Project Management in Consulting Firms

Despite the crucial role that consulting firms continue to play in the current business environment (Visscher, 2006; Bloch, 1999; Haywood-Farmer and Nollet, 1994), a review of literature showed that there is less emphasis on the way consulting firms (PSFs in particular) are governed and how they do their work (Grey, 1998). Of the little that is known about PSFs is that they usually operate in highly institutionalised environments such as resorting to methodologies (Stumpf et al, 2002), which are accompanied by unique governance and management challenges (Stumpf, 1999). These unique governance and management challenges manifest themselves in the way PSFs do their work, more specifically on assignments undertaken by the firms, since each consulting assignment can be considered to be a unique project in nature (Kipping & Engwell, 2002).

Consulting firms are involved in a variety of assignments depending on their line of focus. Their work is intangible (Alvesson, 2002; Lowendahl, 2000; Greiner and Metzger, 1983) and its classification can be a subject of debate among practitioners and scholars (Chickillo and Kleiner, 2007). However, Cadle and Yeates (2008) state that consultancy and business analysis assignments are projects, even where it can be as simple as giving advice. This is supported by the fact that PSFs are considered as temporary service providers (Kubr, 2002; Lowendahl, 2000; Greiner and Metzger, 1983) whose mandate is to provide unique support over a specific period of time. Nonetheless, it is not uncommon to find PSF work that spans over several months or years (Stumpf et al, 2002) but such relationships are considered temporary to the extent that contracts between the parties are for shorter periods and specific solutions. Nachum (1999:4) supports this view by describing PSF as providing “one time solution to specific client problems”. The idea of one time and specific problems mean PSFs are not included in the standard organisational structure of their clients but considered as temporary organisations. Their works then conform to the definition of projects as “temporary endeavour…to create unique…service” (PMI, 2004:5). Since the services provided by PSFs are customised or adapted to specific client’s requirements (Chang and Birkett, 2004), which covers the element of uniqueness in projects. Thus PSF assignments can be considered as projects in terms of support provided to clients. Therefore it can be deduced that consulting firms by their very nature are project based organisations and are not exceptional to new developments in project management .

Chickillo and Kleiner (2007) emphasize the need for consulting firms to adopt new ways of approaching their work in order to experience the growth had happened within the industry in the past. In view of this, the adoption of agile becomes more relevant for consulting firms because according to Cadle and Yeates (2008), estimation, planning and control of assignments in consultancy is sometimes difficult since some clients have a vague scope (do not understand their problem) and are unable to specify their specific requirements. In addition, most consultancy projects are obtained on the basis of a fixed-time and fixed-cost constraints which strongly interfere with how the project will be executed in the face of uncertainties (Hällgren and Wilson, 2008; Steffens et al, 2007). In these situations, the consultant will also be constrained by the budget and time scale from the contract. To deal with such challenges, the budget and time scale ought to be fairly flexible (Cadle and Yeates, 2008; Steffens et al, 2007) and this is where the adoption of agile project management may be useful.

Although it is normal practice for some consultancy to agree and fix the scope of the project before execution, it must be noted that this may lead to the unforeseen challenges of trying to explain to the client the limitations that may emanate from this arrangement (Kakabadse et al, 2006). These limitations may pose issues such as scope creep leading to delays or a narrow scope, which may not result in desired outcome (Cadle and Yeates, 2008). These situations create accusations and counter accusations when project manager try to adjust the scope to meet quality delivery requirements; whilst on the other hand, he may be viewed as being greedy to increase his contract value (Kakabadse et al, 2006). Therefore, for some projects it may be necessary to adopt a flexible approach that allows for uncertainties in defining scope at the onset. The need to consider other project management approaches (such as agile) is illuminated by the increasing complexities and uncertainties of client’s business, use of technology and stiff global competition (Kubr, 2002) among others that consequently result in project management challenges for PSFs.

There is well documented evidence on TPM being exploited to the benefit of consulting firms, however, little is known about the newly emerging approaches. For instance, Henry (1982) in his study on, ‘A look at the strategic planning consulting firms,’ mentions that the Boston Consulting Group (BCG), Mckinsey & Co and Arthur D. Little have been running their assignments as structured projects for a long time. Stumpf et al (2002) describes PSF’s TPM approach to projects by indicating that they are standardizing service offerings through the use of methodologies in their approach to work. Furthermore, the fact that consultancies are expected to ensure stability within teams and establish good relationships with clients by focussing on communication and management skills as well as the project outcome (Chang and Birkett, 2004), shows that traditional project management exists in consulting firms.

Nevertheless, some literature on professional service firms suggest that APM practices may be part and parcel of their project management operations. For example the study carried by Chang and Birkett (2004) on an Australian branch of a large international accounting firm (providing professional accounting and consulting services) details how autonomous and creative top teams are exploited to manage projects in such a professional service firm. They highlight that at a certain level of professionalism, the team members are expected to “manage assignments from start to finish with limited supervision” (pp. 19). This suggests that APM may be applied for certain projects in PSFs because some of its principles are already being applied. In this case, team autonomy and creativity are important elements of APM being employed by this professional service firm. The bottom line, however, is that project management exists in consulting firms and can be enhanced for their benefit in this rapidly changing business world. Therefore, with the proliferation of consulting firms (Visscher, 2006) and the difficulty in differentiating products or services offered, it is important for PSFs to consider adoption of new project management approaches that can help them to deliver effectively, retain and acquire new clients in a competitive environment (Ferguson, 1996).