The Changing Balance Of Power In The Consulting Market

The downturn in the market for consulting services has created chaos in this once highmargin industry. The impact on both management consultants and their clients has been profound. Sandra Niewiem and Ansgar Richter argue that both need to react.

—

Consulting markets around the world are in turmoil. For more than 20 years the industry grew at above-average rates. Driven by steadily rising demand, margins were abnormally high, even when supply expanded substantially as new players entered the industry and the established consulting firms continued to hire people in what they called the “war for talent”.