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New Trends in Consulting

Advice2
(@Advice2)
Estimable Member

What new trends do you see in the consulting field? How will technology help the industry? How will outsourcing impact the competitive environment?

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Topic starter Posted : 16/01/2008 12:28 pm
Ace
 Ace
(@Ace)
Estimable Member

Re: New Trends in Consulting

I think that working yourself out of a job is a big trend in other words making sure that when you take on a consulting assignment you make it clear to the small employer that you will provide them with the tools and the knowledge to do the job after you leave

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Posted : 23/01/2008 12:14 pm
newt
 newt
(@newt)
Trusted Member

Re: New Trends in Consulting

I think a big opportunity is going to develop a "customized' solution to small businesses at a reasonable cost - something that will be a constant challenge

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Posted : 25/01/2008 1:12 pm
Dgrowth
(@Dgrowth)
Estimable Member

Re: New Trends in Consulting

newt;33487 wrote: I think a big opportunity is going to develop a "customized' solution to small businesses at a reasonable cost - something that will be a constant challenge

I think a lot of people talk about this but it is very elusive because unfortunately small businesses see and want the same things that big businesses do and it is very difficult to deliver profitably without delivering a solution in a box

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Posted : 28/01/2008 1:07 pm
stevewalter
(@stevewalter)
Eminent Member

Re: New Trends in Consulting

Latest Trends in Consulting

Recently the consulting industry has been getting a whole new look. With cost cutting and new competitive strategy, most companies have had to change their approach to consulting over the past few years.

The same forces impelling organizations to turn to consultants in the first place, such as the proliferation of company-wide software applications, globalization and the bewildering rate of technological innovation, have now led the industry to refashion itself in ways that have important ramifications for client companies.

One thing is for certain -consultants aren't going away, but they will look and behave differently. Client companies will have to reacquaint themselves with this new version if they want to get the most out of their consulting relationships. Here are the major trends taking place in the consulting industry and what they mean for client organizations

Fast Growth

The business world is desperate for consulting help. With excess staff being cut down, most organizations lack the technical, strategic and project management skills to handle the benumbing rate of technological and market change. Happy to oblige, the consulting industry is trying its best to accommodate the demand. Big consulting firms are inhaling new employees, gulping up smaller firms and merging with peers. Small firms, or "boutiques," are sprouting up everywhere. The consulting industry in general is growing fast — about 20 percent per year. In particular, the IT consulting sector, which is growing at 30 percent annually, is a major driver behind the increase.

Why is the growth in the industry significant for companies? The good news is that with so many consulting firms competing for clients, the firms will be forced to continually improve their offerings to differentiate themselves. The bad news is that, increased competition notwithstanding, high demand will drive up prices. In the past we have seen that another negative side-effect of the growth of the consulting industry was increased conflict between the consulting and auditing arms of the former ‘Big Five’ (Andersen Worldwide, comprising Andersen Consulting and Arthur Andersen, KPMG Peat Marwick LLP, Ernst & Young LLP, Deloitte & Touche LLP and PricewaterhouseCoopers). Earlier these firms had been centered on their auditing practices. But as client companies shifted their focus from cost cutting and reengineering to growth, auditing became a commodity. The only way auditing practices could compete was by lowering their prices. Conversely, consulting practices at these firms became huge profit centers with unlimited growth possibilities. Consultants started to resent sharing their enormous profits with the bean counters, and the auditors didn't want to let go of the golden cow they helped create. This trend was seen in action with the vitriolic split between Arthur Andersen and Andersen Consulting.

One stop for all your solutions

In addition to a boom in the number of consulting firms, the size of individual firms is growing in response to another industry trend: one-stop shopping. Consulting providers are broadening their skill sets and geographic reach to try to fill their clients' every need. Since a single application can involve many different types of technologies and extend across the globe, it makes good business sense to have all major competencies in-house. The natural tendency, therefore, will be for providers to swell to gigantic proportions as they merge with or buy other firms that can expand their skills base. Providers that can't compete on size will still try to offer one-stop shopping by outsourcing a chunk of a client's project to another firm while maintaining responsibility for the overall project.

