czerniawska slides

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Published on January 24, 2008

Author: Sigismondo

Source: authorstream.com

Fiona Czerniawska:  Fiona Czerniawska Storm clouds ahead? The future of management and IT consulting www.arkimeda.com Storm clouds behind:  Storm clouds behind Fee income 1996-2003 (£m) and percentage growth rates The growth in public sector consulting:  The growth in public sector consulting Percentage changes in fee income 2002-2003 The growth in outsourcing:  The growth in outsourcing The problem with (almost) everything else:  The problem with (almost) everything else Storm clouds ahead? Agenda:  Storm clouds ahead? Agenda Three challenges: Enron and the tarnished reputation of consultants An increasingly volatile market for management ideas Offshoring and the organisational structure of consulting firms Storm clouds ahead? Agenda:  Storm clouds ahead? Agenda Three challenges: Enron and the tarnished reputation of consultants An increasingly volatile market for management ideas Offshoring and the organisational structure of consulting firms (1) Enron and the reputation of the consulting industry The client context:  (1) Enron and the reputation of the consulting industry The client context Enron has not materially changed clients’ attitudes towards the consulting industry, but has reinforced some of their fundamental concerns that: Consulting projects are most likely to go wrong when they involve end-to-end or bundled services There is insufficient objective information available to clients Aggressive selling is compromising the ability of some firms to offer the best possible advice and assistance (1) Enron and the reputation of the consulting industry The 12 factors that “tip” small scandals into large ones:  (1) Enron and the reputation of the consulting industry The 12 factors that “tip” small scandals into large ones (1) Enron and the reputation of the consulting industry Feedback from clients:  (1) Enron and the reputation of the consulting industry Feedback from clients (1) Enron and the reputation of the consulting industry How close to tipping?:  1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 9 10 1 2 3 4 5 6 7 8 9 10 (1) Enron and the reputation of the consulting industry How close to tipping? (1) Enron and the reputation of the consulting industry The options:  (1) Enron and the reputation of the consulting industry The options The consulting equivalent of the prisoners’ dilemma Firm B Firm A’s position Firm B’s position Does not act Acts Acts Does not act Freeloads on the action of others Freeloads on the actions of others Damages own reputation Damages own reputation Everyone wins Everyone wins Everyone loses Everyone loses Firm A Storm clouds ahead? Agenda:  Storm clouds ahead? Agenda Three challenges: Enron and the tarnished reputation of consultants An increasingly volatile market for management ideas Offshoring and the organisational structure of consulting firms (2) The volatile market for management ideas Management ideas have life-cycles:  (2) The volatile market for management ideas Management ideas have life-cycles Management fashions introduced in recent years: have shorter life spans are broader-based require greater implementation effort are abandoned more quickly (because they’re more difficult?) (2) The volatile market for management ideas The life-cycle of management ideas:  (2) The volatile market for management ideas The life-cycle of management ideas Level of benefits and costs Costs Benefits Time (2) The volatile market for management ideas Innovation:  (2) The volatile market for management ideas Innovation Never has been the core competence of most consulting firms Need to avoid monolithic ideas – but there’s no economic incentive for individual firms to do so Need to reinvent the wheel more often – has implications for resources and cost structures Storm clouds ahead? Agenda:  Storm clouds ahead? Agenda Three challenges: Enron and the tarnished reputation of consultants An increasingly volatile market for management ideas Offshoring and the organisational structure of consulting firms (2) Offshoring and the organisational structure of consultancies The pyramid firm:  (2) Offshoring and the organisational structure of consultancies The pyramid firm Junior consultants Senior consultants Partners (3) Offshoring and the organisational structure of consultancies Ripe for disintermediation?:  (3) Offshoring and the organisational structure of consultancies Ripe for disintermediation? “Once I’ve found the people I want to work with, what value is the firm?” Brand? Knowledge sharing? Training and quality assurance? Network? (3) Offshoring and the organisational structure of consultancies Factors determining supplier impact:  (3) Offshoring and the organisational structure of consultancies Factors determining supplier impact Direct access to clients Private sector client base Pressure on margins Offshore (low cost) Onshore (high cost) Public sector client base Changing definition of offshore-able Perceived level of risk (3) Offshoring and the organisational structure of consultancies Four scenarios:  Scenario #1 Scenario #4 High Low Low High Level of interaction between client and service provider Perceived level of risk Scenario #3 Scenario #2 Constant confrontation Profitable distrust Offshore rules Onshore returns (3) Offshoring and the organisational structure of consultancies Four scenarios (3) Offshoring and the organisational structure of consultancies The diamond firm:  (3) Offshoring and the organisational structure of consultancies The diamond firm Junior consultants Senior consultants Partners Slide23:  (3) Offshoring and the organisational structure of consultancies The future of consulting?

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