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The last decade has not been kind to “gatekeeper” organisations. In almost every facet of our lives, we seem to have decided that we simply don’t have the need for them that we once did. We don’t need a taxi company to tell us who is and who isn’t qualified to drive us around; we’ll just have an app to do it. Once upon a time, aspiring TV producers had to go through an army of network executives before getting on our screens; now, anyone with a camera and a bedroom can reach millions of people overnight on YouTube. We seem to have collectively decided to cut out as many middle men as possible from our lives. Connect consumers directly with service providers, the theory goes, and the cream will naturally rise to the top.
This presents something of a challenge for top tier consulting firms. Such firms have, traditionally, leaned on their role as “talent gatekeepers” to justify their sometimes eye-watering prices. Clients looking for consulting talent—whether they need a new project team spun up from scratch or they simply want to augment existing workstreams with additional resources—know that if they go to one of the leading firms, they can be assured that they’re getting access to high quality resources. McKinsey, BCG, the Big Four: they’re not hiring anyone who walks in off the street.
A project team put together by a leading firm comes with an implicit guarantee of quality; the people in that team were talented enough to get hired by their firm and to thrive there. And that means that other people in your organisation will take them seriously by default. When the team from McKinsey presents their findings to your board, people will stop and listen.
The firm is the taxi company, vetting people who want to work in the industry and then dispatching them to projects that fit with their skillsets. So, in an era of Uberisation, it would be entirely understandable for partners at such firms to look around the room and wonder whether they themselves will be the next middlemen to be made partially or completely obsolete.
So far, the industry has proven resistant to truly radical disruption. But that provides no guarantee of long-term sustainability. An external shock—the long-predicted US recession finally arriving in 2020, for example, or the fallout from Brexit—could force clients to re-evaluate their priorities. When you’re strapped for cash, cheaper ways of finding consulting talent to staff projects start looking a lot more appealing.
And it could be that the ideal “gatekeeper-less” delivery model has yet to fully emerge. Yes, clients now have access to gig economy platforms for finding freelance consultants; stick the skills you need into an app like COMATCH or Movemeon and take your pick of available experts. But there are also options that fall somewhere between that fully distributed approach and the McKinsey model. For example, there are firms like Eden McCallum whose value proposition rests on being able to resource projects by tapping into sprawling associate networks; the brand of the firm still plays a gatekeeping role, but a much reduced one.
There is a very real risk on the horizon that clients will decide that they no longer need someone to man the toll bridge separating them from the consultants they want to work with—or, at least, that their tolerance for what they’re willing to pay for that service will decrease. So what is a big firm supposed to do to stay competitive in a world where clients are actively comparing their services against what they could get from a freelancer network or an Uber-style app?
There’s always the option of joining them. All of the Big Four have now created their own databases of freelance talent—in many cases, populating them with their own alumni. Sixty-five percent of US clients say that they have worked with at least one firm that used such a database to augment their delivery teams. In the long-run, those sorts of models may allow firms to grow their revenues at a rate that outstrips their headcount, keeping overheads under control so that savings can be passed on to the customer.
Alternatively, firms can focus on what they bring to the table that goes above and beyond their role as “talent gatekeepers”. There are some things that the likes of McKinsey and PwC can offer their clients that simply cannot be replicated by “gig economy” firms that don’t have the same resource base. Firms that lack big internal teams cannot develop and refine new project methodologies; they cannot create assets and build services around them; and they cannot create truly compelling and original pieces of thought leadership. Traditional consulting firms benefit from a sort of network effect: By bringing together so many talented people under one roof, they can create something greater than the sum of its parts. Only by taking full advantage of that alchemy will firms be able to continue to justify the hefty price tags for their advisory services.
The established model is not going to go away overnight. In all likelihood, clients in the future will have a whole smörgåsbord of options available to them should they wish to work with talented consultants. They may just plug their resource needs into an app if they’re looking for one or two experts to round out a project team; but if they want a ready-made delivery team prepared to hit the ground running on Monday morning, they’ll still have to call up their account managers. Established firms will not necessarily be competing directly against the “Uber of consulting”—whatever that turns out to be—but they will need to have a compelling value proposition for their clients that they cannot get elsewhere.
For more on the intersection of consulting and the gig economy, see our interview with Richard Longstreet, Strategy, Transformation & Change Manager at recruitment agency 3Search—available on our Emerging Trends platform.