Consulting firms can operate using various organizational structures. The most effective organizational structure for a consulting firm depends on human resources, organizational capability and profitability. Larger consulting firms which are established in the industry can have executive officers, mid-level managers and specialized departments. Smaller firms can consist of a lead or general partner with a pool of consultants present, working full-time. The organization's mission statement and strategic plan defines the structure of a consulting firm.
One and Two-Tier Style Structures
Organizational structure for a consulting firm depends on resources and personnel groupings. Most consulting firms adopt a tier-based organizational structure. Large firms have a two-tier structure base with executives, key managers and administrative services occupying the first tier. The second tier consists of senior, junior and apprentice consultants hired by the firm. Smaller firms consist of a one-level tier configuration with a lead partner at the top who is responsible for executive management of the firm. Directly under the lead partner is the senior, junior and apprentice consultants with other processes such as administration, project management and finance.
Executive management is responsible for establishing the strategic business plan of the organization, ensure the mission statement of the consulting firm is understood by employees, allocate resources for various projects, departments and initiatives in the firm and guide the firm to profitability. Executive management also sets goals and objectives during annual reviews for the entire consulting firm.
The administrative division of a consulting firm provides administrative support to executive management and operations. This includes customer inquiries, interoffice correspondence, communications and report processing. The division includes positions such as administrative assistant, project analyst or chief administrator.
Activities from business development to auditing are initiated through consultant services. In large consulting firms, consulting services can be formed as a branch, division or department with access to administrative functions. In a smaller firm, consultants have their own independent structure, reporting to a lead partner, and usually work per contract.
Most consulting firms have a contract management division or contract management specialist. The contract management specialist creates, arranges and reviews consulting contracts and provides compliance reviews of all contracts established by the firm. In a large consulting firm organizational structure, the contract specialist is an adjunct to executive management while providing legal advice to consultants according to established business law practices. In smaller firms, an outside lawyer might be responsible for contract management.