Should management consultants charge clients on a contingency basis for merger and acquisition work?

Management consulting firms frequently assist their clients by providing merger and acquisition advice on a contingency basis. Drawing on a field study of acquisition decisions, the paper describes the common rationale for such behaviour and the pitfalls to which it may lead. These pitfalls include,...

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Bibliographic Details
Published inThe Service industries journal Vol. 32; no. 16; pp. 2677 - 2689
Main Authors Connell, Richard, Zalan, Tatiana
Format Journal Article
LanguageEnglish
Published London Routledge 01.12.2012
Taylor & Francis Ltd
Subjects
Acquisitions & mergers
Client relationships
Consulting firms
Contingent fees
Management consultants
management consulting
mergers and acquisitions
services pricing
Studies
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Summary:Management consulting firms frequently assist their clients by providing merger and acquisition advice on a contingency basis. Drawing on a field study of acquisition decisions, the paper describes the common rationale for such behaviour and the pitfalls to which it may lead. These pitfalls include, among others, a loss of revenue that could be available from charging fees and a degradation of client relationships. The research also specifies factors that consultants should take into account both in their own and client organisations when deciding whether to propose to charge clients fees or a percentage of the value of transactions that may or may not materialise.
ISSN:0264-2069
1743-9507
DOI:10.1080/02642069.2011.593168