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Engineering consultant-client relationship: Transactional versus collaborative approach

David Osuna Contreras

No 4408, MBA Research Papers from Victoria University of Wellington, School of Management

Abstract: The main focus of this study was the transactional and collaborative nature of the engineering consultant – client relationship. The aim of the study was to determine the extent to which each one of these approaches describes real life business relationships in the engineering consulting context. The study revealed that, in New Zealand, relationships between engineering consultants and their clients were mostly of a collaborative nature. However, collaborative trust-based relationships were held between individuals, not between companies. Even though clients and consultants also engage in transactional relationships, the extent of this type of relationship was significantly low. It was also found that confrontational relationships do not constitute a third framework to in understanding client-consultant relationships. This type of relationship corresponds to a circumstantial context that is more common in transactional scenarios than in collaborative ones. The decision on whether a relationship evolves depended on the client’s and consultant’s interests. Regardless of how a relationship started, whether it is a transactional or collaborative beginning, its evolution was determined by the levels of trust that were built up over time. The challenge for consulting companies lies in taking the personal relationship between consultants and their clients to a state in which the individual expertise sought by clients was transferred to the company brand. A collaborative approach had direct implications on other elements of the consulting business model such as value proposition, customers, costs and revenue. Similarly, collaborative relationships were the essence of the “key partners†element of a client’s business model. Due to the highly tailored nature of engineering consulting businesses in New Zealand, it is considered to be a type of business which is very difficult to scale. Only transactional relationships offer the option to take advantage of economies of scale as these are easier to fit into standardised procedures. It is therefore considered that collaborative relationships will not fit a business model based on economies of scale. The following recommendations are provided should either party want to nurture a collaborative relationship: • Both clients and consultants should see each other as equally powerful while working together, as power imbalances of any kind can have negative consequences for the results of consulting projects. It is also suggested to establish a clear division of roles and responsibilities as this is a critical success factor in consulting projects. • It is important that both client and consultant have as much shared input as possible during the scope of work definition. If there are any modifications to the scope of work during the project, these should be discussed with the stakeholders in order to ensure that the revised scope of work meets the expectations of both parties. • The interaction between parties during the problem solving process should be kept as open as possible to maximise the two-way flow of ideas. For clients, it is suggested to allocate as much time as possible to the technical discussion with the consultant. • If there are contracting teams involved in the negotiation process, it is important to differentiate their role from any existing relationship between individuals. • An idea is a network. Building up collaborative networks with people from different backgrounds creates the right environment for the formation of innovative ideas. It is highly recommended to use collaborative interaction as the start of a client-consultant dynamic to foster the creation of new ideas and solutions.

Keywords: Client consultant relationship; Transactional relationship; Collaborative relationship (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ino and nep-ppm
Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:vuw:vuwmba:4408

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