Pallab Roy, Director - Strategy & Operations, Deloitte
Consultants and trusted advisors in India are dotted throughout ancient history (Chanakya, the royal advisor of Chandragupta Maurya helped establish the Maurya empire around 300 BCE), mythology (Lord Krishna’s advice helped the Pandavas win the Mahabharata War against the Kauravas) as well as medieval and modern India. However consulting firms arrived a bit delayed in post modern India, only by the early 90’s, synced with the cue of the economy. Since then consulting firms have enjoyed growth over the last two and half decades as the economy has further developed.
The Indian market for consulting is extremely attractive over the longer term which is evident from the sheer presence of consulting firms in India. Today you have well established presence of the strategy firms (McKinsey, BCG, Bain, AT Kearney); the Big Four's (Deloitte, PWC, EY and KPMG), consulting arms of technology players (Accenture, Capgemini and IBM), credible newcomers like Oliver Wyman and Rolland Bergeras well asa number of boutiques and freelancers addressing the niches. As if this wasn’t enough, there are a host of other firms who have set up advisory arms such as Indian IT companies, outsourcing providers as well as analytics and product companies adding to the competitive intensity.
Consulting firms in India have constantly improvised and done distinctly different things over the last two decades which has contributed both to their growth and evolution. Classically consulting firms have mostly been advisory orientated while leaving implementation to clients. However, this has been steadily changing and the trends of this decade will further push consulting firms very hard to transform to the next level of evolution-embracing the paradox of the ‘&’ in having to engage seamlessly in drawing (advisory) as well as doing (implementation to deliver outcomes).
There are three key trends that are likely to shape further adoption of this paradox:
• Premium for Outcomes rather than Ideas
• Democratization of Knowledge
• Asset based consulting leveraging embedded Analytics and Open Talent Networks
Premium for Outcomes rather than Ideas
Indian clients have culturally always been distinct from their western counterparts, in their explicit preference for outcomes rather than the value attributed for methodology. However, it was always difficult for clients to judge a consultant’s performance in advance or after a project because so many external factors influence the outcome. As a result clients historically have been relying on brand, reputation and social proof for engaging consultants.
However this is changing rapidly with newer companies buying consulting services, sales cycles getting longer and loyalty from clients diminishing and competition getting tougher. It is increasingly becoming more about supporting clients in achieving tangible outcomes through implementation than just pure recommendations.
Consulting firms now have to work harder to keep clients happy and while the 90s was about ideas and insights, the last decade has evolved to much more about insights and implementation.
Democratization of Knowledge
Most of the work that consulting firms undertook towards the end of the last decade and at the beginning of the current was transformational in nature given the state of the economy. This required consulting firms working along with client teams through the implementation cycle and injecting capability to ensure success of the initiative beyond the duration of the engagement. This resulted in capability building at the clients and translation of knowledge and methods over time.
Also there have been some significant consolidations in the consulting industry at the beginning of this decade - Monitor merged with Deloitte and Booz merged with PwC to name a few.
Combine this with the fact that many clients have hired small armies of former consultants for internal strategy and management functions has resulted in increased sophistication of engaging with consulting firms. Clients are now unbundling scope, defining what can be done in-house and channelling work to a number of firms with the most relevant expertise, capability and commercials. While this may have helped clients extract better value out of engagements, this democratization of knowledge has resulted in increased modularization of capability within the consulting industry.
Asset based consulting leveraging embedded Analytics and Open Talent Networks
In this decade we continue to witness digital transformation across the value chain of almost every conceivable industry enabled by technologies like SMAC, BigData, IoT, AI and the likes. Modularization discussed earlier along with this digital disruption will force consulting firms to move to asset based consulting. Asset based consulting is the packaging of ideas, processes, frameworks, embedded analytics and other intellectual property leveraging artificial intelligence algorithms.
Asset based consulting will put far greater emphasis on the competence of the consulting teams deployed to come up with radical designs, sustain the change with incredible speed as well as secure value delivery guaranteed through outcome based pricing. Consulting firms may have to embrace a much more open approach to talent - globally integrated within the firm or beyond the firm by developing open talent networks. The brand of the firm will uphold the exacting criteria for quality and professionalism.
This new world order in consulting could provide clearer RoI to clients on projects while helping the firm stay “top of mind” between engagements and generate leads for the future.
In Conclusion – Embrace ‘Draw & Do’ to sustain growth
Going by the history of the last two and half decades; evolution has been the cornerstone of growth for consulting firms in India. Fully embracing ‘Draw & Do’ is the next logical phase of evolution for consulting firms in India to continue to remain relevant in the future.
As a final thought, below are some of the key attributes that consulting firms should consider to manage this evolution:
• True partnering capabilities aligned with client’s objectives through outcome based revenue models.
• Ability to create the most pragmatic designs, sustain the change with incredible speed as well as secure value delivery through implementation.
• Collaborative and dynamic firm culture to leverage enhanced data visualization, embedded analytics and globally integrated talent with access to open talent networks.
• Smarter and cost effective ways of delivering service through the use of asset-based consulting.
• Constant focus on innovation to create new services that will contribute 20% or more revenues in the future.
Consulting firms who are able to navigate this evolution, either organically or in-organically, stand to benefit immensely as the next chapter in India’s growth story unfolds.