Governing public sector use of external management consultancy: beyond client procurement and consultant professionalisation

IMPACT
Efforts to improve the governance of external management consulting have a mixed record. Attention has focused on either procurement (and insourcing) and/or raising standards through professionalization. The persistence of critiques and public scandals suggests that more is needed from the industry, policy-makers, clients/purchasers and other stakeholders. In this article, the authors highlight how systemic problems with consulting arise from the nature of its reward and value systems and the resulting lack of openness of consultants and their clients—none of which have been adequately addressed through traditional governance mechanisms. The authors explain why these neglected areas need attention. This can be done, in part, by drawing on new trends and classic dilemmas. Is the rise of purpose-led or alternative organizational forms, as well as moves to facilitate transparency and the speaking of ‘truth to power’, improving the governance and outcomes of external management consultancy?

ABSTRACT
Most research on the use of external management consultancy in the public sector focuses on critique, with less attention given to improving governance. Where governance has been considered, a longstanding concern has been with client procurement and consultant professionalization. However, the persistence of malpractice and critique suggests a need for complementary approaches. In this review article, the authors explore three such options which are linked to core problems in the practice and use of consulting: reward systems and values in consulting firms and spaces where both clients and consultants can openly challenge and speak ‘truth to power’. These are examined in the wider context of an apparent move towards ‘purpose-led’ consulting where profit is held to be less important. This is seen to present an opportunity for reform, but is insufficient on its own without other actors and activists intervening and traditional approaches being strengthened or radicalized.