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The
Witch Doctors: R(E)Inventing
Themselves
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The
mainstream management consulting firms, which faced their
biggest challenges in the past couple of years from new age
e-biz advisors and net-focused consultancies, apart from the
rapid pace of e-business transformation, are trying to remodel
their very organisational structures and business strategies
through a slew of partnerships, pacts and alliances. But this
period of consolidation and the constant threat from the IT
giants eking out a dominant share of the burgeoning e-business
consulting pie themselves will see a shake-out with a rearranging
of various tiers of the consulting industry.
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PALLAB
DUTTA is partner, p & r Consulting, a Mumbai-based business
consulting and information services firm
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of the earliest pioneers of the consulting business (as we know
it today) such as Arthur D. Little, Frederick Taylor, Edward
Booz and Marvin Bower might not have envisioned that advice
on strategic and organisational structure aspects could change
so cataclysmically with the emergence of a new business medium—the
Internet. Yes, the ‘witch doctors’ (with their remit
of consultancy activities spanning IT implementation, corporate
strategy, auditing, accounting, business process re-engineering,
change management, product and service management) such as McKinsey
& Co., Bain & Co., Pricewaterhouse Coopers, Andersen
Consulting (to be rechristened Accenture from January 2001),
KPMG Consulting, Arthur Andersen, Deloitte Consulting and others
of the pecking order of brewing solutions to the most complicated
of solutions are worried. About change—which they have
thrived on and built multi-million dollar practices on for decades—wrought
by the fast-paced progression of businesses to the digital economy.
Structural
Adjustments & Competitive Threats—The IT Effect
Up until the beginning of the nineties, the Big Five (earlier
the Big Six) and the strategy firms could adjust themselves
to both short-term and cyclical changes and long-term structural
or fundamental changes because of their better harnessing
of intellectual capital, well-honed process expertise and
the ability to deploy resources at client bases around the
world. They were regular advisors to the top Global 1000 on
a panoply of issues besides servicing all their outsourced
requirements. Hand-holding and ‘mentoring’ these
corporations and enterprises during disruptive change wracking
the very vitals of the business ecosystem became a way of
life for the consulting firms.
Luckily for these consultancies, the deregulation of financial
markets, lowering of international tariff barriers and related
strictures and the very globalisation of businesses were being
ushered in as impactual forces at different stages in regional
economies. From the mid-eighties in South-East Asia (bringing
in the cusp of the economic tsunami in this region) to the
East European and other Iron Curtain nations, consultants
ruled the roost and leveraged and extended the lifecycle of
numerous consultancy techniques, methodologies and expertise.
Whether it was McKinsey’s famed 7-S framework model or
ichael Porter’s five forces related to the strategic
dynamicsf organisational structure, the nuggets of wisdom
doled outby the roving
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management
gurus, the process expertise and brand power of the management
consultants were never questioned. Even as businesses became
extremely dependent on IT (with IT emerging as the single largest
capital expense of many corporations), consulting firms, which
had already invested heavily in developing technical know-how
and related implementation skills, were their gain to facilitate
integration of IT (a major and forceful change catalyst for
the consulting firms). Competitive capabilities were differentiated
on how well the ow infotech-oriented consultancies enabled the
organisations to improve efficiencies and cut costs—basically
teaching them to leverage the applications of IT as a business-driver
rather than a mere business-enabler. The consulting pie increased
dramatically in the nineties due to unprecedented technological
change and the upward surge of IT implementation |
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