People advisory services: A multi-disciplinary nirvana?

By Fiona Czerniawska.

Organisations have always used consultants for two main reasons: to access world-class expertise and to give them organisational flexibility (teams brought in at short-notice to accelerate the delivery of a project, extra pairs of hands when the business-as-usual work threatens to overwhelm their in-house resources, etc.). Conventionally, these two needs have been mutually exclusive: you want a specialist or a generalist. Increasingly, though, clients want both.

Nowhere is this more painfully obvious than where people advisory or human capital services are concerned.

We’ve written before in this blog about how a chronic lack of innovation among the large, HR firms created an opening in the market through which the people and change practices of strategy firms and the Big Four walked (ran, really). And they met with huge success, to a point where approximately 78% of today’s HR & change consulting work is delivered by firms that are not HR specialists. Moreover, because these new entrants had a wealth of other services to bring to the table, they spotted the opportunity to integrate a range of disciplines into a single proposition for clients. Optimising your workforce around the world isn’t, they’ve argued, just a case of knowing what resources are likely to be required where, but needs to take into account how easy it is to move people, the tax implications, etc.

But the multi-disciplinary approach, while going down well with clients in theory, seems to be proving harder for consulting firms themselves to swallow. The result, clients tell us, is a disjointed approach, in which individual experts don’t seem to function as an effective team, and where firms themselves seem to be struggling to provide the type of fast, responsive, and flexible service delivery clients are looking for.

So what’s going wrong? The usual suspect would be performance metrics–partners who continue to have their own P&L so have no incentive to collaborate–but much has been done to try to create combined goals. Different perceptions of expertise remain: the more specialised someone is, the less likely they are to appreciate the specialist knowledge of someone else, so people still sit in silos in their heads even when you put them in an office together. But at the heart of this is a widespread failure to see service delivery from the client’s perspective: most people simply haven’t realised just how bureaucratic and fragmented their approach appears to be. If you have to spend 10 minutes explaining your operating model to a client–as one CHRO put it–then something has gone very wrong.

You can’t, I think, create a multi-disciplinary practice by combining several disciplines in one. You have to start again and create an integrated service from scratch.