Business Model Innovation and the Change of Value Creation in Consulting Firms

The digital transformation across all industries accelerates growth in the consulting industry. This is a blessing and a curse at the same time. As clients seek help to implement new systems, to utilize emerging technologies for automation, analysis and intelligence and demand ideas and knowledge to build new business models for the digital economy, consulting firms neglect the impact of the digital transformation to their industry. Albeit increasing revenues and profits, the consulting industry faces significant challenges as technology outpaces human capability and capacity in core domains of consultants’ work and new, yet unrecognized, competitors enter the market for professional advice. Neither the business model and value creation paradigm, nor internal processes in consulting firms seem to be adapted and transformed in order to build resilient and sustainable firms in a digital economy. The paradigm and mindset of prioritizing billable work above everything else hinder innovation and the required transformation towards a more digital and scalable business.