Although management consulting and strategy consulting sound similar, there is a clear distinction between the two. The biggest difference is that strategy consulting is done at the executive level, usually with CEOs or a board of directors. The goal here is to determine long-term strategies that can be adopted for the company.
Another difference between management consulting and strategy consulting is that each of them is suitable for different business situations. Management consulting is more geared toward creating replicable methods that bring faster solutions for the issues that they were designed to handle. It also delivers functional excellence on a significant scale in any organization.
In comparison, strategy consulting lets an individual work in different industries. It takes a couple of months for a consultant plan to show how to cut costs, promote a new product, and so on. In simpler terms, strategy consulting has a more problem-solving approach. It goes directly to the needs of individual clients, and the aim is to satisfy them.
Another critical aspect of management consulting vs. strategy consulting is that big companies and corporations hire strategy consultants that focus on policies within a specific niche. Management consultants usually get hired by various company sizes, and they can apply their knowledge to numerous domains.
Explore the difference between management consulting and strategy consulting in this comprehensive article we’ve prepared for you.
For companies looking to improve performance and operations, hiring outside consulting services can provide an invaluable objective perspective. However, between strategy consulting firms and management consulting firms, the type of guidance and expertise offered can vary significantly.
In this article we’ll examine the key differences between strategy consulting and management consulting when each may be more applicable, and how consultants in these fields approach engaging with clients. Understanding these distinctions can help you determine the best type of consulting to meet your organization’s needs.
Overview of Strategy Consulting
Strategy consultants are typically brought in to address a specific business challenge or opportunity a company is facing Their role is to analyze that singular issue in-depth, conduct research and data gathering, and then develop an insightful strategic plan to move forward
Some common strategic initiatives where companies engage strategy consultants include:
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Market entry: Identifying how to expand into new markets or geographies
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New product launch: Determining positioning and go-to-market plans
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Mergers & acquisitions: Guiding M&A target evaluation and due diligence
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Restructuring: Assisting with corporate restructuring, spinoffs, or carve-outs
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Competitive response: Crafting strategies to address disruptive competitors
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Growth opportunities: Pinpointing areas for growth and expansion
Rather than offering prescriptive solutions, strategy consultants aim to collaborate with clients, provide objective analysis, and jointly develop strategy. Their engagements tend to be time-bound and focused on delivering a strategic plan for that individual business need.
Overview of Management Consulting
Management consulting takes a broader view, assessing the operations and performance of the client organization as a whole. Management consultants identify areas for improvement across the business to enhance efficiency, productivity, and results.
Some examples of where management consultants support organizations include:
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Operations: Evaluating production processes, supply chain, or logistics for opportunities to streamline operations
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Organizational structure: Assessing reporting structures, roles, and workflows to reduce inefficiencies
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Change management: Guiding major transitions like systems implementations, relocations, mergers & acquisitions, etc.
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Process optimization: Analyzing and re-engineering business processes for increased consistency, quality, and cost reductions
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Performance improvement: Conducting operational audits to identify issues impacting financial performance or KPIs
Management consultants take a holistic view to understand the interconnections between departments, workflows, and systems within a client organization. Their recommendations aim to address pain points throughout the business.
Key Differences at a Glance
To summarize the core differences:
| Strategy Consulting | Management Consulting | |
|---|---|---|
| Scope | Focused on specific business issues | Looks broadly across entire business |
| Outcomes | Strategic plans for individual problems | Solutions for company-wide performance |
| Timeframe | Project-based engagements | Ongoing client relationships |
| Approach | Analytical and strategy-focused | Process-driven and implementation-focused |
| Deliverables | Strategic plans, research, analysis | Business process optimization, org change, operational improvements |
While there is some overlap, strategy and management consulting engagements require distinct perspectives, skillsets, and approaches.
Comparing Client Engagements
To provide a more tangible sense of how strategy consultants versus management consultants engage with clients, let’s walk through a sample scenario for each.
Strategy Consultant Scenario
ABC Company is looking to expand their consumer goods business into the European market. However, they lack familiarity with the competitive landscape and customer preferences in Europe.
ABC Company hires a strategy consultant to guide their market expansion. The engagement may involve:
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Landscape analysis: Research European competitors, products, positioning, and pricing
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Customer research: Surveys, interviews, and focus groups to identify purchase drivers
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Data analysis: Evaluate market size, growth rates, channel mix, and regional differences
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Benchmarking: Study European best practices and pitfalls to avoid
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Strategy development: Define product offering, pricing, channel strategy, and marketing for Europe
The end deliverable is a data-driven strategic plan to drive ABC Company’s successful Europe market entry and expansion.
