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  • October 2013
  • Article
  • Harvard Business Review

Consulting on the Cusp of Disruption

By: Clayton M. Christensen, Dina Wang and Derek C. M. van Bever
  • Format:Print
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Abstract

Consulting fundamental business model has not changed in more than 100 years: very smart outsiders go into organizations for a finite period of time and recommend solutions for the most difficult problems confronting their clients. But at traditional strategy-consulting firms, the share of work that is classic strategy has sharply declined over the past 30 years, from 60% or 70% to only about 20%. What accounts for this trend? Disruption is coming for management consulting, the authors say, as it has recently come for law. For many years the professional services were immune to disruption, for two reasons: opacity and agility. Clients find it very difficult to judge a firm's performance in advance, because they are usually hiring it for specialized knowledge and capability that they themselves lack. Price becomes a proxy for quality. And the top consulting (or law) firms have human capital as their primary assets; they aren't hamstrung by substantial resource allocation decisions, giving them remarkable flexibility. Now incumbent firms are seeing their competitive position eroded by technology, alternative staffing models, and other forces. Market research companies and database providers are enabling the democratization of data. The vast turnover at consultancies means armies of experienced strategists are available for hire by former clients, whose increasing sophistication allows them to allocate work instead of relying on one-stop shops as they did in the past. Drawing on the theory of disruption, the authors offer three scenarios for the future of consulting.

Keywords

Disruptive Innovation; Consulting Industry

Citation

Christensen, Clayton M., Dina Wang, and Derek C. M. van Bever. "Consulting on the Cusp of Disruption." Harvard Business Review 91, no. 10 (October 2013): 106–114.
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About The Author

Derek C. M. van Bever

General Management
→More Publications

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    Managing Innovation at Atrium Health: 'Never Let a Good Crisis Go To Waste'

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More from the Authors
  • Managing Innovation at Atrium Health: 'Never Let a Good Crisis Go To Waste' By: Derek van Bever, Rory McDonald and Anibha Singh
  • Jobs to Be Done: A Toolbox By: Derek C. M. van Bever, Bob Moesta, Iuliana Mogosanu, Shaye Roseman and Katie Zandbergen
  • Beyond Beer: Brewing Innovation at Molson Coors By: Derek C. M. van Bever, Stephen P. Kaufman, James Barnett and Shaye Roseman
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