How effective is consulting nowadays? Are companies efficiently handling the COVID shock in the industry? What factors are contributing to less advisory and more bankruptcy? Can we safely assume that conditions will improve without our vigorous adaptation and transformation? What is hindering the potential of management and legal consulting in a time of dire need?
Even if theoretically unusual, consulting companies faced a hard time during COVID
Instead of booming with business clients like the long queue for gifts on the Holiday seasons after fasting for a full month, most Consulting companies have not relished this special time of the century. Not only consulting, but also many other types of companies and industries, who according to recent statistics, show that their decisions were quite “unmanagerial” with respect to the global changes and required responses. Most decision-makers found the urge to pull business strategies by chance out of a box of choices in an effort to land the right punch, yet without proper analyses or planning for more accurate results. The season known as COVID, or 2020, was taken over by highly adaptive and strategizing companies knowledgeable of what measures are most suitable in such profoundly unconventional circumstances affected additionally by the external green environment and weather changes, which contributes to a stronger spread of the coronavirus and lower physical immunity, to win over the necessary markets. As explained in “The era after COVID may not be as comfortable,” large corporations and oligopolies took over the markets respectively and left no room for the smaller entities that are not as deep-pocketed or financially wealthy to withstand prolonged times of suffering, resulting in a massive disruption of the supply chain, distribution movement, and to the order of things behind the blinds of the pandemic. Forecasts of industries Post COVID and 2021 display that even if many companies are filing for bankruptcies, especially in the retail, restauration, and supermarket industries, this trend is rising not only because of COVID, but also due to digitization and the trendy shift to online sales, including the automotive industry. This change also complements the online financial payment systems and services that shall support these industries furthermore. The method containing fixed or sunk costs from physical storefronts, utilities, 8-hour shifts employees, and their living expenses also went mostly obsolete. Storefronts transformed majorly online, where a company’s landing page, which is considered the reception for the clients, needs to be ideally designed and conventionally representing. “Profit-sharing” to ensure the efficiency and effectiveness of the roles is the solution of tomorrow.
Larger and more predatorial consulting firms overtook the industry for engagement, yet not efficiently
According to managers at small consulting firms, “our business took a severe hit even though we are operating in business consulting,” they add, “restaurants and perishable goods should face such outcomes, not us.” After conclusive research on the consulting industry, larger and more wealthy companies have been more naturally “predatory” in terms of pricing, attraction, poaching, and sleek expansion. Building robust systems and being reputable in the digital transformation field overtook considerably. The share of the market for a smaller boutique consulting following the older, uncreative, and more costly methods with less capital or financial support was the void filled by the larger or more ingenious firms. The acquisition of a competitor’s clients is a success that no other than the victorious can celebrate. The level of competition enshrined exceeded normal limits given the international commissionary protocols on domination and pacts. However, they also did not get to the projected results they hoped to achieve. According to senior partners at global consulting firms, their adaptation to the environment faced some backlash in terms of economic indices outside of their control, usually under the government’s control and oversight, which “affected business.” Little did they know, their lack of creativity contributed to the slower-than-anticipated progress where many companies preferred liquidation and bankruptcy proceedings over retrieving expensive external help for management direction and assistance. As explained in “Demanding radical change requires psycho-graphically understanding ourselves and target bodies,” advanced age puts an individual in a position to look for comfort and routine with internal peace than change and adaptability to the environment.
Governments’ stimulation of the economy was not very fitting or inclusive
The importance associated with local markets by strategizing boards of enterprises where COVID’s globalized ripple effects and conditions worsened duly was on the fact that governments’ speculations were only as accurate as their brainstorming session before a press release or statement. Accounting for “zombified” companies, the exploitation of the sweet relationship between government and COVID benefitted the vast array of companies hoping to take a step back and enjoying bankruptcy in the book or defaulting on millions of dollars in debts that creditors are not as frowned given the stimulus that will aid them as well. Unusual policies gave governments some room to maneuver outside structured norms. The back and forth objectives in the economy to COVID ratio of today’s environment allowed the shareholders and operators of legal entities to stay afloat without significant or costly attention to everyday business operations, or completely damaged and liable for default. According to government economists, these are the main reasons behind the ‘faulty’ plans of distributing the stimuli to all kinds of legal entities without careful supervision on who needs it more, who deserves it less, and who may be exploiting it. With heightened pressure by local companies in need of stimulation, federal entities will keep on overlooking some crucial red flags where protocols are vaguer in nature. The rubrics relying solely on revenue or turnover for entitlement to a fiscal stimulus is very narrow, neglecting a substantial portion of companies in between different states of growth, innovation, and expansive transformation. According to company founders of more than a year old startups, their positioning and access to the stimulus seemed to be locked out even if governments incubated and housed some of them for the sake of equal treatment and protecting innovation. Most of them have zero revenue or turnover, projecting the start of COVID to supposedly be the start of their success, where the payoff to their high costs from innovation was negatively affected by COVID and governments’ narrow judgment. Some would say that not exploiting today’s conditions would be like rejecting a bag full of cash without proper repercussions other than the simplified feedback from tax authorities or short term zero interest rates, “Keeping the books clean can be the only requirement.” Essentially, governments need to expand their plans to all sorts of entities, given that nearly 80-90% of companies took a hit, regardless of the industry.
Fixing consulting problems through surgically renovating the industry by taking tomorrow into consideration
Consulting firms before COVID relied on the market price of services that amounted to sometimes extreme figures, which normalized an industry price average. As explained in “the importance of consulting 2.0,” firms often charged companies with 6-7 figures for one project that spanned to a duration of few months, plus the additional expenses of travel, living, and accommodation of the consultants. All this in addition to a usually stressed atmosphere between the group of consultants internally likely to face competing troubles and leadership issues, the in-house advisors looking to establishing their names and inciting relentless criticism, or mid-level managers aspiring for better results in the race to the top, provided that consulting firms often preferred that their consultants worked at the client’s premises where interaction, suitability, clocking in, and confidentiality lines are as blurry as the cultural diversity and misunderstanding of the environment. According to consultants, “we found some hard times dealing with clients from [neighboring countries] who are directly interacting with our senior who also does not usually clarify the exact lines to us.” Not to mention, when the client is not as satisfied, which is the most usual case after months of “hard” work and thousands if not millions in billables spent, from the recommendation or solutions brought forth by the group of associate consultants with merely a few years of experience, it becomes complicated to handle, legally or amicably. According to companies with bad experiences with consulting firms, they usually proceed to mediated sitdowns to settle on a middleground if not an escalated legal court claim against the consulting firm’s promise of delivery and recommendations’ efficiency that are supposed to be “the best work,” in addition to surveillance procedures on the consultants’ work that is one-sidedly decided to being mediocre, lacking, or largely idle in nature. If incentive or motivation is not clear for tackling the extra work and stressful conditions, outcomes produced by the consultants can be suboptimal.
Most consultants, after a few years of working at consulting firms, often find the need to become more autonomous, independent, and flexible. The stress of working day and night sometimes has determination and ambition side effects, even if firms try their best to satisfy their employees. To clamp down on this ambition atrophy, independent consultants are becoming a trendy outcome for graduates of consulting firms. According to former consultants of big firms, the usual reasons for resignation stem from anxiety, overwork stress, toxic environments, social hierarchy, inequality, and “the need to whistleblow.” Being a unique identity with flexible power on input and output with an open opportunity to talent besides empowering artificially intelligent and smart processes without any physical or environmental ‘socio-political’ restraints are tomorrow’s best form of profession and advisory. Hence, Consulting 2.0 is vital for tomorrow.
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