Why consulting firms are so interested in each other at the moment

In the course of the average Formula 1 race there are lots of little incidents: Cars get too close to each other and eventually come into contact, sending one or the other (and sometimes both) spinning off the track; someone approaches a corner too fast and ends up beached in gravel or with the front of their car crumpled by a wall of tyres. More often than not the affected drivers jump out of their cars and stomp off, apparently more upset to be out of the race than they are relieved to be alive.

And then there are the bigger incidents in which either someone is seriously injured, or a collision spreads debris over the whole track, making it unsafe for the race to continue. In these situations, the “safety car” is brought on: It positions itself at the front of the race, allowing nobody to pass it, and reduces the speed at which everyone is driving. Cars bunch up behind it, in order of their position in the race, and stay like that until the problem is resolved. Their respective positions at the time of the incident are maintained, but the gaps between them are reduced to pretty much nothing.

For as long as the race is suspended behind the safety car, drivers and their teams have a moment to take stock—checking systems, analysing the positions of all the drivers that are important to them, discussing tactics, and keeping their tyres warm for the moment when racing resumes.

Judging by the nature of the questions we’re being asked at the moment, I think that’s a pretty useful description of what’s going on in the consulting market right now. There’s been a major incident and growth, like speed, has been dramatically cut (in fact it’s been put into reverse, but let’s ignore the problem that causes our analogy). And suddenly there seems to be a much greater focus on the competitive landscape than there was before; on the position and condition of rival firms now that the merry-go-round of growth has come to a juddering halt and everyone’s bunched up in plain sight of each other for the first time in ages.

It makes sense: Firms are quite reasonably deciding that the playing field has been temporarily levelled, and that their race is effectively being reset. They also appear to be deciding that the race, when it’s finally restarted, may run to a new set of rules and a new narrative. What mattered before might matter less soon. What was irrelevant before might now be critical. So it’s a good time to work out where you’re strong and weak compared with the competition, and how those strengths and weaknesses are going to play out once the safety car pulls off into the pits and everybody hits full throttle again. After all, competitors who were behind you may now have a once-in-a-lifetime opportunity to overtake you relatively easily. But by the same token, you might never have a better opportunity to overtake the firms in front of you. No wonder everybody’s spending so much time sizing each other up.