Management consulting

●Conformance to what the system was designed to do. For instance, a payroll programme that allows arithmetical errors or a banking system that is open to attack by hackers is simply not acceptable.

●Satisfaction of the needs of its users. This becomes increasingly difficult as the range of users increases from trained employees, to trusted customers to members of the general public. To quote F. F. Reichheld and W. E. Sasser:5 “The focus of quality control in any service environment switches from zero defects in the product to zero defections of customers.”

●Flexibility to meet new business needs and user needs that have not been fully foreseen. Many examples of competitive advantage through information technology have arisen because users see new ways of using existing systems.

Consultants can help ensure the conformance aspects of quality by good project management and software engineering. Satisfaction of user needs results from consultation, experiment and prototyping. Flexibility is a trade-off. It must be built into IT products at an early stage in their design and will carry a significant cost. Sometimes it is better to scrap an inflexible system and start again rather than to try to build on shaky foundations.

13.5 The providers of IT consulting services

The variety of providers tends to grow as the relationship between IT and management consulting becomes more complex and as new generations of IT systems become commercially available. A short overview is given here. For advice on selecting consultants see box 13.1.

Strategy consultancies

In the past, the international high-level strategy consultancies tended to work at the corporate rather than the functional or operational level. However, the growth and strategic importance of IT has given them no choice but to become closely involved in IT strategy. The best of these firms are leaders in understanding the impact of IT on business strategy, and the best firms will be honest about how far they regard implementation of IT strategy as being within their competence and their interests.

General management consultancies

IT consulting is the biggest and fastest-growing segment of management consulting as a whole. It follows that any large firm of general management consultants will have a large IT consulting practice and will have built up a lot of experience. One selling-point for the larger consultancy is the ability to carry a project through from strategy to actually running the hardware if necessary.

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Consulting in information technology

Box 13.1 Choosing an IT consultant

The following guidelines should help in the selection of an IT consultant. Although these are addressed to the client, consultants should also bear these points in mind and recognize the difficulties that clients have in buying the services that they sell. The guidelines should be read in conjunction with Appendix 1, “The client’s ten commandments”, which suggests general principles for selecting and using consultants.

1.If you are likely to need IT consultants (and most organizations do), then budget well ahead so that you are not forced into a time-and-materials contract that looks cheap in the short run but may be expensive in the end. You should also budget for time to manage the consultants.

2.Be very clear about what you want. What are the tangible deliverables? What are the intangibles? What will it be like when you get to the end of the project? Decide if skill transfer to your staff is an important deliverable.

3.Be very clear about the scope of the project. “Scope creep” is endemic in IT projects and can be in the interests of the consultants, at least in the short term. Consultants should note the difference between “selling-on” a follow-up project and allowing the current project to drift.

4.Develop relationships with a small number of consultancies. Competitive tendering is a time-consuming process for client and consultant and is sometimes done so badly as to be worse than useless. If you need to go out to tender, then limit the number of competitive quotes.

5.Talk to other clients of your chosen consultant before making a final decision. This is unlikely to reveal any real horror stories but it will enable you to form a view on how well the consultants will fit your organizational culture and way of working.

6.Check the breadth of skills on offer. Is the consultant essentially a specialist in technology or a strategist? Can the firm offer a broad service? Will some aspects of the service be offered through their partners or subcontractors?

7.Make sure you meet the individuals who will be working on the project, not just the senior consultants who are doing the selling.

8.Be honest about your budget and demand honesty from the consultants as to what they can deliver for that price.

Many consultants will have formed partnerships with hardware or software manufacturers. Although it can be argued that this militates against their impartiality, most clients value the increased technical capability that arises from a well-managed and open partnership.

Specialist IT consultants

The growth of the IT consulting sector has fuelled tremendous growth and diversification in consultancies that started out as IT specialists. In the same way that the general management consultants have been forced to embrace IT,

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Management consulting

the one-time specialists have recognized the need to develop general management skills. Firms that started from a technology base now rival the traditional consultants in size. Mergers, alliances and spin-offs have further blurred the boundaries so that the distinction between the large general management consultancies and the technology-based ones is largely a matter of history.

New entrants

The underlying market strength of IT consulting, and in particular the rise of the Internet, has allowed new entrants to appear and to grow rapidly. Many have started by providing a specialized service such as Web site design. Some of these are maturing into full-service companies while others continue to specialize.

Hardware and software suppliers

It has always been a feature of IT consulting that some of the largest players are the hardware and software suppliers themselves. This tendency has intensified through strategic alliances of various kinds so that few of today’s consultancies could claim to be truly independent of the IT manufacturers.

“Virtual” consultancies

The great diversity of skills needed to implement IT systems has facilitated the rise of “virtual” consultancies.6 These are formed on a project basis and teams usually come together because a leader, either a firm or an independent consultant, has an opportunity to bid for work that is too large or complex for him or her to handle alone. This method of working can be very effective but it is hard for clients to judge the capabilities of the network in advance. It is therefore safest to start by employing a virtual consultancy on a relatively smallscale, low-risk project.

Individual consultants

Individual consultants offer a valuable source of expertise and a potentially independent source of advice. The risks of using a single individual can be mitigated by looking carefully at their track record and their references and by allowing them to prove themselves first on a small project. Although individual consultants are unlikely to have a formal alliance with a hardware or software manufacturer, they are inevitably influenced and limited by their own experience. A consultant with broad experience of different systems is better able to select the right tool for the job whereas, paraphrasing a piece of homely wisdom: “to the consultant whose only tool is a hammer, every problem starts to look like a nail”.

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