As a distinct niche of the broader consulting industry, the strategy specialisation emerged after the second world war, principally among a small group of American consulting firms. Many of these have been acquired or disappeared, but one notable survivor is McKinsey.

Business consulting had emerged much earlier, around the beginning of the 20th century in the US and Europe. The first waves of consulting firms concentrated on applying to large-scale manufacturing the principles of scientific management, made famous through the work of Frederick Taylor and others.

Other firms also came into existence to work on accounting and control problems presented by the scale and growing complexity of the largest enterprises. Strategy consulting was distinctive in being concerned with the agendas of top managers, advising them on the application of major decisions like mergers and international expansion.

The term strategy was not commonly used at first. Indeed, much of what strategy firms did in the 1950s and 1960s was concerned more with organisational matters rather than what might be called pure strategy. At the same time, the discipline of strategic management was emerging in leading business schools, drawing on economics and ideas from military planning.

The emergence of strategic consulting as a term to describe these firms’ distinctive activities and claims of expertise occurred in the 1970s. During this period firms such as McKinsey, Bain and the Boston Consulting Group were busy defining theories which would shape the industry.

One could think of the period between the 1960s and 1990s as a golden period for strategy consulting. The leading firms developed reputations for this work particularly as the notion of building a sustainable competitive advantage came to underpin what strategy meant. Other advances in academic thinking, such as the idea of building unique resource and capability bases to support a strategic position, further helped to develop the market.

Since then, the business of strategy consulting has evolved for a number of reasons. One is that clients themselves have become better educated and more sophisticated, not least because of the proliferation of MBA and executive education. Most executives have an excellent overview of the concept of strategy and now want to focus on how to execute well. At the same time, strategies have become more temporary or emergent and companies have been encouraged to be agile and more entrepreneurial, particularly as digital technologies have transformed industries. and created new opportunities. And today, companies have also to be seen to be doing the right thing. These trends have been reflected in the activities of consulting firms.

So I see the activities of strategy specialists spreading across a number of areas. A niche speciality remains pure strategy in the sense of advising clients on creating and sustaining competitive advantages. Aiding these specialists is the use of big data to deepen their analytic capabilities.

More mainstream strategy now focuses on implementation processes, or strategy execution (in a way that echoes earlier work on organisational effectiveness in the 1950s). This is the somewhat crowded domain of the established strategy firms as well as Accenture, IBM and the Big Four accounting and advisory firms. Further consolidation would not be surprising.

A third area is innovation: just as the discipline of strategy in business schools has expanded into areas such as entrepreneurship, so consulting firms are developing capabilities to address clients’ concerns with renewal.

And a fourth area plays to the term purpose, the successor to vision (which itself replaced plans and goals) as the buzzword of chief executives. Purpose links strategy to the wider stakeholder demands facing today’s chief executives along with the question of how to differentiate organisations and bolster commitment among employees.

Purpose also links to leadership development so it invites a range of potential interventions, such as counselling, that can be combined into a lucrative consulting-client relationship. Purpose also encapsulates the preoccupations of leaders in the early 21st century, when the relative simplicity of competitive advantage has given way to more complex and dynamic leadership challenges. Successful consulting firms will be the ones that seize the opportunities this complexity presents.

The author is professor of Management Studies at Saïd Business School, University of Oxford

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