By Prof. Dr .Githa Heggde, Senior Associate Dean, Welingkar Institute of Management
Prof. Dr .Githa Heggde, Senior Associate Dean, Welingkar Institute of Management
Organizations take the support of consultancy firms with the expectation that they will add value by offering a distinctive proficiency which is not easily accessible within the organization. With organizations focusing on core competencies, the need for expertise in areas such as analytical know-how innovation and swiftness of response provides a great prospect for consultancy firms to add value to their clients by way of their unique solutions. The Indian Consultancy market has grown exponentially in the last decade the period when the average income doubled owing to high economic growth up to 8 percent in the late 2000s.
The explanation for the sustained accomplishments of the consultancy industry can be analyzed through economics of the businesses involved. Organizations decide the success of their consultancy partnership on basis of financial value added minus total transaction costs. During the evolving years, the chief value addition by consultancy firms to their clients was by providing experts who were expected to provide an objective view-point on the client's tribulations and challenges.
Nowadays, the consultancy industry has evolved from not just providing experts to resolve their clients' tribulations but also to help access the consultancy firm’s vast and organized information base. As every proficient consultant knows, it is imperative to raise the right questions at the right time. Subsequent to that is the aspect of rational arrangement wherein inquiring is done to get to the root cause of the problems. Needless to say all of this encompasses excellent communication skills on part of the consultant.
The Balancing Act
The great balancing act that all consultancy firms need to uphold is their clients’ demanding lesser expenses and high returns even as the costs of talent retention are increasing fervently. In the past, a consultancy firm would share their strategy with their client and depart. Today, a consultancy firm is expected to work closely all the way all through their execution as well as facilitate the client to accomplish concrete, substantial and measurable results.
There are many consultancy firms who support themselves on tenets of efficiency and prosper on having immense platforms of codified information. But there are few but highly distinctive consultancy firms who focus on innovation and experience and have flourished on strategies of building highly competent and esteemed exceptional teams. These proficient experts have considerable sphere of influence and profound know-how.
Evolution of Consultancy in Indian Markets
The consultancy phenomenon started in India about twenty five years ago, when a prominent automobile industry entrepreneur signed on a global consultancy firm for a turnaround of his company. Ever since, the consultancy realm has blasted off with a hierarchical pyramid configuration taking shape.
In this pyramid, the top most consultancy firms have strategy and reorganizational guidance as a focal point. They have immense implicit knowledge to distinguish their services and are normally occupied with the client for small amounts of time.
The mid-tier of consultancy firms provide consulting on operations, technology and cost control. This is done by leveraging their concrete foundation of technological knowledge across frameworks. They are usually occupied with the client for a longer term.
Amongst the third category, are consultancy firms consisting of specialist firms that provide particular solutions to their clients. These would be niche firms in specific industry/sectors or in functional domains, for instance innovation.
In Indian industry, there has been a rising significance of top-end consulting with respect to strategy, advancement of higher segmentation in the marketplace and most importantly focal point being on the substantial and measurable results of the projects undertaken.
Industry-Academia Interface in Consultancy
The academic involvement in consultancy is still in a nascent stage in India. The academic institutions have a large scope to play a part in the consultancy industry by collaborating with both the consultancy companies and also taking up direct consultancy assignment with the end company.
The academia participation in consultancy has to be strengthened by all stakeholders. This can be done by faculty at management institutions equipping and updating themselves constantly on business trends and analyzing impacts. The consultancy companies using intellectual capital, the corporate connect and student resources from academia and the companies that are looking for consultancy support also considering the academic perspective. As one of the leading companies in India commented, “We would like to approach the academia to validate the research findings and report from a leading consultancy firm that we engaged. It is likely that an academic consultancy report will be less biased”.