There's surely some mistake. It sounds as though Bryan Hickman has just suggested that the US is three to nine months behind the UK in the development of the management consultancy market.
'The US has real issues with outsourcing and offshoring,' says Hickman, senior account director with recruitment specialist Top-Consultant, 'and it's outsourcing that is driving the UK's recovery.'
Figures from the Federation of European Management Consulting Firms (Feaco) show a modest 3.5% growth in fee income across Europe last year. Britain's Management Consultancies Association, which contributes to the survey, says growth in the UK was much higher at 13% in 2003 and is continuing at 5% per quarter.
As more than a third of last year's £5.8 billion in consulting fees (MCA figures) was spent on 'outsourcing-related' consulting, it's clearly an important engine of growth - and one that US politicians and labour unions are less willing to countenance than their more flexible UK counterparts.
For once, then, the UK could be leading the world into the next wave of management change - one in which large companies increasingly hand over the management of non-core activities to specialist service-providers.
At the MCA's annual autumn reception last month, where consultants mixed with headhunters, bankers and each other on the House of Commons' terrace, the prevailing emotion was one of optimism tinged with a slight apprehension that the shape of the industry is changing - that a gap is opening up between the strategy consultants who sell expertise and the proponents of outsourcing, who are becoming global service providers with employee numbers to rival those of their clients.
For Roger Camrass, managing partner, business transformation, Fujitsu Services, the further consultancies move down the road to service provision, the less the old labels fit. 'It's not consultancy at all any more, it's third-party services,' he says. 'What you have are "global utilities" - IBM, Fujitsu, EDS and the like.' Being a global utility company may sound duller than McKinsey-style consultancy, with its partner structures modelled on the professions, but it could be the inevitable next wave for an industry that has changed with the decades.
In the 1960s, consultancy - for UK business, at least - was about applying the engineering-based skills of work study and Time and Motion developed in the US by Frederick Taylor early in the 20th century. By the end of the '70s, strategic consultancy had taken hold. Outsourcing started in the '80s, with the first major deal between Unilever and EDS in 1982, and in 1990 the research findings of the seminal MIT programme 'Management in the '90s' gave birth to business re-engineering, an idea that drew accountancy firms into the ranks of consultants.
The dot.com boom and bust, followed by the Enron scandal, put a stop to large-scale business change projects, while corporations dealt with the fallout from the former and digested the implications of the latter. Now the big theme is business process outsourcing. Its effects will be far-reaching, not just on the consultancy sector, but on the shape of global business.
In his book Atomic, published last year, Roger Camrass said: 'The IT service sector, deprived of lucrative systems integration and consulting contracts, has seized on radical corporate restructuring as its salvation ... This is a vast transfer of assets from the "old" to the "new" economy, with many surprising effects. The outcome is a dis-integration of the corporation.'
This is apocalyptic stuff, but there's no doubt that outsourcing is changing the shape of corporations and service providers alike. The larger outsource-driven consultancies are taking on employees as they take over the functions - and staff - of their clients' non-core activities. The consulting arm of IBM, for example, could have more than a million employees worldwide in the next five years as it rides the outsourcing wave. But where does consultancy proper end and the global utilities phenomenon begin?
For MT's league table of the 100 top consultancies, the question demanded difficult calculations to sort the consultants proper from those who are employed simply as part of outsourced operations, such as helpdesk staff.
It has also heralded the arrival of new names among the ones that we had expected.
Alongside the familiar consultancies, the full table - published in the MT Black Book, the directory of UK consultancy and professional services - lists construction and engineering firms such as WS Atkins, EC Harris and Arup, financial services giants such as Aon and Mellon, utility providers such as United Utilities and BT, and recruiters such as Hogg Robinson, Reed and Manpower. There are also manufacturers as diverse as Siemens, BOC, Tata and Volkswagen, and - perhaps less surprisingly, given their ambitions - media groups such as WPP and Omnicon.
The lines between consultancy and service provision are blurring. It's perhaps a little premature, though, to write off traditional, strategy-based consulting. While the figures may be less spectacular, it's still the engine of business development for thousands of client companies - and the breeding ground for new management thinking.
Lis Astall, country managing director at Accenture UK, admits that her own organisation has adapted to meet the new market conditions: 'Inevitably, outsourcing has changed the structure of our company. We have 10,000 people in the UK and over half would be involved in outsourcing work.'
She denies, however, that the rush to outsourcing means that traditional consulting virtues of 'distilled intellect' are being forgotten. 'You have to have a fundamental awareness of where the business benefits will come from. You can't do outsourcing and say it's just about taking costs out or people out.' For Astall, the place for the high-end traditional consultancy within outsourcing is in engineering the deals and shaping the agreements under which services are contracted out.
'The combination of outsourcing and consulting is key - how will the IT investment be integrated into the business and deliver results?'
It's a question that is being asked more frequently now than was the case in the first flush of enthusiasm for outsourcing - and the answers aren't always positive. In September this year, JP Morgan Chase & Co said it was pulling out of a seven-year deal to outsource its IT to IBM. In part, this may have been the inevitable result of those US doubts when it comes to outsourcing - but it may also be an early sign that outsourcing, although an important engine of growth in the lean years for 'traditional' consulting, cannot provide the answer to every problem. Which would, of course, be where the old-fashioned consultancy virtues of problem-solving and managing change come in
At Bain, director of external relations Samantha Axtell is confident that whatever the growth in outsourcing, Bain's core business of strategy consulting continues to prosper. 'We feel we did well - last year was a record year for us, both in the UK and globally,' she says.
