With everyone from doctors to kitchen designers being forced to offer their hard-won expertise as a freebie, should consultancies be worried? Our management consultancy columnist Mick James says it’s simply a question of finding a new way to monetise something that people value but yet won’t pay for.
There’s an interesting debate on LinkedIn about whether an initial period of free consulting is worth offering to a client.
“Free consulting” is generally seen as an initial sales device or as a way of defending a fee rate. Both have their attractions: surely a couple of days with a client will let them see what a useful fellow you are, while offering a three-for-two allows you to get work during lean times while defending your fee rate.
But all these discussions beg a really important question, which is why pay for consultancy at all?
There are lots and lots of professions where, even though it is the most valuable thing offered, advice is generally free. Visit your dentist and he or she will tell you to brush your teeth well, floss regularly and avoid sugar in your diet. If you only follow that advice you probably need never go back and you’ll probably live longer too. You won’t, but even if you did, you won’t hand over a cheque for the £20,000 of reconstruction work you’ve just been saved.
It used to be a cliché (by which I mean I said it a lot) that the world was becoming more consultative. Consultancy skills were not only valuable in the business advisory sphere but in the sales of all sorts of items and the internal management of companies.
I think we’ve turned a corner now: the changes in the business environment that made management intermittently more consultative are now baked into the practice of management itself. You would no more think of hiring a manager who couldn’t manage projects or achieve results through influencing people than you would run your accounts on punch cards. You would also be increasingly unlikely to run a massive change project with a coach-load of strangers. Whatever outside expertise you bring in, you would want as many of your own people as possible to be involved at all stages of the journey, creating, learning, collaborating in and owning the change.
The interaction between consultancy and selling stuff has always been difficult, as witnessed by the ever-fluctuating border between the worlds of IT telecommunications and consultancy “proper”. Even at the consumer level, an unwise step into a mobile phone shop was more likely to lead to an encounter with a “consultant” than a salesman.
Things have changed. Shop assistants in mobile phone shops hide behind pillars when you enter their domain. They know you’ve been on the internet for the last two days and know everything about the latest Motorola Z-whatever – probably more than them – and now you are just trying to nail down the price. I spent an inordinate amount of time buying a light bulb the other day. Ask me anything re luminous flux and colour temperature, and I’ll keep you entertained for hours.
This is happening everywhere – everyone from doctors to kitchen designers is being forced to offer their hard-won expertise as a freebie in a desperate effort to get their voice heard in this cacophony.
As above, so below. We used to feel pretty confident about ignoring the vagaries of the B2C market in the allegedly serious world of B2B. That was before everyone went out and bought a wireless router and suddenly your staff had a better network than corporate HQ.
It needs to be said at this moment that clients owning their problem and simply shopping around for solutions is not an unequivocally good thing. The patient who comes into the doctor with a list of statins and beta blockers he would like to be prescribed for his heart condition is not a dream but a nightmare (he could at least have the decency to stay at home and order them himself from Singapore). Such a client has tunnel vision and it’s going to be hard work getting him back out of the tunnel to talk about diet and exercise.
The question is how to insert good, value-adding advice into the equation. Increasingly in the consumer world, those opportunities come where the rubber hits the road. I’m sure, for example, that there is still some work out there for a freelance kitchen designer but I know I can get a lot of that for nothing (or at least for a refundable payment) from a kitchen cabinet supplier. That’s a pretty grim reversal – the person who used to order the chippie about now works for him.
Is this model going to replicate itself in consultancy? I think we’re already seeing signs of it – one area I’m going to be looking at quite intensely over the next few weeks is the collapsing boundary between digital marketing and consultancy. Consultancies are furiously buying digital agencies but is this happening any faster than digital agencies are winning business from consultancies?
I’ll be scrutinising this story in coming months because I think it’s a lot more than the usual add-a-string-to-your-bow acquisition strategy consultancies have followed down the years. There are significant differences between the agency culture and consultancy, one of which is the “creative pitch”. You don’t sit in front of a client and tell them how brilliant your creative director and copywriters are and show them stuff they’ve done. You come up with actual ideas for campaigns and slogans, draw them pictures. In the digital world it seems futile to draw pictures when you can create the demo material using exactly the same tools you will use to create the finished product.
In this new world it is not so much a case of “if you build it they will come” but “if you build it they might buy it from you”.
I can see consultants – one of whose main phobias, as evidenced by the discussion above, is of having all their ideas out in the open before money has changed hands –being deeply uncomfortable with some aspects of this new world. But other people have lived like this for years – look at TV production companies. It’s a question of finding a new way to monetise something that people value but yet won’t pay for. If the makers of Downton Abbey can do it, so can consultants.
All views expressed in this article are those of Mick James and do not necessarily reflect the views of Top-Consultant.com and Consultant-News.com.
Contact Mick with your views or suggestions at: firstname.lastname@example.org.