In India, the consulting or the business advisory market is said to be valued at around $12 billion, with nearly $1.5 billion of the revenues that flows into the pockets of the top management consultancy firms. However, considering the global disruption in the consultancy industry, India too, finds itself to be in similar waters with regards to the onset of major disruptions.
Such disruptions are being caused by the enabling of new business models, swift technological developments, replacement of older distribution channels, and changes in the manner of how businesses and people interact with each other.
As mentioned earlier, disruptions are taking place across most industries globally. If you examine the Fortune 1000 lists starting from 1973, you will be able to tell that significant changes have already occurred. By 1983, one-third of these companies were not present on the list, and by 2013, only 30% of the original companies were still on the list. These changes will continue to increase at a faster pace since only one-third of today’s major corporations are projected to survive in the upcoming 25 years.
The alterations mentioned above are caused by mega-trends that have interrelated and far-reaching consequences for businesses, industries, economies, societies, and individuals. All these factors combined are causing immense transformational shifts or disruptions.
Before taking a deep-dive into these disruptions, it is essential to know what business advisory is?
Business Advisory refers to the essential services, advice, help, and support offered by experts that help businesses to achieve success. The primary objective of business advisory services is to provide a greater focus on a business’s value proposition by delivering a variety of competencies and advisory services.
Principally, there are four main functions of business advisory or consulting, which includes:
Information: The business advisory analyses the client’s industry, market position, and data in-depth and gives suggestions.
Expertise: The business advisory offers solutions to problems that are discovered after analysing the client’s data.
Insight: The business advisory rigorously analyses the data to provide ideas that will help a business succeed.
Execution: The business advisory offers a roadmap for selecting and implementing the changes to be made for the short and long-term success of the business.
Let us now take a look at some of the trends that are disrupting business advisory services in India:
In today’s time, digital transformation contributes to a stark $44 billion towards the global business advisory industry. Further growth is expected due to the advancement of novel automated technologies and the increasing deployment of Artificial Intelligence (AI).
As technology continues to develop, the requirements of businesses change to accommodate said developments. Technology is impacting business consulting companies in a major way, be it communications or healthcare.
An instance of the challenges faced by business consulting firms is the utilisation of AI-identical technologies. These technologies enhance do enhance a firm’s processes and increase innovation in business advisory services leading to higher growth.
However, they are costly to implement, and they exacerbate the existing digital competencies gap across the business spectrum.
It’s no secret that the gig economy has reshaped the way businesses now work, since on-demand talent is cost-effective in the long-term, due to lack of commitments to employee benefits like pensions scheme or sick leave have been regularised.
At the same time, business consulting companies do not have to continue paying the salaries of experts every month if they are only hired on a project-to-project basis. This is an excellent way for business consulting firms to tap into the talent pool. Still, at the same time, it comes with issues in the form of work quality, talent availability, and the efficiency of non-permanent staff.
Apart from this, another issue arises in the form of digital intuitive software and platforms. Due to digital transformation, business consulting firms have begun subscribing to the aforementioned intuitive software and platforms for which they have to pay substantial subscription charges.
In this context, the hiring of experts on-demand might lead to exploitation or misuse of such platforms, or even confidential data breaches. Furthermore, it is difficult for business consulting companies to encourage the flexible workforce to take a hands-on approach towards project completion.
Clients are increasingly demanding that business consultants be up-to-date and highly skilled on the latest technologies that enter the markets. Unfortunately, the exponential speed at which new technology is being developed and introduced in the market can leave even the most dedicated business advisories at a loss.
Hence, in an attempt to meet the massive demand for infinite demand for technological knowledge, the top management consultancy firms are acquiring or merging with technological start-ups or digital agencies.
Besides, clients are also demanding that business advisories possess an in-depth understanding of the legal and regulatory landscape. Thus, business consultants also find themselves burdened by the interminable need to be aware of the latest regulations and legislations in the legal domain.
Nowadays, clients are demanding higher value for their money with both public and private companies coming under scrutiny for their spending on business advisory services.
Due to this, business consulting companies are being forced to work on performance-based payments. In other words, business consulting firms are not appropriately paid for the number of hours worked. Instead, they are paid for the work that has resulted in success in terms of the goals and objectives of the client.
This may not be an issue for the top management consultancy firms, but it does affect smaller-scale business consulting companies. The effectiveness of performance-based billing wholly depends on the understanding between the business consulting firm and the client who has entered into a contract.
We, at TRC Corporate Consulting, offer comprehensive, tailored, and innovative business advisory services to meet the business requirements of our clients with the help of our extensive industry experience, detailed technical knowledge, and creative and smart forward-thinking.
Our expert business consultants dedicatedly serve clients throughout their business lifecycle and assist them to emerge smarter and more robust by providing them with overall distinctive client experience. For more understanding about our business advisory services, contact us!