EFFECT OF INNOVATION MANAGEMENT CONSULTANCY SERVICES ON THE R&D AND MARKETING RELATIONSHIP

Impact of Innovation Management Consultancy Services on the Relationship between Marketing and Research and Development Functions within Organizations
Name
Institutional Affiliation

AbstractThe current study uses case studies to develop a framework for examining the effects of innovation management consultancy services on the intra-organizational relationship. The focus of the study shall be the relationship between the marketing function and research and development function within organizations. This area of focus is based on the fact that collaboration between marketing and R&D functions is critical to the success of organizations. Therefore, the study focuses on how specific management consultancy services impact this collaboration. Six case studies involving four client companies and two consultancy companies were conducted. Participants were required to describe the effects of the innovation management consultancy services before, during and after the interventions. Based on the review of the literature, a theoretical framework was developed. The framework was utilized in linking the activities performed by consultants to organizational goals and long-term changes. Findings from this study provide insights for describing conditions under, which management consultancy services can have an impact on intra-organizational relationships. Further studies are necessary to validate the theoretical framework proposed in the current study.

Table of Contents
TOC o “1-3” h z u Abstract PAGEREF _Toc470999307 h 21.

INTRODUCTION PAGEREF _Toc470999308 h 42.REVIEW OF LITERATURE PAGEREF _Toc470999309 h 52.1Overview of Management Consultancy Services PAGEREF _Toc470999310 h 52.3Evaluation of Impact Assessment Models PAGEREF _Toc470999311 h 63.RESEARCH METHODOLOGY PAGEREF _Toc470999312 h 74.RESULTS PAGEREF _Toc470999313 h 94.1Types of Activities Performed. PAGEREF _Toc470999314 h 104.2Results Obtained During the Intervention PAGEREF _Toc470999315 h 114.3Impact of the Interventions PAGEREF _Toc470999316 h 125.DISCUSSION PAGEREF _Toc470999317 h 146.CONCLUSION AND IMPLICATIONS PAGEREF _Toc470999318 h 15References PAGEREF _Toc470999319 h 17
Impact of Innovation Management Consultancy Services on the Relationship between Marketing and Research and Development Functions within Organizations
INTRODUCTIONManagement Consultancy Services (MCS) play a significant role in helping organizations to improve business performance, solve problems and maximize growth. Their range of services includes process re-engineering, strategy implementation, corporate communication, change management and operation management (MCA, 2011). Over the past few decades, the issue of management consultancy has been the subject of heightened attention from the research community. Three major factors have contributed to this attention. The first factor is the rapid growth of the global consulting industry. The second factor is the changing competitive landscape across industries, which forces organizations to seek professional services. The third factor according to Sturdy, Clark, Fincham and Handley (2009) is the increasing positive impact of management consulting services in many organizations.
Existing researches on management consultancy have focused mainly on the general benefits of using consultants instead of the benefits derived from specific types of services. Review of existing literature shows that no meaningful attention has been given to the study of innovation management consultancy services (IMCS) and its effects on the relationship between marketing and research and development (R&D). The purpose of the present study is to explore this research gap. The study is based on six case studies about innovation management consulting services in manufacturing companies. The paper consists of five main sections. The first section is a systematic review of literature about management consultancy services and their significance in organizations. The second section outlines the methodology used in conducting the current study. The third section presents a detailed analysis of the results and the emerging frameworks while the fourth section gives a discussion of the findings. The last section is the conclusion and implications part.
REVIEW OF LITERATUREOverview of Management Consultancy Services
Management consulting services (MCS) have been defined in various ways by different authors and researchers. However, the various definitions agree that MCS entails professional services provided by qualified persons who help organizations in identifying and analyzing problems, making recommendations on the most effective solutions, and implementation of solutions (Greiner & Poulfelt, 2010; Sturdy et al. (2009). Indeed, management consultants have many important roles, which they can play in helping organizations to gain competitive advantages. They can help companies to make seamless cultural transitions, facilitate organizational change, and bring various stakeholders together. Because of their integral role in initiating change, management consultants have been referred to as agents of change.
