NEW YORK: I once worked for a large magazine company in the US that was worried about falling revenues and loss of readership amid what was then called the dotcom revolution. Corporate leaders decided to hire a major management consulting firm to analyse what should be done.
While the profession boomed during COVID-19, when companies desperately sought help to deal with everything from supply-chain troubles to work-from-home shifts to the uncertain nature of the economic cycle, it is now slowing. According to the Kennedy Consulting Industry Monitor, revenue growth halved to 5 per cent last year.Consulting firms are coming under political pressure, too.
Economist Mariana Mazzucato and her colleague Rosie Collington last year published The Big Con: How The Consulting Industry Weakens Our Businesses, Infantilizes Our Governments And Warps Our Economies. Indeed, the industry’s problems go even further back. One could argue that modern management consulting is the unfortunate love child of early 20th-century Taylorism - in which Frederick Winslow Taylor, a mechanical engineer from Philadelphia, aimed to clock the productivity of workers down to the second - and Chicago School ideas about “efficient” markets, which gained steam from the 1960s onwards.Consultants have created a huge global market by preaching the gospel of disruption.
In the beginning, he says, executives thought “we need to fix this problem; therefore, we need to change”. Now, he says, too many believe that “we need to change, because then all the problems will be fixed”. It’s possible that a recession will give the industry new life. Management consulting often makes money by telling companies to cut staff. It can also replace them temporarily with either technology or more consultants, without all those bothersome issues of full-time employment or benefits.