Embracing Evolution: Why Generalist Consulting Firms Must Harness Specialist Talent or Risk Falling Behind
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By Philip Thomas – Senior Consultant, Advisory
Increasing demand for specialist knowledge across a range of industries means that generalist consulting firms are having to adapt in order to compete. The solution of choice is an increase in the hiring of specialist talent. This calls for evolution not revolution. Firms that evolve successfully and first will be well placed to be at the front of the race for such talent.
An increasing demand for specialisation
Across all major industries, businesses are hurting from a severe lack of internal specialist expertise. The open labour market is unable to satisfy their need for talent. As a result, they turn to consulting firms and demand ever-increasing levels of specialisation to ensure the quality of the tailor-made solutions required. For consulting firms, client impact increasingly requires deep knowledge in niche areas such as digital, blockchain, cybersecurity, climate and sustainability, data science, etc.
Specialist consulting firms, by their nature, may be well placed already. Generalist consulting firms, however, need to react if they have not already done so.
Tapping into the specialist talent pool
Not all personalities suit the traditional generalist consultant role. Requirements to resolve poorly defined problems, to be flexible enough to fill any resource gaps and to work towards leadership positions where people management and dealing with the unknown is a common theme is not only not suitable but also simply not desirable for some individuals. Many such individuals are actively searching for a different career path and they may well be looking to specialise.
Specialists (also sometimes referred to as experts or subject matter experts), with their deep subject knowledge, have strong problem-solving abilities with respect to their speciality. By nature of experience and proven, known solutions, their approach to work is streamlined and efficient. Given their subject matter passion, they actively seek specialist roles that suit their skills, interests and career goals best rather than force fitting themselves into alternative career scenarios they may consider less satisfying.
When given the opportunity to do so, specialists find places to excel. They find a home where their talents thrive and their subject matter passion can be nurtured and maximally leveraged.
Leading generalist firms are already evolving
A number of generalist consulting firms, ahead in the rapidly advancing game, have already partially evolved. They have recognised that no single career path suits all possible talent. Such firms are becoming more flexible and creative with respect to offering differing, alternative types of careers.
Specialist career tracks are now being offered by increasing numbers of generalist consulting firms, as well as many of the top-tier strategy-oriented firms, including Bain, BCG and McKinsey. These specialist tracks typically differ from generalist tracks in a number of ways, including:
Less client-facing time: Specialists are typically less client facing than generalists, often working across multiple project teams while focussing on the same topic.
Career path: The path to partnership is not yet common. In many cases Specialists will not have a path to partnership. In these cases, career levels before partnership are viewed as landing positions and this was historically accepted by the incumbents. However, with the large increase in the number of specialists working for consulting firms, more and more firms are developing specific tracks, which do provide specialists with a path to partnership.
Progression timeline: The timelines for progression on specialist tracks are less rigid. There is often no up-or-out policy. Actual timelines can vary considerably from very quick to relatively slow.
Performance evaluation: While performance expectations are broadly similar to generalists (i.e. utilisation), a specialist’s knowledge and expertise form a much more significant portion of their evaluation and therefore more heavily influence their ultimate success.
Pay: Many firms offer comparable pay. However, specialists carry high credibility due to their deep level of knowledge and experience. This may allow consulting firms to charge higher fee rates for specialist services, so in some cases specialists are able to demand higher salaries. Interestingly, at the most ‘senior’ career levels, specialists may currently lag behind their generalist peers.
Aside from dedicated specialist tracks, many firms are also hiring more specialist consultants but on generalist tracks while allowing for increased specialisation.
Challenges on the road to specialisation
Generalist consulting firms wanting to catch up with the trail blazers are faced with two key and immediate challenges. Those being the limited supply of specialist talent and the need to evolve in order to attract and retain such talent.
Key Challenge #1: The race for specialist talent is already well under way with some firms setting an early pace while others are yet to leave the starting blocks. The mad dash to the always moving finish line is yet to begin. When it does, the intensity of the race will rapidly increase as more and more firms attempt to attract talent from a decreasing supply of specialists.
The longer firms wait, the harder it will become for them to secure the talent they need to compete. To compound the problem, once the supply of specialists starts to run dry, it may take significant time before it is replenished considering the time and effort it takes to reach a certain level of specialisation.
Key Challenge #2: Generalist consulting firms need to become more attractive to specialists. Firms will need to evolve in order to attract the increasingly confident and vocal specialist labour force. Robust and competitive specialist career tracks, sufficiently attractive to specialists but not to the detriment of generalists, must be created and installed. Informed action by firms should be decisive and taken before too long or they may get left behind.
Some firms have a healthy head start with their evolution in this respect. However, with such a dynamic situation, even those that have paved the way so far would do well not to rest on their laurels. We also believe signals coming from the labour market show that candidates are demanding more bespoke career tracks beyond the existing generalist track.
In short, consulting firms should not be asking what specialists can do for them, but what they can do to become attractive to the specialists.
Evolution not revolution
The foundations built on generalist consultants are solid and the demand for the broad expertise of generalists will not disappear. Client demand for specialisation, however, does necessitate the evolution of generalist consulting firms. They will need to evolve by harnessing the power and deeper expertise of specialist consultants. Those firms that fully embrace the importance of specialists and those firms that make themselves more attractive to specialists by offering desirable and specific career tracks will have a major advantage in an increasingly competitive race.
Note: We use the term specialists in this article for simplicity and to avoid inferring that generalists are not experts in their own way.
For more information on this topic or on how you may successfully respond to the issues raised in this article, please contact Vencon Research – as always, we are happy to assist you.