How Investment in Management Consultancy Can Represent Value for an Organization - Essay Example

Discuss how investment in management consultancy can represent value for an organisation? How can this value be assessed? Management consultancy refers to the practice of assisting organizations and clients to better their performance and this is normally achieved through the detailed analysis of the current organizational issues as well as development plans to improve the operations of the organization. An organization may choose to employ management consultant’s services for several reasons and they include consultants specialized expertise access and gaining advices from external sources. The exposure of consultancy firms as well as their close relationship with several organizations has resulted to such firms to be well vast with the best possible practices in the industry. However, the application of these consultancy practices from a given organization and transferring them to another can be limited by the particular nature of the situation in question. Consultants are also charged with the responsibility of offering management change assistance in different organizations, coaching skills development, strategy development, technology implementation or operational services improvements (Health & Welfare 2000, p. 78). In most cases, management consultants often introduce their own frameworks or property methodologies to assist them in identifying issues and serve as recommendation basis for more efficient and effective means of conducting their work tasks. Several approaches can be applied by different consultants and can be regarded as being as existing somewhere within a continuum having a prescriptive strategy on one side as well as a facilitative strategy at the other side. When it comes to expert approach, the consultant assumes the expert’s role and offers expertise assistance or advice to their clients. In this approach, the consultant is more and collaborates more with the client compared to the case of facilitative approach. In the facilitative approach, the consultant has less focus on the technical or specific expert knowledge leaving most of the consultation process to itself. The facilitative approach is in some cases referred to as the consulting process following its focus on the consultation process (Kent 2000, p. 61) In the recent past, most consulting firms have assumed a matrix structure in which a single axis is used to describe a function of the business or the consulting type like operations, strategy, executive leadership, technology, sales and talent management. The second axis focuses on an industry like gas, oil, retail and automotive. These matrix forms together with consultants taking part in either of the matrix cells like a consultant can focus fully in retail industry operation while another consultant focuses on the improvement of process in the same industry. The main aim of consultancy is to introduce value in an organization through understanding the intervention choices in relation to the most appreciated intervention style. In an effort to achieve the desired value within an organization, consultants may occupy several positions within a continuum from those led by experts, those that are centered on clients and to both non directive and directives (White 2000, p. 63). Heated debates have come up in relation to continuum position ranges between those that refer to themselves as coaches, mentors, advisors, counselors, consultants and facilitators. Despite the debates, each of the above mentioned roles need a specific set of skills, knowledge and behavior making them related disciplines. Consultants who introduce the desired value to an organization are the consultants who stand out as being the most effective and are considered as to be having the ability to carry out different roles within the required time and are able to move from a client to the other without mixing up their responsibilities. Most consultants have been observed to confuse their clients when they have many responsibilities before them thus reducing the value of their work. To maintain the value in the role they play incase of different clients, consultants have to form an agreement with the clients defining the role to be undertaken and this is expected to change with the evolution of the relationship between the two and through out the project. In this tough economic times, clients will attain value of their money if the consultants assist them by combining their scale and employ innovation in the solving of their issues to the expectations of the clients (White 2006, p. 98). This can be achieved through supporting the clients in coming up with the right investments, strategic decisions and operating efficiently. Cost management is the basic way of having the client gain value of their money with the other consideration being on the supply chain performance and environmental impact. The structure of a consultancy firm plays a crucial role in the delivery of value to its client. The geographic spread, capability and size of the firm’s network ensures that the firm operates across border getting in contact with the right people who have local insight and knowledge for solving the needs of clients. Well distributed firm network will ensure that its clients access its expertise easily whenever they are in need of their services (McKelvey 2007, p.90) A client will be better placed to judge if the services received from a consultant have realized the value for his or her money through reviewing every step of the investment experience through looking out for what was accomplished by the consultant and what areas had problems. Some of the areas that the client should focus more include whether the consultant honored the contract fully, if the work of the consultant contributed to any growth and development in the business, if the project between the client and the consultant achieved the set goals, whether the consultant achieved reasonable conclusions, findings and recommendations, if the agreement matured as both the two parties involved had hoped, if the report of the project was clear and of great help, if the agreement was met without any misunderstanding and was never breached, if the expectations of the agreement were realistic and were realized, if the client was in a position to invest enough money to see off the contract to completion, whether the consultant offer advisory services and useful information regarding the contract and other related issues, if incase of another duty the client wont think twice to hire the same consultant and if the client will be confident enough to recommend the consultant to any other person. If the answers to all or most of the above concerns are positive, then the client should be contended that he or she received value for the invested money (Turner 2002, p. 125) Consultants offer several types of values to the clients depending on the client needs. One of the values that a client can receive from a consultant is the aspirational values. These types of values are the ones that do not exist in the organization of the client at that time but the client believes that they can be of great assistant to the success of the organization. These types of values have to be identified carefully as if not properly employed; they can dilute the already existing core values of the client’s organization. Aspirational values may lead to sudden changes within the organization which may not go well with the staff. This calls for the client to adjust the internal operations