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Has the consulting industry hit a value ceiling?
Value. It’s something that every consultant worth their salt talks about, but relatively few manage to convince their clients that they actually deliver it.
The results of our annual survey of consulting clients’ views are in, and it seems that perceptions about value are stalling. There are changes since last year: The top- and bottom-rated firms are different, and where each firm sits relative to each other has shifted. But the industry appears to have hit a ceiling. This year, the top-rated firm for adding value only convinces 45% of its clients that it adds more than it charges in fees. Last year, the top-rated firm scored the same. In 2017, one firm reached the dizzying heights of 46% … but you get the picture. The market as a whole appears to have plateaued at this level.
Meanwhile, firms that have lagged behind on this metric are now catching up, scoring in the high, rather than the low, 30s. What that means is that, much like perceptions of quality, clients now see little difference between firms when it comes to value: Just eight points separate the top- and bottom-rated firms. “Best practice” is quickly becoming common practice.
But best practice is a bit of a misnomer when the number of clients (46%) saying they get no more in value than they pay in fees is higher than the number saying they do get more. It suggests that consulting firms are still struggling to track, measure, speak about and, yes, even deliver, value. A new approach is needed.