Management consulting isn’t working. Here are 6 ways to do it better.

January 11, 2016 Robin Camarote

Bloomberg Government regularly publishes insights, opinion and best practices from our community of senior leaders and decision-makers. This column is written by consultant Robin Camarote, part of her series exploring changes to the management consulting business model.

As we discussed in the two previous pieces in this series, federal management consulting is ripe for disruption and the industry’s current business model is too fragile to flex and meet the government’s needs. So now what?

There are two ways to go: fight or flight. We either abandon the business (…probably not) or we see disruption as a call to change. I am up for the fight. This disruption presents a tremendous opportunity to morph into a client-centered consulting model.

It’s a win for our government clients and a win for consultants in securing a more viable future business — a win-win.

So if you accept the glass half-full perspective, there are actually two opportunities to be had. The first is a space for new firms to form, hire staff with elusive skills and create faster, more effective approaches to solving management problems. The second is an open door through which current firms move toward a more lasting, sustainable business. There is plenty of room for both. This is a prime chance to preserve government’s access to smart, dynamic problem-solvers, and it comes precisely at a time when tight budgets and big problems demand everyone’s most innovative thinking.

Government clients buy two things when they procure consulting services—people and focused attention. All acquisition decisions can be boiled down to a federal buyer trying to secure these two fundamental elements to solve their problem. With this in mind, the foundation of the client-centered consulting model is delivering access to the right people with a commitment to focus on the problem at hand.

Note that the responsibility to implement any of these fixes falls to the consulting industry, not the government. Of course, many people would accurately and fairly point out that there are a number of things the government can and should do to get more value for their consulting dollars. True. So, so true. However, I believe that change starts from within and consultants themselves are, in fact, in the best position to take the first step. By making real changes to the way our business is done (not just updating our vision statements), we might generate the energy and momentum needed to spark changes on the government side, as well. But let’s not hold our breath and wait for anyone else to fix our business.

Here are six things that would enable consulting firms to harness the wave of disruptive forces instead of being swept up and pulled under.

1. Move to decentralized, collaborative teams. Similar to the direction other creative industries are headed, consulting firms in the future should include an account coordinator, a miniscule leadership team and a network of hands-on consulting teams. As retired General Stanley McChrystal writes in his book “Team of Teams,” “It’s no secret that in any field, small teams have many advantages—they can respond quickly, communicate freely and make decisions without layers of bureaucracy.” Sometimes that will come from teams within consulting firms, and sometimes that will lead to…

2. Dramatically expand strategic partnerships. Consulting firms need to expand collaboration both inside and outside their own businesses. Internally, consultants should look at models like IDEO, which has created a culture of collaborative help, where co-workers freely “share perspective, experience and expertise that improve the quality and execution of ideas,” according to a HBR piece. These collaborations produce better outcomes for customers and provide a more attractive working environment for top talent. As Millennials, especially, drive us toward a “gig” culture, consultants also need to look outside their own firms to create creative collaborations with experts in multiple disciplines (including big data) to bring together the best team possible to solve a client’s problem. This will mean partnering with freelance consultants, other firms or experts from outside the consulting industry.

3. Implement dramatically smaller projects. Bring the average management consulting contract duration down from nine months to two weeks. Borrowing from the practices of Agile Project Management, consultants need to break giant projects down into smaller, more manageable chunks. By escaping the multi-month, multi-pronged approach, both consultants and federal program managers are able to free themselves (both their intellect and their calendar) to intensely focus on each problem at hand. The end result is more innovative solutions, reached faster and increased satisfaction from all parties. Smaller is better when you want to get something done.

4. Layer the corporate brand behind a dazzling sky of shining, individual stars.  Establish the corporate brand in the background as a uniting message behind each individual consultants’ personal brands instead of the other way around. Put aside the generic slogans and sometimes mediocre staff to focus on the talent of team members. Encourage all staff at every level to differentiate themselves through research, writing, speaking, industry group participation and whatever other creative outlet they might find. We have to accept responsibility for being the experts we say we are—and be able to prove it.

5. Start thinking of clients as partners instead of just clients. Change the focus from account building to problem solving. We’re not at risk of solving our way out of business. The nature of our world is that there is a never-ending stream of problems to solve — fixing one thing reveals another. By actually solving problems and being able to produce results, the account building will naturally follow. Being proactive partners with the clients who need our help will lead to growth.

6. Convert all consultants back into consultants. The mindset should be: consulting is the job, and solving progressively challenging client problems is the reward. Instead of: consulting is for lower-level workers, and the reward is a move into management (and out of actual consulting). Keeping that consulting talent on the front lines, also frees firms to create smaller, decentralized teams, as well as building a brand behind a sea of shining stars. By making better use of technology and collaboration tools, firms have less of a need for internal coordination, planning meetings and bureaucracy.

One more wild thing worth considering…

Let’s create a model where consultants take on more ownership of their business. More like independent contractors in a co-op, each consultant could set their own salary and target the amount of time spent on client projects. The math is straightforward. Each employee would set their salary, adding in benefits and a contribution to the company for overhead services and reinvestment. They could set this salary based on whatever clients will pay for their services. Most GSA schedules provide a framework to start from that outline the years of experience and educational requirements. In this model, advancement would mean higher rates and access to more challenging projects, keeping the best and brightest staff engaged and productive.

I’ll acknowledge my bias here but I think most people would agree—government is better with access to the value-added services of management consultants. And the good news for consultants and their investors is that there is no shortage of government problems to solve.

To address the fragile business model, consulting firms must figure out a more reliable way to deliver the promised staff in a way that delights the client and encourages the employees. And lastly, successful management consulting firms of the future will flip the trend and have consultants at all levels actively engaging with clients and leaving the internal management fluff behind.

Previous entries in this series:

Part 1 – Management consultants, prepare yourself for disruption

Part 2 – Here’s why the management consulting business model is broken

Five ways to motivate employees