In an attempt to discover how and why top-level executives hire management consultants, Goodman Lantern conducted a survey of 200 executives in Fortune 1000 companies. The results showed that the two main reasons behind the hiring of management consultants were as follows:
1. To give a much-needed shift in strategy
2. To bring a fresh perspective
While the above-mentioned two reasons for hiring management consultants were the clear forerunners, various other significant needs were addressed as well – staffing, training, and fundraising, to mention a few. In terms of specialised expertise, financial and strategical advice were highly sought after with technology and human resources following closely behind.
The Hiring Process
On the subject of head-hunting management consultants, a large percentage of the interviewees alluded to using popular search engines such as Google and Bing. Generally speaking, more traditional recruitment methods such as phone calls, referrals, and company reputations were significantly less popular.
Astoundingly, 63% of Fortune 1000 executives stated that their number one reason for not re-hiring a management consultant was arrogance. On the other hand, only 17% of the panel seemed concerned about the quality of work supplied by the consultant. From this, we concluded that a consultant’s attitude and general demeanour are the foundations for a successful partnership between executives and consultants.
Management Consulting Trends
According to our research, nearly 42% of Fortune 1000 companies are steadily moving towards hiring in-house management consultants rather than leaning on large consulting firms. Those who preferred to outsource stated that they were more likely to do so from a developing economy. Additionally, most of our interviewees preferred to stretch payment of consulting fees over the period of a year. Despite the expectation that the Management Consulting market will grow to over $350 billion within the next year, efforts to cut back on costs are still hugely significant.
Primary and secondary research relating to markets, costs, industry trends, etc. often falls on an external research firm working in collaboration with the marketing consultant. Naturally, this would incur additional fees. When asked who should shoulder this financial burden, more than 50% of our interviewees were willing to contribute to the additional costs incurred.