Facing Heat

Face the criticism?

Client (many public firms) often find themselves in a tough position when they have to justify the high fees they pay for consulting firms that are working to bail them out of a tough situation.

In India, with the Right to Information(RTI), anyone could question the decision why a government agency chose a particular firm.

Here are some news articles:

Air India asks Booz to cut fees for cost reduction consultancy


"Mumbai: National Aviation Co. of India Ltd (Nacil), which runs national carrier Air India, has issued an ultimatum to management consulting firm Booz and Co. Inc. to lower its fee for advising the ailing carrier on cost reduction and revenue maximization techniques.

Air India may go with its own cost restructuring measures in case Booz is not willing to lower its fees, according to a senior government official who did not want to be identified.

Booz is one of the three consultants that have been working with the national carrier.


In November, Booz proposed at least 70 cost-cutting and revenue enhancement measures that could generate up to Rs5,000 crore for Air India in the next 18 months. The plan is yet to be implemented.

Air India chairman and managing director Arvind Jadhav confirmed that the company has asked Booz to lower its fees. Under a non-disclosure agreement signed with Nacil, Booz will “not be able to share information regarding any matter related to the said assignment”, Booz said in a statement.

“We have asked Booz to slash the fees. Also, the fee would be directly linked to cost savings that we will derive by implementing its suggestions,” added the government official cited in the first instance.