Consulting Costs and Value Analysis: On-Demand Talent vs. Traditional Firms

Consulting Costs and Value Analysis: On-Demand Talent Savings vs. Traditional Firms — Scale icon with dollar sign on background of financial graphs

Using on-demand talent adds value to your biggest strategy and implementation projects while significantly cutting consulting costs. But just how much can you save by using independent consultants rather than traditional firms? To find out, we analyzed consulting costs three ways. See what we found in the infographic below.

Summary of Findings

Save 48–63% on consulting costs vs. traditional firms

Business Talent Group (BTG) provides on-demand access to management consultants, subject matter experts, consulting boutiques, and F1000 executives. With BTG, clients are able to build highly specialized team configurations to solve specific business problems, maximizing consulting value while reducing spend. To quantify the savings, we conducted a rate card analysis, team configuration by engagement analysis, and client interviews.

A rate card analysis shows that using high-end on-demand talent rather than a consulting firm could save companies an average of 35-49% on strategy projects and 31-47% on implementation projects.

Potential savings on consulting costs are even greater when examining team configurations on a project-specific basis, resulting in an average savings of 48-63%. This is even more significant in light of the fact that when we asked clients what they would consider meaningful consulting cost savings, respondents said that a savings of 15-20% would be significant.

Consulting Costs by the Numbers: A Closer Look

Consulting Costs Rate Card Comparison

A direct rate card analysis of broad project types shows significant savings when comparing on-demand talent to other sources of consulting.1

Client daily rates reflect average daily rates by role. Strategy Suppliers defined as firms primarily focused on strategy, such as McKinsey, Bain, and BCG. Big 4 firms include PwC, EY, KPMG, Deloitte, and other firms with extended service offerings (consulting, audit, etc.).

Strategy Projects

We compared consulting costs for strategy projects against both strategy suppliers and Big 4 suppliers at various talent levels. BTG provided significant savings across the board.

When compared against strategy suppliers, BTG offered the following savings off each talent level:

  • Partner: 53%
  • Associate Partner / Senior Engagement Lead: 55%
  • Senior Consultant / Engagement Lead: 50%
  • Consultant: 42%
  • Senior Analyst / Analyst: 43%

When comparing consulting costs for strategy projects against Big 4 suppliers, BTG provided savings of:

  • Partner: 40%
  • Associate Partner / Senior Engagement Lead: 34%
  • Senior Consultant / Engagement Lead: 34%
  • Consultant: 33%
  • Senior Analyst / Analyst: 35%

Overall, working with BTG provided average consulting costs savings of 49% over strategy suppliers and 35% over Big 4 suppliers on strategy projects.

Implementation Projects & Project Leadership

When looking at implementation projects and project leadership against other types of suppliers, we found that BTG offered similarly significant savings on consulting costs.

When compared against strategy suppliers, BTG offered savings of:

  • Senior Program Leader: 50%
  • Program Leader: 53%
  • Program Manager: 48%
  • Project Manager: 40%
  • Project Analyst: 42%

When comparing consulting costs for implementation projects & project leadership against Big 4 suppliers, BTG provided savings of:

  • Senior Program Leader: 33%
  • Program Leader: 32%
  • Program Manager: 31%
  • Project Manager: 29%
  • Project Analyst: 30%

Overall, working with BTG provided an average savings of 47% over strategy suppliers and 31% over Big 4 suppliers on implementation projects and project leadership.

Effective and Efficient Team Configurations

For a holistic analysis of the true value of on-demand talent, we looked into how consulting costs on BTG projects compare to traditional consulting firm costs in four different scenarios, noting the typical staffing models of each.

Note: The percentages next to each role in the examples below denote the amount of each consultant’s time dedicated to the engagement.

Scenario 1: Supply chain improvement

An F200 agricultural company wanted to enhance end-to-end supply chain processes for its leading business units, including redesigning all operational planning capabilities and executing the improvements. BTG delivered a high-powered, Partner-level talent, who was a former AT Kearney and BCG Principal and supply chain/omnichannel strategy executive. This talent worked alongside a subject-matter expert who had 30+ years as a supply chain executive, as well as a top-tier analyst. The team of three worked full-time to deliver outstanding results.

TEAM STRUCTURE

BTG Solution:
Partner (100%)
SME (100%)
Analyst (100%)

Traditional Firm Solution:
Partner (10%)
Engagement Lead (100%)
Consultant x 2 (100%)
Analyst x 3 (100%)

SAVINGS

BTG Cost: $337,000
Strategy Firm Cost: $810,000 | Savings with BTG: 59%
Big 4 Cost: $525,000 | Savings with BTG: 36%

Scenario 2: Growth strategy

An F100 CPG company needed help developing a growth strategy for the chilled beverage market. BTG delivered a former Sr. Engagement Manager and beverage expert with 12+ years of experience in McKinsey’s CPG/Retail Practice, who performed the bulk of the work with the help of one part-time analyst. BTG’s brand name, top-tier talent was just the piece of the consulting pyramid needed with specific industry expertise at a fraction of the cost.

TEAM STRUCTURE

BTG Solution:
Partner (100%)
Analyst (50%)

Traditional Firm Solution:
Partner (10%)
Engagement Lead (50%)
Consultant (100%)
Analyst (100%)

SAVINGS

BTG Cost: $75,000
Strategy Firm Cost: $272,000 | Savings with BTG: 72%
Big 4 Cost: $197,000 | Savings with BTG: 62%

Scenario 3: Data analytics implementation

A global tech company had engaged a large consulting firm to create a big data strategy roadmap but did not have the budget to cover implementation. BTG delivered an experienced, unbiased technology leader—who had served as CIO for several name-brand eCommerce organizations—to implement the firm’s recommendations.

TEAM STRUCTURE

BTG Solution:
Partner (100%)

Traditional Firm Solution:
Partner (10%)
Associate Principal (30%)
Program Manager (100%)
Analyst (100%)

BTG Cost: $516,000
Strategy Firm Cost: $1,580,000 | Savings with BTG: 67%
Big 4 Cost: $1,125,000 | Savings with BTG: 54%

Scenario 4: Product launch

A global pharmaceutical company was preparing for a new product launch and needed to support the development of an agile launch plan and playbook. BTG delivered three consultants with global biopharma launch experience to lead the highly coordinated effort. The team included a former McKinsey Sr. Engagement Manager with 15 years’ experience in pharma and medical device product launch, as well as a former Deloitte consultant experienced in market access, and a former Accenture consultant with 10 years’ experience in pharma and healthcare.

TEAM STRUCTURE

BTG Solution:
Associate Partner (100%)
Consultants x 2 (100%)

Traditional Firm Solution:
Partner (20%)
Engagement Lead (100%)
Consultant (100%)
Analyst x 3 (100%)

SAVINGS

BTG Cost: $296,000
Strategy Firm Cost: $670,000 | Savings with BTG: 56%
Big 4 Cost: $490,000 | Savings with BTG: 40%

Beyond Consulting Costs: Independents vs. the Big Firms

More broadly, a recent study showed that independent consultants report they are able to work more efficiently and cost-efficiently to deliver more value for clients than when they’re employed in traditional consultancies.2

  • 91% of independent consultants said they deliver better value for the money
  • 76% said they are able to work more efficiently
  • 66% said their recommendations are more likely to be implemented
  • 61% said their projects are more impactful for clients

BTG’s marketplace of independent management consultants and executives can help you tackle your next initiative and save big on consulting costs. Find out more about the value of using on-demand talent today.

Succeeding With High-End Independents

Curious how high-end independent talent helped other F1000 executives? Check out our 2019 report.

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