Bersin Sale to Deloitte Consulting: One Word Says it All
By Jim Lundy
Consulting firms are different than Research and Advisory Services (Analyst) firms. Last week Josh Bersin announced that he had sold his firm to Deloitte Consulting. We are happy for Josh and the Bersin Associates. However, since that sale was announced, we have had many calls asking for our take. So this blog post is about our take on the differences between Research and Advisory Services firms (Analyst Firms) and Consulting Firms.
Research and Advisory Services (RAS) versus Consulting
Analysts analyze, write research and give great advice. Consulting firms generally want to deal with all of the aspects of a project from strategy all the way through to deployment and sometimes operation. Consulting engagements are generally project oriented and can involve more than just strategy.
When a firm offers both RAS and Consulting, conflicts of interest can arise from time to time. The biggest areas of conflict often are in government, when a firm provides advice on an RFP and then the same firm wants to respond to the RFP and win all the consulting and implementation revenue. Gartner did this for many years and still does this, much to the dislike of many CIOs. My practice for my clients was always to avoid potential conflicts of interest. We operate that way today.
One of the reasons for conflicts is that the Consulting firm may only focus on the deployment of certain products in the category, so they may only be recommending that specific set of products or services. This limits the choice for the end user enterprise.
Research and Advisory Services firms may do consulting type work (aka an extended engagement), but if that is not their primary business model, the hourly rate can be very high. The reason for that is that it comes down to the business model. The enclosed graphic does a good job of comparing and contrasting where Analyst firms engage versus Consulting firms.
The tier one Analyst firms generally will evaluate the markets that they cover and will evaluate the vendors that participate in them using different methodologies. For example, we have our Aragon Research Globe and we use it to rate vendors in the markets we cover, including the upcoming Globe for Learning.
Consulting firms that Advertise as a Research and Advisory Services Firm
Many consulting firms want it all. They want to advise you on what your strategy should be and then have you pay them for executing the strategy that they develop for you. Essentially today, Deloitte Consulting now wants to provide advise from their new Bersin by Deloitte subsidiary, and also do all the consulting work that may result from it (Vendor Selection, vendor implementation). This isn’t a new model. For years, Accenture would try to advise enterprises on their learning strategy and then turn around and sell them an LMS. That worked for a while before enterprises started to get wise to the conflict of interest.
To go back to the earlier graphic above, Aragon Research talks about our SOARs Methodology, which generally stops at requirements and selection criteria, in the form of Toolkits. We certainly give advice to enterprises about firms that can provide services to support their project.
So, for smart buyers, understanding who you get advice from, is just as important as who you hire to do the execution work for you. These are subtle differences, but the most important point here is that you should not limit your choices when it comes to technology. If you’d like to discuss this further, feel free to comment below.