Future of consulting #3: Consulting disrupted by Digital and Tech

Future of consulting #3: Consulting disrupted by Digital and Tech

Nous lançons notre série d’articles sur le futur du conseil. Nous avons discuté avec des Partners / Founders de 6 boutiques de conseil pour essayer de comprendre les tendances émergentes du conseil: Freelance, disruption, spécialisation, collaboration entre boutiques et grandes firmes etc.

Converteo – The future of consulting series with Movemeon

We spoke with Emilie, an ex-McKinsey consultant who joined Converteo – a tech consulting boutique specialising in everything that revolves around data and marketing. She described the impact of digital progress and innovation on consulting, and what that might mean for the boutique landscape

Digital and tech has disrupted the consulting market

As technology evolved within the consulting industry, a few big players were quick to embrace that opportunity to grow their business. Emilie remembers how McKinsey was especially swift in reinventing processes with a greenfield approach and began a fast agile process transformation in 2014. “Something was beginning to emerge. McKinsey was really strong and moved quickly. They surrounded themselves with top notch developers to facilitate this change.”. She explained how they had the capacity to both deal with C-level governance and provide expertise in how things should be delivered, projects should be managed and how to develop projects fast – an effective combination off high-level strategic, and operational consulting. “ They provide a great example of how a traditional consulting firm managed to quickly adapt and achieve this level of expertise. 

However, it has “allowed the emergence of small tech / digitally focused boutiques” as cheaper and more pragmatic rivals to traditional players like McKinsey. As there has been an increasing focus on digital and tech in consulting, these boutiques have managed to grow and capture the attention of companies with a lower budget and a need for consulting.

The initial rise of boutiques – Converteo as an example

Emilie cited Converteo as a great example of a boutique that was able to take advantage of this rising trend. 

When Converteo was created in 2007, they focused on Web Analytics and Conversion Optimization. As digital became a strategic growth and efficiency lever in many industries (in its e-commerce form or to manage operations), Converteo started hiring strategy consulting profiles, to help clients design their e-commerce strategy and omnichannel customer journeys. The rise of data in the past years was another shift that pushed for more strategic consulting, with many organizations wondering how they can leverage their data, what their top priority use-cases should be. Interestingly, that shift generated two developments in Converteo’s offer that could be seen as opposite whereas they are complementary: strategic consulting, and IT/Infrastructure advisory. The latter is a much appreciated add-on to the boutique’s expertise, as everyone is now aware that even the best thought-through data use cases will not deliver value unless data is readily available and properly exploited. 

As a consequence, Converteo now represents a one-stop shop for digital and data expertise, with a hybrid model that covers the whole project value chain (from strategic design to operational run) but also the whole range of data marketing expertise (from IT infrastructure to marketing activation and measurement). And that contributed to Converteo having more and more C-level discussions, when 5 to 10 years ago those were mostly reserved to a happy few strategy consulting firms.

Boutiques have some competitive advantages

“Tech-enabled boutiques have disrupted the consulting market because they can be more flexible around client’s needs and budgets” 

 “In large and established consulting firms, there is no small assignments.”  As such, the budget required, and entry cost, to work with traditional consulting firms is very high. However, boutiques can break down projects into different parts to make it more affordable for companies. “It removes the barrier of having a high initial cost. We can do an initial small project to get into projects 3 and 4. We’re pragmatic and we’re focusing on bringing value”.

Boutiques and consulting firms are competing for the same accounts, typically on project designs, strategy design, roadmap design… but their models of delivery differ completely. The boutiques’ flexibility allows them to build their offers around the clients’ needs “We’re very flexible in the way we serve our clients, if they need a consultant to stay 3-6 months in interim that’s what we’ll do.” Their expertise is key to answering all of the clients problems “If it’s strategy, we’ll do it. If it’s build and implementation,we can do it all.”

A period of consolidation?

We posed the question of what next in the world of boutique consulting. Emilie explained that she was seeing an increase in consolidation within boutiques: smaller firms are getting bigger and hiring more talent while bigger boutiques are buying smaller consulting boutiques: “Consolidation is definitely on it’s way. Either organically through hiring a lot of people, or inorganically through acquisition. We’re constantly looking at M&A options.”

When we project forward a few years, Emilie predicts that successful boutiques will emerge as the next big players – One of the key success factors of the next consulting stars will be, in my opinion, the ability to work hand-in-hand with solution providers in the tech space. I feel that large consulting players are sometimes too proud or too presomptuous to rely on software editors or even get well acquainted with them. They may fear they will appear less independent as well. But the truth is that today, to serve your clients well, you need state-of-the-art tech, you need to embrace solutions developed by large software editors or small startups. Problem-solving skills and super brains still make a difference, but they will not be enough in a world where most business operations are becoming largely tech-assisted. You can try to catch up and be in the race, internalizing tech capabilities (as BCG or MCK, who hire tons of tech profiles). I believe though that it is a lost cause, because tech, AI, data science, data solutions in general move super fast, with specialized applications by industry and business function. Everyone knows how complex it is for consulting and pure tech players to form solid and trust-based partnerships: I bet the ones who manage to do so in the upcoming years, even on a small specialized field, will be rising stars.

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