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Consulting Terms that You Need to Know

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Published:
May 18, 2021
Reading Time:
10 minutes
Lynn
Lynn's diverse perspectives on business stem from her extensive experience as a management consultant - her role as a beloved wife, mother and grandmother adds further depth to her insights.

Many articles take a lighthearted look at consulting terms, giving advice about learning “consultant talk” and fitting in at a consulting firm.

This article takes a more serious look at two terms that represent the bread and butter, so to speak, of consulting firms: strategy and change. It will also unpack some of the consulting terms used to describe the techniques surrounding them.

To start, we’ll consider the distinctions between “strategy” and “strategy review.” Then, we’ll define the differences between “change,” “change management,” and “change models” and reflect on how they impact management consulting.

What is Strategy?

I have two favorite quotes about strategy. The first is from Michael Porter: “The essence of strategy is choosing what not to do.”

One of the challenges for management consulting is to remind clients that strategy is about the allocation of resources – an organization must prioritize and make clear-cut choices about how to compete. While we might challenge clients to have “big hairy audacious goals,” the bottom line remains that they cannot be everything to everybody. Being strategic means focusing on what is important to them, not others, and defining the objectives that will give them a competitive advantage. Then the skill is to develop a plan to reflect these objectives and execute it with determination and steadfastness.

My second favorite quote is from Winston Churchill: “However beautiful the strategy, you should occasionally look at the results.” This is such a profound comment. Execution of strategy can flounder on many fronts. Some research has shown that at least every second strategy is not executed properly. Some of the common reasons are the following:

  • Communication that is unclear, insufficient, or lacking altogether; lack of performance information
  • Goals that are unclear, conflicting, or too ambitious; lack of priority; too much complexity
  • Lack of resources – people skills, management capability, time and budget
  • Organizational culture, including silo behaviors and resistance to change
  • A Strategy that is not adapted to changes that occur

The last reason – a strategy not adapting to changes – brings us to the next consulting term to understand: “strategy review.” (And the second last, “resistance to change,” will take us to the following section on change management.)

“However beautiful the strategy, you should occasionally look at the results.” - Winston Churchill

What is Strategy Review?

One of the most difficult tasks of a management consultant is facilitating the rollover of strategy from one year to the next – for example, from year two to year three of a five-year strategy. It’s sometimes easier to develop a new strategy for a new cycle.

There are several challenges to managing a strategy review. The first is to identify what has or hasn’t worked in the past year. Next is to identify environmental changes that may demand completely new approaches. The third is to define what changes are required – objectives that should be left as-is, those that should be tweaked, and those that need massive change or should be deleted from the strategy altogether. Perhaps the objectives should remain, but the targets or the measures should change? Or maybe the initiative being used to reach the objective should be adapted or replaced?

The fourth challenge can be pretty tricky: defining, communicating, and preparing for the changes, while continuing to manage and measure the original objectives to the end of the planned period.

Those who are experienced in management consulting have their favorite models or processes for reviews. Less experienced consultants may want to look for online templates and guidelines. It is essential to have a model and a process – otherwise, reviews can become very messy and unproductive.

Here are some more consultant terms for you to know. They describe models that you can use to identify factors outside of the organization and to question the assumptions the organization had at the time they set the strategy:

  • SWOT analysis – strengths, weaknesses, opportunities, threats
  • PESTEL analysis – political, economic, social, technological, environmental, and legal factors. Some people have added ethics as a new factor.
  • Porter Model – competition, new entrants, suppliers, customers, substitutions

For internal factors, consider changes in structure, especially at the senior level, mergers and acquisitions, the unexpected success or failure of a product or process, or new budgetary constraints. Also look at the organization’s reporting structures – how often are meetings held, what is reported, which sections of reports are considered in detail, what questions arise after reporting?

Once you have been through the review and have identified the changes to be made, you might be back to the same problem you had at the start – resistance to change.

So, let’s look at change as a consulting term and then as a reality to be managed.

Change vs. Change Management

Change refers to any movement out of a current state via a transition state to a future state. The role of management consulting is to analyze and identify deficiencies in the current state, provide technical support to design the future state, and develop a solution for the transition state.

consulting terms, Consulting Terms that You Need to Know

It may be relatively easy to change products or processes. However, change impacts the way people do their jobs – and, mostly, people don’t like this. Therefore, change management has two prongs. The first is to undertake the necessary operational changes – design, develop and deliver. The second is to support people impacted by the change through their own transitions from their current state to their future state. There are three steps here: embrace, adopt and use.

Unless employees go through these three steps, operational changes are doomed to failure.

Change Model

A change model is a framework to guide the change management process.

So, we have three consulting terms to think about here:

  • Change is the movement from the present state to a future state via a transition phase
  • Change management is the support given to design the future state and to take the steps involved in the transition
  • Change model is the framework used by management consultants to guide the change management process

Consulting firms will generally have a preferred framework. My favorite is the Beer Model, proposed by Professor Michael Beer of Harvard University. It has the following formula: C = D x M x P > Cost.

This model proposes that

  • The degree of change (C) you are likely to achieve depends on
  • The amount of dissonance (D) there is in the organization (the amount of dissatisfaction with the current status and understanding of the need for change), multiplied by
  • The clarity of the proposed model (M) of the future state, multiplied by
  • The rigor of the process (P) or steps to be undertaken.
  • All of this must be greater than the cost – or perceived cost – of the change. Cost includes people’s concerns about loss of status, loss of income, loss of relationships, etc., that might arise due to the change.

The consultant should be aware of all of these elements and understand how to impact and balance each one.

Other consulting terms describe alternative models:

  • Kotter’s Model: This model focuses on preparing employees for change rather than change implementation itself. Proper workplace communication is the primary focus.
  • McKinsey’s 7-S Model: We are reminded that all aspects of business are impacted by change, and therefore must be addressed – strategy, structure, systems, styles, staff, skills, and shared values.
  • ADKAR Model: This model covers awareness, desire, knowledge, ability, and reinforcement. It addresses both the business and the people side of change.
  • Kübler-Ross 5-Stage Model: Originally designed to deal with loss and grief, it has been adapted to understand the pain suffered by those who face change and the phases they must go through to reach equilibrium: denial, anger, bargaining, depression, acceptance.
  • Lewin’s Model: The first phase of this model is to “unfreeze,” getting employees prepared for change, followed by “change,” when the changes are implemented, and then “freeze” when employees accept the changes and settle back into a routine.
  • It doesn’t matter which model you choose, as long as you are comfortable with it and disciplined about dealing with each of the factors that underpin it.

    From Consultant Terms To Consultant Actions

    Strategy and change are not simply consultant terms. They are part of the fabric of any intervention you undertake at any client. Whether you are part of a consulting firm or an independent management consultant, you will need to incorporate them into your thinking and planning. It may be helpful to choose and master a few models and share them with clients. In this way, there is no confusion about the steps you are taking, and you will empower clients to undertake further interventions without you.