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Times have changed quite a lot since the early days
of management consulting. Clients world over are demanding more
out of their consulting partners. They want solutions quicker than
earlier and as business situations get more complex, the consulting
budgets are getting less generous. Consulting companies world over
are finding new ways to provide efficient services to clients in
spite of stringent billings. In such a stead distance consulting
forms a formidable option for consulting companies to service clients
in the SME sector at much lower costs than what their conventional
consulting methods allow.
Distance consulting can be simply defined as providing consultancy
services to clients by use of media like the Internet and telephone
than use of conventional face-to-face interactions. Consulting companies
offer distance consulting to clients through a variety of media
- telephone, Internet chat or email and video conferencing. This
is analogous to distance education, another term that is taking
raise the world over. An obvious and immediate benefit of distance
consulting is that it is much cheaper than its traditional counterpart.
For one, the client saves on the costs of accommodating the consultant
(and his team) in his office, not to mention all the administrative
expenses and a share of marketing expenditure the consulting company
allocates to the client that is normally included in the client's
bill. So instead of going to high-priced consultants, thousands
of managers are now turning to their computer screens and seeking
advice from online services via the Internet.
How does it work?
The client may or may not be in a geographical different territory
from the consultant though distance consulting may be experienced
to its fullest with most cost savings that way. The customer gets
in contact with the vendor with a specific question using any of
the following media and the same is answered in a stipulated period
of time by the consulting team.
The client has access to multiple media to get in touch with the
consulting firm -
Telephone
Email/ Chat
Videoconference
Interactive software set up on consulting company's website
Teleconsulting
Out of the above modes, telephone consulting has been in practice
for quite some time now. Its fast and its cheap! It's a tried and
tested mechanism where the processes and the billing methods are
fixed. Telephone consulting usually involved face-to-face meetings
to clarify the requirements and then working offsite on most of
the project with discussions held on telephone, with again face-to-face
meetings required only for very critical meetings. Now with the
advent and growth of technologies like videoconferencing, these
meetings also can be avoided without loss in the consulting service.
Email Consulting
With the advent of Internet, email consulting started as a form
of providing consulting service. Today email has overtaken the telephone
as the primary means of business communication, according to a survey
of more than 400 Human Resources executives (study by Ernst &
Young | HR Focus survey). In email consulting, the client emails
the consulting firm with his specific problem and he receives a
reply from the consulting team in a matter of 24- 48 hours.
Email consulting is in existence since 1996 - an initial version
of the exercise was a free email consulting service offered by SCORE
(Service Corps of Retired Executives), a Government Agency to offer
startup and administrative advisory services to SMEs. It had a voluteer
network of consultants who fielded questions over email (over 800
consultants total)
A benefit of email consulting is that clients are more prepared
with their problems and as experienced by SCORE 64% of the cases
had only one exchange of conversations (client to consultant to
and fro).Also the time required for a consultation via email is
less than face to face or phone consulting. This is perhaps because
email consulting helps clients articulate problems when they write
to consulting firms thus leading to faster solutions.
An offshoot of sorts of email consulting services is chat based
consulting where the consultants meet clients on an online chat
as an extension of their email dialogue. Instant messaging is increasing
in popularity by leaps and bounds and this is showing everywhere
as more and more executives use chat messengers and chat clients
to transact business. In fact, the Gartner Group predicts IM will
surpass email as the preferred mode of communications by 2006. This
trend might bring in a host of distance consulting activity on the
chat frontier.
Videoconferencing
However the most technologically advanced the most effective means
of distance consulting is videoconferencing. Here teams from the
consulting company as well as the client can meet and see each other
online, share ideas and discussions over a white board application,
exchange files and maintain archives. Its almost as good as being
there. Often telephone consulting is see as one to one form of consulting
but the videoconferencing can be many to many where two or more
teams can arrange meetings even if they happen to places across
the world.
Interactive software based distance consulting
The last mode of consulting is quite different from the above.
Ernst and Young way back in 1996 started an online consulting service
where users could register and search answers to their questions
from their knowledge base. This form of distance consulting, later
also implemented by the likes of Andersen, KPMG and a few other
top consulting companies proved quite value adding for the clients
as it provided them access to the consulting companies' expertise
and consultants at a much lesser cost than their conventional companies.
