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Publish Date
June 6, 2024
In the management consulting industry’s evolution, new technologies and emerging trends are rapidly changing the playing field. Forward-thinking consultants and companies use these advances to create new opportunities and solve complex problems.
However, unexpected challenges can threaten to derail even the best-laid plans.Executive consultantKevin Modany currently serves as a Chief Executive Officer (or CEO) for a private equity portfolio client. Modany details four management consulting industry challenges and offers guidance for resolving them.
2 Client-Related Challenges
Each management consulting client has distinctive challenges. Some clients ask a consultant to solve a well-defined problem while other clients aren’t fully aware of a problem’s scope. Executive consultant Kevin Modany offers insights on two common scenarios.
Continued Marketplace Uncertainty
The past several years have proven challenging for client companies across many industries. To illustrate, the COVID-19 pandemic ushered in an unprecedented upheaval of the entire business landscape. Some companies closed down their operations while others adopted a remote work structure.
Once businesses began to resume normal operations, they were often faced with employees who didn’t want to return to the office. Other companies chose to navigate the challenges inherent in a hybrid work structure. Today, many workforce-related issues remain unresolved.
Finally, often-volatile economic conditions make it difficult for companies to deliver on short-term objectives while developing longer-term strategic plans. With accelerating inflation, and correspondingly higher interest rates, many firms have had second thoughts about expanding their operations. Other companies are simply struggling to keep the doors open.
Putting It All in Perspective
Executive consultantKevin Modany acknowledges that each client problem likely involves multiple factors.With a cut-and-dried solution unlikely, he recommends assessing each problem through the lens of the company’s mission.
Operational constraints will certainly enter the picture. In addition, certain issues carry a higher priority than others. With these factors in mind, and with good two-way communication, the client and management consultant can develop a plan for resolving each complex problem.
Ambiguity About an Assignment’s Purpose
An effective management consulting project involves a well-informed client and a consultant who delivers on the services they pledge. However, a failure to achieve a “meeting of the minds” can mean the consultant delivers irrelevant, useless data. Conversely, the data may be useful, but the client botches the game plan recommendations. Either outcome likely results in frustration on both sides.
Getting on the Same Page
To avoid these less-than-optimal outcomes, executive consultant Kevin Modany recommends a two-part solution. First, the management consultant should lay the groundwork for good two-way communication. This can facilitate problem resolution and set the stage for constructive exchanges.
Kevin Modany details his straightforward approachto consultant-client communication. “If you ask me a question, you’ve got to be careful because I will give you an answer, and I don’t believe in anything other than being honest and forthright. Sometimes, it’s painful, but you’ve got to be truthful. That’s the way I am, and that’s the way I’ve always been,” Kevin Modany declared.
Once the communication lines are open, management consultants should educate their clients on an assignment’s realistic expectations. If clients request additional deliverables, the consultants should ideally meet these broadened requirements.
2 Management Consulting Firm Challenges
Each management consulting firm faces its own operational challenges. Executive consultant Kevin Modany discusses two scenarios along with strategies for addressing each one.
Evolving Consulting Skills Requirements
The increasingly sophisticated business landscape brings new technologies and improved techniques to the forefront. Ideally, client companies should keep up with these advances that can help drive each firm’s growth.
Concurrently, management consulting firms should ensure that consultants have the proper skill sets to successfully address forward-thinking clients’ concerns. These consultants are well-positioned to gain business compared to consultants who are behind the curve.
Two Skills Acquisition Methods
As executive consultant Kevin Modany points out, management consulting firms have two options for obtaining these skills. First, the firm can train existing consultants in the desired disciplines. This is a cost-effective option compared to hiring consultants with in-demand skills. However, time spent in training means fewer billable client hours.
In contrast, the firm can bring in consultants with the desired skill sets. Although the acquisition cost is high, these ideally equipped consultants are ready to perform on Day One.
Challenges in “Scaling Up” Consulting Operations
Clients’ residual difficulties from the pandemic disruptions, along with inflation and geopolitical concerns, continue to impact businesses in diverse industries. Targeted technology can inform management consulting firms about pressing client service needs and emerging opportunities. Taken together, these trends should spur consulting firms to scale up their operations.
However, executive consultant Kevin Modany says outdated legacy systems and substandard technology greatly hinder the scale-up process. Varying company priorities, and an inability to focus on defined consulting firm goals, can also negatively impact scale-up operations.
Relying on New Technologies is Key
Not surprisingly, technology can play an integral role in consulting firms’ scale-up operations. Specifically, artificial intelligence (or AI) and machine learning can identify sectors with the highest client demand and optimal service margins. These areas should ideally see higher resources investments.
Emphasizing Data-Driven Solutions
Once management consulting firms can access relevant and timely data, they should share it with stakeholders who can benefit from its use. Teams in alignment with the same objectives, and with the necessary data analysis capabilities, are well equipped to identify (and realize) “bigger picture” goals.
Kevin Modany’s Alignment with This Methodology
Highly skilled in data analytics, executive consultant Kevin Modany determines how specific findings will affect a client’s operations. Based on this information, he develops targeted strategies that offer solutions for existing (and/or emerging) problems.
Kevin Modany emphasizes the importance of this approach.“There’s a plethora of data. People are collecting more and more of it. I think it requires that we prioritize and we make sure that we’re focused on the right set of data, and we don’t get overwhelmed by it. But, I think it’s super exciting,” Kevin Modany said.
Qualitative Factors Still Have Value
Data analytics advocate Kevin Modany notes that qualitative variables should remain a part of the decision process. “[The data is] not the end all be all, right? There are still qualitative considerations, and you always have to have that as part of the equation,’ Kevin Modany concludes.
Reassessing Each Client’s Situation
Business challenges don’t occur in a vacuum, and relevant factors rarely remain constant. For this reason, executive consultant Kevin Modany recommends that management consultants frequently reassess each client’s challenges.
Equipped with new information, the consultant may elect to revise their strategy accordingly. Alternatively, the consultant could decide that their existing solution would offer the best chance for success.
Members of the editorial staff of San Diego Reader were not involved in the creation of this content.
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