| Recruiting in a downturn: how to grow your team and your business |
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| | By Mindbench
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2) Capacity
building
In the short term,
consulting firms need to
think about whether they
need additional skills to
adjust to changing client
demand – by enhancing
their operational
consulting or cost
reduction capability, for
example. They will need
to change the ideal
target profile to reflect
this. They may also want
to improve their own
development capability –
in a more challenging
business environment,
they may need to hire
seasoned business
developers in order to
grow or sustain business
levels.
Longer term, the
market for consultancy
services is highly
cyclical and is therefore
likely to return to
growth in 2010. Fiona
Czerniawska of Arkimedia
comments: “Looking back
over the last 20 years, I
think that the consulting
industry works on
five-year cycles: three | |
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| | years or so of relatively
high growth, followed by
two years of lower
growth.” Firms which can
sustain lower utilisation
and profitability through
2009, but retain
consultants or build
capacity through hiring
will benefit once growth
recovers.
The recession is a
great and rare
opportunity to build
capacity cost-effectively
due to the increased
availability of good
consultants. Whilst
during normal times
consulting firms often
exit under-performing
individuals through an
up-or-out approach, the
quality of the talent
being released to the
market during the
downturn is often very
good or exceptional, as
firms often cut
indiscriminately when
restructuring areas of
their business. The
“switch premium” or
increased package that
firms need to offer, to
lure consultants away
from their existing
employer is also lower
due to fewer competing
offers. Faced with | |
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3) Effective
resource management
Maintaining high
consultant utilisation
levels will be one of the
key challenges over the
next year. Firms which
have multiple service
lines including existing
operational and cost
reduction consulting
should plan in terms of
who they can transfer
from their growth and
strategy areas. Firms
which have international
offices could also
consider relocating
consultants from the UK
to overseas markets which
have better prospects. We
have already seen
transfers occurring to
Germany and Dubai, and
expect this trend to
continue with consultants
being offered relocation
to Asia as well.
Developing and
utilising a pool of
contractors will provide
a useful variable
component to the resource
mix for consulting firms,
as they are paid on an
as-needed basis. They
also can offer
flexibility in terms of
hiring the contractors
permanently once the | |
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| | market improves.
Contractors can also
provide specialist skills
which are in high demand
during the downturn.
Firms will need to think
about how they develop
their contractor
consultant network and
may want to partner with
a specialist recruitment
firm to assist in the
search and engagement
process. When we founded
Mindbench in 2003,
contractor support for
consulting firms was the
first area of resource
management that we
addressed. At the time,
clients had made
significant redundancies
and were looking to
deliver projects
effectively without
significantly increasing
their fixed costs. At the
same time a significant
number of good
consultants wanted more
work flexibility. We
built a network of the
best contractors who had
excellent consulting
pedigrees and engaged
this talent on a project
basis with our consulting
firm clients.
Continued on page 4
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| | potential redundancy and
dwindling promotion
opportunities,
consultants are also more
flexible and pragmatic in
terms of their career
aspirations. For example,
we have seen good
strategy consultants
becoming interested in
operational consulting
work. These operational
consulting firms have
been able to tap the
analytical skills of
consultants who, under
“normal” circumstances
wouldn’t have considered
working in non-strategy
firms.
There is also an
excellent opportunity to
acquire superb talent
from outside consulting.
Within financial services
and industry larger scale
cuts are taking effect
and career opportunities
becoming scarcer. At
least one of the Big Four
is actively exploiting
the softness in the
recruitment market as
part of its general
strategy to build scale
over the next two years.
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