The future of consulting and corporate strategy
The future is a pretty abstract concept for all of us right now. Aaron Brandon and Marc Lesner from Investigo’s Strategy and Consulting team hosted a panel discussion on Wednesday, October 14th to discuss the future of consulting and corporate strategy. Our expert panel of Adam Van Loon (Chubb Life), Aneri Jambusaria (LPL Financial), Nick Farhi (OC&C Strategy Consultants) and Lynn McMahon (Accenture) provided their insight on how the consultancy and corporate landscape has shifted over the last seven months, and what lies ahead.
At the start of the crisis, the response of Accenture’s clients was to wait and see what would happen. From June to August, they decided to adjust and select which projects they should be working on. In the last couple of months, they’ve accepted that this is a new normal, at least for now. “Is it easier to sell to existing clients? Yes,” said Lynn McMahon, Managing Director of Accenture’s New York Metro Office. “Companies are developing new clients and relationships in this environment, but it’s a little harder. For clients who have existing relationships with customers, it’s easier to get access. They’re used to having to set up a meeting and travel. Now they get access pretty quickly.”
Are clients now working on smaller projects as a result of the pandemic? “No. Clients are thinking hard about what they need to do and taking on bigger, more complex programs. They don’t need to do the smaller stuff but they need to carry out the bigger change due to this environment. This is something that may have been done with a three to five-year plan but now it needs to be done immediately.”
Chubb Life looks at sales through three lenses mapped to its main distribution channels: face to face, partnership and direct to consumer. “Life insurance has traditionally been sold through face to face,” said Adam Van Loon, Vice President and Head of Strategy Partnership and Corporate Development. “It’s sold, not bought – unlike property and casualty. Even before COVID, there was a big opportunity for the industry in imbedding digital into the sales process. COVID has really accelerated digital as a priority for life insurers and forced them to answer the question of what it means to do digital.”
The 17,000 advisors served by LPL Financial, many of whom conduct their own activities, have been affected in similar ways. “It’s part of our mandate to think how to better enable advisors to grow in a way that expands the business,” said Aneri Jambusaria, Executive Vice President of Strategy, New Ventures and Analytics. “It’s been a good time to think about innovation – how we can expand our core marketing services, accelerate digital sales and outreach, help them use social media, explore new sales enablement services. Everything from digitally-driven referral of services to virtual office solutions.” Aneri has seen a higher receptivity amongst advisors for these solutions and a willingness to pay. “It’s a great time to innovate around the sales opportunity,” she said.
Change has certainly represented opportunity for OC&C Strategy Consultants. “We opened in the US five years ago,” said Nick Farhi, Partner. “Since then, we’ve been rushed off our feet. April and May were the first opportunity to pause for breath. We were feeling confident going into it, we didn’t furlough or lay anybody off. It was an opportunity to consult, look at what we learned, do some BD, reach out to clients we haven’t had time to reach out to, cement relationships and consolidate them. This has been fantastic for the subsequent bounce-back.”
Another positive for the business has been its ability to increase the geographical reach of its global experts. “People no longer need to get on a plane to join a meeting in Columbus, Ohio, so they can attend 10 meetings a year in random parts of the US instead of one meeting a year that they can justify the flight for. That ability to project our expertise globally has really been an opportunity for us as well.”
The crisis has required many organizations to change what they’re selling. An expert in the hospitality and leisure industry, Nick has seen a notable downturn in his travel, cruise line and hotel clients in the last six months, but fortunately automotive and logistics, especially ecommerce logistics clients, have filled the gap. Grocery and CPG clients have also been more successful than anticipated while tech clients have been largely unaffected. “I’m glad to say we’re still doing pure strategy projects. COVID hasn’t changed the question of where to play, how to win. COVID is at least 10% of all current projects, but not 90% of any project.”
Digital has opened doors for the life insurance industry. “We’re seeing some pretty fundamental changes in consumer interests in a couple of dimensions,” said Adam. Life insurance products fall into two categories – protection and health. Adam has seen interest in protection products growing significantly during these unsettling times, as consumers look for protection for their families. On the flipside, economic uncertainty means consumers are “looking to keep cash in their pocket,” and there’s not so much “interest in long term savings vehicles. That part of the business is more challenging.”
As a result, Chubb has been looking at ways of deviating from traditional life insurance products. “We’ve had to pivot and think about product development and strategies to cope. Digital has become a big question through direct to consumer and digital partnerships. How do we integrate simpler products that are baked into a richer digital journey, providing a better customer experience for those who buy them? As we have more regular engagement through digital means with consumers, we’ll have more data, know more about them, and be able to do more innovative things like dynamic pricing.”
