Corporate Consulting

Sandberg (2003) is one key proponent of the idea of corporate consulting describing them as “firms within product-based parent organisations” (ibid: 14). Examples of such firms include Shell Global Solutions, AT&T Professional Services and Ericsson Consulting among others. Sandberg indicates that such firms tend to have internal clients (parent company) and external clients. These firms are required to show a high level of independence from their parent companies, which sometimes become challenging, especially when they are dealing with clients that are also competitors to their parent companies. These companies are mostly driven by customer demands on their parent company and therefore are considered as departments or units within the parent company. They are required by the parent companies to satisfy non-core customer demands on the parent company, whilst the parent concentrates on its core business. On the other hand, external clients require them to provide mainly technical solutions in a professional manner. Sandberg (2003) identifies four types of corporate consultancies in terms of how they create value for the parent company and the key knowledge needed to support external clients. The four types have been reproduced in Figure 2.9 below.

Expert CC: Professional knowledge of the consulting firm is exploited and marketed to clients who are not within the value chain of the parent (product) business. An example is ABB Financial Consulting, which provides services such as balance sheet management and other financial support services to clients even though such services are not provided by the parent company – ABB Engineering.

Know-how CC: The consultancy is driven mainly by firm-specific knowledge with the consulting firm acting mainly as knowledge brokers for different departments of the product company. An example is Shell Global Solutions that was created to support internal non-core business services such as product research and technical advisory among others but with time these services have also been extended to external clients.

Spearhead CC: This type of corporate consulting is expected to complement the parent company’s value chain in quite a loose manner. The services provided by such corporate consultants need no industry specific knowledge and may also be required by the product organisation. Such consultancies, as Sandberg identifies, should largely be independent of the parent but still thrives on the brand image built by the product company over the years. An example is Ericsson Consulting, which gives business strategy and customer management advisory services to the telecom industry.

Integration CC: These types of CC like Spearhead CC also complements the value chain of the product company but in a very connected manner. That is, they are highly integrated with the product company whilst relying heavily on firm-specific knowledge. An example is PeopleSoft Consulting, which provides software and IT system solutions to clients, which are closely tied to the product company’s software package.

Corporate Consulting is a growing phenomenon in view of the increasing focus on customer needs (Hax and Wilde, 1999), which has generally led to greater attention on customer satisfaction even where the needs are not entirely related to the core business of the organisation. Often, there is the explanation that the organisation is providing total customer solutions, which can only be described as a myth. With this trend, a unit is usually set up to give the customer the needed support without interfering with the core business of the product organisation. Such units, with time, acquire some competences, which lead to their spin off and invariably becoming corporate consultancies. Though the results of the thesis can be applied to such consulting organisations and their approach to work, the context of the study is rather Professional Service Consulting, which may have some characteristics different from corporate consulting. These characteristics are not captured in this thesis as it is outside the scope of the study.