| | Despite the tough market
for European consulting
firms, a
Sourceforconsulting.com
report based on the
views of more than 400
C-suite and
director-level clients
across Europe and the
Middle East, has found
that the majority (95
per cent) of management
consultancy clients have
either no plans to
reduce the level of
consulting, or they plan
to increase it
significantly.
This expected
increase in demand is
not being driven by the
need for new skills or a
major change programme,
but because clients
expect the line between
what is internal and
what is external to be
re-drawn. Cutting the
number of permanent
employees they employ
will mean relying more
on outside companies.
But the report is quick
to point out that
consulting firms will
have to be prepared to
change the services they
offer, the role they
play, or even their
operating model, in
order to take advantage.
BCG best
positioned for growth
The report also ranks
11 of the biggest global
consulting firms,
according to how well
clients feel each is
positioned to tap into
the potential for
growth. The Boston
Consulting Group came
top, a result both of
the high regard which
clients have for the
firm generally, and the
fact that it is seen to
be increasingly capable
of diversifying by role
and delivery model.
PwC – the front
runner out of the Big
Four
There is, says the
report, little to
separate PwC from
Deloitte – something
that is a problem for
both firms – but the
former have the edge at
the moment on the back
of especially favourable
views amongst clients
about the quality of its
people.
Source co-Founder
Fiona Czerniawska
commented: “Despite the
malaise of the | |
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| | consulting industry in
many parts of Europe,
and the widespread
perception that demand
for consulting in the
region is likely to grow
slowly at best in 2012,
we believe that the
potential for
longer-term growth is
much greater. This may
be akin to the explosion
of activity which
fuelled the consulting
industry in the early
1990s, as pressure on
headcount forced
managers to re-draw the
boundaries between what
they made and what they
bought.”
Huge reliance on
consultants to validate
difficult decisions
When looking at why
clients are buying
consulting, a third of
all consulting continues
to be driven by clients’
need to access
specialist skills.
However, around a sixth
stems directly from a
need to have difficult
decisions validated and
defended to internal and
external stakeholders.
The report says that it
is clear that CEOs and
their board directors
see this simply as part
of doing business. It’s
a trend that is
especially marked in the
financial and resources
sectors (primary
industries, energy and
utilities) and amongst
strategy, finance and
risk managers. What it
does is to make people
in these sectors and
functional areas
extremely
brand-conscious when it
comes to their choice of
consulting firm,
something that goes a
long way to explaining
why reputation and
relationships are
something the biggest
consulting firms are so
keen to manage well.
One strategy and
operations director
commented: “One of the
main reasons why we’d
bring in one of the
well-known strategy
firms is that there’s a
difficult, even
contentious, message we
need to get across
internally and/or
externally. These people
can articulate it better
than we can – and
they’re also more likely
to be believed because
they’re independent | |
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| | outsiders. 50% of this
work is genuinely
helpful; 50% is just to
make us look better.”
A different form
of collaboration is
emerging
One of the most
significant changes to
the way clients are
using consultants comes
in the way they expect
to use external help for
implementation. Despite
virtually every
consulting firm laying
claim to its unique
ability to bridge the
gap between advice and
implementation, the
report suggests that
clients remain
unconvinced. Indeed they
appear to have very
sophisticated views
about the role they want
consultants to play,
something which is
informed by the
increasing access many
clients now have to
internal consulting
resources. Four-fifths
now expect consultants
to work in collaboration
with internal consulting
units while about
two-fifths expect them
to manage internal teams
of people. These
shifting needs don’t
simply affect the amount
of money organisations
spend with external
consulting firms, they
also go a long way to
determining the types of
firms they use in the
first place.
Some of the other
key findings included:
• International work
– the report estimates
that, overall, around a
third of all consulting
work has an
international component
to it – and that this is
likely to grow.
• Clients see a clear
relationship between
price and value, and
will either push prices
down or allow them to
rise depending on the
gap between the two.
• There are three
main ways in which
consulting firms can
diversify in order to
take advantage of the
opportunities for
growth: by service, by
role and by delivery
model. | |
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