Another advantage offered by huge, diverse firms is that clients get the brainpower of thousands of smart people. Knowledge management tools, best practices databases and the Internet make it possible for consultants to draw upon the knowledge of every consultant in the organization—as many as 27,000 people in a firm like PriceWaterHouseCoopers, for example. Large firms also invest huge amounts of money in research and development.

But there are also downsides to this Sam's Clubbing of consulting firms. No firm can do everything well. Moreover, relying on a single provider makes clients vulnerable to mediocre service. If a firm feels confident it has a customer in its pocket, it may become complacent and cease to offer the best effort and price. And by not checking who else is out there, clients may not get the best experts for their problem.

The smaller firms

While bigger firms are facing several problems of their own, countless smaller ones are quietly joining the fray. They follow a different strategy—being the very best at a narrow competency. Today those small firms are being taken more seriously and are getting business. Indeed, while large providers are enjoying 10 percent to 25 percent growth per year, established ‘boutiques’ are growing at around 50 percent.

‘Boutiques’ have an advantage over giants in that they can ramp up on a new technology quickly, whereas big firms take a year or two. But choosing a small firm requires more work on the part of clients to separate the dross from the real experts. And boutiques are a riskier choice because they could get bought up tomorrow or go out of business. Finally, unless they have established relationships with other consultancies, smaller consulting companies aren't qualified to work on large, complex efforts or dispersed geographic initiatives.

The best approach thus seems to be using a combination of large and best-of-breed providers. When working on a large project, it is safer to go with a large consultancy. But when looking at smaller projects or new technologies, it may be worthwhile to put out a bid to see what else is out there. Right now, the biggest client companies have close, informal partnerships with one of a handful of mega-providers. But these companies will spend 25 percent of their service dollars with boutiques, often for highly visible projects.

New business models

Part of the appeal of boutiques is their user-friendly, hands-on business model. Client organizations have grown weary of big, impersonal firms where only junior people return their calls. They're also tired of paying time and materials for projects that drag on for years. Boutiques play to this frustration. To combat this encroachment, large firms are adopting some of the elements that make boutiques so appealing. One of their focuses will be knowledge transfer. In general, smaller firms have traditionally been better at giving one-on-one attention and helping clients learn how to do things for themselves. Large firms, on the other hand, are notorious for swooping in, fixing the problem and leaving with only a cryptic white paper report in their wake. But increasingly, even large firms are making an effort to transfer their knowledge and processes to clients so that they will be able to carry on even after the consultant leaves. Companies are also demanding alternative pricing arrangements based on fixed time and price billing. Engagements are shorter and the scope more carefully defined.

In addition, consultants are beginning to accept more of the risk of implementation. Almost every product or service you buy has 100 percent guarantees.

Shortage of people

The greatest threat to the growth of consulting firms is their inability to get enough qualified people. Since so many new consultants are needed, it could end up with more inexperienced or incompetent consultants working with clients - assuming businesses can get booked into a consulting firm's schedule at all. Some firms are already devising creative solutions such as launching their own accredited MBA programs - geared toward the specific needs of consultants. Smart people are continuing to gravitate toward the consulting profession, especially with its heightened demand and visibility, not to mention inflated salaries. True, many of these people are be freshly minted college or MBA grads, especially at the bigger firms because of their prestige and commitment to training. Small firms, on the other hand, tend to lure experienced consultants with the promise of IPOs and the chance to make a greater individual impact.

