Cost:

The day rate costs of using Associates are substantially lower than using consultants from the traditional big consulting firms. In K2’s case our rates are around 50% lower than the large traditional firms. In addition, we find that Associate led consulting engagements are delivered faster due to more dedicated consultants who are not distracted by internal employer challenges. In addition, we are able to deploy the best for each role without the need to leverage large teams behind the senior resources. In the traditional firms their economic model requires senior consultants to be leveraging between 15-20 consultants on the same project. In an Associate model this is NOT the case. 

Scale:

The Associate marketplace is very large globally. The Associates engage with a client in a number of ways. Some are single individuals some work through the traditional agencies (like Hays); some work for small niche consulting firms that use an Associate model and then there are a few larger Associate based consulting firms. The largest in Europe is K2. K2 has over 3,000 Associates in Europe and 1,000 in India we are now expanding into the US due to client engagements. 

Breadth of skills

The breadth and depth of skills available through an Associate model are far greater that through the traditional firms. The traditional firms are constrained by financial targets and the major cost issue of the “bench”. This is the cost of consultants who are not chargeable to clients. This needs to be kept to a minimum and as such investment in acquiring all the right skills is limited, as it is simply not financially viable. In an Associate model there is no “bench” as K2 (and other similar firms) do not have to pay the Associates if they are not working on a client engagement. In the 5 years that K2 has been formed we have always been able to find the right Associate with the right skills. In addition, investing in a new skill or capability is also far more challenging for the traditional firms

Quality:

This is often a perceived big issue for clients considering an Associate model. In reality this concern is misplaced. Firstly, the Associate pool is larger than the employed consultant market. Secondly, many have already worked for the traditional consulting firms. Third, and most important, the key motivators for the Associates to deliver “quality” are all controlled by the client. Associates simply want 3 things: to be paid a fair rate and expenses for the job they are doing; to work on an exciting project; and to work with good people who they like and can learn from. In an employment model from the traditional firms the client “controls’ very little of the core demotivators for the consultant: “I didn’t get promoted; my pay increase wasn’t what I expected; my bonus was too small; I don’t want to do that project; I don’t want to work away from home”. This also has a direct impact on consultant retention. In an Associate model, from my experience, Associates are far more loyal and client focused than employed consultants from the traditional firms.

Speed of onboarding:

K2 will typically be able to present Associate CV’s to a client within 24-48 hours dependant on the complexity of the skills and the volume. However, we do not just present CV’s we actually engage with a client to find the right Associate e.g. a client asked K2 for a Program Manager, we asked what type and style did they want – a planner, a stakeholder manager, hard “bulldog” skills, a diplomat – all key questions to find the right Associate. In another client, we were asked to find a project manager for a failing agile project. We asked the client “what stage of the agile project failure are you at so we can place the right person to fix it”. So, whilst we place our Associates into clients faster than the traditional firms we also submit Associates that “fit” the client need not who is left on the bench. In a recent client we were asked to place an Associate in our client where there was a traditional firm incumbent. The traditional firm couldn’t do this for 3 weeks, K2 placed the Associate working in the client in 2 days. 

Focus on delivery:

A major issue for clients is when project teams start to try to sell more work when they have not yet delivered. This is a key problem with the traditional firms whose financial model and internal performance metrics “force” the senior members of the team to sell-on. This is particularly the case with the large System Integrators. Whilst Associate firms like K2 also want to sell additional work, the core delivery team has no financial motivation to sell and so very simply do not. They want to focus on delivery.