| UK consulting industry returns to growth |
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| | The findings of the
Management Consultancies
Association (MCA)
Industry Report suggest
that the UK consulting
sector is focused on a
growth agenda. Despite
a drop in public sector
consulting work, the UK
consulting industry
returned to growth in
2010, with private
sector fee income
increasing by 10% – the
fastest rate of growth
since 2007. In total,
fee income of MCA firms
was up 1% on 2009 to
£5.436 billion. It is
estimated that MCA firms
represent 67% of the UK
consulting industry,
slightly down on
previous years.
The MCA report says
that this private sector
growth was fuelled
primarily by the
financial services
sector. Fee income from
the banking sector grew
by 35%, almost equalling
its highest annual level
of growth (40% in
2006).
Alan Leaman, CEO of
the MCA, said:
“Consulting firms are
helping financial
institutions to respond
to the direct and
indirect impacts of
regulatory change,
re-organisation and new
business opportunities.
Elsewhere in the private
sector, consultants are
playing a critical role
in helping businesses
develop new
opportunities for | |
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| | growth.”
The UK consulting
industry in total is now
worth around £8.1bn.
IT consulting
shows strong growth – up
by 9%
Faced with
operational challenges,
competitor threats and a
need to innovate,
private sector
organisations are
relying on new
technology more than
ever. The MCA report
says that while there is
little sign that
companies want to
commission large-scale
IT projects, they are
working with consultants
to maximise their return
on past investment and
to explore the potential
for future investment.
Taking UK skills
and professionalism
overseas
The UK consulting
industry continues to
make an important
contribution to the UK
balance of payments and
reinforces the country’s
reputation in the
professional services
sector. On average, 10%
of fee income was earned
by UK-based consultants
working in other
countries, suggesting
that total exports were
worth around £900m.
Responding to
public sector
challenges
The public sector | |
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| | consulting market
reduced expenditure in
all areas in 2010:
demand in central
government fell by 11%,
executive agencies and
NDPBs by 13% and local
government by 35%. The
consulting industry is
already responding to
this challenge. The MCA
has been working with
the Cabinet Office’s new
Efficiency Reform Group,
looking at the role of
consultants and how
their use can be
improved.
Leaman commented:
“Consultancies will be
vital to delivering the
government’s programme
of savings and reforms;
there is a common
interest in ensuring
that their use is driven
by need and that
procurement systems
focus both buyers and
suppliers on achieving
specific outcomes.”
Paul Winter,
president of the MCA,
concluded: “The economy
is still struggling and
the outlook remains
fragile. Management
consultancies will be
working with clients to
inject energy, optimism
and acumen into
Britain’s push for
economic recovery. The
value that consultancies
generate will be
evident, confirming the
MCA’s recent research
finding that benefits to
clients are worth around
£6 for every £1 spent.” | |
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