Indirect Management Consulting : Evaluation of an alternative consulting method : MBA thesis in marketing

Abstract: Indirect Management Consulting (IMC) is a new concept within organizational change management consulting. The basic principle is to make the client more active in the change effort compared to conventional management consulting where the consultant actively drives the change. With IMC, the client is provided with a tailored set of skills and methods that makes him able to lead a change project and to make sure that the new organization is sustained. The IMC-model is a combination of management consulting and e-learning, where the consultant has an indirect role in supporting the client.This study has shown that the IMC-model increases the chance for successful change implementation by increasing knowledge and involvement of the managers in the client organization. A common problem with conventional consulting is that the new organization fails to persist some time after the change project has ended and when the consultants have left the organization. This is overcome by the IMC-model since it transfers necessary knowledge and tools to the client’s managers who then can drive the change as well as ensure sustainability long after the project itself is completed.The IMC-model is more cost-efficient than conventional consulting since less involvement is required by the consultant and since the customization of the e-learning systems can be made efficient by modularization. The lower costs make it possible to compete with a lower overall price and the combination of high quality of the organizational change with low prices makes the IMC-model an attractive complement to conventional management consulting. This study is a part of an evaluation of the potential of a new business concept within the field of management consulting. The study is written to give insight of the functionality of the concept as well as the market barriers that a new company can expect to encounter if it decides to start up a business based on the concept.Indirect Management Consulting (IMC) is a new and unproven concept within change management consultancy and can in a simplified manner be described as a mix between e-learning and traditional management consultancy. The basic principle is that the client is given instructions and tools to be able to lead the change project by following a model similar to an e-learning program. The contents of the program are custom-built by a management consultant according to the needs of the change project. The consultant monitors the progress of the organizational change and adapts the model and gives feedback to the client as the project progresses. By following the IMC model, the client does the majority of the work while he does not require initial knowledge of change management since he is continuously provided with the information, tools and templates needed to analyze the organizational performance and implement the change successfully.The functionality of the IMC concept was evaluated in two ways: First by comparing the contents of the IMC-model with existing change management theories in order to find out if the model covers the most critical aspects of the theories. Secondly, the market for the IMC model was analyzed mainly by using Porter’s five-force theory.This study has shown that IMC can be an efficient method for implementing organizational change. Its efficiency comes from a number of sources, mainly related to the fact that the organization’s own managers have, compared to conventional management consulting, a high degree of involvement in the analysis of the organization and the implementation of the change. This in turn leads to better communication of the change plan and makes it easier to motivate employees to accept to the organizational change and make them feel a ‘sense of urgency’ for participating to successfully implement the project. The model was also found to make it easy for the manager to formulate a change strategy and to implement the change in a structured manner.For the consulting company, IMC means that costs (and consequently prices) can be kept much lower than for conventional consultant services. One main reason is that the model does not have to be built from scratch for each client. The contents of the model are relatively easily adjusted to suit most types of organizational changes. A second reason for the lower cost is that time the consultant spends at the client’s offices is minimized or eliminated. This gives an advantage compared to conventional management consulting.While the management consulting industry have relatively low entry barriers, that is however not equivalent that it is easy for a company to enter the market based on the IMC-model. A high quality of the services is crucial and, if that cannot be proven, the advantage of having a low price is diminished. It is therefore important for a new starter in this industry to have a portfolio of successfully implemented projects. For the IMC concept, this is problematic since the model is new and unproven. It can therefore be difficult to find the first clients and alternative entry strategies such as partnering or simply advocating a “non-profit” strategy for the first clients might be necessary.