FOREWORD

Management consulting has long been recognized as a useful professional service that helps managers to analyse and solve practical problems faced by their organizations, improve organizational performance, learn from the experience of other managers and organizations, and seize new business opportunities. Hundreds of thousands of private businesses and public organizations throughout the world have used the services of management consultants, separately or in combination with training, project management, information technology consulting, financial advice, legal advice, audit, engineering consulting and other professional services.

The International Labour Organization (ILO) has been active in management and small-business development, and employment promotion since the early 1950s. Management consulting and the promotion of effective consulting practices were quickly identified as powerful tools for the ILO’s activities. Through its technical cooperation projects, the ILO has assisted many member States to establish local consulting services for the various sectors of the economy, and to develop management consultants and trainers. At present, the ILO, through many different programmes, is an important user and developer of consulting services.

To respond to a pressing demand for a comprehensive, practically oriented guide to management consulting, three editions of this book were published between 1976 and 1996. The book quickly became a basic reference work and learning text on management consulting, published in 12 different language editions in addition to the English original (Chinese, Czech, French, Hungarian, Indonesian, Italian, Japanese, Korean, Polish, Portuguese, Romanian and Spanish), and used worldwide by thousands of management consultants, educators and clients of consultants. Universities, business schools and management institutes in the United States and other countries have used the book in their management and consulting courses. Many associations and institutes of management consultants have recommended it to their members as essential reference and study material.

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However, management consulting is a dynamic and rapidly changing sector of professional services. To be relevant and useful to clients, consultants have to keep abreast of economic and social trends, anticipate changes that may affect their clients’ businesses, and offer advice that helps the client to achieve and maintain high performance in an increasingly complex, competitive and difficult environment. The knowledge-based economy is generating growing demand and creating new opportunities for consultants. Management consulting is affected by information and communication technologies, the Internet, globalization, market liberalization, major changes in geopolitics, the advent of regional economic groupings, demographic changes, the progress of education, shifts in consumer taste and behaviour, the changing role of governments and the public sector, and numerous other developments. Consultants need to “reinvent themselves” continuously to be able to advise clients on these increasingly complex and challenging issues.

As a professional service sector, management consulting also interacts closely with other professions. This interaction has many facets, including both cooperation and knowledge transfer in the clients’ interest, and fierce competition in national and international markets. The borders between professions are shifting, professional firms merge or split, and new models and techniques of service delivery emerge.

A fundamental reference text on consulting has to reflect all these developments and challenges. Therefore the fourth edition of this guide describes state-of-the-art consulting practices, issues of major concern to consultants and clients alike, current and emerging trends, and approaches likely to enhance the value of the services provided by consultants. All the chapters and appendices of the third edition have been updated. New topics of growing concern to consultants have been added, including e-business consulting, consulting in knowledge management and the use of knowledge management by the consultants themselves, total quality management, corporate governance, the social role and responsibility of business, company transformation and renewal, and the public sector. More attention and space are devoted to key legal aspects of consulting services, such as consultant liability, contracts and intellectual property issues. A consistently international perspective has been maintained: like previous editions, this fourth edition aims to give a true and balanced picture of consulting as it is practised in various parts of the world.

When ILO first decided to develop and publish a guide to professional management consulting in the mid-1970s, the literature on the topic was surprisingly meagre. There were only a few anecdotal pamphlets on the history and activities of consultants, and several conceptual contributions on intervention methods used in consulting, coming from the behavioural science circles. In 2002, a bibliographic search using the terms “consultant” or “management consulting” will produce hundreds of references. Consulting has become a very popular topic and has been covered by many authors from varying perspectives.

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Foreword

The concept of consulting

In this book, management consulting is treated as a method for improving management and business practices first of all. This method can be used by an independent private firm, an internal consulting (or similar) unit in a private or public organization, a management development, productivity or small-enter- prise development institute, an extension service, or an individual (e.g. a sole consulting practitioner or a university professor). Even a manager can act as a consultant if he or she provides advice to peers or subordinates.

At the same time, however, management consulting has been developing into a profession. Thousands of individuals and organizations have consulting as their full-time occupation, and strive for professional standards in the quality of the advice provided, methods of intervention and ethical principles. Individuals who do some consulting without being full-time members of the profession can also comply with the profession’s standards and principles, and should be encouraged and helped to do so.

There is no conflict between these two ways of viewing consulting. Indeed, consulting as a method and consulting as a profession constitute two sides of one coin, and a guide such as this has to deal with both sides.

This book describes the consulting approaches and methods applied to various types of management and business problems, organizations and environments. There is an extremely wide range of consulting approaches, techniques, methods, modes and styles. This diversity is one of the exciting features of management consulting. It means that even clients with very particular problems and characters can usually find a consultant who fits their organization and personality. Conversely, consulting also exhibits certain common principles and methods. Some of them are quite fundamental and are used by the vast majority of consultants. For example, every consultant must be able to use interviewing techniques, diagnose the client’s problems and purposes, structure and plan the work to be done, enlist the client’s collaboration, communicate with the client, share information and knowledge with the client, and present proposals and conclusions orally and in writing.

Thus, to generalize about consulting and recommend a best way of approaching it is difficult and risky at best, and can even be misleading and counterproductive. We have therefore opted for an eclectic approach, trying to provide a comprehensive and balanced picture of the consulting scene, including the different methods, styles, modes or techniques used, and pointing out their advantages and shortcomings. Readers can make their own choice, consistent with the technical, organizational and human context of the given organization.

However, to say that the authors of this book have no bias whatsoever for any approach to consulting would not be correct. We do have a bias, and a strong one, for consulting in which: (i) the consultant shares knowledge and expertise with the client instead of trying to hide and withhold it; (ii) the client participates as closely and intensively as possible in the assignment; and

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(iii) both parties spare no effort to make the assignment a valuable learning experience. Many different methods and techniques can apply within this broad concept.

Purpose of the book

The main purpose of this book is to contribute to the upgrading of professional standards and practices in management consulting and to provide information and guidance to individuals and organizations wishing to start or improve consulting activities. The book is an introduction to professional consulting, its nature, methods, organizational principles, behavioural rules, and training and development practices. It also suggests guidelines to consultants for operating in various areas of management. However, it is not intended to replace handbooks and manuals that deal in depth and detail with management functions and techniques: for this the reader should refer to special sources.

In a nutshell, the book is intended for:

–new entrants to the consulting profession;

–independent management consultants and consulting firms;

–consulting departments of productivity, management and small-business development institutes and centres;

–internal management consultants in business companies and governments;

–management teachers, trainers and researchers (who may be part-time consultants, and whose work is closely related to that of consultants);

–students of management and business administration;

–managers, business people and administrators who wish to use consultants more effectively, or to apply some consulting skills and approaches in their own work.

Finally, many principles and techniques described in the book apply to consulting in general; hence consultants operating in areas other than management and business may also find it useful and inspiring.

Terminology

The most common terms used in management consulting in various countries are explained in the text of the book. But the meaning and use of two basic terms warrant a definition at this early point:

–the term management consultant is used in the book as a generic term to apply to all those who perform all or some of the typical consulting functions in the field of management, on either a full-time or a part-time basis;

–the term client is also used as a generic term to apply to any manager, administrator or organization using the services of management consultants in private businesses, public enterprises, government agencies or elsewhere.

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