At Accenture, “One of the first things we’re seeing is an accelerated shift to digital,” said Lynn. “No clients are saying ‘we wish we had less cloud, AI, analytics.’ Companies are adopting it faster and in a more aggressive way. The second trend we’re seeing is more alignment in measuring outcomes versus the effort. Clients are asking for more set measurements for outcomes of projects. The third is that the value proposition is changing so it doesn’t consider just financial metrics.” The Business Roundtable is thinking more about the 360 value of the work they do with clients, the independent metrics of the value brought by their projects, rather than merely the financial side of shareholder or wider stakeholder value. “What are the experiences of customers and employees? Are we sustainable when doing projects? Are we leaving the talent at our clients in a better place – skilling a client’s workforce as a biproduct of the project?”
Aneri has seen some shifts in the way end consumers think about and engage with LPL Financial. The lockdown “was a great time to dust up our financial plan, make sure we weathered for the long period. More permanently, advisors have gone from live in-person meetings to virtual meetings. The concept was fairly rare prior to COVID. The feedback has been very positive. It’s more convenient, they don’t have to get in a car. It will stick for the long term, many client interactions going from live to virtual. It will change advisors’ experience overall from event-driven, revolving around meeting of specialists, to an always-on experience, engaging at any time, not waiting for a specific date and time.”
Interestingly, the rise of digital can help companies engage with their customers on a more personal level. “I’m not sure consumer engagement has been the life insurance industry’s forte,” said Adam. “But I see a huge opportunity because of that. What are the benefits to consultancy of driving that engagement?” As part of its drive to introduce “tools that are fun, useful, easy to use,” Chubb Life is currently rolling out an app that supports the user with their health, financial wellbeing and connectivity with friends. “Give consultants tools, potentially from partners, that enable them to live a better life and achieve their goals, then embed all of that into a richer engagement experience.”
There’s always been a strong link between location and industry, and nowhere has that been truer than in the consulting industry. Consultants have traditionally been physically located with their clients and leadership have even had to live nearby. Indeed, as part of pre-COVID operating model changes, Accenture refined its structure to support being closer to clients. “All bets are off on that now as everyone’s in different locations,” said Lynn. “People are moving around to make their lives work. How much will it stick? Proximity to clients is important. On Fridays when consulting firms leave, it’s a good time to be at a client. You can walk around, run into people. Those interactions are important. I see a lot of new models continuing but I also think we will go back to something that’s more in person than we have now. People want that.”
“We’ve always been very remote, very digital,” she added. “We deliver work across the globe. The biggest change we’ve seen is moving the sales process to being more remote.” Indeed, it’s easier for companies to provide expertise to their clients remotely than it is to fly people across the country to attend a physical meeting. Digital has “increased our capability to have more meetings, see more clients. That’s here to stay.”
Aneri moved her family across the country from Boston to San Diego and started her role virtually in April, having never worked virtually before. Many would have been daunted, but she’s been enriched by the onboarding process. “It was an amazing learning experience. With things like that, you can’t rely on techniques that have worked in the past. Sitting with the team was a big technique for me, learning by osmosis, which is not really possible.” But Aneri has discovered that remote osmosis is also possible. “I’m bringing in new people who are going through something similar. You have to find creative ways to share more about yourself with your colleagues in a way that guards your time. Posting on a Slack channel, for example.” Videos have been a useful way of introducing new starters to existing members of staff.
OC&C operates a model where “spontaneous interactions, being in a room when a discussion is happening that you can learn from, is crucial,” said Nick, who feels that “current interactions being fully virtual is significantly impacting the pace of learning. I wouldn’t contemplate a fully virtual end state with current technology. That camaraderie and community is a crucial part of our proposition to our talent.”
Opening its office in mid-August on an optional basis, the company found half of its summer interns and all of its September joiners opting to live in New York, coming into the office two to three days a week. “They instinctively knew they would have a better experience. It’s not the tech utopian solution,” said Nick, who is very much a believer in the value of physical interaction. “I don’t think we’ve found a substitute for that yet.”
Part of being in the consulting industry involves travelling from client to client. But clients are now having to come to terms with consultants not being onsite. “We actually deliver go-lives and major conversions in this remote format,” said Lynn. With a remote working model and the resultant blurring of the line between work life and home life, however, “There’s a lot of danger of fatigue when people are running their business and home lives. We have to help each other through that.” She also believes in the value of “getting people together to think through big innovation plays. You can use different technological tools, but it’s a second-tier replacement for stuff you can do in the same room, the water cooler conversations on the side.” Lynn feels that this could see the start of a “drop-in model,” where people no longer go into an office for five days a week and perhaps only turn up for meetings. “Everyone’s grappling with how to get their people back. We’ll be some of the last people back to clients’ sites while they work on spacing.”
