London: The European consulting market has potential for higher than expected growth say clients, according to a new report from consulting industry research group Sourceforconsulting.com published last week.
The report, based on the views of more than 400 C-suite and director-level private sector clients, finds The Boston Consulting Group best positioned for growth.
Despite the tough market for European consulting firms, the report finds that the majority of clients have either no plans to reduce the level of consulting they buy, or to increase it significantly.
Source says that the expected increase in demand is being driven by clients keeping a check on the permanent headcount and, as a result, redrawing the line between what's done internally, and what's done externally.
But, says the report, consulting firms will have to be prepared to rethink not only the services they offer, but the role they play in implementation and even the model by which they deliver their services.
Source says that throughout the course of researching the report, clients mentioned 11 consulting firms more than any others, and for each of these it looks at how well positioned they are to take advantage of the new opportunities for growth.
Top of the pile is The Boston Consulting Group, now almost as frequently mentioned as McKinsey, and with a growing reputation for its ability to redefine the role it plays. It sits ahead of PwC, the best positioned of the Big Four if only marginally ahead of Deloitte.
There is also evidence that about a sixth of all consulting is driven by the need, amongst clients, to validate decisions they're taking internally. Indeed this is something with which the most senior clients are very comfortable, seeing it simply as a part of doing business. As one strategy director commented:
"One of the main reasons why we'd bring in one the well-known strategy firms is if 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 outsiders. 50% of this work is genuinely helpful; 50% is just to make us look better."
A new form of collaboration
One 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.