How Knowledge Accumulation Changed the Competitive Advantage of Strategy Consulting Firms

21 Pages Posted: 26 Aug 2006

See all articles by Frans A. J. Van Den Bosch

Frans A. J. Van Den Bosch

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship; Erasmus Research Institute of Management (ERIM)

Marc Baaij

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship

H. W. Volberda

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM); Amsterdam Business School; Erasmus Research Institute of Management (ERIM)

Date Written: October 2005 5,

Abstract

Research evidence confirms that the accumulation of knowledge contributes to the competitive advantage of firms. In the strategy consulting industry, one of the most knowledge-intensive professional services industries, however, established firms thatexploited their knowledge accumulation by adding exploitative consulting practices have found their performance has deteriorated. To investigate this phenomenon, this paper willdescribe how the increasing share of exploitative practices in the strategy consulting industryhas attracted both established ICT-related consulting firms and new entrants, and enabled clients to expand their problem-solving abilities. We will argue that these developments in terms of competitiveness and client competencies have reduced the attractiveness of exploitative practices for established strategy consulting firms. To analyse thesedevelopments and to provide strategic options for the established strategy consulting firms, a conceptual framework will be proposed. Based on this framework, three strategic option are identified: ‘Follow the herd’, ‘Become ambidextrous’ and ‘Back to the original focus.’ In summarizing our argument, we highlight the pros and cons of these options and the implications for top management.

Keywords: strategy consulting, knowledge, exploitation and exploration, ambidextrous organization

JEL Classification: D21, L20, M

Suggested Citation

Van Den Bosch, Frans A. J. and Baaij, Marc and Volberda, Henk W. and Volberda, Henk W., How Knowledge Accumulation Changed the Competitive Advantage of Strategy Consulting Firms (October 2005 5,). ERIM Report Series Reference No. ERS-2005-026-STR, Available at SSRN: https://ssrn.com/abstract=797959

Frans A. J. Van Den Bosch

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship ( email )

RSM Erasmus University
Rotterdam, 3000 DR
Netherlands
+31 10 408 1955/2005 (Phone)
+31 10 453 0137 (Fax)

HOME PAGE: http://www.rsm.nl/fvandenbosch

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Marc Baaij (Contact Author)

Erasmus University Rotterdam (EUR) - Department of Strategic Management and Entrepreneurship ( email )

RSM Erasmus University
Rotterdam, 3000 DR
Netherlands

Henk W. Volberda

Erasmus University Rotterdam (EUR) - Rotterdam School of Management (RSM) ( email )

P.O. Box 1738
Room T08-21
3000 DR Rotterdam, 3000 DR
Netherlands
+31 10 408 2761 (Phone)
+31 10 408 9013 (Fax)

HOME PAGE: http://www.eur.nl/fbk/dep/dep4/faculty_members/Henk_Volberda

Amsterdam Business School ( email )

Plantage Muidergracht 12
Amsterdam, 1018 TV
Netherlands
+31 205254369 (Phone)

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands