Management consulting and strategy consulting are often used interchangeably. But both fields are quite different.
They are both centered on solving problems within an organization. These range from revenue, cost, operations, performance-related problems, and so on.
This post compares management consulting and strategy consulting. So continue reading to know more.
What Is Management Consulting?
First, let’s define management consulting. Management consulting is centered on helping businesses to improve performance. A management consultant is hired for this purpose.
Management consultants can work directly with the company leadership. Organizations hire consultants for external advice. They believe the consultant’s expertise will help propel their business to a greater height.
Hiring a management consulting is necessary for businesses experiencing a decreased performance. With the expert’s help, such businesses can bounce back and achieve their targeted goals.
Career-wise, management consulting is highly competitive. For instance, McKinsey, one of the world’s largest consulting firms, only accepts about 1 percent of candidates that apply to join the firm. Their acceptance rate is even lower than Harvard Business School.
What Management Consulting Entails?
Management consultants are known as problem solvers. They work with the organization’s leadership to find a lasting solution to performance and operations-related problems.
So, for issues relating to performances and operations, management consultants are the go-to experts. They can handle simple and complex projects in both small and large organizations.
It’s also important to note that most management consulting firms focus on specific industries. Some focus on marketing, IT, healthcare, and so on. Others might take a broader approach and focus on varied industries and business-related issues.
How management consultants operate is this. Once they arrive at the client’s site, the first step is to understand the business. The consultant interviews the employees and gathers as much data as he or she can. The consultant then analyzes the data and presents the information in a simple-to-read format to the top executives or clients.
However, this is just a summary. The job can be more complex.
Here are the services that management consultants offer:
- Process analysis
- Strategy development
- Technology implementation
- Development of coaching skills
- Operational improvement services
- Organizational change-management assistance
Skills Required For Management Consulting
The basic skills are communication and analytical. The consultant has to interview the company’s employees, gather and analyze the data collected. From the analysis, management consultants can prepare recommendations for the company’s key players. They also have to convince the company leadership that their recommendation is the best.
The recommendation must include the problem, solution, and ways to achieve the targeted goal.
Here are other skills consultants require to succeed on the job:
Consultants must be ready to learn new things. It doesn’t matter the experience they have up their sleeves. The ability to search for new information and changing trends can prove helpful on the job.
Planning is very crucial in consultancy. Clients do not only want to know the problem. They also want to know the solution, including how to achieve the result. That’s the reason they hired a consultant in the first place.
Consultants are problem solvers. If businesses don’t face problems, there won’t be consultants. Experts in this field must have the ability to solve any problem thrown at them. It doesn’t matter if they’re familiar with the problem or not.
Consultants need strong people skills. The job involves interacting with employees and the company’s leadership to identify and solve problems.
The ability to gather information, inspect and analyze the data is crucial in consulting. By inspecting the data, consultants should identify the problem and proffer a solution and roadmap to get the results.
Oral and written communication:
This skill is very important to consultants. Why? As a consultant, you need to explain the problem and solution to the company leadership’s understanding.
Top Firms That Offers Management Consulting:
- Ernest & Young
Why Is Hiring A Management Consultant A Great Idea?
If you’re seeking reasons to hire a management consultant, you have found them. Here are reasons you need to hire a consultant for your business.
Track and solve problems:
Because employees are closer to the problem, they may not know the actual problem crippling the business is. But when you hire a consultant, the problem is quickly identified and resolved. You can get the solution within a given deadline. The truth of the matter is, it’s easier for an outsider to spot a problem than an insider, let alone a consultant who has years of experience.
Whether the business is making a profit or not, you must pay your employees at the end of the month. But when you hire a consultant, you won’t be paying every month. You only need the services of a consultant when there’s a problem in the business. It’s just like fixing a car. You only need a mechanic whenever the car becomes faulty.
Effect needed change to uplift the business:
Since everyone in the company is used to the status quo, it can be difficult to effect some changes. Some employees may not even take it seriously since the order is coming from a colleague. But if it’s coming from a consultant, they might be more serious about implementing it.
What Is Strategy Consulting
Most people use the terms strategy consultants and management consultants interchangeably. So now that we have defined management consulting, let’s do the same for strategy consulting.
Strategy consulting is often called boardroom consulting or strategic advisory. Most consultants view it as the high-end segment within the profession.
Organizations approach strategy consultants to help develop and implement successful business strategies.
So what’s a strategy consulting? It involves a process where businesspeople comprising general executives, management, and board members decide to hire a third party (consultant) to offer their view on the business challenges.
A Handy Tip: A strategy is a plan developed to achieve a short or long-term goal.
What Does Strategy Consulting Do?
The name “strategy” tells all you need to know about strategy consulting. Consultants use their knowledge and skills to develop strategies for their client’s businesses. They may also play a part in implementing the strategy.
High-ranking managers and executives within an organization are responsible for strategic decision-making. That’s why strategy consultants usually work for them.
These consultants also help businesses to redefine their mission, vision, and strategy. As you know, a business may struggle to reach its full potential without defining these terms.
Strategy consultants create a roadmap for businesses that want to break into new markets. While in the area of merger and acquisition, they support the M & A process. They do so by setting the merger and acquisition strategy, create the merger business case, execute the commercial due diligence, and design the road map of the integration.
They carefully study and analyze a firm’s practices and goals. From there, they can make suggestions that will get the company back on track. Consultants devise full-proof plans to help organizations reduce costs, increase revenue, and make critical decisions.
These experts help clients analyze their business competitors to establish objectives and goals that will drive them forward.
Top Firms That Offers Strategy Consulting:
Difference Between Management Consulting and Strategy Consulting
We have defined what management consulting and strategy consulting are. Now let’s take a proper look at the differences between both terms for better understanding.
- One of the differences between strategy and management consulting is that the former occurs at the executive level. These include the CEOs and top leaders, such as the company’s board of directors.
- Big corporations and firms hire strategic consultants to concentrate on policies in a given niche. However, companies of various sizes hire management consultants, and they use their knowledge in diverse domains.
- Strategic consulting is a subset or a niche under management consulting. Management consulting is more generic, as it encompasses every aspect of the business.
- A management consultant’s job involves addressing issues relating to running the business. The strategy consultant’s job involves addressing issues on changing the business subject.
- Strategic consulting involves acquiring a deeper understanding of a business’s goal and direction.
- Strategic consulting is more specific. But management consulting includes every aspect of how a firm should function to get positive results.
Management consulting and strategy consulting are two separate fields in consulting. When faced with problems, a business may turn to consultants for help. Strategy consultants are usually the first to call upon. Once they are done, management consultants can come in. They implement the strategy recommended and mobilize the parties involved to achieve the goal.
However, strategy consulting is also a subset of management consulting. Management is more generic.
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