The growing acceptance of management consultancy services in many industries has led to the conclusion that empirical research on this topic is limited (Appelbaum & Steed, 2005). Most studies on MCs have been too general instead of focusing on the specific types of management consultancy services (Sturdy et al., 2009). Some of the common areas that have been explored extensively in previous studies include roles of consultants, types of consultancy models, client-consultant relationship, skills and capabilities of consultants and consultant characteristics. Most of the previous studies on the topic have been overly descriptive and theoretical (Schwarz, 2002; Greiner & Poulfelt, 2010). As such, limited research efforts have been directed at the various types of MCS, one of which is IMCS.
Essmann (2009) defines IMCS as a type of MCS concerned with the development and management of innovation processes in organizations. IMCS can also provide additional related services such as coaching on innovation practices. Generally, IMCS is a new development in MCS and covers diverse areas such as innovation lifecycle management, development of innovation strategy and innovation culture among others (Sturdy et al., 2009). Whereas several studies have focused on MCS, very few have focused on the IMCS. Interestingly, the few studies have only explored narrow areas such as the significance of MCS in innovation. As such, there are wide theoretical gaps regarding the contributions of IMCS in organizations.
Significance of Innovation in the Relationship Between Marketing and R&D
According to Obstfeld (2005), innovation is a critical aspect of organizational growth and ability to compete successfully. In order to attain high intensities of innovation success, a strong relationship between R&D and marketing is necessary. This is because the two functions share many responsibilities that are directly related to long-term organizational outcomes of innovation (Massey & Kyriazis, 2007). Although the success of innovation depends greatly on this relationship, studies have shown that it can be the cause of major organizational problems. For example, a study by Massey and Kyriazis (2007) reported that majority of development projects showed little harmony between the marketing and R&D relationship. This lack of harmony is thought to be responsible for rampant project failures and inefficient product development. Specific factors such as organizational culture and structure, time orientation, rewarding systems and leadership style have been to inhibit the R&D and marketing relationship (Obstfeld, 2005).
Evaluation of Impact Assessment ModelsImpact refers to the consequences, results or effects caused by an action concerning an agent (Collins, 2006). Since the objective of the current study is to explore the impact of IMCS on organizational relationships, appropriate impact assessment models will be utilized. Research is replete with various models, which can be used to identify and evaluate impacts of organizational interventions. One of these models is the conceptual chain process, which involves assessment of inputs, outputs, and outcomes as illustrated in the figure below (Mayoux, 2002).

Figure SEQ Figure * ARABIC 1: Conceptual Process Model (Mayoux, 2002)
The above model will be used to study the effects of IMCS on the relationship between marketing and R&D. The main benefit of the above model is that it considers organizational learning as a critical output and thus a determining factor in project outcomes. As Dutta and Crossan (2005) explain, organizational learning can be considered as a way of achieving crucial outcomes.
RESEARCH METHODOLOGYThe center stage of the current study is to develop a framework that can be used to evaluate the impact of IMCS on the relationship between marketing and R&D functions within organizations. The foregoing literature review shows that research focus on this area is highly limited. As a result, the current study will adopt an empirical approach to answering the research question. A primary research involving six case studies will be conducted. In particular, the research used a qualitative research approach by involving experts from six selected consultancy firms. The idea was to select a group of consultancy experts who represent their specific innovations and compare their responses regarding specific areas of interests. As a way to be eligible for inclusion in the study, the consultancy service was supposed to have been completed at least six months before the interview date. The six companies were selected from different industries using a random study approach.
