Management consulting means the individual processing of business problems through interaction between external, independent persons or consulting organizations and a customer company seeking advice. Services provided by management consulting firms are traditionally used by private companies. Consultancy services are increasingly in demand from other organizations, such as public sector institutions or non-profit organizations.
Defining business consulting
Business consultants help their clients master corporate challenges. The traditional business model of business consultants is the project-based use of external resources to solve their customers’ problems. The reasons for using external management consultants are mainly the lack of know-how of the customers for addressing issues or purchasing additional resources.
Recently, the business models of management consultants have evolved significantly. In addition to the classic project business, management consultancies today offer varied and flexible forms of cooperation with their customers.
Consulting isn’t just about the bottom line
Management consulting can also be understood as a sub-form of corporate consulting. Business consulting includes all consultancy or services offered to a company. If the offer is aimed at management (e.g., management challenges such as strategy development and strategy implementation), then management consulting is used. However, consulting also includes other types of services or topics, such as those relating to IT, human resources, or auditing.
Any type of management consulting can, therefore, be described as a corporate consultancy, but not the other way around. To understand the process a bit better, contact David Johnson Cane Bay today.
The history of business consulting goes back a long way; people have always sought advice and were supported by external “consultants” when solving their problems. Management consulting started in the 19th century in the USA. With the advent of industrialization and the associated division of labor and separation of ownership and management, there has been a demand for new management models and management approaches.
The first management and consulting firm was founded in 1886. Initially specialized in advising on technological research, the American consulting firm later focused on implementing management approaches. The development of management consultancy in America was accelerated, above all, by the global economic crisis.
Banks fearing for their money stopped their debtors from implementing restructuring and reorganization programs carried out by outside management consultants. In 1926, the “inventor” and pioneer of classic management and strategy consulting was founded.