A constructive alternative approach to the expensive flood of consultants of the federal government

The acute problem of the excessive consultant costs

The German federal government faces a serious problem that affects both taxpayers and the integrity of the administration: the uncontrolled dependence on external consulting companies. In its most recent report, the Federal Audit Office has had a clear criticism of the lack of strategy of the government to reduce this costly dependency. The numbers speak a clear language and reveal the extent of this problematic development.

In the past ten years, the federal government has spent more than 1.6 billion euros on external consulting services. This sum corresponds approximately to the annual salary of 40,000 average employees and illustrates the dimension of financial burden on the federal budget. The fact that the expenditure has risen by 39 percent annually to just under 240 million euros annually between 2020 and 2023.

This development is all the more worrying when the Bundestag's budget committee had already called for a substantial reduction in consultant costs in 2020. However, the Federal Government has not fulfilled these claims, as the Federal Audit Office unequivocally determines. Instead, the government's annual advisory reports show little willingness to make changes in the use of external consultants.

The structural weaknesses of the current approach

Lack of strategic planning

The criticism of the Federal Audit Office focuses on a fundamental deficiency: To date, there is no coherent strategy in the federal government to reduce the external need for consultancy. This strategic lack of planning means that consulting orders are often awarded ad hoc without developing a long -term perspective for building internal skills.

Most ministries have not even formulated concrete dismantling goals for their advisory addiction. Even the Federal Ministry of the Interior, which had submitted a 14-point plan, could not achieve any substantial improvements. Paradoxically, the same ministry even stored a core task of financial controlling to external consultants in the “IT consolidation BUND” project.

Hanging up administrative integrity

The situation in the IT area is particularly critical, where the federal government has given too much control to external service providers. The Federal Audit Office urgently warns that the integrity of the administration is in danger if its own skills are not immediately built up. This dependence on external IT consultants makes the federal administration vulnerable and affects its ability to act in critical areas.

The federal advisors are often global consulting companies with annual sales in the billion dollar sector. These companies such as McKinsey, Deloitte, KPMG and PWC dominate the consulting market and sometimes have a significant impact on political decisions. At least 112 former employees of the largest consulting companies work in the Chancellery and Ministeries alone.

Quality problems and copy paste advice

The quality of the external consulting services is often questionable. Critics complain of banal PowerPoint presentations as end products, inconsistencies in reports and even gross mistakes in dealing with numbers and facts. The so-called copy paste consultations, in which reports are in parts or entirely, are literal copies from deliverable for other clients.

The innovative alternative proposal: partnership with SME interest representatives

The basic idea of ​​direct cooperation

Instead of further transferring millions of taxpayers to expensive external consulting companies, the federal government should build close cooperation with the interests of small and medium -sized companies. This solution offers several decisive advantages: it is cheaper, practical closer and at the same time strengthens the democratic participation of the medium -sized economy in political decision -making processes.

The SME interest representatives have an enormous treasure of practical knowledge and experiences from the real economy. Small and medium -sized companies represent 99.3 percent of all companies in Germany, employ 51.3 percent of all employees subject to social security contributions and are responsible for 96.9 percent of German exports. These figures illustrate the immense importance of medium -sized businesses for the German economy.

The established SME interest representatives as a partner

Germany has a well -developed landscape of SME organizations that can act as a competent partner for such cooperation. The Federal Association of Medium-sized economy (BVMW) networked small and medium-sized companies as well as self-employed and represents their interests across professional and industries. With over 900,000 contacts per year and 300 regional branches, the BVMW has an impressive range.

Other important actors are the Chambers of Industry and Commerce (IHK), which include 79 regional chambers and represent all traders and companies with the exception of pure craft companies. The German Chamber of Commerce and Industry (DIHK) acts as a umbrella organization and represents the overall interests of the commercial economy at national and European level.

The chambers of crafts as self -management facilities of the craft complement this structure. They represent the interests of the entire craft in their respective chamber districts and have profound knowledge of practical challenges in the craft sector.

Practical implementation of cooperation

The cooperation between the federal and more of the BUND and SME interest representatives could be carried out in various formats. Regular dialogue events would enable direct exchange between decision -makers from politics and the economy. These events could be organized in terms of topic in order to specifically open up expertise in certain areas.

Working groups for specific political fields would enable continuous advice and support for legislative projects. SME representatives could contribute their practical experience and indicate possible effects of regulations before they come into force.

Another innovative approach would be the establishment of SMEs in the various federal ministries. These bodies could take a regular basis and comment on current political projects. The members would be sent from the various SME interest representatives and would bring their respective industry expertise.

Xpert.Digital has in-depth knowledge of various industries. This allows us to develop tailor-made strategies that are tailored precisely to the requirements and challenges of your specific market segment. By continually analyzing market trends and following industry developments, we can act with foresight and offer innovative solutions. Through the combination of experience and knowledge, we generate added value and give our customers a decisive competitive advantage.

More about it here:

• Use the 5x expertise of Xpert.Digital in one package - starting at just €500/month

The advantages of the alternative model-SME expertise against consultant costs

Cost efficiency and sustainability

The most obvious advantage of this approach is the enormous cost savings. While external consulting companies request millions of euros to their services, the costs for cooperation with SME interest representatives would be a fraction of this. The travel and event costs for dialogue formats as well as moderate expenses for advisory board members would move in the low million range.

