridiculous amounts of money. 

But what I really would like to discuss here is not the author’s argument about how hiring management consultants is weakening the government entities nor defending my industry against some bad actors or seeking justification for some failure stories. What I would like to present here to the reader is a quick summary on what management consultants can bring to their clients’ organization as value. 

Management consultants, across all areas of specialty or industry focus, can bring significant value to their clients' organization in a number of ways, including:

Expertise: Management consultants are typically subject matter experts in their field, and they bring deep knowledge and expertise to their clients' organizations. They can offer insights, best practices, and proven methodologies that may not be available in-house. Moreover, after serving many clients in different industries, they will be able to identify cross-industry best practices to pass from one sector to another. 

Objectivity: Management consultants are independent third parties who can provide an objective view of an organization's operations and strategy. They can identify areas for improvement and provide unbiased recommendations without being influenced by internal politics or biases. This is why in many cases, leadership or board members would like to bring management consultants to look into a certain situation and recommend solutions. 

Efficiency: Management consultants can help organizations streamline their operations and improve their efficiency. They can identify bottlenecks and inefficiencies and offer solutions to eliminate them, ultimately helping the organization save time and resources. Moreover, they can recommend tools and methodologies that can be used by the organization for continuous improvement of their internal work practices. 

Innovation: Management consultants can bring fresh ideas and innovative approaches to an organization. They can offer new perspectives on existing problems and identify opportunities for growth and development that may not have been considered before. Not only that, but more passionate management consultants can also provoke the client organization to think in a different way by showing them possibilities and opportunities that they have not considered before to solve their problems.  

Implementation: Management consultants can help organizations implement new strategies and initiatives successfully. They can provide guidance and support throughout the implementation process, ensuring that the organization achieves its goals and realizes the full value of the initiative.

Knowledge Transfer: Management consultants can share their expertise and knowledge with the client organization by providing training and coaching sessions to staff members. Management consultants can help build the internal capacity of their client organization by taking a collaborative approach that empowers the organization to take ownership of its own improvement initiatives.

Overall, management consultants can bring significant value to their clients' organizations by providing expertise, objectivity, efficiency, innovation, and support throughout the implementation process. Obviously, the client organization should be able to choose the right consultant that matches their needs, industry practice and culture. I have some ideas on that, which I will keep for my next article.