of the organization to make the value the core values. The other type of value is the permission to play values which represent the behavior framework and the basic standards within which the employees in the client’s business are expected to perform. They are normally simple standards hence are basically the same in all the organizations. If confused with the core values, they will end up complicating the business’s defining characteristics. They interfere with the organization need to remain unique hence attract customers (Bessant & Rush 2005, p. 100) Most businesses focus their strategies on markets that have confused these values with the core values to assist them in building the required business strategy. For example, integrity is normally confused to core value yet it is a standard value expected from every employee within an organization. Additional values normally arise without the management cultivation. Such values exist within the client’s organization and normally reflect the staff’s common interest (Newman, 1999, p. 152). These values tend to be positive now that they are a reflection of the organization personality, however, they have to be managed carefully in order to prevent them from becoming the core values. Value added can be best looked at by considering the clients perspective, their initial assessment and perceived needs of the same. The clients in question are believed to be interested in both their benefits and experiences. There are several ways in which consultancy adds value and this depends with the interest of different values. Value added normally refers to the solutions, deliveries and results. These are the main value that the client wishes to buy or sought. However, it has been observed that consultants add value all through the consulting phases. Each consulting stage brings with it opportunities and moments to learn from contracting and entry to closure and evaluation (Bower 2002, p. 34). In each step of the consulting process which include action planning, analysis and implementation, chances are that value will be added. In the analysis stage, the data that will be collected, the framework used or the developed insight may all result in added value for a given client in the event that mindsets will be changed, learning takes place or the ensure of different decisions. The action planning stage involves the consultants and the clients exploring new ideas, coming up with intervention plans on the existing organization structure or coming up with a better structure or review possible alternative means of proceeding. Both the action taking and planning stage allow value to be added to the clients (O’Mahoney 2010, p. 42) The final implementation stage involves a lot to learn on the modifications, systems, corrections and adaptations. This stage also allows the implementation that involves several skills more than what either action planning or analysis involving both the client and the consultants. Value can be accrued in the manner in which facilitation is applied, the designing of processes, the inclusion of employees or structured training. In order to determine the value that has been added, the consultant and the client should look for evidence proving that the consultation efforts are resulting in a difference in areas that matter within the organization (McKenna 2006, p. 87). The occurring outcomes have to be valued and moved in the right direction. The determination of the added value is fraught with several difficulties following the many perspectives, lenses and timeframe used. In the definition of value added, it is important to take into consideration the dimensiosto determination and the perspective to be used. It is difficult to settle for the correct value added as a result of the different perspectives and dimensions used in the operations of different organizations. This follows the possibility of having values which benefit individual clients or the entire system but such benefits may be applicable in one level but unable to be reflected at a different level. This implies that the analysis level has to be specified while determining the added value. A consultant has to specify the analysis level first before going a head to determine the added value (O’Mahoney 2006, p. 41) The other issue determining the value added is the frame work being used by the consultant. It has been observed that results and benefits may be realized within a short-term while others will take longer than expected to materialize. In additional, some benefits and results may be realized first at the client’s level before being witnessed at the system level (Bergan and Kratochwill 1999, p. 56). The needs also come in different ways such as real needs and perceived needs. To meet perceived needs, a client may be contended that value has been added only to realize that the real needs were not met. This interferes with the determination of the added value as the client may come up with the initial determination while the larger system may make the ultimate determination (Lowman 2002, p. 34). How much the client gets in relation to the capacity of the client is another value determination consideration. Depending on the perspective taken, either approach could result in value added. In addition, in every situation, there are always chances of unintended and intended outcomes (Fanibanda 1999, p. 550). Intended outcomes are the ones that the client has planned for while untended outcomes occur or emerge as a result of other operations being carried out. The question is which among the two outcomes results to value? Either of the two may result in useful results. What the client and the consultant observe or measure may also determine what will be observed thus permitting for some value to be missed. As the issues and systems get more complicated and individuals as well as organizations changes are need for arising resolutions, then the identification of added value tend to become more difficult. Bibliography Bergan, J & Kratochwill, T, 1999. Behavioral Consultation and Therapy, Springer, New York Bessant, J and Rush, H., 2005. “Building bridges for innovation: the role of consultants in technology transfer”, Research Policy, 24:94-114 Bower, M., 2002. The Will to Manage, McGraw-Hill, New York Fanibanda, K, 1999. Ethical issues of mental health consultation, Professional Psychology, 7, 547-54 Health & Welfare, 2000. Choosing Consultants and Making the Best Use of Their Services- A Handbook, Heath & Welfare, Toronto Kent, J., 2000. Effective Organization- A Consultant’s Resource. Skills Program for Management, Volunteers , Fitness & Amateur Sport, Toronto Lowman, R., 2002. Handbook of Organizational Consulting Psychology, Jossey-Bass, San Franscisco McKelvey, M., 2007. When to Hire a Consultant and How to Get Your Money’s Worth, Diamond Planners, New York McKenna, C., 2006. The World’s Newest Profession: Management Consulting in the Twentieth Century, Cambridge University Press, London Newman, J. 1999. Ethical Issues in Consultation. Journal of Counseling and Development, 72, 148-56 O’Mahoney, 2010. Management Consulting, Oxford University, London O’Mahoney, J., 2006. Management Consultancy, Oxford University, London Turner, A., 2002. “Consulting is more than giving advice,” Harvard Business Review, 5: 120-9 White, J., 2000. How to Select a Consultant. Presentation to Canadian Consulting, Agrologists Association, Toronto White, J., 2006. Procedures for the Selection of Community Planning Consulting Services and the Preparation of Contracts, Agrologists Association, Toronto Read More