Do Forbes’ consulting firm rankings actually help anyone?
Friday 20th Apr, 2018
By Alison Huntington.
Earlier this week, Forbes, in partnership with Statista, published its top management consulting firms in the US. As with similar studies in the Financial Times in the UK, or Capital in France, it’s based on a survey of both senior executives in industry and management consultants themselves, and covers 32 sectors and functional areas. The top-ranked firms are the ones with the highest number of recommendations across different categories. The big firms dominate, with Bain & Company and Deloitte topping the ranking with nominations in all 32 categories. In total, 229 firms make the list of top firms.
Gauging clients’ opinions about consulting firms is difficult—we know this because we run a global research programme every year that looks into precisely the same thing. While the Forbes study gains something in having a straightforward methodology, it seems worth revisiting some of the concerns we’ve voiced previously:
So, while I’m sure the Forbes winners are delighted to have their hard work publicly recognised, we don’t think this study helps clients to see the wood for the trees. Even if they only consider the ‘top’ firms in this study, there’s still 229 to choose from.
It also doesn’t help firms to understand the impact of their brand. Does a nomination in every category tell Bain & Company or Deloitte anything useful? We see some parallels in our own study—clients in the US see convergence between firms when it comes to the quality of work they deliver—but it tells a firm nothing about whether a firm can knit all these capabilities together for a seamless client experience. Nor does it say what a firm is like to work with day-to-day, or if their endeavours actually add value to the client.
In fact, the study suggests a buying behaviour that we’re hearing is very rare these days, particularly in the US. Rather than entrusting all their work to one provider, clients are buying in smaller chunks, and keeping every phase of a project or programme highly competitive. Winning phase one doesn’t mean you win phase two. So it seems unlikely that, even if clients do recommend a firm for everything, any would actually buy all their consulting requirements from just one provider.
Lastly, Forbes says that, “There is one fundamental reason that the 229 ranked management consulting firms all find themselves on this year’s list: They embrace change.” I don’t think this is true. I think some do, indeed, embrace change. But a substantial proportion of the 229 firms on this list are reacting to change that is foisted upon them, rather than actively embracing it. Whether you pick the adoption of new technologies, the way client relationships are managed, or diversity of talent, the consulting industry (and indeed, much of the professional services industry) is lagging behind many of its clients in other sectors. Change is certainly good business for consultants, so to that extent they do, of course, embrace it. But we increasingly hear clients saying they want their consultants to practice what they preach, and in that respect, in many firms, there’s work to do.
For a deeper look at clients’ perceptions of consulting firms, our report, Perceptions of consulting in the US, will be published in full this month.