In yesterday’s post, we outlined the process for and importance of the client discovery phase in the consulting process. This post will discuss why consultants should strive to accelerate client discovery. Traditional client discovery methods can decrease the overall value of consulting, and consultants should leverage technology to overcome the challenge traditional methods pose.
Where Current Discovery Can Decrease the Value of Consulting
The Opportunity Cost Pressures of Discovery
Given the rigorous nature and high risk of many consulting engagements, discovery is not a cheap process. Fortunately, by the time businesses engage consultants for assistance, they are more focused on the quality of the services rendered, and thus they tend to be less price sensitive. There are significant pressures for consultants to consider, however.
- Workforce Constraints. Working long hours is a basic expectation for any consultant. But there is a high opportunity cost associated with spending considerable time on discovery for a single engagement. As for any high-touch effort, there are many other key business activities that must be prioritized lower in order to complete discovery for an engagement. There’s only so much an army of consultants can do in a given timeframe.
- Expertise. More importantly, opportunity costs for consultants become critical when considering the type of engagements consultants conduct. Not only are workforce constraints an issue, but often it is a matter of fitting the right people to right areas of expertise. If there are only a select number of experts who are best suited for a specific type of engagement, the consulting firm is substantially constrained in the volume of deals it can conduct. Efficiency certainly helps alleviate this problem, but until methods of discovery change substantially, there will always be an expertise bottleneck.
- Credibility. Consultants have to balance speed with quality, which becomes increasingly difficult with constrained resources. Often, successful discovery is shortchanged because the consultant simply needs to meet a deadline. Other times, rigorous discovery is simply far more intensive than initially anticipated. Regardless, discovery can suffer when there is a deadline to meet. “Good results” become “good enough,” and quality tends to suffer.
Decreasing Willingness to Foot the Bill
Most consulting practices would simply pass these resource costs onto clients as higher-priced services. But as many mid-to-low market consulting services discover that during harsher economic climates, prospective clients are becoming increasingly less willing to accept these costs. This is not a short-term trend, nor is it only affecting smaller consultancies. For instance, major strategy consultants are now involved in only an average of 20% of strategy development and planning, whereas 30 years ago, they were involved in as much as 70% of the process. Shifts in the industry and reshuffling of major consultancies has made prospective clients even more reluctant to take on new engagements with high cost.
Consequently, consultants have been facing growing pressure to reduce costs and accelerate engagement timelines. Despite technological innovations that consultants have increasingly adopted to improve their discovery, basic discovery, data cleansing, and analysis techniques have remained the same. Most innovations have focused on increasing the value-add of the organization, not necessarily on the speed at which consultants gather insight. When discovery still relies on manual processes such as gathering spreadsheets, in-person stakeholder interviews, and individual consulting knowledge, it becomes quite difficult to scale in a cost-effective manner.
Consultants Should Accelerate the Discovery Process
What Consultants Can Accomplish by Accelerating Discovery
Most consultants focus innovative energies on efforts that directly add value to their brand. Consequently, methodology and process improvements are considered less important unless they have immediate client visibility. Thus accelerating the discovery process might not seem highly valuable for consultants. There are, however, several benefits to accelerating the discovery process.
- Increase margin. With accelerated discovery, resource constraints are reduced. This not only frees up resources within the firm, but also means that every engagement has an increased margin. Instead of using manual processes to collect, track, and store data, consultants can use use technology to gather more useful information (a value-add in itself) while freeing up more resources.
- Increase volume. If resources are less constrained, there is more bandwidth to pursue more engagements. Thus, while benefits might not be apparent initially, consultants will be able to more effectively pursue additional opportunities without being concerned about bottlenecks.
How to Accelerate the Discovery Process
Improving discovery requires a process that delivers results quickly without compromising the quality of the insights gained from discovery. Any improvements, therefore, must intentionally focus on how to accelerate existing techniques without necessarily following the exact same procedures to implement them. Three helpful principles to keep in mind:
- Scale the collection process. Accelerating discovery requires implementation of effective means of scaling existing infrastructure. Technology-enabled solutions are excellent ways to automate previously manual processes. The mantra of automation has overtaken the tech world, and consultants have begun using software to great avail. The key for any consultant is to think of what needs to be scaled in the discovery process and why. As many business leaders are discovering with big data, scaled discovery is not beneficial if it means more noise and less insight. But scaling to gain more meaningful data dramatically improves the quality of discovery.
- Employ flexible technology. When using technology-enabled solutions, consultants need information that can capture robust data. Since most consultants have their own defined methodologies and frameworks, they need something that can easily translate their conceptual frameworks into useful data without relying on back-end manipulation. Consultants need a way to integrate information into their framework. That way, consultants can easily feed data into their own methodologies without requiring additional work to reconcile what they have with what they need.
- Make it easy to compare data. Since a consultant’s discovery process is about gaining insight from data, it is important to ensure that any technology-enabled solution increases the ease of comparing data. Translating data into a common framework largely services consultants’ needs for individual engagements, but firms also need to manage knowledge across multiple engagements. Consultants could add considerable value to their discovery process if they employed technology that used benchmarkable information across other engagements. Not only would benchmarkable data provide a credible baseline to begin discovery, but it would also provide a reasonable model for how to leverage past insights.
Resource constraints and more demanding client expectations are placing strain on the traditional methods of client discovery in the consulting process. Consultants would do well, therefore, to employ technology to accelerate client discovery.