Thursday, May 26, 2005

Why are more companies using consultants?

Over the past thirty years the consulting industry has grown at double digit rates in most years. In that time more managers have MBAs and companies have brought in better training and evaluation tools. However, business activity has peaks and valleys. Thirty years ago, companies staffed for the peaks, and managers had time to think or create projects. Today, companies staff for the valleys and managers spend more time in meetings and dealing with email, i.e. they spend a higher proportion of their time communicationg. Furthermore, as consulting firms have grown in size and prestige, they have been able to recruit more talented people. So today, a company which never or rarely uses consultansts is probably suboptimizing.

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