Originally posted on Deltek.com. Link here: 2023 Unwrapped: The Consulting Year-In-Review – (Part 1) Navigating Uncertainty
2023 has brought unprecedented challenges that have tested the resilience and adaptability of everyone throughout the consulting industry. Recently, we asked some of the top industry thought leaders to discuss the challenges they faced this year and the opportunities they see for 2024 and the future. Part one of our year-in-review blog series focuses on the top challenges faced by consulting firms last year, later we’ll detail the opportunities identified for 2024.
Not surprisingly, all of our experts pointed to uncertainty as the top challenge facing consultancies in 2023. But the real question is, what to do about it? Below, we share some of their tips:
6 Tips for Navigating Uncertainty in the Consulting Industry
#1. USE UNCERTAINTY AS A CATALYST FOR OPPORTUNITY
Tissa Richards, CEO, award-winning leadership author and keynote speaker, emphasizes that uncertainty has been a double-edged sword. While hiring freezes and delayed budgets have impacted project timelines and client decision-making, the challenge has also brought opportunities. Richards emphasizes that consultants can turn these challenges into opportunities by helping companies navigate uncertainty. Despite reduced budgets, companies still need to invest in growth, innovation, and outcomes.
“If you are good at what you do, there are always opportunities – especially if you can help companies navigate through uncertainty.”
– Tissa Richards, CEO and Leadership Expert
#2. BECOME AGILE & CLIENT-CENTRIC
Luk Smeyers, Founder of the Visible Authority, highlights the impact of economic uncertainty on consulting businesses. Smeyers advocates for agility, innovation, and client-centric approaches to address reduced client budgets and project indecisiveness. He lays out a four-pronged strategy that involves deepening existing client relationships, innovative service design, redefining client engagement points, and establishing data-driven educational leadership.
“Clients’ budgets, needs, and expectations have evolved rapidly, requiring consultancies to be more agile, innovative, and client-centric than ever before.”
– Luk Smeyers, Founder of The Visible Authority
Dave Hofferberth, Managing Director at Service Performance Insight, also underscores the impact of geopolitical issues on global uncertainty, emphasizing the need for agility and adaptability in the face of these changing economic landscapes.
#3. FOCUS ON YOUR IDEAL CLIENT
Jason Mlicki, Principal of Rattleback, sheds light on the quick changes in the business cycle, emphasizing that firms have faced talent retention challenges amidst a hot market. Mlicki suggests that successful firms utilized this period to become more selective in client acquisition, improve delivery approaches, and adopt value-based selling methods. This strategic evolution allowed them to enhance prices and margins, setting the stage for sustained growth. However, anecdotal evidence suggests a slowdown in the second half of the year, prompting firms to explore and expand lead-generation programs for business development.
“The best firms used this window to get more selective in the clients they take on, improve their delivery approaches, and adopt value-based selling methods to increase prices and margins.”
– Jason Mlicki, Principal of Rattleback
Consulting Leadership Panel: 2023 Unwrapped
A Year-End Review of Consulting Challenges and 2024 Opportunities
#4. INCREASE VISIBILITY WITH INDUSTRY THOUGHT LEADERSHIP
Andy Jordan, President of Roffensian Consulting S.A., also sees massive uncertainty impacting budgets and margins for many organizations. He advocates for a shift towards thought leadership and strategic consulting work, focusing on delivering smaller, faster solutions to meet short-term needs. Jordan anticipates a more predictable 2024 and encourages consulting firms to adapt to the changing economic environment.
Luk Smeyers agrees that firms should focus on becoming thought leaders but argues that they need to focus on data collection and analysis. “Given the thought leadership noise in the market, I recommend that consultancies transform into educational hubs by focusing on data collection and analysis, creating and sharing insights through various channels, and positioning themselves as knowledgeable leaders with data-driven expertise (e.g., industry benchmarks, client benchmarks, etc.).” While thought leadership, when done well, can help you increase visibility and attract new clients, it can extend beyond that by helping you bring top talent into your organization as well.
#5. FOCUS ON CULTURE
Scott Montgomery, COO and founder of Worldgate LLC sheds light on the challenges of transitioning to a hybrid work environment. With a focus on employee realignment, Montgomery emphasizes the importance of maintaining a positive company culture in a hybrid setting. Initiatives such as virtual coffee chats, holiday parties, and increased in-office presence contributes to a more effective and connected work environment.
“It’s a slow process but better serves our culture, customers, and morale to see everyone.”
– Scott Montgomery, Chief Customer Officer at Worldgate, LLC
According to Scott, Worldgate LLC will have more conservative growth and sales strategies this year and will instead take time to figure out how to improve process efficiencies and build culture and team cohesion.
#6. DIVERSIFY YOUR SERVICES
Marc Lacroix, Partner at RTM Consulting, LLC, sees economic uncertainty and cost reductions as challenges in the technology and other sectors. Lacroix suggests that firms with diverse offerings weathered the softness in demand better than others. This diversification allows consulting firms to remain resilient despite economic volatility.
“Consulting firms with a diverse range of offerings weathered the softness in demand better than others.”
– Marc Lacroix, Partner at RTM Consulting, LLC
Sean McDermott, President & CEO of Windward Consulting, points to macroeconomic issues impacting client spending and causing project delays: “Macroeconomic issues had a lot of our clients holding back spending. We didn’t see a lot of canceled projects, just more delays.” To address this, Windwards’ focus for 2024 will include developing more bundled service offerings and packages designed to build more recurring revenue.
And Speaking of Tips for Navigating Consulting Uncertainty
Make sure to join me on December 14th as I host an exclusive panel of top consulting industry leaders (including many of those cited above) for an interactive discussion on the challenges they faced in 2023 and the opportunities they see for 2024 and the future. We will review tips to tackle uncertainty, discuss how consulting firms use A.I. and share best practices to improve efficiency in 2024.
Thank you to our consulting partners who helped with this effort:
- • Andy Jordan, President of Roffensian Consulting S.A.
- • Dave Hofferberth, Managing Director, Service Performance Insight
- • Jason Mlicki, Principal of Rattleback
- • Luk Smeyers, Founder of The Visible Authority
- • Marc Lacroix, Partner at RTM Consulting, LLC
- • Marcus Quigley, Partner, Technology Practice at Environmental Financial Consulting Group, LLC.
- • Sean McDermott, CEO of Windward Consulting
- • Scott Montgomery, Chief Customer Officer at Worldgate, LLC
- • Tissa Richards, CEO and Leadership Expert at www.tissarichards.com