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The other big “watch
and wait” story is the
EU investigation and
report into competition
within the audit
profession. On 1
December 2011 the EU
published its report and
recommendations. These
recommendations will now
be put under scrutiny
before being ratified
and implemented. The two
key recommendations for
the consulting sector
are:
• Mandatory rotation
of audit firms after a
maximum engagement
period of six years.
• Non-audit services:
audit firms will be
prohibited from
providing non-audit
services to their audit
clients. In addition,
large audit firms will
be obliged to separate
audit activities from
non-audit activities in
order to avoid all risks
of conflict of interest.
Obviously, if these
recommendations were
implemented, the impact | |
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| | on the management
consultancy industry
would be enormous. KPMG,
PwC and EY have all
invested heavily to
rebuild their consulting
practices ‒ all for
nothing, should this go
through. Not
surprisingly, all of the
Big Four are lobbying
the EU heavily on this
matter. What will happen
is unclear, but this is
certainly a very hot
story to keep close to.
Public sector
consulting in 2012 has a
new framework to get to
grips with. The
consultancyONE
framework, announced at
the end of 2011, is the
result of a lot of hard
work by the MCA and has
resulted in a more
streamlined government
procurement process that
ought to create a fairer
playing field for
smaller consultancies.
It also removes the
requirement for a
consulting organisation
to have worked in the
public sector before.
This is a critical
development as it | |
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| | enables an easier
transfer of knowledge
and know-how from the
private sector to the
public.
Growth
markets
In the light of the
significant negative
press that western
economies have been
receiving, much has been
written about the
importance of emerging
markets for consulting
firms in 2012. The
Government has been
pushing for higher
exports to the growth
economies; some of our
best products are our
professional services
(law, accountancy,
financial services and
consultancy), so watch
this space.
Challenges to global
growth are significant,
but the appetite is
there. In mid-November
the Management
Consulting Group (MCG),
owners of Kurt Salmon
and Alexander Proudfoot,
bought the Chinese
retail consultancy
Vertical Retail | |
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In terms of what this
hiring will look like, I
think we will see a
qualified cautious
optimism across the
market. I expect that
the public sector will
remain relatively flat
and financial services
will slow, while the
rest of the market will
continue. A lot of it
will be “about building
and refining a distinct
proposition, rather than
just acquiring bodies
and contacts” (Mick
James, 2011).
The opportunities are
there, in all areas of
the market, and will
become much clearer
through the next month.
If you think you would
like to make a move in
the next 12 months, then
now would be a good time
to update your CV and
talk to us to find out
who, in the consulting
world, is planning what
for the next 12 months.
Until the next
quarter, enjoy the
market! | |
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