Management Consultant Scenario
XYZ Inc. is experiencing declining customer satisfaction levels along with rising costs in their customer service call center. The CEO suspects issues with operational efficiency and employee motivation but lacks visibility into daily operations.
XYZ Inc. engages a management consultant to perform an operational audit. Activities may involve:
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Process review: Map current workflows, identify redundant steps, sources of delay
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Resource analysis: Evaluate staffing levels, workload balancing, skill gaps
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Technology audit: Assess current systems, integration issues, and feature usage
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Metrics analysis: Correlate CSAT with call volume, wait times, handle times, and resolution rates
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Industry benchmarking: Compare operations against industry best practices
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Employee interviews: Uncover pain points impacting morale and performance
The end result is a report detailing recommended changes to optimize processes, workflows, resources, and technology in the call center. This drives increased customer satisfaction and decreased costs.
When to Use Each Type of Consultant
So when should you engage a strategy consultant versus a management consultant? Here are some guidelines:
Consider a strategy consultant when you need:
- An in-depth analysis of a specific business challenge, market, or opportunity
- Specialized industry or market expertise to formulate strategic plans
- Data-driven strategic plans and objective recommendations
- Expansion into new markets or offerings
Consider a management consultant when you need:
- A holistic audit of company-wide systems, processes, and operations
- Identification of inefficiencies impacting performance
- Optimization of workflows, reporting structures, and resources
- Implementation support driving operational excellence
- Organizational change management
For targeted strategic planning around high-level business initiatives, a strategy consultant may be the best fit. When the desired outcome is optimized processes and performance across interconnected departments, a management consultant may be ideally suited.
Choosing the Right Consulting Partner
Whether you choose to work with a strategy consultant or management consultant, make sure you:
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Clearly define the scope – Be explicit about expected deliverables and outcomes.
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Vet their expertise – Look for experience specific to your industry and business needs.
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Assess working styles – Ensure your operating norms and mindsets align.
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Plan implementation – Discuss how you will execute on the consultant’s recommendations.
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Agree on milestones – Define measurable checkpoints and outcomes to gauge progress.
By selecting the right type of consultant and establishing clarity upfront, you can ensure an engagement that yields strategic value and performance improvements tailored to your organization’s current business challenges.
The Bottom Line
While strategy consultants and management consultants both aim to guide business success and growth, their specific approaches and areas of focus differ. Strategy consultants bring an analytical perspective to address targeted strategic business priorities. Management consultants take a big picture view to optimize all the interconnected elements that influence company-wide performance. Understanding these nuanced distinctions allows you to match the type of consulting expertise to your organization’s needs. With the right consultant partner, you gain the insight and guidance to overcome hurdles, capitalize on opportunities, and accomplish your mission-critical goals.
Management Consulting vs. Strategy Consulting
TL;DR – Strategy vs. Management Consulting Main Difference
Strategy consulting focuses on long-term organizational strategies and is often done with CEOs or boards of directors. On the other hand, management consulting is focused on improving the efficiency of various organizational functions.
Who needs management consulting?
Wondering who’ll hire you and why if you become a management consultant? Let’s see:
- Businesses hire management consultants to track problems. Many times employees can be too close to a problem inside the organization to be able to spot it. This is the moment when you as a management consultant can join and get to the bottom of what is going on.
- A consultant can be an extra staff member. Businesses save a lot of money by hiring you as a management consultant. This means that if they don’t need full-time employees to perform a specific task, hiring consultants is wiser. Another advantage of hiring a consultant is that an organization can also save extra money as they do not need to pay benefits to the consultant they decide to hire.
- A consultant can be the spark of the change. People do not like changes, but some of them are needed. A consultant can be brought to reflect on the changes that need to be implemented.
Management Consulting Vs Strategy Consulting (Differences Explained)
What is the difference between management consulting and strategy consulting?
The purpose of strategy consulting is to guide a company toward good business strategies and help them implement them in order to increase revenue. In contrast, the purpose of management consulting is to improve overall performance in the workplace and create operational efficiency.
Can a management and strategy consultant work at the same time?
Although it is uncommon, it is feasible for someone to hold dual positions as a management and strategy consultant. It is uncommon for someone to excel at both management consulting and strategy consulting at the same time because they call for separate skill sets.
What is a management consulting firm?
They are often referred to as “management consulting firms” and are renowned for their strategy work. However, they also take on management consulting projects outside of pure strategy. The Big Four, including Deloitte, KPMG, PwC, and Ernst & Young, are known for their audit and financial advisory practices.
What is strategy consulting?
Strategy consulting falls under that umbrella. It’s a subset of management consulting where consultants provide industry-specific insights and actionable strategies to deal with individual business and management challenges. For the sake of this example, imagine a chain restaurant called “Broohaha’s.”