A cross-sectional research design was used in the study to take snapshot of several companies. For the purpose of this study, only IMCS involving manufacturing companies were considered. The cases are divided into two broad categories. The first category (hereafter called client cases) comprised of four companies that were recipients of IMCS. These companies were from the agriculture, telecommunication and finance industries. An interview method was used to collected responses from the participants. As mentioned earlier, the research targeted senior employees from the selected companies. Specifically, two senior management officers from each of these companies were consulted in telephone interviews to assess the relationship between marketing and R&D before, during and after the consultancy services. The interviewed officers were from the marketing, and R&D divisions included innovation directors. Two additional case studies (hereafter called consultant cases) involved interviews with representatives from companies that provided IMCS to the client cases. Interviews with consultants were necessary to get crucial information from the perspective of experts.
Prior to the interviews, a notification was sent to the companies informing the respondents of the nature of the study and the essence of their participation. During the interviews, the participants were asked to describe the relationship between R&D and marketing in the three phases (before, during and after). The description covered several key areas namely: the objective of the consultancy service; nature of the recipient company and consultant (business type); activities performed by the consultants; outputs of the consultancy; and impact of the consultancy. The last part (impact) assessed the overall effects of contracting the consultants with a specific emphasis on the R&D and marketing divisions. All data were coded and analyzed to identify relationships between variables as well as relevant patterns and factors.
RESULTSThis study uses the modified conceptual process framework to explain findings on the relationship between the effects of IMCS on the relationship between marketing and R&D. The framework consists of three parts: specific activities performed; results of the IMCS process; and impact. Since the research was qualitative in nature, the researcher identified common responses by using key words. The idea was to place similar responses together and different ones far apart in a bid to determine the level of agreement or disagreement between respondents.
This framework is represented in Figure 2 below:
Client Company Characteristics Changes in the marketing and R&D relationship
Type of Activities Performed Results During the Intervention Impact of the Interventions Facilitation activities Alignment of processes Changes in attitudes and behaviors Promotion of Joint work Expansion of Communication Channels Changes in ideas and knowledge Provision of common knowledge Strengthening of informal relationships Changes in processes and structures Consultant Company Characteristics
Figure SEQ Figure * ARABIC 2: Theoretical framework for the study (author’s creation)
Types of Activities Performed.The types of activities performed by consultants were divided into three broad categories: facilitation activities; promotion of joint work; and provision of common knowledge. Regarding the issue of facilitation activities, all participants concurred that these activities played a crucial role in strengthening the relationship between marketing and R&D. For all the client companies involved, facilitation activities encompassed establishment of an enabling organizational climate, the creation of mechanisms for engagement, mediation role and bolstering of stakeholder relationships. The participants noted that innovation management consultants created enabling organizational climates because they made no distinction among stakeholders. This means they eliminated power differences and thus made all people within organizations to feel valued, more engaged and able to interact with each other on equal terms.
In all the six case studies, it was established that the relationship between R&D and marketing was not strong before the intervention by the innovation management consultants. Accordingly, the consultants helped to mediate between the two functions and hence strengthened the relationship. The consultants used various techniques to inspire and motivate people to support the change initiatives. In all cases, the consultants sought the involvement of senior managers so as to mobilize other stakeholders in the consultancy process. Effectively, the commitment by management proved to be the most crucial factor in the success of the innovation management consultancy services.
Regarding the promotion of joint work, it was revealed that intervention by consultants fostered strong working relationships between R&D and marketing divisions in all the cases. In particular, interdepartmental team works, as well as, interaction between different areas were improved significantly. Notably, all consultancy services adopted the multi-disciplinary teamwork approach. Prior to the interventions, the only teams that existed were temporary and were formed for ad hoc purposes. The teamwork approach facilitated drastic changes in interpersonal and cross-functional interaction within client organizations. This led to improved organizational performance, efficient execution of functions and better engagement of stakeholders.
It was found that consultants promoted the provision of common knowledge in two major ways: common training and methodologies for teamwork. All research participants cited common knowledge as a core activity for all types of consulting services. Multi-disciplinary teams were formed to offer appropriate training activities. The use of purposely selected frameworks was noted by all participants and led to higher levels of integration.
