From Caterpillar to Butterfly – the Evolution of Consulting Firms

As the co-founder and mentor of a consulting company, Synconic Solutions and Services Pvt Ltd., trying to grow our client base among small businesses, I am quite used to prospects declining our proposals, without being very forthcoming about the real reason for rejection. And we used to put it down to price. Maybe they feel our prices are too high. Maybe they can’t afford our services.

A recent conversation with an entrepreneur (let’s call him Varun) gave new insights into how they think when dealing with a consulting proposal.

Price, Varun said, wasn’t the main thing. He felt it was reasonable considering the scope of work and the depth of our experience. The problem, he said, was with trust. Or the lack of it. “How do I know you will deliver what you promise, since I hardly know you”? “How can I be confident that you will be able to understand my business and justify the time, efforts and money I will be spending on the engagement”?

The feedback set off a train of thoughts in my mind about how consultancy firms typically traverse the journey from early struggle to an established brand.

Any consulting business, or, for that matter, any business that provides services evolves through 4 stages in its growth journey , which I would like to term Trust, Traction, Track Record and Transformation. These are not distinct stages; they overlap and in fact, builds on the previous phases. Let me elaborate.


A new consulting business starts out pretty much on a wing and a prayer. No marquee clients, no record of executing successful assignments, no testimonials. A clean slate. True, the founders would possess sound academic credentials and may even have had successful careers behind them. Personal track records of the consultants are selling points, so are recommendations from mutual contacts. That said, in giving an assignment to a fledgling consulting company, clients are actually taking a leap of faith. At this stage, all they can do is trust the consultants’ ability to deliver on the promises made. They also hope that being small, the consulting agency would be flexible, agile and would put in all their efforts to ensure a successful outcome.

At this stage, the firm is, in reality, a pool of freelance consultants executing consulting gigs.


After executing a number of such trust-based assignments to the satisfaction of clients, the firm starts to establish a presence and develop a reputation for execution. This is the traction phase where the consulting machinery shifts into the next gear. The blind trust shown by initial clients is replaced by demonstrated expertise generated by the few engagements that are successfully executed. The emphasis is still on getting assignments through word-of-mouth publicity, network, and social media publicity. However, slowly but steadily, the firm starts to stand on its own, and lean less and less on the founders’ crutches.

The trust factor is still critical, but the firm is able to garner engagements from clients who might not be personally known to them or to their network of contacts.

Track Record

At this stage of evolution, the consulting firm is an established entity capable of growing on its own steam -on the strength of proven capabilities. There is now a distinction between founders and the company; management goes from personal to professional. Founders and senior consultants spend more time managing client relationships and project monitoring than working directly on engagements. Young consultants seek out the firm to carve out successful consulting careers. The firm could have marquee clients to boast of, and quite probably, multi-year contracts with large, reputed clients.

Trust and traction still play their roles but they are reinforced to a great extent by the track record of achievements.


A successful track record takes the consulting firm onto a different orbit. It is now a well- known name, an established brand. While the marketing team will continue to add new clients and engagements, the brand name is strong enough for clients to seek them out as well. The emphasis is more on building and maintaining relationships and leveraging past successes for bigger and more prestigious assignments. The leadership team is now assisted by a large pool of consultants at various levels.

Trust, traction and track record have transformed the consulting caterpillar into a full grown adult butterfly, capable of spreading its wings and flying independently.

Let me sign off with a couple of questions:

1.      Many of you would have some experience as a client or a consultant. Does the above post resonate with you in some way?

2.      All consulting companies do not pass through all stages and reach the transformation stage. Why, in your opinion, are their journeys halted midway?

I would love to hear your views.