What Does Consulting Do?

As a successful consultant for several decades, I played several major roles:

1. Designated Teller of Hard Truths. I operated outside each client's organizational hierarchy and internal factions. By design, I was expendable and not seen as having a particular bias or “dog in the hunt.” That made it easier to say the difficult things that needed saying. E.g. "Your product...is not good and not competitive." "Competitor X is eating your lunch because A, B, and C. You need to get your act together and admit that those are important issues."

2. Bringer of News from the Outside World. Large organizations become exceptionally insular and self-referential. Everyone inside has to speak the house jargon and more-or-less toe the company line. I could break that spell, bringing in new concepts, perspectives, language, and attitudes. Over the years as a tech analyst, I introduced object-oriented programming, CAD/CAM/CAE, distributed computing, Unix, “Big Iron Unix,” the Internet, grid and clustered computing, web services, standardization, buy-not-build strategies, Linux and open source, virtualization, automated provisioning and orchestration, cloud computing, blade servers, scale-out architectures, and DevOps. Many of these were initially unfamiliar or viewed with disbelief and hostility. I also was a conduit for shifting customer expectations and appetites, market attitudes, and cultural vibes—offering a “voice of the customer” or “voice of partners” when internal teams wouldn't otherwise get a clean, unfiltered read on what was happening in the world outside their walls.

3. Family Counselor. Surprisingly often, I told organizations what other people inside the same organization were thinking, saying, or doing (and what customers or partners thought of that). The degree of insularity, siloing, and parochialism in large organizations is hard to overstate. I was almost like a counselor, helping internal teams see, understand, and appreciate their peers, and put what they were doing into a larger perspective that would have otherwise been overlooked.

I did a lot of other things, but these were my largest, most systematic, and most recurring patterns of "adding value."

>Using difference-in-differences designs exploiting these sharp consulting events, we find positive effects on labor productivity of 3.6% over five years, driven by modest employment reductions alongside stable or growing revenue. Average wages rise by 2.7% with no decline in labor’s share of value added, suggesting productivity gains do not come at workers’ expense through rent-shifting.

Snide internet comments are once again wrong...

I am a consultant, and while I agree with the sibling comment from jonathaneunice (especially the point about being what I call "business therapist"), there is one thing I will add: a lot of what you are paying a top-tier consulting for is _speed_.

Many organizations, especially large ones, are very slow at making decisions, even if they ultimately make the right ones. Bringing in people outside the hierarchy to synthesize a great deal of info from across the org, and give upper management the insight to make a decision quickly (and, depending on the engagement and the firm, also implement it) is very often worth the bill at the end.

I will not pretend all of the work we do is 100% the most urgent work all of the time, but I have helped make the sausage for a number of years now, and despite the usual disparaging comments in this thread, it really is often an intellectually rewarding environment where you work with smart colleagues and help people solve real problems.

I went to one of those universities where a lot of people are hired by consulting firms.

I don't think I've ever met anyone in the business who thought they were doing what it says on the tin. This is a story you will hear over and over again: "The MD went and sold the project, but now a bunch of graduates are tasked with helping the company". I know someone who was advising a central bank, aged 22.

At best, the young consultants tell the company what they wanted to hear, and use the report as their excuse to do what they were going to do anyway.

You also have to wonder how much their public facing advice actually is based on experience, rather than being advertising. You often get these dressed-up white papers and pseudo-academic articles talking about some aspect of business coming from these firms.

In some risk averse environments, when a critical decision needs to be made, part of the consulting does is take responsibility and be the party that can be blamed later in case things go south.

Ultimately, (good) consulting just gets decisions made. Companies hire consultants when they don't know what the decision should be, or where to go next. Whether the decision is right or not, depends on the competence and experience of the firm (and also some luck).

"Consulting" is a term so generic and ill-defined it almost doesn't mean anything at all.

When I did software consulting, I was basically a decent "modern" web dev brought into crusty old companies to bring some new perspective and approach. I'd help with some project direction and initial implementation and try to get a team up to speed to continue the work. I typically embedded as part of the team for a while and did plenty of hands-on design, coding, and troubleshooting work right alongside.

But this was just a small consulting shop, not one of the big "strategic" consultancies. Very different worlds.

there’s a sort of self-answering irony in having a academic paper try to answer the age old question “what exactly do you do around here?”

The “strategy” consulting offered by the big firms is mostly BS. It’s typically a few senior folks that have minimal real world experience in the thing they claim to be an expert at leading a bunch of junior folks that have minimal to no experience in just about anything. The firms talk a lot of hype about how they’re guiding innovation and such but in practice they’re mostly hired to do fairly routine grunt work and just be an extra set of hands for an exec with budget to burn.

The best “consultants” that actually consult are typically sole proprietorships that is just some semi-retired person truly an expert at something that’s offering up temporary help at a thing they just enjoy doing and making some $ on the side. Ironically the big firms have very few of these true experts floating around.

Consulting provides a report supporting the strategy the leadership already decided on.

There are two kinds of consultants: those who write code and those who only give advise. It seems to me that those who only advise lost their market to LLMs pretty completely.

they provide expertise to companys who don't have domain knowledge. it's a specialist, thats it.

when companies hire 300 consultants its weird, but hiring someone who specializes in boilers is not weird.