(read case below).
Human interaction is not entirely cut out in the above mode, however.
If users can't get a satisfactory answer through interactive software,
they can email a consultant for help. Arthur Andersen promised a
consultant will contact the subscriber by phone to discuss the query
within 24 hours whereas Ernie (E&Y's initiative) emails a written
answer within two days.
While providing companies with clients who otherwise wouldn't have
afforded their services, this form of distance consulting also helped
the companies understand the pulse of the market based on the questions
asked which helped them modify their conventional offerings
Benefits of distance consulting
The immediate benefit of a distance consulting project is the cost.
Clients who are not able to afford consulting services of bigger
consulting companies can afford to pay for distance consulting services
as they are priced much economically than conventional services.
Moreover the client has access to the whole consultant strength
of the consulting company across all its branches in different geographical
areas as the client questions can be routed on the company's intranet
to the respective expert.
The turnaround time is generally short for distance consulting projects
with milestones in foreseeable future helping the client an option
to stay with the consulting company or move away with not all of
his investments stuck with the same company.
For a consulting company, distance consulting offers opportunity
to service clients in different geographical areas where it does
not have a physical presence. Often in such times, consulting companies
are able to offer the client the same service he's getting locally
at a fraction of the cost as against their conventional local counterpart.
For the client this means a wider choice of consulting firms available
to invite bids for his project - important specially if the service
is a niche offering.
Shortcomings
There are times when the hands-on consulting is required though.
While face-to-face interaction per se can be handled by tools like
video conferencing, coordinating a team of client staff over a prolonged
period of time may require face to face meetings. Also projects
of a large size may need onsite personnel to monitor and coach client
during implementation. However if properly applied distance consulting
can also be part of such projects no matter what their size and
nature.
Case study
ERNIE: (online consulting model developed by Ernst and Young)
Amongst the distance consulting ventures started by the consulting
companies, ERNIE - a venture by Ernst and Young was the first. Build
in 1996, Ernie was developed as an interactive system that helped
users access the E&Y knowledge base and find answers to their
problems.
Started in 1996, 1400 companies registered by 1998 as subscribers.
Used by E&Y as initially a free service (converted to a paid
one later) to web users for accessing all the consulting strength
of EY; also helped them to get a pulse on the markets and current
concerns. Users would search through what were called the Previously
Asked Questions (PAQs) and if there was no question related to the
user's interest, it got transferred to E&Y consultant who answered
it by email. Ernie was later converted into a paid service in which
users could subscribe to Ernie by paying an amount for a certain
number of questions (ten questions with a life time validity). This
actually posed a problem as users started hoarding questions which
made Ernie change its pricing structure. Per-question fees too produced
low response rates. Ernie then made it into an annual subscription
service where users could ask unlimited questions for a fixed fee.
This solved the hoarding problem and also helped Ernie getting a
feel of what the customers problems were.
Ernie was later called Ernst & Young Online that is an interactive
gateway for E&Y clients to access E&Y's knowledge resources,
and business tools. Ernst & Young Online gave the clients the
information and knowledge to make decisions fast, as well as enable
E&Y team of consultants to work more effectively with their
clients-promoting efficiencies, enhancing communications, and adding
new depth to their relationship.
There were quite some changes in the Ernie's business model. The
2-day response time was found to be too long for some service areas
like taxation matters and new service packages (express delivery)
and pricing had to be devised.
ERNIE was one of the recipients of the Smithsonian Institution's
Award for Technological Innovation.
Initiatives by other consulting firms also made a mark in their
respective client base. Knowledge Space was started by Arthur Andersen
in 1998 and was aimed again at SME that could not afford the traditional
face-to-face consulting services.
Distance Consulting works best for both consultants and clients
alike. It gives clients an opportunity to search companies across
geographical boundaries specializing in the client's problem area
and providing service at lesser costs. At the same time, it gives
consulting companies an opportunity to service customers across
geographical boundaries and those who cannot afford its conventional
services and also offer added value to its existing set of customers
who buy conventional consulting service.
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