Consulting Industry Today

Top 12 Overlooked Challenges in Digital Transformation That Can Prove Costly to Clients and Consultants.

by | May 28, 2019 | Knowing the Consulting Industry

In the new digital economy era, the demand for change to the traditional consulting business model is more pressing than ever. Digital transformation is providing consultants with nearly 40% of their revenue, but still, there are plenty of challenges for Clients and Consultants as well.

The good news is several levers can be implemented to guide Consultants and Clients in the right direction.

There is the shared goal – Clients and Consultants aspire to become digital enterprises.

And it’s interesting to see is how Digital transformation is changing Consulting business models, and more specifically, the challenges that Clients and Consultants now face.

Consulting firms still have many hurdles to address to be able to exploit this opportunity, and to avoid being disrupted themselves by new forms or automation.

“Problems are good, as long as you solve them quickly.” – Meg Whitman


We have a developed a List of Challenges that represent new opportunities as well-

1. Adoption is still slow –

Even though Digital transformation is happening, and Consultants are adding digital service offerings to their portfolios adopting digital tools to enhance their capabilities, the process is still slow. The slow digital transformation of many consulting firms is inexcusable. Take a look at the websites from the consulting firms in your network, and you will see if the shoemakers have good shoes.

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2. Clients expect better value and customized solutions –

Clients in the digital economy are demanding more value from day one and customized solutions unique to their specific problems. New upstart competitors leveraging data and technology are beginning to make waves. Should the clients take the usual route through consultants or embrace the disruption proposed by fashionable start-ups.

3. Stronger integration –

Adopting new consulting business models that leverage digital applications is crucial to the transition of Consulting firms into the Digital transformation economy. For example, Accenture started to implement Agency-type services that comprise of ad spending, media, and consulting together.

4. Optimization of the Intellectual Property Value –

McKinsey Solutions lead the way with their Productized Approach in an attempt to get the best value of their intellectual property. BCG is stepping in the same footsteps with several tools that look extremely close to the Mc Kinsey ones. See for instance Key by BCG vs. Wave by Mc Kinsey. Another productization is offered by a company like nine lenses industrializing assessments (maturity models, capabilities, …) for all professional services from consulting to talent.

5. On-demand Subscription Service –

First introduced by GLG Introduces, the As-A-Service Model, this new opportunity needs to be tested as a business model.”As-a-service” will include more long-term, smaller projects rather than large-scale projects for a fixed period.Subscription pricing, instead of billable hours, and on-demand services, is also a new financial model that will gain ground.

6. Consultants need to lead by example  –

The challenge to Consulting firms seems that first, they need to adopt digital transformation, then promote it to clients. Management consulting companies have mastered the art of selling “digital transformation” projects to clients, but still struggle to adopt digital tools in their business model. 

Also, digital transformations promoted by consultants need to be pragmatic enough. Aspirations do not always convert at the bottom line level, and the level of risk associated with digital models is quite high.

7. New significant cost savings for Clients  –

The significant cost savings that Digital transformation can bring represent an attractive proposition. If clients can save enough thanks to digital in their operations, it can fuel other profound transformations in other areas. From digitizing processes to the digitalization of ways of working, the opportunities for savings are almost unlimited.

8. Embracing Digital transformation internally –

Consulting firms followed different strategies to deliver digital transformation projects, with a strong focus on how to best serve their clients externally more than how to embrace a digital culture internally. A good indication would be the number of Chief Digital Officer within consulting firms. Rather limited, isn’t it? Are consultants sharing best practices or re-inventing them? How codified is knowledge ? Are they using digital learning platforms …. Do they take advantage of open innovation?

9. Opportunity to attract top Tech talent  –

Thanks to the attractive elements of the consulting career such as low risk, higher salary, diversified work experience, and fast career growth, Consulting firms can attract the best tech talent, at least those not joining the GAFAs and have them join their digital transformation teams. But the competition is fierce with the start-up world and the sirens of venture capital.

10. Pressure on Consultants to deliver top-notch digital transformation expertise –

We see digital transformation as a massive opportunity for growth for clients and consulting firms. Businesses will have to rethink their business models and processes to succeed fundamentally. Clients will be very selective in choosing their business partners while willing to pay high consulting fees to ensure their business doesn’t get disrupted in the Digital transformation age. This calls for creating a successful differentiation among Consulting firms, as they offer similar sets of expertise.

11. The emergence of Crowd Consulting –

As an evolution of innovation crowdsourcing, consulting crowd consulting could provide great value to the clients to solve micro battles, allowing them to access the best possible expertise and insights irrespective of which Consulting firms they decide to work with.

From a Consulting Firm standpoint, it raises similar questions. Should Consulting firms build the capabilities in house, develop a network of reliable experts and subcontractors or Should they rather rely on digital platforms ?

12. Clients’ capability development –

One of the main challenges for both clients and consultants remains capability building of clients. In any consulting project, capability building is important, to ensure the implementation of the strategy, but even more demanding in Digital Transformation.

As client gear to embrace digital transformation, they will need to staff at various levels. Implement governance to manage demands for Digital Transformation. Create catalysts in the organization to promote digital culture and propose low-cost rapid prototyping. But also connect the ideation and project management properly with the rest of the IS infrastructure without hampering speed with legacy processes. Did anyone say agile?

As we outlined the main challenges and opportunities in the Digital Age, we know that every client faces a unique set of questions. We welcome the opportunity to discuss your specific needs and see how we can further assist you in your Digital transformation journey. Do not miss the chance to step up your digital strategy today and bring it up to pace with the changes transforming your industry.

If you want to share your experience on digital transformation, or need help to get started, you can just book a call. We are always happy to help.

CEO and Co-Founder at | Website | + posts

Hélène Laffitte is the CEO of Consulting Quest, a Global Performance-Driven Consulting Platform and author of “Smart Consulting Sourcing”, a step by step guide to getting the best ROI from your consulting. With a blend of experience in Procurement and Consulting, Hélène is passionate about helping Companies create more value through Consulting.

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