By Sthitaprajnya Panigrahi
Consulting industry play a dynamic role in helping businesses across fields pertaining to business strategy, sales and marketing, manufacturing and supply chain, and human resources. Supporting their clients in a multitude of ways, starting from assisting them to articulate business models, reduce costs, forecast risk and revolutionize products, to solidification of their processes for talent supervision, staying acquiescent and staff recruitment. Management Consulting Industry has been proactively helping clients to stay ahead of the curve when adopting digital technologies across the rapidly shifting geopolitical situations. However there exist some business challenges for consulting companies that often hinder their path in providing seamless solutions.
Some of the top challenges for consulting firms that are frequent at the global level are mentioned below.
Changing Client Behaviour
The buyers of corporate professional services have become more demanding. They are not agreeing with concepts such as billable working hours, fixed fees and with transparency on costs. Amidst the agile environment the market has been becoming intensified by rapid digital innovation, clients now expect greater value, advanced quality of work, and a quicker delivery of solutions and services, along with transparency and accountability in work delivered. This particular shift in behaviour rises from the financial crisis, when companies were compelled to radically reduce their external consulting spend and are now monitoring the work of consultants with greater interest than ever before.
Clients are not only looking around for premium consulting services but are demanding greater value and flexibility at lower prices. This has highly affected many consulting firms, forcing the consulting executives to restructure their own business models accordingly. Since the considered price pressure is rising with each passing day, reaping profits has become a major concern for consulting firms. Most of the consulting firms have recently revealed that they are facing issues in complying with the client’s demands for more effective services at lower price value.
Unpredictability of Industry
These are tempestuous times, unpredictability in the marketplace has emerged as a top business challenge for management consulting firms for many years now. The consulting marketplace is developing quickly. Shifting its form from one that depend mostly on interpersonal contact to develop new business to an open online field, the consultancy industry has become highly unpredictable. Amidst the swift business development changes, the whole landscape of consultancy is rapidly evolving too, with a strong demand for more prolific services.
Consulting firms often have to handle a massive volume of client information and most of them are confidential. Starting from strategic information such as mergers & acquisitions to commercial engagements along with some personal data, all these information can bring high risks to the client if exposed. Since such high-value information can be very destructive if it falls into the wrong hands hacking and data breaching can bring particularly serious threat to consultancies. Numerous consultancies have already suffered the consequences for failing to comply with the client confidentiality. As a result of which, they not only had to pay a huge sum of money as fines but also lost the both current as well as future contracts.