Consultants - More bang for your Buck
Date: 05-06-2008
Source: National Business Review
Companies and governments around the world are spending more and more on management consultants. But are they getting what they want and what is the local experience?
Recent global research commissioned by Ernst & Young on the merits and virtuosity of management consultants offers a compelling yet bittersweet message for consultants and clients, depending on where you sit.
Pollster Ipsos MORI last year interviewed 456 people within a wide range of large companies in the US, UK, France, Germany and Italy that had recently commissioned projects or who had worked on projects with a management consultancy firm. The responses indicated that businesses and government departments around the world are spending unprecedented amounts on management consultants. But most of them feel that they see little or no benefit for their investment.
Businesses and governments worldwide conservatively spend about US$150 billion a year on consultancy - an increase of 1000 percent in just 10 years. The US is the world's largest market, followed by the UK where businesses and institutions spend around 12 billion annually on external advisors. The increased spending on consultancy has been driven by the challenges of globalisation, mergers and acquisitions, and especially by increasing investment in IT, systems integration, and disruptive technologies arising from the increasing use of the internet.
So the research clearly shows that clients are spending as never before, but also they are far from happy, leading to the unpalatable conclusion that consultants are failing their clients.
The survey also found there is surprisingly little trust between clients and their consultants - 40% would not describe the consultants they used as trustworthy. More than half (53%) thought that the work that had been delivered had neither effectively, nor very effectively, improved the performance of their business.
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