Hiring top-tier strategy consultants: what is important for financial services firms?
August 2018 | EXPERT BRIEFING | BANKING & FINANCE
In the world of financial services, things are changing every day. From regulatory reforms to accelerating innovation to the rise of new competitors, it is increasingly difficult to keep up with the ever-changing tides – especially as the global war for talent rages on and the US unemployment rate hovers around an 18-year low.
One option to help keep your organisation on the cutting edge is to hire an in-house strategy consultant. There are many reasons why companies hire consultants, some of which include top-notch presentation skills, world-class problem-solving capabilities and a strong analytical toolkit.
Historically, most strategy consulting firms revolved around a generalist model, whereby consultants were purposefully staffed on projects in a variety of industries and functional areas to develop a ‘general management’ or ‘general athlete’ skill set. This skill set enabled their consultants to drop into any situation or industry and rely on their strategy toolkit to deliver results for clients.
Some consulting firms are now adapting their service offerings to meet the changing demands of their clients. When organisations hire top consultancies, they frequently expect a team of consultants – or, at minimum, one or two consultants – with an expertise in the functional area the client is bringing them in to address. Those areas can vary: pricing, turnaround, implementation, technology and sales and marketing, to name just a few. Or clients may expect to benefit from consulting knowledge specific to their industry, such as financial services, private equity, retail, consumer packaged goods, agriculture, technology or healthcare. There can even be subcategories of specialisation on hot topics such as insurance, Big Data and regulatory work. The consulting firms are shifting their models to meet the growing needs of their clients.
Given the changing landscape, there are certain things which financial services firms would be wise to consider when recruiting a consultant to stay on the cutting edge.
First, what level of consultant should be hired? There are four core skills in the consulting toolkit: (i) analytics and slide building; (ii) project management; (iii) case cracking; and (iv) selling, influencing and leading. All consultants have varying degrees of experience in these key skills, depending on the stages of their consulting careers. An analyst, for example, spends close to 75 percent of his time on analytics and slide building, splitting the remaining 25 percent between project management and case cracking. On the flip side, a partner spends 70 percent of her time selling, influencing and leading, with 20 percent devoted to case cracking and 10 percent to project management (and effectively zero time on analytics and slide building).
Consequently, if you want someone who will primarily focus on building analytical models and presentations and can assist in project management and problem solving, then an analyst should do the trick. If you need someone to manage a team and be responsible for problem solving and project management while incorporating core analytics and PowerPoint skills, you will probably want to focus on managers.
Second, consider whether you need a generalised or specialised consultant. Top-tier strategy firms are starting to produce consultants that are industry or functional specialists across all levels. Based on the level and complexity of the role for which you are hiring, you will need to decide what level of industry and functional expertise a consultant might need.
Do you need a generalist or someone who has expertise in a specific functional area? In many cases, a generalist can get the job done, especially given how quickly consultants are trained to get up to speed in new spaces. Recently, though, financial services firms seem to be requesting consultants who at least ‘know enough to be dangerous’ in a certain functional area – perhaps someone who has worked on at least one or two regulatory, digital transformation or blockchain projects. However, the more senior the consultant, the more specialised that professional is from industry and functional perspectives. Remember, too, that generalist firms build specialised practices and occasionally allow consultants to specialise earlier in their careers.
Do you need a generalist, a financial services expert or an insurance expert? Different roles often require different levels of industry expertise. There are financial services companies that are open to consultants who have no professional experience in financial services, but do have a strong interest in transitioning into the space. There also are organisations which require either a broad base of knowledge in financial services or a more specialised skill set in property and casualty insurance. How much industry expertise will this person need with them on day one? When looking for an industry specialist, another option is to consider a former consultant who now works for the wealth management arm of a bank.
And what about the good news? No matter what level of consultant and expertise you attain, elite consultants are typically trained and experienced in getting up to speed quickly on brand-new topics and digging deep into foreign areas. This is especially important for companies in financial services, where things are changing every day.
Ashlee Wagner is a senior associate practice leader and Jody Karavanic is senior practice leader at Charles Aris Inc. Ms Wagner can be contacted on + (336) 378 1818 ext 9142 or by email: firstname.lastname@example.org. Ms Karavanic can be contacted on +1 (336) 378 1818 ext 9104 or by email: email@example.com.
© Financier Worldwide
Ashlee Wagne and Jody Karavanic
Charles Aris Inc.