Standardization of Consulting Activities: Overview of ISO 20700:2017
The main objective of developing ISO 20700 (Guidelines for management consulting services) was to increase transparency in management consulting services and to improve understanding between clients and management consulting service providers (MCSPs).
What was the background to the development of the standard and why is ISO 20700 needed? The main factors that served as a catalyst for launching the development of this standard were the following:
- there was a lack of generally accepted guidance on good practice (although the European standard EN 16114:2011 was launched in 2011, but it needed improvement);
- there was a lack of a common body of knowledge on how to evaluate consultants and their projects;
- many clients did not understand the value to be gained from consulting projects and the criteria by which management consulting service providers (MCSPs) could be differentiated.
ISO 20700 is based on best consulting practices and is applicable to all MCSPs, regardless of business area or company size. The developed standard provides an opportunity for MCSPs to protect differentiation and improve mutual understanding with clients.
Now to the content. ISO 20700 provides guidance to improve the specification, execution, acceptance, closure of management consulting services and includes the following sections:
- Scope;
- Normative references;
- Terms and definitions;
- Principles;
- Contracting;
- Execution;
- Closure;
- Annex.
So, according to ISO 20700, the client and MCSPs jointly perform three activities during a "typical consulting process": contracting, execution and closure. At the contracting stage, the client and the consulting services provider must reach a clear understanding and agreement on the scope of services to be provided, as well as approaches to the provision of consulting services. After agreement is reached between the client and the provider, the parties move on to the next stage - execution of the assignment. As noted in ISO 20700, the MCSP must provide consulting services in accordance with the agreed approach and plan, the client and the provider must cooperate on the basis of mutual respect, transparency, trust and fairness. The final step in a "typical consulting process" is job closure, which includes handing over all materials to the client and evaluating the results of the job. The standard notes that closure of the assignment is accomplished by resolving all pending issues and fulfilling all contractual and legal obligations. For each step, ISO 20700 provides a complete guide to contracting, performing the engagement, and closing the engagement.
As applications, ISO 20700 includes the following:
- Supplementary information on ISO standards;
- Examples of typical stakeholders;
- Basic structure of consulting activities;
- Examples of guidelines for MCSPs for a code of conduct;
- Examples of guidelines to manage conflicts of interest;
- Examples of criteria to evaluate capability;
- Examples of guidelines for MCSPs for typical risk management;
- Examples of typical understanding activities «pre-assignment».
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So, ISO 20700 refers to processes, not the personal competence of consultants, and covers all issues of management of consulting projects, this standard, being the property of ISO, is available to all market participants. This standard is designed to help clients and consulting service providers achieve a high level of transparency and understanding, as well as better results.