The challenges of business consulting
For example, usage of Ai-like technologies can enhance the firm’s business processes as well as bring innovation to the services promising them higher growth. But, the budget, implementation, and training issues will be a great challenge for the consultancies.
GIG ECONOMY
Gig economy or open talent economy reshapes the way how business works. Because on-demand talent costs cheaper than a traditional counterpart and is specifically hired for working on a specific project, the organizations, especially the consulting firms are embracing the system of gig economy. For consulting firms, it is one of the best ways to tap on the right talent specialized in a particular area bringing to their clients the much-needed skill set and experience. However, the quality of work, availability of talent, the efficiency of the non-permanent staff is a concern for the HR managers.
The revenue generation for consulting firms depends on the strategies and services developed by the consultants in close interaction and collaboration with the clients. They might even require field-tests for which many on-demand or freelance employees are not ready. Also, the consulting firms have started going digital with intuitive platforms and software for which they have to pay a hefty subscription amount. Misuse or exploitation of such paid tools and software and the manipulation with data meant to be kept confidential is a threat for the consulting firms. Unlike traditional employees, the consulting firms have to face a tough time while grooming the flexible workforce and encouraging them to take a proactive approach to project completion.
PERFORMANCE-BASED BILLING SYSTEM
Moreover, the consulting industry has also witnessed the emergence of fees based on outcomes or performance-based billing. In such a pricing system, the work hours of the consultant are not considered at the time of billing. Instead what matters is to what extent do consultants achieve the objectives and targets given by the client. This pricing style saves the client from paying extra bucks to the consulting firms and also provides the consultant firms a benchmark in order to prove their worth. However, the small-scale consulting firms lag behind when it comes to implementation of this performance-based billing system. Many a time, the client does not agree to change the tentative amount proposed to him earlier after the consultant achieves success. The effective implementation of the performance-based billing totally depends on the sophistication of both the consulting firm and the clients entering into the contract.
Moreover, one of the biggest nightmares the consulting firms have is by the time a consultant prepares a research report or any strategic plan for the client after collecting data, analyzing it, and pilot testing, those trends and issues become outdated and are replaced with the new emerging disruptive forces. Such vulnerabilities affect the revenues of small-scale consulting firms which do not have an easy access to Big Data, Data Analytics, Cloud, and other cognitive technologies. However, the consulting giants who are the early adopters of dynamic nextgen technology dominate the market leveraging the relevant insights, automation devices, and scalable data gathering. They are better able to advise clients on the seamless implementation of disruptive technology as they themselves harness the potential.