Results Obtained During the InterventionThe results that were obtained during the intervention have been classified as the alignment of processes, expansion of communication channels and strengthening of informal relationships. Alignment of organizational processes, particularly between individuals and functional areas was the most notable contribution made by the consultants. The alignment was achieved through common vision and language. Through common vision, a sense of direction was created, which helped individuals from different areas to collaborate in the execution of organizational goals. In addition, it enabled people to work together toward a common goal. The expansion of communication channels was characterized by the establishment of new communication avenues linking together all the marketing and R&D divisions. The most important benefits, in this case, was the reinforcement of direct communication between the two divisions, and also between junior and senior management.
Strengthening of informal relationships was a result of efforts by consultants to foster close working relationships between individuals from the two groups (marketing and R&D). As the consultancy service activities were being implemented, employees from the two departments got the opportunity to interact with each other. These engagements were crucial since prior to the interventions, the employees did not have time for nurturing cross-functional relationships.
Impact of the InterventionsThe impacts of the consultancy interventions were divided into three groups: changes in organizational attitudes and behavior; changes in ideas and knowledge; and changes in organizational structures and processes. The three levels of change were considered critical to the realization of a positive relationship between R&D and marketing. Concerning the issue of change in knowledge and ideas, it was found that specific consultancy activities that promoted organizational learning were positively related to the improvement of the relationship. The participants pointed out that the consultancy made it possible to have a better understanding of working relationships as well as the respective roles of the various activities that enhanced the relationship. In this regard, understanding of business processes (particularly the innovative processes) was a fundamental outcome. In all the client companies, employees were able to appreciate the way in which R&D and marketing processes were structured and the way they worked.
In terms of change in organizational behavior and attitudes, the study revealed significant changes in employee behaviors upon the implementation of consultancy activities. This is because the employees felt a better connection with the goals set out by the consultants. In addition, there was increased recognition from people in other areas within organizations. In the view of the participants, this recognition created unprecedented enthusiasm, which led to more collaborative behaviors. As a result, employees from marketing division were more open to accepting the divergent views of employees from R&D and vice versa. In other words, both departments appreciated each other’s culture, ways of thinking and approaches to decision-making and problem-solving. For example, when R&D came up with innovative solutions for the marketing division, the latter accepted them and showed great willingness to implement the solutions. Where the solutions did not work, the two teams engaged in the joint review of the problem and came up with better solutions.
As for the issue of change in organizational structures and processes, it was found that the use of IMCS led to the establishment of new processes, which in turn led to the introduction of fundamental changes involving the way in which the R&D and marketing functions worked. The participants noted that new structures were introduced that promoted increased interdepartmental cooperation. For example, groups were established to foster close working relationships between employees from different departments. Some of these fluctuations were as a result of the direct recommendation by the consultants while others were initiatives of management. Regardless of the origin of the changes, they were fundamental in creating new structures and processes.
From the perspective of the consultants, it can be noted that introduction of new common processes was the greatest impact. It enabled organizations to promote involvements and interactions between participants from different areas within organizations. The consultants noted the apparent change of relations between marketing and R&D divisions all the client organizations. This was an important development because it led to sharing of decision-making power between marketing and R&D divisions. Although most of these changes were at intra-organizational levels, some were noted at the personal level, meaning that departments and their people benefitted in varying degrees.
DISCUSSIONThis discussion of research findings builds upon the conceptual process framework highlighted in Figure 1 to inductively develop a theoretical framework for future studies. The new framework consists of three core parts: activities performed by the consultants; results of consultancy; and impact of the consultancy services. This framework underscores the initial impact of IMCS activities and also the resulting progressive effects of these activities on the long-term growth of organizations (Sturdy et al., 2009). As for the activities undertaken by the consultants, the current study revealed that promotion of joint work, facilitation activities and promotion of common knowledge are critical activities. Both the clients and consultants agreed that facilitation activities were important in improving the relationship between R&D and marketing. This finding is constant with previous studies such as Heron (1999) and Kubr (2002), which show that positive climate is created in organizations when functional units work closely. Other studies such as Schwarz (2002) have shown that mediation roles have reported that mediation roles promote good working relationships between functional groups in organizations. Schwarz (2002) reported that promotion of joint work provides a holistic view of the organization, which helps individuals and work groups to appreciate the contribution of each other.