These cost savings would not only be once, but would be repeated year after year. The funds saved could be used for the urgently needed structure of internal skills in the federal administration. Especially in the IT area, the administration could hire and train its own specialists instead of continuing to depend on external service providers.

Practical and realistic advice

SME representatives bring a different quality of advice than external consultants. You speak out of daily practice and know the real effects of political decisions on companies and jobs. Your recommendations are not based on theoretical models or copy paste solutions, but on authentic experiences from everyday economic life.

This practical perspective is particularly valuable in the design of regulations and laws. SME representatives can indicate unintentional side effects at an early stage and contribute constructive suggestions for improvement. This would avoid expensive improvements and corrections that arise if laws are adopted without sufficient practical testing.

Strengthening democratic participation

The direct integration of SME interest representatives would significantly strengthen the democratic participation. Currently, large corporations and expensive consulting companies often have privileged access to political decision -makers. The medium -sized economy, which forms the backbone of the German economy, on the other hand, is often underrepresented.

This imbalance would be correct through institutionalized dialogue formats. The voice of the SME would be stronger and taken into account in political decision -making processes. This would not only lead to better politician results, but also strengthen the trust of medium -sized companies in politics.

Building long -term partnerships

In contrast to project-related consulting orders, working with SME interest representatives would create long-term partnerships. These continuous relationships would enable a deeper understanding of the needs and challenges of medium -sized businesses.

The SME representatives would not only advise on individual projects, but could also participate in the strategic planning and development of long-term policy approaches. This partnership -based approach would lead to more consistent and sustainable political decisions.

Specific areas of application and pilot projects

Digitization and IT modernization

Especially in the IT area, where the federal government is particularly dependent on external consultants, SME interest representatives could provide valuable support. Many medium -sized companies have successfully implemented digitization projects in recent years and have developed practical solutions.

The Federal Administration could advise an advisory board from IT-experienced SME representatives on the digitization of their processes. These entrepreneurs know the challenges of introducing new IT systems from their own experience and can suggest realistic schedules and budgets. At the same time, they could point out proven technologies and service providers who have proven themselves in practice.

Bureaucracy reduction and administrative modernization

SMEs are faced with bureaucratic hurdles every day and have a vital interest in efficient administrative processes. Your experiences with various authorities and procedures are a valuable resource for administrative modernization.

A systematic dialogue between administration and SME representatives could produce concrete suggestions for improvement for existing procedures. The entrepreneurs could show where processes are unnecessarily complicated and which simplifications would be possible without affecting the quality of the administrative services.

Sustainability and climate protection

Medium -sized companies play a crucial role in transformation to a climate -neutral economy. Many SMEs have already developed and implemented innovative solutions for climate protection and sustainability. These practical experiences are invaluable for the design of climate policy.

A climate protection advisory board from SME representatives could support the federal government in developing practical climate protection measures. Entrepreneurs could show which measures can actually be implemented and what support they need for transformation.

Challenges and solutions

Coordination and organization

Cooperation with various SME interest representatives requires professional coordination. A central point would have to be created that organizes the different dialogue formats and systematically evaluates the results.

This coordination office could be located at the Federal Ministry of Economics, which already has experience in dealing with medium -sized business organizations. It would be important to coordinate close to all departments to ensure that SME expertise is used in all relevant policy areas.

Quality assurance and objectivity

In order to ensure the quality of SME advice, clear selection criteria for the representatives would have to be developed. The members of the advisory boards should have proven expertise in their respective areas and represent the interests of their industries representatively.

At the same time, it would have to be ensured that the consultation takes place objectively and in the overall interest. Conflicts of interest would have to be made transparent and corresponding rules of conduct would be developed.

Integration into existing structures

The new form of cooperation would have to be carefully integrated into the existing political and administrative structures. This requires close coordination with Parliament, since SME advice supplement the democratic decision-making processes but should not replace.

International role models and best practices

Scandinavian models

In Scandinavian countries there are successful examples of the systematic integration of business representatives in political decision -making processes. These models could serve as inspiration for German implementation and be adapted to the specific circumstances.

Regional pilot projects

The new cooperation model could be introduced gradually, starting with pilot projects in selected policy areas or regions. These pilot phases would make it possible to gain experience and optimize the model before it is rolled out nationwide.

No more consulting costs: So the middle class could make the federal government more efficient

The exhausting consultant costs of the federal government are not only a financial, but also a structural problem that threatens the integrity and ability to act. The proposed alternative approach of close cooperation with SME interest representatives offers a practical and inexpensive solution that also strengthens democratic participation.

The German medium -sized landscape has an impressive expertise and experience that would be of enormous value for the political design. Instead of still paying millions of external consulting companies, the federal government should use these existing resources and at the same time build their own skills.

The implementation of this alternative model requires political courage and the willingness to question retracted structures. However, the potential advantages - both financially and qualitatively - justify this effort. It is time that the federal government overcomes its dependence on expensive external consultants and instead relies on the competence and experience of the German economy.

The criticism of the Federal Audit Office should be understood as a wake -up call. The time for fundamental reforms in the Federal Government's advisory practice has come. The proposed model of cooperation with SME interest representatives could be the key to a more efficient, cheaper and more democratic political design.

I would be happy to serve as your personal advisor.

Head of Business Development

Chairman SME Connect Defense Working Group

LinkedIn

 

 

I would be happy to serve as your personal advisor.

contact me under Wolfenstein ∂ Xpert.digital

call me under +49 89 674 804 (Munich)

LinkedIn