Strategic consulting companies play an essential role in the success of modern, transforming enterprises and are trusted to work alongside clients to address some of the toughest problems within their operations. “Strategy consultants provide clients with an outside view of options and trade-offs that business leaders need to make in order to achieve their corporate mission and vision, or specific business objectives, these can include: increasing revenue, reducing costs, acquiring a target company, or entering a new market,” explains , leading Strategy and Operations at Bain & Company (Middle East).
There are multiple scenarios where businesses would look to hire a strategy consultant. However, Haddad details that they typically fall into one of three categories:
1. New leadership team
“When either a new Board of Directors is formed, or a new management team is put in place, the time is right to assess the current state of the business and (perhaps) sail into a new direction. This typically entails developing a new corporate strategy and strategy consultants come in handy to help with this process.
2. New business opportunity
“Strategy consultants are often brought in to help with a critical decision related to the ‘non-core’ part of business operations. The types of decisions encountered here include entering a new market with an existing product, acquiring a competitor, selling off a business unit, or launching an adjacent product line."
3. Complex business issue
“Even while running ‘core’ business operations, business leaders might be faced with tough decisions that can have a long-term impact, such as how to price a new product, how to improve the performance of their business model, what organisation structure is best suited to cater to productive employees, or what compensation model to offer employees. Strategy consultants are hired to help in all of these situations.”
Organisations that fall under these categories can benefit from unbiased opinions, adept problem solving and short term results with long lasting impact, and while Haddad highlights that “sometimes the message that consultants will deliver is not necessarily what the executives want to hear,” he stresses that at Bain & Company this is what it calls ‘True North’. “It means that we are guided by our unwavering commitment to always do the right thing by our clients, people and communities. We have a deep intellectual honesty, and the candor to tell it like it is in straightforward language, which can at times challenge our clients to think and act differently.”
Considering the current state of the industry, Haddad reports multiple emerging trends when it comes to strategy consulting, such as the rise of remote collaboration. “Strategy consultants usually travel to be on site with their clients. The global freeze in travel as a result of COVID-19 has meant that we have needed to adapt to be able to work as one team, if we are in different locations. We have been surprised at the degree to which we have managed to achieve this and some of the best practices of remote collaboration could continue even once travel normalises again.” In addition Haddad has seen an increase in demand from government entities and the digitalisation of offerings as more and more businesses move to online services. “Strategy consultants have traditionally collaborated with private sector companies. However recently several government entities, especially State Owned Enterprises (SOEs) have seen the value in applying private sector philosophies into their operating model leading to more collaboration with strategy consultants. In addition, with businesses moving to online services and interactions, strategy consultants have had to keep up with this trend and load up on digital capabilities to better serve their clients.”
When it comes to developing a business strategy, Haddad explains that it needs to have three components in order to be effective which include a baseline assessment, strategy design and results delivery plan. “There needs to be a thorough understanding of the starting point of the business,” details Haddad. “This is achieved by conducting extensive interviews of the leadership team, the customer facing employees as well as the customers themselves, and by analysing key metrics of the business such as financials, operational metrics, organisational elements, competitor benchmarks, etc.”
Once the starting point is understood, Haddad further explains that it is then time to articulate a mission, vision, or objective, along with the ‘what’ and the ‘how’ of the strategy, highlighting the key priorities and enablers that will bring the strategy to fruition. Finally comes the results delivery plan, “this is where most strategies fail. They look extremely nice and ambitious on paper, but practically they are impossible to implement. Experienced strategy consultants will think long and hard as to what are the day-to-day activities that need to be executed in order to bring the strategy to life and see increasing tangible impact.” Built correctly, this method needs one more feature in order to be effective and that is “an empowered, decisive, and unified leadership team. If the leaders of the business are convinced that the strategy will take them to the next level, they need to rise up, have the courage to take difficult decisions, and communicate the same key messages in a clear and memorable fashion,” adds Haddad.
How has COVID-19 impacted strategic consulting?
With the COVID-19 pandemic having a huge impact on every industry and the larger global economy, Haddad reflects that “while each sector has had their share of ups and downs, strategic consultants have been sought after to help create a plan to sustain and manage the damage caused during the COVID-19 phase.”
Since the outbreak, Haddad has seen a surge in demand for strategy consulting from two main sources: COVID-19 ‘war rooms’ and companies in ‘boom’. Within the industry Haddad has seen “several clients reach out for help to put in place a plan to tactically respond to the ongoing pandemic. While at the same time developing a strategy to come out of the pandemic in the strongest position possible and mitigate a second wave or potential similar pandemics in the future.” In addition to these types of clients, Haddad has also seen online marketplaces, gaming platforms, healthcare providers, and safety and security operators see demand for their offerings soar exponentially during the COVID-19 pandemic. “Several of these companies were not ready for such a dramatic change in the market and have worked with strategy consultants to help them come up with an action plan to drive sustainable growth for their business.”
Looking to the future for the strategy consulting industry, Haddad believes that the future is bright for strategic consulting after COVID-19. First, strategy consultants need to embrace and look for further opportunities to serve the currently booming industries that are in need of proper direction. Second, as businesses start to deal with a post COVID-19 world in the next few months, the traditional demand for strategy consulting will come back even stronger with new challenges and new questions to ask, and strategy consultants will be ready to answer them.”