Disrupting the Management Consulting Industry - A study of the internal forms of organization and external forms of collaboration of consulting firms

Abstract

Disruptive innovations are radically transforming and revolutionizing several industries nowadays, among which the management consulting one is not an exception. Its consideration as one of the sectors immune to the threat of disruption has been challenged by different vulnerabilities existing within the consulting companies’ operations and strategies, such as the presence of excessive human labor, outdated business practices or not sophisticated revenue models. This study aims to identify if and how internal forms of organization and external forms of collaboration across management consulting firms might lead to disruption in the business. In this regard, internal forms relate to phenomena such as the implementation of new strategies, the creation of novel units or innovative business models. External collaborations concern networks building and partnerships across the consulting firms. The research has been developed through a deep literature review of disruptive innovation and its application in the management consulting industry through new internal organizational forms and external collaborative settings. The theory has been then complemented by information collected through qualitative semi-structured interviews with consulting firms of different sizes and offerings. An extensive analysis of the literature and the responses of the interviewees demonstrated an awareness and topicality of the threat of disruption towards the management consulting industry, even if the phenomenon is perceived differently across the market’s actors. In this context some internal forms of organization and external collaboration forms leading to disruption have emerged, ranging from new sophisticated revenue models based on subscriptions to strategies of self-disruption of the consulting company itself and networks of organizations collaborating together within ecosystems. Based on this, some practical recommendations are provided by the author. These include, for instance, familiarize with the concept of disruptive innovation and maintain a wide view over the market by becoming aware of the new strategies, models, organizational and collaborative forms emerging in the sector in order to face in a more proactive manner the disruptive threat.