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Five things to know about your competitors
Crises have, historically, often led to seismic shifts in the competitive landscape of consulting. As we hurtle towards the one-year anniversary of the beginning of the pandemic, it’s worth stepping back and taking stock of how, exactly, this particular crisis has changed the rules of the game for consulting firms. In our view, there are five key trends that your firm needs to have on its horizon right now—because if you’re not keeping abreast of these trends, your competitors certainly are.
New sources of data: Almost every piece of research we’ve done since the summer has highlighted the extent to which clients are starved of robust data. The crisis has changed the dynamics of every market, and the behaviour of every customer segment. The value of existing models that rely on historic data to predict the future is now questionable at best. Consulting firms have an opportunity to use the data they’ve gathered and analysed since the start of the pandemic to open doors that were previously shut to them; your competitors may well be looking at your existing clients and trying to figure out what kind of data offering it would take to peel them away.
Agility—the ability to combine expertise with flexibility: For as long as there have been consultants, clients have been forced to choose between the two things they want most: depth of expertise, and organisational fluidity. Specialists who tend to be sought after are so often unavailable; generalists are two a penny but may not be able to help. In a time of crisis, specialist expertise becomes more important than ever—but so too does the ability to get that expertise to where it’s needed as quickly and as efficiently as possible. When we call an engineer because our heating has broken, we don’t just want someone who can fix it; we want them to fix it now. You might have built your business on specialist capabilities, but that alone won’t be good enough moving forward. If there’s a competitor out there who can match you for expertise, but also has a demonstrated track record of deploying that expertise in client engagements in a more agile and nimble way, then you’re likely to lose market share.
The innovative use of technology: While clients’ priorities have shifted since the start of the pandemic towards the more fundamental attributes of consulting firms—responsiveness, the ability to deliver results, and so on—a firm’s ability to innovate remains as important as ever. What’s more, our research suggests that the extent to which a firm is seen as innovative—and viewed more positively in general—now largely depends on its use of technology during the crisis. One of your rivals may have stolen a march on you because of the way they’ve leveraged technology; even worse, you may be facing unexpected competition from new players who’ve emerged out of the technology space.
Speed of delivery: Twenty years ago, the rise and (often) rapid implosion of early web-based businesses forced strategy consultants to deliver in weeks the type of work that would previously have taken months or even, in some cases, years. More recently, the threat of disruption in client industries has forced further acceleration. And now of course the pandemic has exacerbated that trend. Part of the motivation is price reduction—in the professional services world, a short project is usually a cheaper one, after all—but that isn’t the whole story. In a world in which the economic and legal landscape can change overnight, clients need the ability to act faster than ever. If a client asked you how you could deliver a given project more quickly than one of your immediate competitors, what would you say?
Measurable value: “Value” is a complex concept in consulting, but at its core it means helping clients do something they wouldn’t be able to do on their own. Perhaps you have a better solution than anything your clients could design if left to their own devices, or perhaps you can deliver the same solution more quickly. We’ve talked before on this blog about the five dimensions of value in consulting, but regardless of how you create value for your clients, the crucial thing is that you know how to articulate and quantify it. Indeed, a lot of our research suggests that even this process of articulation is itself greatly appreciated by clients. As your firm assesses how the competitive landscape has changed, it would be worth paying close attention to how your competitors are talking about value.