To provide motivation to their consultants, 66% of senior executives said they are pressing consultants to complete projects in shorter time frames and 68% suggest management consultants be held legally responsible for their advice and actions, according to Celerant Consultng’s Management Consulting in the USA 2003 survey.
The shift in the consulting marketplace has been felt across the industry with an average decline of 6% – 8% in annual revenues for firms as a whole for year 2002 and as senior management is seeing less from their consultants. Only 40% rate the consulting projects they engaged in the past two years as being “very” or “extremely” successful in their rollout. Yet many top brass want to see results in a shorter time frame. “I expect a consulting engagement to deliver payback within two quarters,” said one executive.
Much of the problem may be in how contracts are drawn up; only 15% said they currently build success-based remuneration into their contracts with consultants and 85% are still on a traditional fixed-fee arrangement . As such, 40% of those polled see a paradigm shift in demand from strategy consulting to implementation consulting – from consulting that helps determine what the company should do towards consulting that does what it determined it should do.
Despite a seemingly flawed system for consultants to produce on project delivery, the most difficult part of this process cited to overcome was the implementation phase, with just under half (48%) of respondents indicating this to be the case. Of the issues that were cited as being a hurdle to the implementation phase of a consulting project, the primary reasons included:
- 51% – lack of support from staff
- 50% – problems with engagement of the project by management
- 45% – a discrepancy between theory and putting recommendations into practice.
The survey canvassed 200 US companies that hired consultants within the past five years and have annual revenues in excess of $500 million and more than 500 employees. More information is available at www.celerantconsulting.com .