Thought for the day:Choosing a consultancy - as easy as ABC?

Martyn Hart asks what separates the big consultancies from the boutiques and whether size really does matter.

Martyn Hart asks what separates the big consultancies from the boutiques and whether size really does matter.

Folk law or truth? In consultancy the "A" team sells and the "C" team implements.

A friend suggested to me that one of the ways that large consultancies achieve the margins they need to pay top salaries to the few and have those massive glass buildings in high-rent areas is to charge a fortune for their staff but pay those staff peanuts.

But, if you pay peanuts you usually end up with monkeys, and what customer is going to pay through the nose for low-grade staff, I asked.

Easy, he told me. Until you get the order, dazzle the client with stars. And they may be stars too, the real experts in the field. But the programme (once it's won) is populated with planets, in fact, more like moons or asteroids! Therefore main costs are down at sub-stellar level, allowing those doing the selling to get paid well themselves, along with the few top names they actually have.

It doesn't matter how the project goes, because the size of the big consultancies means they have to be continually sucking in customers to feed the machine, so there's always another one. And, of course, who would say that a big consultancy didn't deliver? After all, it took an Enron to challenge the market.

Then my friend asked me to consider a boutique consultancy. Boutiques don't have a cast of thousands; in fact 30 is a normal size, so there's no room for monkeys. These small consultancies depend on you knowing that they have done a great job - their future income depends upon it, because on average 80% of business is repeat!

Your relationship is likely to be much closer, so you won't have to deal with account handlers, sales force managers and so on. The boutiques will understand you better and are much more likely to work just as you want. They will be staffed by experts in a few key areas, so you will get focused, high-quality support.

So, it seems there's a strong logical argument for picking small consultancies. But surely, I countered, there is a serious choice to be made: best of breed or one-stop shop?

If you want the very best then you need to know not just what support you want, but where to find it.

However, many clients don't know exactly what they want, so maybe that's why people go to the big consultancies - they believe that somewhere in that organisation someone must know what's required.

But what manager wouldn't know what he wanted? Is the folk law right? Do A and C teams really exist?

What is your view?
Is bigger better or small beautiful when it comes to consultancies? Tell us in an e-mail >> CW360.com reserves the right to edit and publish answers on the Web site. Please state if your answer is not for publication.

Martyn Hart is chairman of the National Outsourcing Association and practice director at Mantix, a consultancy that delivers value from complex programmes.
This was last published in November 2002

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