Change is the keyword

Consulting firms often need to relearn the truism that once you master a hammer, everything starts to look like a nail. The recent trend to use Six Sigma statistical process-control metrics for almost everything is just the latest example of the adaptive instincts of modern consulting. In the field of HR consulting, escalating cost pressures mean that organisations have to rethink traditional practices and encourage flexibility in their employees. They are increasingly considering short-term assignments and commuter working, away from the one-size-fits-all package. Incentive premiums and other perks are being cut back as companies look to cut the costs of placements, while increasing their number. The telecom consulting industry is also a significant channel to market with more than 60% of consultants’ recommendations being implemented by clients, and 20% to 25% of industry sales in 2001 being directly influenced by consultants.

Some of trends for the future are likely to be: in a down economy, highly successful companies will invest more in customers, not less. Companies will compete for customer share, not market share. Companies will realize customer satisfaction doesn't translate to loyalty and will stitch their customer channels together. And finally, companies will shift to a long-term focus. Only one thing is for sure – the only thing that is constant in the consulting industry – like any other industry – is change!

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Posted : 28/06/2009 9:27 am
stevewalter
(@stevewalter)
Eminent Member

Re: New Trends in Consulting

1. Help you work "on your business, not in your business!"

I know, it's an old chestnut from that fantastic book E-Myth and which forms the cornerstone to most business coaching strategies. It is the key to being able to grow any business and applies to bookkeeping as with any other part of your business.

If you employ a bookkeeper, you still have to monitor the quality of their work, when they work, when they take holidays, etc. By outsourcing all of your accounting and bookkeeping functions to a professional bookkeeper, all of your accounts duties become their responsibility and you can focus on growing your business, with the confidence that you are receiving accurate reports on your performance and meeting all statutory obligations.

2. An onsite bookkeeper gets to know your business

There are some bookkeeping services that offer to take care of your accounts from their office which could be based anywhere in Australia or as far away as India. This involves transferring source documents either electronically or physically back and forth from your office to theirs. While this can be fine for micro businesses, it can prove difficult once your business begins to grow.

Before you can provide meaningful management reports, you need to know how a business operates and what are it's key performance indicators. The only way to achieve this effectively is to get to know the company and the people who work within the company. This can only be done by performing the bookkeeping functions at the clients premises.

3. There's "bookkeepers" and then there's "bookkeepers!"

There can be a huge difference in skill level of people that call themselves bookkeepers. Just as an apprentice "chippie" and his boss with 30 years construction experience may both call themselves "builders," people representing themselves as bookkeepers can range from data entry clerks through to qualified management accountants.

A professional bookkeeping firm should be accredited in the accounting software used by your company and they should have qualified accountants to support their bookkeepers to enable them to provide a management accounting level of service.

I hope this gives you some ideas of how using a professional bookkeeper can save your business money.

Business accounting services || Accounts payable management services

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Posted : 28/06/2009 9:32 am
mikemark
(@mikemark)
Active Member

Re: New Trends in Consulting

they help us find the right way which we wants

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Posted : 23/09/2009 5:07 pm
megabucks
(@megabucks)
Active Member

Re: New Trends in Consulting

Thanks to everyone. I have found the information you are dishing out valuable to my business.

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Posted : 23/09/2009 5:45 pm
grace12
(@grace12)
New Member

Re: New Trends in Consulting

Great post.:D

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Posted : 17/11/2009 6:53 am
benton672
(@benton672)
Eminent Member

Re: New Trends in Consulting

Smart people are continuing to gravitate toward the consulting profession, especially with its heightened demand and visibility, not to mention inflated salaries. True, many of these people are be freshly minted college or MBA grads, especially at the bigger firms because of their prestige and commitment to training.
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Posted : 19/04/2011 5:30 am
aapkae
(@aapkae)
Eminent Member

Re: New Trends in Consulting

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Posted : 03/05/2011 9:32 am
benton672
(@benton672)
Eminent Member

Re: New Trends in Consulting

Consultants started to resent sharing their enormous profits with the bean counters, and the auditors didn't want to let go of the golden cow they helped create. This trend was seen in action with the vitriolic split between Arthur Andersen and Andersen Consulting.
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Posted : 07/05/2011 9:28 am
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