ADAPT & PROSPER

CONSULTANCY IN A CHANGING CLIMATE A WHITE PAPER SUMMARY OF DISCUSSIONS WITH BUSINESS LEADERS

BY NICK CLOSE & MEL CHAPLAIN OF EPI INTERNATIONAL

EPI WOULD LIKE TO THANK THE ABOVE CONSULTANTS FOR THEIR HELP IN THIS STUDY

Neil Morecraft

Marc Roberts

Len Todd

John Atkinson

Stephen McComb

John Anfield

Martin Riddell

Rob Hines

James Sale

Ian Luke

Darren Mee

David Beck

Peter Jones

Anonymous Consultants

Mark Davies

Andrew Wilcock

Alasdair Robertson

Ihsan Al-Zanki

David Oldroyd

Fergus Ryan

George Ryder

Bruce Lewin

Liz Machtynger

Stephen Murphy

Bob Apollo

Mark Burnett

Kit Patel

Anne Morris

Marco Busi

CONTENTS 2 Thanks to Those Who Helped

3 Contents

4 Setting The Scene

5 Response to Q1: What Changes In The Marketplace Have You Observed In The Last Few Years?

8 Summary Q1

9 Response to Q2: Have You Made Any Strategic Changes To Your Consultancy Practice?

12 Summary Q2

13 Response to Q3: What Do You Think Consultancies Need To Do To Thrive?

15 Summary Q3

16 Response to Q4: What Do You Think About Strategic Alliances With Other Consultancies?

19 Summary Q4

20 Response to Q5: What Trends Do You Foresee Over The Next Few Years?

23 Summary Q5

24 Response to Q6: What Are Your Biggest Consulting Challenges?

27 Summary Q6

28 CONCLUSIONS

29 Contact Information

OVERVIEWThis White Paper shares qualitative research sought from practicing consultants Q1/2013, and can be read in depth word-by-word, or as a useful quick-glance guide by going to the ‘summary’ page for each question, or the ‘conclusions’ page at the end.

All pertinent responses have been reproduced verbatim, and at the end of each question section, the key points have been summarised to capture the main findings.

EPI has been helping reduce costs and improve efficiency

for over 20 years, and in that time its business model has

changed quite radically. EPI moved away from traditional consultancy and towards

software with service & knowledge transfer.

Over a period of years we developed software (with Warwick University) that captures consultant expertise and

method. The result is iCEO - a suite of software tools that radically increases the

speed and quality of analysis, and offers advantages to both consultant and clients for cost and ‘relationship’ results.

We created iCEO as it was the software we wanted, so we could more simply and

easily VISUALISE, ANALYSE, PRIORITISE & ACTUALISE cost reductions & process improvements.

As a consultant, the software speeds up and simplifies process; it integrates data

from disparate sources, and creates highly visual spend models that can be sliced and diced for deep drilling. Clients value

the speed of turn around, flexibility of the

data, and the ‘knowledge transfer’ that can be part of the software-with-service

package - delivering perceived ‘extra value & expertise’.

As we moved into phase three of our business model and efforts, we began to look increasingly outwards and across the

market place, and began wondering...

If EPI has been changing to meet the

changing market place, is the rest of the market doing the same to future proof itself?

As we were already connecting with like-minded consultants within forums and

LinkedIn, we thought ‘let’s make those LinkedIn transactions with others equally focused and create some research of real

value’.

So we did, and this White Paper is the

result - and will be the first in a series exploring and answering questions on trends, challenges and opportunities

within this sector.

We hope you find it insightful and useful,

and we welcome any feedback on this paper or suggestions for future papers.

4 / 29

SETTING THE SCENET

Q: WHAT CHANGES IN THE MARKET PLACE

HAVE YOU OBSERVED THE LAST FEW YEARS?

Clients want bespoke solutions at off the peg prices.

This in itself is nothing new, but combined with increased availability of knowledge from the web,

consultancy needs more than just tools & techniques to survive. Andrew Wilcock

The market valuing focus & domain expertise. If you can demonstrate you’ve got that, you can

command significantly rising day rates & fees. Bob Apollo

Customer demanding more added-value from the

consultants, and they prefer the hands-on approach. Ihsan Al-Zanki

I am of the opinion that the major clients markets

have tended to use ‘the big 4’ primarily so as to be beyond criticism from the analysts. In other words

consultancy has followed the same pattern as external accountancy. At the other end of the market, small businesses have shied away from

consultancy usage as pressure on funding has intensified - courtesy of the tough recession. Only

chronic under-performers and those with significant growth aspirations have continued to make full use of consultants, but the space has become crowded

courtesy of inter im management supply. David Oldroyd

5 / 29

I’ve experienced clients become more open &

receptive to our offerings as economic conditions have effected confidence and forced change.

