Management Consulting Industry

The management consulting industry is in the early days of a massive technology and talent-led transformation. While it has thus far been able to pivot and weather the impact of change, the industry is slowly but surely undergoing change.  From early models of information, expertise, insight and execution, to a shift to strategy and execution, the industry has thus far transformed into an entity that continues to serve customers well as growth continues through 2023 and the foreseeable future. 

Large consultancy firms, while excellent at big picture strategy, are increasingly finding themselves ill-equipped to help with more targeted opportunities, ones that require deep subject matter expertise. We are seeing a rise of boutique and independent consulting entities that are better equipped to deliver better value faster at reduced costs.

Transformation and Disruption

Consultants specializing in digital transformation, DEI, Cloud and the Metaverse, legislation and compliance, continue to  play an especially critical role throughout the near future, both in future-proofing their own organizations and in supporting clients through their respective transformations.

Nonetheless, there are signs of change as technology continues to make inroads into every aspect of every industry. Technology is dramatically reshaping the businesses of key sectors of the consultancy customer segments  like the financial industry, banking, insurance, healthcare, legal, supply chain just to name a few.

Generative AI Challenges

Generative AI technologies like ChatGPT are rapidly being deployed to replace mundane tasks, reduce manual labor and provide better insights into data. In management consulting, this equates to replacing traditional consulting with big data processing and automated analysis for more accurate forecasting and decision-making support faster, with less effort and cost.
 

With regard to digitisation and automation, the need for specialists with specific skills will become increasingly important and in demand as technology rollout continues to accelerate. This trend poses a huge challenge to management consulting firms who will need to adapt their own skills and resource base to the training and development of their employees for the digitisation era to ensure they are competent in offering these new technologies to their clients.

Looking Ahead

As the management consulting firms handle this new world, they’re doing less and less outright strategy work and more and more work on execution.

Every day, there are more ex-consultants ready to share their expertise. Every day, the tools that companies can use to form their strategy get better and more advanced. And every day, consulting firms need to prove that they can be relevant in this new world.

Consulting firms are  now finding themselves tasked more and more with looking ahead to figure out how to help their clients deal with transformation and disruptive trends. Adapting to continuous change being brought on by technology advances is the major challenge that will matter to their clients. Adapting to this reality is the only way management consulting businesses can remain relevant.

Talent Acquisition

With continued rapid rollout of new AI-based technologies, businesses are finding their workforce to be nowhere close to where it needs to be regarding AI literacy. Nearly 60% of execs ranked their teams’ AI skills as low or somewhat low.

Recent surveys show 80% of C-level IT executives today are facing increasing workforce skills gaps, while nearly 70% are struggling to hire qualified talent, notably those with proficiency in AI. 

IT leaders are two times more likely to upskill and reskill existing employees than hire additional staff to close skills gaps.