Today, such economic phenomena as audit and consulting are no longer surprising. Yet only a few decades ago, this direction in business was not so widespread. How did these concepts appear, and what was the prerequisite for breaking up the consulting business? This will be discussed in our article.
The beginning of business consulting
Even in ancient times, such a position as an adviser appeared. These specialists were with whom authorities consulted when making particularly difficult decisions. However, if we talk about consulting in the modern sense, then this is a fairly young direction (legal services for enterprises, accounting, software implementation, and other activities). This economic phenomenon took shape in a separate industry only at the beginning of the twentieth century.
The first prerequisite for the development of consulting was the industrial revolution, a period when new factories and manufactures began to open actively. The next stage of development is associated with the process of communication and structuring of managerial experience. The result of this was the emergence of the need to describe the various methods and principles of business development. At the same time, the first attempts to generalize this kind of knowledge were made in the 19th century, when the scientific management movement was born. However, in those days, consulting dealt only with such issues as increasing labor productivity in factories and plants, as well as organizing and optimizing the workflow. Such consulting in those days was called production organization, and the consultants themselves were experts in development efficiency.
Business consulting in XX century and now
At the beginning of the 20th century, the scope of consulting activities increased significantly. Thus, the first professional and authoritative consultants appeared, whose opinion was important to any leader. The biggest names in this field are Frederick Taylor, Arthur D. Little, Towers Parrin, and Harrington Emerson. By the way, the last two founded the world’s first consulting company! In the 20-30 years after the end of the Great Depression, consulting became incredibly popular in developed countries. However, its scope was very limited at that time. Their services were used only by industrial giants, but by no means by small and medium-sized enterprises.
Consulting was especially widespread in the USA in the early 70s. At that time, there was approximately one consultant for every 100 managers in the country. And in the early 80s, the unofficial term “consultant-to-arms” even appeared.
Today such areas of consulting as accounting consulting (accounting support, preparation of reporting documents, audit, etc.), legal support (providing a legal address, protecting the interests of the company in court, legal advice, etc.), as well as IT consulting (software implementation, office equipment maintenance and much more) are extremely popular. Every year the demand for such services is constantly growing, and hence their quality too.