Nevertheless, Bain isn't blind to the importance of outsourcing for its global clients. It now has a site outside Dehli as a 'point of information' for clients considering outsourcing and offshoring to that part of the world. Like its strategy competitors McKinsey and Boston Consulting Group, Bain isn't ready to surrender the high ground to the global utilities just yet.
'People say strategy firms are back,' says Axtell. 'We believe they were never gone.'
TOP 25 MANAGEMENT CONSULTANCY COMPANIES
Financial Global Global Global
Rnk Company year turnover employees cons-
1 IBM Bus Consulting 31/12/03 $89.1bn 319,000
2 LogicaCMG 31/12/03 £1,706.6m 20,000
3 Accenture 31/08/03 $11,818m 83,000 66,000*
4 Capita Group 31/12/03 £1,081m 21,000
5 Capgemini 31/12/03 EUR5,754m 48,304
6 Unisys 31/12/03 $5,911.2m 37,000
7 Deloitte 31/05/03 $15.1bn 119,770
8 Watson Wyatt 30/06/03 $710m 4,000
9 Pricewaterhouse- 30/06/03 $14.7bn 122,820
10 Mercer HR Consulting 31/12/03 $11,588m 60,000 13,000
11 PA Consulting Group 31/12/03 3,000
12 WIPRO 31/03/04 $1.35bn 28,502
13 Xansa 30/04/03 £453.9m 5,583
14 Fujitsu Services 31/03/03 $38.4bn 157,000 6,000
15 Atos Origin 31/12/03 EUR5bn 47,000 7,200
16 Siemens Business 30/09/03 EUR74bn 413,000
17 CSC (Computer 31/03/04 $1,4768m 90,000 9,500
18 Hewitt Bacon&Woodrow 30/09/03 $1.98bn 15,000
19 Oracle Consulting 31/05/03 $9,475m 42,299 9,000*
20 Towers Perrin 2003 $1.5bn 8,000
21 WS Atkins 31/03/03 £935.3m 15,100
22 Vertex (parent: 31/03/03 £1,920.5m 13,802 6,540
23 Tribal Group 31/03/03 £105.7m 1,174
24 Detica 31/03/04 £53.5m
25 McKinsey & Co 31/12/03 6,500 6,200*
Rnk Company employees cons- Comments
1 IBM Bus. Consulting 20,000* 12,000* UK nos. are unconfirmed
Services industry estimates;
consulting was 14% of
global revenue in '03
2 LogicaCMG 6,159 5,500 20% of UK revenues were
from outsourcing in '03,
64% from systems
integration and consulting
3 Accenture 9,000 3,500 Outsourcing accounted for
30% revenue in '03
4 Capita Group 21,000 3,000 Consulting includes IT,
property and BPO advice
5 Capgemini 6,485 2,000* Consulting accounted for
21% revenue in '03, out-
sourcing 30%. Total
employees 5,5750 when
Transiciel acquisition is
6 Unisys 8,500 2,000 UK consultancy nos. are
estimates and refer to
systems integration and
7 Deloitte 10,000 1,800 Deloitte has retained its
(worldwide: Deloitte consulting division
8 Watson Wyatt 1,636 1,280
9 Pricewaterhouse- 13,643 1,200
10 Mercer HR Consulting 3,500 1,100
11 PA Consulting Group 1,427 1,047
12 WIPRO 990 951 A major outsourcing
13 Xansa 4,291 900* UK consultants are
14 Fujitsu Services 1,000 700
15 Atos Origin 600 Global figures include
(including Sema) Sema acquisition; in '03,
9% of Atos revenues from
16 Siemens Business 5,000 600 Outsourcing services
(parent: Siemens Grp)
17 CSC (Computer 520 Outsourcing was 53% of
Sciences Corporation) turnover in '03, IT &
professional services 47%
18 Hewitt Bacon & Woodrow 1,900 500 Outsourcing accounted for
(parent: Hewitt 62% of revenues,consulting
Associates) 37% in '03
19 Oracle Consulting 1,000* 500* Consulting and UK employee
nos. unconfirmed industry
20 Towers Perrin 800 500
21 WS Atkins 12,500 450 Major engineering
22 Vertex (parent: 6,300 450
23 Tribal Group 1,174 430* UK consultancy nos are
Management unconfirmed industry
Consultancy Services estimates
24 Detica 500 425
25 McKinsey & Co 450* 350* All figures are
TOP 10 HR CONSULTING
Rank Firm No of UK
1 (8) Watson Wyatt 1,280
2 (10) Mercer HR Consulting 1,100
3 (18) Hewitt Bacon & Woodrow 500
4 (20) Towers Perrin 500
5 (28) Aon 300
6 (37) Mellon HR & Investor Solutions 211
7 (48) Hay Group 150
8 (50) RightCoutts 145
9 (62) Best International/Spring IT 100
10 (84) Pecaso 56
(Top 200 ranking in brackets)
TOP 10 IT CONSULTING
Rank Firm No of UK
1 (1) IBM Business Consulting 12,000*
2 (2) Logica CMG 5,500
3 (3) Accenture 3,500
4 (4) Capita Group 3,000
5 (5) Capgemini 2,000
6 (6) Unisys 2,000*
7 (12) WIPRO 951
8 (13) Xansa 900*
9 (14) Fujitsu Services 700
10 (15) Atos Origin (incl Sema) 600
(Top 200 ranking in brackets)
Copies of the Black Book 2005, published by MT in collaboration with the
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(including postage and packing). Tel: 020 8606 7500