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consulting firm organizational structure

Consulting Firm Organizational Structure: Best Practices

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How do you structure a successful consulting firm?

Perhaps you’re an independent consultant who’s looking to grow your business.

You no longer want to be spending the majority of your time on consulting work.

Instead, you want to be a consulting business owner: someone who runs a consulting business.

You’d rather be focusing on leading a team, business development, and building an asset that you can sell.

In this post, we’ll break down…

Ready? Let’s dive in…

There are many different ways to structure your consulting firm, and there is no “right” way to do it.

What Is The Consulting Firm Model?

The consulting firm model is where you run a consulting business with a team instead of doing all of the client-facing work yourself (like a solo consultant).

You move from spending your time on delivering client projects to management, strategy, and business development. You manage a team of consultants who will do the heavy lifting and the majority of the client-facing work.

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As discussed in our article on consulting business models, there are pros and cons to this model.

The pros of the firm model are…

  • Firms scale well you can add more consultants to take on more work
  • Removes you from doing the day-to-day client work
  • The business can run without you
  • Firms are a higher-value asset and are much easier to sell
  • Allows you to create a greater impact and help more people

The cons of the firm model are…

  • Requires a lot of people management
  • Lower profit margin
  • Firms require more infrastructure to keep running
  • More people depend on you (and you’ve got to make payroll)

There are many different ways to structure your consulting firm, and there is no “right” way to do it.

In the next section, let’s look at the typical consulting firm’s organizational structure.

Consulting Firm Org Structure Breakdown (With Examples)

Here is the typical structure of a larger consulting firm. This will differ from a boutique consulting firm, which has fewer people.

Remember, there is no one way to set up a consulting business. Use what makes sense for the consulting business and lifestyle that you desire.

consulting firm organizational structure hierarchy
Example large consulting firm structure. Keep in mind you should use the structure/titles that work for your business.

CEO

As the CEO or founder of the firm, your role should be focused on a few key areas:

  • Bringing in new business and ensuring the pipeline is full
  • Being involved in the company strategy, vision, and working on high-level strategy with clients
  • Keeping a close eye on your company’s financials and performance
  • Building and supporting your team. You may not be doing the hiring, but deciding on who to hire and making sure you have the right people in the right seats is key

Senior Partners (Leadership)

Senior partners often have an ownership stake in the business. They typically have been in the business for a longer period of time and they have the most experience. As senior partners, they help the CEO with leadership decisions for the firm.

Senior partners are concerned with the vision, future, and overall strategy of the firm. They will also have long-standing relationships with key partners, making them incredibly valuable for major deals and business development.

Senior partners typically aren’t grinding away on their computers, working on client projects. Day-to-day, they might be attending a conference or even on the golf course. Not only to improve their swing but to build relationships and deal flow.

You’ll tend to find that the higher up you go in the org chart, the less involved people are in the delivery of work. The focus at this level in the organization is on relationships, partnerships, thought leadership, vision, and strategy.

Partners

Partners are there to support the vision of the company. They’re also involved in client projects, but not as directly. They typically do more of the oversight, relationship management, and some presentations.

Partners are also involved in bringing in new business. But, they can be involved in other aspects of the business depending on their specific area of expertise (like technology).

At larger firms, partners can also organize their teams along specific industry areas, like technology, environment, manufacturing, etc.

These next three sections of the organizational chart can vary widely. In some cases, they are blended together. Other firms will have all three as distinct levels with different hierarchies.

Regardless, let’s jump in and cover what these roles look like typically…

Junior Partners

Junior partners are much more involved in client work and delivery. You won’t always find them rolling up their sleeves deep in the data and research. But don’t be surprised if you do. They are active in client conversations and presentations. They receive guidance and coaching from Senior Partners and most aspire to move up in the organization.

Operations & Project Managers

Once the client work begins, the operation managers and project managers begin to get involved. They are the people who are responsible for managing all aspects of project delivery and the people involved in those projects.

They are overseeing the timelines and schedule. Making sure everyone is on track to deliver the project to the client successfully. In this role, you’ll often find people with experience in project management. They will be client-facing. But they don’t make key decisions without talking to the partners who are connected to the project.

Operations managers are more concerned with the operations of the business, while project managers are more concerned with the operations of particular consulting projects.

Consultants/Analysts (Delivery)

Consultants and analysts are the ones who are deep in the data. They are doing the research. They are putting together the slides and all the information necessary to analyze the client’s situation. They will present this to the partners involved in the project, have discussions, and then decide on the recommendations for the client and what the optimal next steps look like.

To this point, we’ve covered the key roles related to client work and project delivery. But there’s a whole other side of the organizational chart we haven’t covered yet.

We now need to look at all the other functions of the business and key areas that are necessary to run a successful consulting business.

Marketing/Content

Marketing people at a consulting firm are responsible for creating brand awareness and visibility. They create content that demonstrates authority and expertise, which can come in many different formats: from organizing conferences to hosting webinars and publishing research and studies. They help generate leads for the sales and business development team.

Sales/Business Development

Sales and business development people are the ones responsible for selling consulting projects to both new and existing clients.

Sales is often a key role that partners at all levels of the firm play. It’s a role that is embedded and led by the firm’s key partners due to the importance of relationships in the consulting industry. Many partners, especially senior ones, will have an assistant or support staff to help them stay on top of business development (think follow-up).

Finance/Legal

The finance people at a firm handle things like accounting, bookkeeping, and payroll. The legal team (often at an external law firm) handles legal matters, like contracts and negotiations for large projects.

