Management consultancy is a key sector in the economic change toward a service and knowledge economy. Originally published in 2006, this book explains the mechanisms of the management consulting market and the management of consulting firms from both economic and sociological perspectives. It also examines the strategies, marketing approaches, knowledge management and human resource management techniques of consulting firms. After outlining the relationships between transaction cost economics, signaling theory, embeddedness theory and sociological neoinstitutionalism, Thomas Armbrüster applies these theories to central questions such as: Why does the consulting sector exist and grow? Which institutions connect supply and demand? And which factors influence the relationship between clients and consultants? By applying both economic and sociological approaches, the book explains the general economic changes of the previous thirty years and sharpens the relationship between the academic disciplines.
• A broad overview of management consulting as a modern economic phenomenon • Enhances understanding of the management of consulting firms • Draws on economic sociology and organization theory
List of figures; List of tables; Preface and acknowledgements; 1. Management consultancy viewed from economic and sociological perspectives; Part I. The Mechanisms of the Consulting Market: 2. Why do consulting firms exist and grow? The economics and sociology of knowledge; 3. How do supply and demand meet? Competition and the role of social institutions; 4. Who is more powerful? Consulting influence and client authority; 5. Substitutes or supplements? Internal versus external consulting; Part II. The Drivers of Managing a Consulting Firm: 6. Diversified services or niche focus? Strategies of consulting firms; 7. Fostering reputation and growth? Marketing consulting services; 8. Economics and sociology of knowledge distribution: organizational structure and governance; 9. Gaining talent and signaling quality: human resource management; Part III. Conclusions: 10. The knowledge economy, management consultancy, and the multitheoretical approach; References; Index.
Review of the hardback: 'This is one of the very best books on management consulting to appear in the last decade. It systematically applies four theoretical perspectives to one of today's fastest and least understood industries. The result is an unusually rich set of insights. The author is careful not to overstate the general relevance of these insights, but this book will be of considerable value to anyone interested in the broader field of professional services.' Royston Greenwood, Professor of Strategic Management, University of Alberta, Canada
Review of the hardback: 'The Economics and Sociology of Management Consulting is a landmark publication. Professor Armbrüster's book is a superb analysis of the consulting sector, convincingly demonstrating why it has grown so large, the dynamics of competition between firms, and the nature of relationships between clients and consultants. In so doing, Armbrüster achieves the highly impressive feat of demonstrating how economic and sociological theories, so often seen as incompatible, can be deployed in a complementary way to gain richer insights than any one theoretical lens can provide. It is a book for scholars, practitioners and for anyone interested in understanding why management consulting plays such a prominent role in contemporary business life.' Tim Morris, Professor of Management Studies, University of Oxford
Review of the hardback: 'The debate about management consulting has rarely encompassed the theories that the social sciences afford us in order to make sense of the world in which we live. This book shows us how recent ideas from economics, sociology and other disciplines can help us understand the dynamics of the consulting market, the structures and strategies of consulting firms, and the interaction between consultants and their clients. Anybody who is seriously interested in the consulting sector - academics, consultants, and practicing managers alike - will learn from the insights contained in this very fine book.' Ansgar Richter, Chair of Management and Consulting, European Business School, Oestrich-Winkel, Germany