Put off by the travel involved in consulting, candidates have often chosen a career in the corporate world instead. But the consulting industry could now be more appealing to MBA graduates. Thanks to its focus on strategy, OC&C has always demanded much less travel than some of its competitors, so being unable to travel to clients’ sites was much less of a transition. Nick said: “I do think there’s going to be a significant reduction in travel and frankly that is good for the industry because it means we won’t lose talent, especially primary carer talent no longer able to jump on a plane. It’s better for the planet and better for us all being home at bath time.”
With Chubb Life doing business in over 30 countries, “Zoom is somewhat par for the course already,” said Adam. “But there is no substitute for spending time together in person. It depends on your culture – the importance of face to face and time out of the office may be different. We’ve managed to be effective but the challenge we’ve faced is the ability to get in a conference room, to whiteboard when facing a complicated challenge, and making big picture decisions is harder to do over video conferencing. Our leadership team in New York is very eager to get back in, to be with our colleagues and customers. We’re hoping the situation will change so we’re able to do that soon.”
With so much working from home, is there a need for physical office locations? “Flexible working’s here to stay,” said Lynn. “Working from home, part time, shifting schedules. But we’re not backing off in having places for people to go. We believe innovation, the serendipity of people being in the office, makes sense.” Accenture’s opening a new innovation hub in New York in the spring. Lynn sees companies being “more flexible in how they work in the office, not having a dedicated space all the time. Given flexibility’s here to stay, what do we need to do to enable people more in their home office? We’ve all experienced bad wi-fi, not having the right equipment, lighting, soundproofing. We’re starting to think through what model we need to support people wherever they’re working from.”
Could we see a change in the relationship between consulting and corporate? “The relationship between consulting and corporate was evolving well before COVID,” said Aneri. “There’s demand for more targeted work, helping with thinking and bringing ideas to life. You need different models for different situations, so you don’t always need a whole consulting team. COVID is accelerating some of those trends. Demand for consulting has increased in a couple of areas, such as digital. There will continue to be demand for digitally-driven, innovation-orientated work.”
Aneri also feels that the digital revolution has lowered barriers to entry for companies entering new industries. “This is a great opportunity to bring in outside perspectives of people who are experts in that space and to help bring to life what an industry expansion could look like.”
Black lives matter
Recent events around the world have initiated a deep dialogue about diversity in LPL Financial – “the deepest in my career,” said Aneri. “Our ways of thinking are influenced by the communities we grew up in, our school, professional experiences. LPL is doing a lot to create opportunities for diverse leaders. We’re a talent feeder to the broader organization with a mandate to bring in leaders from outside to build successful careers. We’re in a unique position to evolve the profile of the next generation of leaders in the organization.” The actions LPL is taking include compiling more diverse interview shortlists and considering candidates with diverse backgrounds. It’s also looking for ways to accelerate the process – through MBAs, internships, rotational programs – to more effectively bring in diverse talent.
Some time ago, Accenture publicized its intention to achieve 50-50 gender balance by 2020, in order to ensure its own accountability. The company is now doing something similar on race, recently setting up focus groups and listening sessions to understand its people’s views. The results were “truly eye opening,” said Lynn. “It informed us on challenges going on that we unfortunately weren’t aware of. It was emotional and a chance to educate ourselves.” Over the summer, the company put together a public pledge to increase its number of African American and Hispanic employees by 60%, and doubling the number in leadership positions by 2025, through recruitment, retention and sponsorship. It’s also conducting mandatory training on racism. It’s key to spread the message not just within the organization, but with partner organizations too, said Lynn. “Sharing best practices, figuring out what’s working and expanding it into other places.”
Although it is clear that the events of 2020 have significantly impacted those within both consulting and corporate strategy, new working models have brought about greater flexibility for employees, and generated opportunities that employers had previously not explored. Digital transformation has been accelerated with more streamlined processes that do not require as much manual input. It is true there has been a significant revenue hit for most organizations, yet most of our clients are now busier than ever. If this momentum is maintained and a vaccine rolled out in 2021, in addition to further strides being made in the fight for diversity and inclusion, we may just find ourselves in a better place than we were before the pandemic.
Many thanks to all our attendees for their contributions. If you’d like to attend our next event or to talk to our team about finding your next strategy job or hire, get in touch now at firstname.lastname@example.org