The study found alignment to be an important result of consultancy during the intervention. Alignment was useful not only in the strengthening of relationships but also in establishing a common vision for the organizations. This finding has been reflected in other studies such as Kerber and Buono (2005) who has pointed out the importance of common goals as a crucial success factor for intra-organizational collaboration. This has been supported by other studies such as that of Maddux (2000) who reported that when organizations agree on pursuing shared vision and goals, conflicts can be reduced significantly. Similarly, informal relationships and enhanced communication have been reported in various studies such as Kubr (2002) and Muthusamy, Wheeler and Simmons (2005). A common subject of all these studies is that intervention by consultants leads to enhanced opportunities for organizations to strengthen cross-functional relationships such as the one between R&D and marketing divisions.
The long-term impact of consultancy activities as reported in this study is the change of knowledge and ideas, attitudes and behaviors and changes in processes and structures. All these changes were found to result in corresponding changes in the relationship between R&D and marketing. In the proposed framework, changes in knowledge have been linked to enhancement in the understanding of core organizational processes and responsibilities and also in recognition of the significance of the relationship. Thus, it can be deduced that consultants contribute greatly to organizational learning and that this promotes new knowledge within organizations. This finds aligns well with ideas expressed by other researchers such as Kerber and Buono (2005) and Appelbaum and Steed (2005). The current study concludes that asserting that IMCS have immense positive effects on intra-organizational relationships. Therefore, the current study backs the existing literature on innovation management in organizations.
CONCLUSION AND IMPLICATIONSReview of existing literature showed a lack of sufficient framework that can be used to study the impact of IMCS on the relationship between R&D and marketing as well as other intra-organizational relationships. This is because previous studies have focused more on the general topic of MCS as opposed to specific services such as IMCS. Based on the literature, the current study has developed an analytical framework that can be used to explore the impact systematically. The proposed structure is capable of seizing the effects and contributions of IMCS on relationships between various functional areas within organizations. The major strength of this framework is that it takes into account the differences between client and consultant characteristics as these can change consultancy relationships.
Implications of the current study relate to the limitations of the research methodology. Although this study has explored the impact on innovation consultancy extensively, it suffered from certain limitations, which may impede its generalization in other scenarios. A key limitation is that the current study was based on case studies from different industries. This may compromise the core validity of the findings, especially when applied in the context of an unrelated industry. Another limitation relates to the possibility that the participants might not have given accurate information. It is recommended that further studies involving quantitative approaches be conducted to provide additional insights on the subject.

ReferencesAppelbaum, S. H., & Steed, A. J. (2005). The critical success factors in the client-consulting relationship. Journal of management development, 24(1), 68-93. <https://www.researchgate.net/profile/Steven_Appelbaum/publication/235251700_The_critical_success_factors_in_the_client-consulting_relationship/links/00b7d53196fefafe72000000.pdf>.
Collins, M. (2006). English Dictionary. London: Academy. <https://www.collinsdictionary.com/dictionary/english>.
Dutta, D. K., & Crossan, M. M. (2005). The nature of entrepreneurial opportunities: understanding the process using the 4I organizational learning framework. Entrepreneurship Theory and Practice, 29(4), 425-449. <https://www.researchgate.net/profile/Dev_Dutta/publication/229729404_The_Nature_of_Entrepreneurial_Opportunities_Understanding_the_Process_Using_the_4I_Organizational_Learning_Framework/links/576aed9a08ae5b9a62b3a5e3.pdf>.
