What Is A Business Consultant – The Ultimate Guide

The UK business consultant industry is vast and far reaching, leading many to rightly question. What is a business consultant? This ultimate guide has a range of key information about the UK Business Consultancy industry. 

What is a Business Consultant?

A business consultant is an external party that offers advice, support and expertise to an individual or business. Generally, a scope of works will detail what is required and the pricing structure of the engagement. A scoping document may also highlight what is outside of this agreement but may be required at a later date. A payment structure will also be included, with common payment structures including an initial payment, milestone payments, or payments based on project delivery.

What is a business consultant?

Key Disciplines Of A Business Consultant

Business consultants operate in every area of business you can think of. In the UK, there are five major pillars of consultancy that are easy to identify with. So, whilst not every single type of consultant is listed below. The major areas are discussed.

Management and Strategy Consultants

Management and strategy consultants work on large scale projects and process redesign that is aimed at delivering ongoing return on investment. These firms will generally bridge the other four consultancy pillars discussed below. The big four management consultants will have each pillar of consultancy resourced internally.

When most SME’s engage with a management consultant, they will not engage with one of the big four. Smaller practices are more affordable and accessible to this market, as the big four firms are, comparatively, very expensive.

HR Consultants

HR consultants are the easiest business conultants to identify with. Many though, don’t realise this is classed as business consultant. If you have ever worked with an external recruiter, you have worked with a business consultant.

In the UK, a HR consultancy company you will undoubtedly have heard of would be Reed. Such companies can help identify, shortlist, primary interview and offer contracts to talent. They will generally have an extensive talent pool to pull from. This can be relationship based, knowing people in certain segments. Or, and more widespread, by creating and curating a database by actively posting jobs.

HR consultants can also support in specific strategic projects. These include employee retention programmes, staff surveys, talent mapping amongst others.

Operations Consultants

Operation consultants are focused on process redesign and implementation projects. Operation consultation and process redesign generally takes shape over four phases. This starts with scoping a project and setting a team. After the existing process is mapped, opportunities are highlighted to improve the process. A trial process is tested and implemented, before a feedback loop seeks to streamline and bed in the new process effectively.  Done correctly, operational consultancy projects can deliver huge benefits to businesses.

IT Consultants

IT consultants can range massively in their scope.

Some IT consultants deal with general process improvement projects focused around an IT implementation project. They are adept at delivering large scale system transformations. One example of an IT consultant is Encordia Consulting.

Then there are also ultra-fast growing specialist companies such as Cloud Gateway. These companies offer highly bespoke, cutting edge proprietry technologies, designed to offer major improvement to your IT infastructure.

In between both of these are a myriad of semi-tied software consultants. These consultants will adapt and implement software solutions specific to your business needs. 

Marketing Consultants

Marketing consultants can take many guises.

A branding agency can deal with branding, strategy and implementation of your joint ideas. A great example of a quality branding agency is FloccThese agencies can also support with digital execution of your stratagy, bringing your ideas to the web.

Dedicated  SEO agencies, such as Found, focus on working on backlinking strategies, content marketing and on-page optimisation. Supporting your business in appearing on search engines such as Google.

PR agencies such as PR Agency One support in delivering news content, crisis management and relationship management. This will generally have a focus on high readership and brand interaction.


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Why Companies Hire A Business Consultant

Business Transformation

48% of businesses stated that support with business transformation projects were their most prominent need. Such projects can be complete strategy realignment, or transformation of just a single process.

Change Management

Unlike transformation projects, change management projects work to align the business and its customers. 41% of businesses stated this was a requirement for consultancy support. 

Project Based Process Redesign

39% of hiring businesses stated they have hired consultants to streamline just one process. This can be due to a lack of understanding of such projects, or labour requirements.

IT and Technology Consultancy

Another huge pillar of consultancy requirements. In fact 37% of hiring businesses requiring support in IT consultancy. A key area being digital and technological transformation.

Human Resource Support

Whilst the most commonly known area of consultancy, only 23% of hiring firms required this type of support. 

Source: MCA: Clients Perception of Consulting Study 2019

Digital Transformation Projects

Digital transformation projects were cited as one of the key growth areas for management consultant activities. With 34% of respondents citing it as a contributory factor to year on year growth through 2019.

Sustainability Projects

25% of UK MCA consultants cited sustainability projects as the number one trend in consulting requirements through 2019. They consider it to be a major requirement through 2020 and beyond.

Source: MCA Members Survey 2020

Some Hiring Companies Needs From Management Consultants

Direction and Transformation

When asked what consultancy meant to them, small businesses ranked transformational support and external strategic direction joint first. In fact, 35% of all respondents listed these.

Future Requirements

Digital and technology advisory services ranked as the number one future requirement for business consultancy requirement to small businesses. In fact, 38% of companies stated this type of project was on their agenda.  Business transformation came a close second, receiving 33% of the vote.

Independent Thinking

Independent thinking was the number one trait businesses valued when hiring a business consultant. In fact, 49% of respondents rated it as their top quality from a hired consultant.

Source: MCA: Clients Perception of Consulting Study 2019

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The UK Business Consultant Industry In Numbers

Size of UK Consultancy Industry
Of UK Firms Fees Are Generated In The UK
Generated by the Big 4 Firms
10 Year Average Growth Rate
Source: MCA: Annual Report 2017
  • 2019 saw on average a growth of 8.3% in revenues for management consultants. This is up compared to the 7% growth of 2018. This demonstrates the overall demand and usage of business consultants is increasing.
  • Pre COVID-19, firms were expecting to see continued growth through 2020 and 2021. In fact, an average annual growth rate of 6% per annum was forecasted. Given the recent events, how that will translate, is still to be seen.
Source: MCA Members Survey 2020

Who Can Be A Business Consultant?

The management consultancy and business consultancy industry in the U.K is completely unregulated. That means that anyone can set up a consultancy firm in any sector mentioned above.

Training To Be A Management Consultant

There are formalised and recognised management and business consultancy training courses in the UK. These give you most of the tools required to operate as a consultant. When considering the management consultancy pillar of business consultants there are two main accreditations.

The Level 7 Diploma in Professional Consulting is a joint award from the Chartered Management Institute (CMI) and the Institute of Consulting (IoC). Both of these are UK professional institutes and awarding bodies.

The syllabus includes two major consultancy projects that must be completed. It also includes:

  • Communicating strategies for consulting
  • Managing consultancy interventions
  • Group dynamics and facilitating skills
  • Managing the business of consulting
  • Organisational structure and change

The IoC also offers their Certified Management Consultant (CMC) course to all members or fellows. The CMC award involves interviews with assessors to demonstrate the required knowledge and skills to uphold the IoC’s standards.

Hiring A Management Consultant

The consultancy industry in the UK are unregulated. As with any unregulated market, always conduct due diligence before making a hire. Here are some steps to consider following before making decision.

Define the project outline.

Ensure a detailed and clear scope is in place prior the tender process. Not knowing what you are looking to achieve can lead to scope and cost creep.

Tendering your consultancy project.

When writing a project outline, leave certain elements for the consultant to define their approach. It is their expertise you are hiring, so let it shine through. You are looking for ideas and how they operate in the proposal. Just because you aren’t going to hire all the companies that tender. It doesn’t mean they won’t all have great ideas.

Check the credibility of the consultant you are hiring.

Check the credibility of the consultant you are looking to hire. This can be done through meeting with them, or asking for qualifications and examples of like projects. Take the time to speak their other clients. This is always a good steer on how they work.