Administration

Administrative people include executive assistants, secretaries, and virtual assistants. They help with scheduling, email and correspondence, filling out forms, and related tasks.

Organizational Structure at a Boutique Consulting Firm

To this point we’ve looked at roles and structure you’ll find most often at large consulting firms. At a boutique consulting firm, due to the smaller size, you’ll typically have a:

  • CEO/Founder
  • COO/Operations Manager
  • Project Managers
  • Consultants/Analysts
  • Marketing/Content
  • Administration (who handles bookkeeping)

Keep in mind that depending on the size of your firm and the work you do your titles and number of roles may look quite different.

One of the key differences inside a boutique firm compared to a larger consultancy, is that you’ll have fewer junior people doing the work and delivery. Boutique firms usually have a higher percentage of experienced and senior consultants.

This provides the boutique firm with an advantage. Larger firms use senior people to land the business. But once it is won, they turn the ship over to less experienced consultants and analysts. In a boutique firm, the founder and/or their small team of senior consultants (often having years of experience and expertise in their areas) are the ones directly involved in the project, working with clients and delivery.

“Is there a specific number of people I should aim for?” Great question, but no. Not really. It all depends on what kind of business you want to build.

Some boutique firms will look like this:

  • Founder
  • 1 Operations Manager
  • 2-3 Senior Consultants
  • 1-3 Junior Consultants
  • 1 Marketing / Content person
  • 1 Admin person

And other firms will have double the number of junior consultants, others may or may not have an operations manager.

But here’s what the shape typically looks like in a boutique firm…

boutique firm structure
Example boutique firm structure. Keep in mind you should use the structure/titles that work for your business.

At boutique firms, the CEO often handles the majority of sales and business development. Eventually, they might hire a dedicated sales and business development person and build a team for that.

They’ll also have an external lawyer and an external accountant.

We’ve looked at the typical organizational structure of both large and boutique consulting firms. Exciting. Maybe it’s time to grow?

Best Practices For Hiring & Growing The Firm

Thinking about applying the firm model to your consulting business?

You’re likely thinking about hiring if you’re feeling overwhelmed, at capacity, and working on lower-level tasks.

Here are several of the best practices for growing a consulting firm:

  • Shift Your Mindset: Building a team should feel like an investment, not an expense. You’re hiring so that you can delegate tasks, enabling you to focus on higher-level work that you enjoy and that moves the needle for your firm.
  • Get Clear On Your Mission/Values: Writing your mission and values — and including them in your job postings — will help you find and retain the right people.
  • Audit Your Time: For 1 week, track your time during your typical workday. Categorize what you love doing, and what you don’t. Think about what you could offload to bring higher value to your business. Writing this down shows you what you should delegate, and this will give you an idea of the type of role to hire first.
  • Consider Your Needs: Do you need an employee or a contractor? Do you want someone working part-time or full-time? There is no right answer, and you’re free to choose what you can afford and what makes sense based on your time audit. In today’s global economy, you can highly customize each role to fit your firm’s needs.
  • Make The Right First Hires: Your first few hires should almost always be administrative, financial, or operational: people who can handle these important yet time-consuming tasks. Having someone to handle tasks like scheduling and bookkeeping will provide you with an incredible ROI.
  • Write A Good Job Posting: A good job posting is less about the job, and more about the person and fit. Start with the company first: what you do, your values, and why someone would want to work with you. Then describe the candidate: who you want to have working with you, how they fit into your culture, and who the role is and isn’t for. Then, describe the role: responsibilities, characteristics, and skills required.
  • Screen Carefully: Did the applicants follow your instruction? Did they communicate well? Use dealbreakers to make decisions easier. Focus more on the person, value-fit, and making sure they don’t have any red flags. You can always teach them learnable skills. But you can’t make it work if they simply aren’t a fit for your business, mission, and values.

Keep these best practices in mind as you go about building your consulting business and scaling it past the independent model.

We go much more in-depth in our Clarity Coaching Program, where we have an entire module dedicated to team & delegation.

Here are some examples of our clients who’ve followed what we teach in our Clarity Coaching Program.

One of our clients, manufacturing consultant Dan Burgos, started his consulting business by doing all of the consulting work by himself. Now, he’s brought in external consultants to deliver work. He gets to focus on what he loves to do: building the brand and the business.

The same goes for life sciences consultant Michele Benton. From day one, she knew she wanted to build a consulting firm. Today, she has someone to help with marketing, administration, and project delivery — so she can focus on working on the business.

Your first few hires should almost always be administrative, financial, or operational: people who can handle these important yet time-consuming tasks. Having someone to handle tasks like scheduling and bookkeeping will provide you with an incredible ROI.

Get Hands-On Coaching To Build Your Consulting Firm

The beautiful thing about starting a consulting business is that you can build your consulting firm to match your desired income and lifestyle.

There is no single right way to do it. As the owner, you have the freedom to build the way you want.

However, the principles for how you build a successful firm are consistent.

And that’s how we’ve helped consulting firm owners like Doug Nelson, Michele Benton, Dan Burgos — and many more consultants like you — build successful boutique consulting firms.

In our Clarity Coaching Program, we’ll teach you the fundamentals of building a successful consulting business.

We’ll work hands on with you to develop a strategic plan and then dive deep and work through your ideal client clarity, strategic messaging, consulting offers, fees and pricing, business model optimization, and help you to setup your marketing engine and lead generation system to consistently attract ideal clients.

Learn more about Clarity Coaching and get in touch to talk about your situation and goals.

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