Essmann, H. (2009). Towards innovation capability maturity. Boston, MA: Cengage. <http://www.slideshare.net/heinzessmann/toward-innovation-capability-maturity>.
Greiner, L., & Polfelt, F. (2010). Management consulting today and tomorrow: perspectives and advice from 27 leading world experts. New York, NY: Routledge. <https://books.google.co.ke/books?id=0-eSAgAAQBAJ&printsec=frontcover&dq=Management+consulting+today+and+tomorrow:+perspectives+and+advice+from+27+leading+world+experts&hl=en&sa=X&redir_esc=y#v=onepage&q=Management%20consulting%20today%20and%20tomorrow%3A%20perspectives%20and%20advice%20from%2027%20leading%20world%20experts&f=false>.
Heron, J. (1999). The complete facilitator’s handbook. Kogan Page: UK. <http://www.human-inquiry.com/cfh.pdf>.
Kerber, K., & Buono, A. F. (2005). Rethinking organizational change: Reframing the challenge of change management. Organization Development Journal, 23(3), 23-40. <https://www.researchgate.net/profile/Kenneth_Kerber/publication/281178683_Rethinking_Organizational_Change_Reframing_the_Challenge_of_Change_Management/links/55da457808ae9d659491edab.pdf>.
Kubr, M. (2002). Management consulting. Geneva: International Labour Organization. <http://ksg.vse.cz/wp-content/uploads/2012/04/MC.pdf>.
Maddux, R. (2000). Team building: An exercise in leadership. New York: Crisp Publications. <https://books.google.co.ke/books?id=HGrYe5CUE54C&printsec=frontcover&dq=Team+building:+an+exercise+in+leadership&hl=en&sa=X&redir_esc=y#v=onepage&q=Team%20building%3A%20an%20exercise%20in%20leadership&f=false>.
Massey, G. R., & Kyriazis, E. (2007). Interpersonal trust between marketing and R&D during new product development projects. European Journal of Marketing, 41(9/10), 1146-1172. <https://www.researchgate.net/profile/Graham_Massey/publication/44883881_Interpersonal_trust_between_marketing_and_RD_during_new_product_development_projects/links/0fcfd50f8bf775e82f000000.pdf>.
Mayoux, L. (2002). What do we want to know: selecting indicators? Adelaide: Massey University. <http://galsatscale.net/_documents/IATK1Indicators.pdf>.
MCA. (2010). The value of consulting in practice. London: Routledge. <https://www.gzs.si/pripone/MCA%20analysis%20%20TheValueofConsulting_0.pdf>.
Muthusamy, S. K., Wheeler, J. V., & Simmons, B. L. (2005). Self-managing work teams: enhancing organizational innovativeness. Organization Development Journal, 23(3), 53-66. <https://www.researchgate.net/profile/Jane_Wheeler3/publication/228247497_Self-Managing_Work_Teams_Enhancing_Organizational_Innovativeness/links/0deec52a9eaf0ea0ee000000.pdf>.
Obstfeld, D. (2005). Social networks, the Tertius lungers orientation, and involvement in innovation. Administrative Science Quarterly, 50, 100-130. <http://www1.economia.unifg.it/Docenti/r_sisto/download/Agrofood%20economics/Obstfeld.pdf>.
Schwarz, R. (2002). The skilled facilitator. San Francisco, CA: Jossey-Bass. <https://books.google.co.ke/books?id=vVR6zOhdCbIC&printsec=frontcover&dq=The+skilled+facilitator&hl=en&sa=X&redir_esc=y#v=onepage&q=The%20skilled%20facilitator&f=false>.
Sturdy, A., Clark, T., Fincham, R., & Handley, K. (2009). Between innovation and legitimation—boundaries and knowledge flow in management consultancy. Organization, 16(5), 627-653. <http://storre.stir.ac.uk/bitstream/1893/1167/1/ZZ13%20boundaries%20and%20kn%20flow.pdf>.