I’ve also observed in larger organisations, career orientated people are concerned about not doing the wrong thing - they are risk adverse, less nimble

and generally don’t feel market changes as quickly as smaller companies. They may take consultancy

as an insurance policy to fall back on.

Whereas the smaller company feels the market pain more readily, and is often more nimble and open-

minded from this receptive position.

I believe the softer middle market is niche focus - if

consultants can evidence their credentials. Bruce Lewin

As the pressures on businesses increase, they are

looking at more and more initiatives to try and reduce costs. However, the return on investment is

even more heavily scrutinised than previously, and there are reservations on making big investments to truly transform processes, business & customer

propositions.

Whilst this may seem the right thing to do, after

engaging on such projects for the last 3/4 years, it has led to a lot of the ‘simple & easy to complete’ programmes on minimal budgets. Thus leaving

more complex - but arguably more vital changes - with little or no appetite to invest.

The positive to this approach is that it has reduced the number of ‘pet projects’ being engaged around business significantly; driven improvement and

reduced the operating costs of the business aligned with the challenges faced externally.

The down side is that it has led to a culture of extreme short term views - and apathy within business to suggest vital improvement, as they

know that unless it will return X with little or no spend, it won’t get funding.

This in turn has lead to work around processes: sticky plasters and local fixes being applied which increases the stress and strain on the floor.

Kit Patel

Noticeable is a tightening of the purse strings and a

greater emphasis on outcome based charging. For the most part, consultants are chasing a reduced

work pool of assignments with a consequential negative impact on rates. George Ryder

Decreasing fees & shorter projects. Marco Busi

A confusion between consultancy, interim and temporary management roles. Stephen Murphy

I see a tendency to make the most of internal consultants/contractors as opposed to going to the

‘big 4’ - this may be perceived as a way to limit costs. Anon

A major change for us has been a marked shift to International (now some 70% of billed hours) with

particular focus on build/consultancy mix. John Atkinson

The market place tends to have more consultants -

often people whose positions have been made redundant. Companies are tightening their belts in

the recession and not increasing their permanent headcount, so those that require an income are often forced into consultancy. Often these

consultants under cut on charges, and some do not deliver to the necessary standard due to lack of

understanding of corporate business.Anne Morris

Bigger bang for buck; less patience for journeymen

consultants; more leverage of who you know and track record; less reporting/writing & more delivery.

Mark Davies

Move away from the straight consultancy in Government where they would bring in consultants

to do general work. Much more is now in house.

Much more of a demand for specific specialist

expertise e.g. Lean, business change and delivering cost reductions.Stephen McComb

6 / 29

Principally, the UK market in particular has become

more competitive, but the line between consulting and contracting has become even more blurred

than during the previous ten years. This I believe is due to clients balancing the risk of direct employment against short term contractors and the

consulting community needing to compete for that type of work, just to survive.

Martin Riddell

There is more of a focus on: providing solutions rather than advice; implementation rather than

recommendations, and increased importance on sector/industry knowledge and expertise.

Anon

A great deal of consolidation of established, smaller and medium sized consultancies into bigger entities

by acquisition, merger or strategic partnerships. A number of good practices have lost their ‘identity’

as a result.

Many consultant practitioners, particularly the larger ones, have expanded their services without

having the genuine in house capability to deliver - they are trading on their old reputation, when it is

not entirely appropriate.

As companies down size due to the economic climate, there seems to be an increased need to

utilise consultancies to fill the gap left by a loss of knowledge and expertise - thus increased demand

for consultants.

There is a growing market in services which businesses have not traditionally carried as in house

expertise e.g. CSR, sustainability, diversity, IT support etc.

Ian Luke

Trends towards consumer focus, value for money, cost reduction, results driven environment (facts &

figures). Dave Beck

Clients reducing their consulting budget. Consulting fees being tied to results delivered. More creative billing propositions being offered by

consulting firms such as contingent fees etc. More firms eyeing the implement pie which means longer

projects.Anon

More reluctance of businesses to engage in longer

term developments. Instead they seem more interested in the short term, quick wins even when

they may see the merits of reviewing how they work through initial discussions.Rob Hines

Massive. Where on earth would I start?Peter Jones

Generic stuff is a bit past it - forget the big consultancy/high day rate model - it’s all about small, specific providers with something new to say.

Alasdair Robertson

7 / 29

SUMMARY

WHAT CHANGES IN THE MARKET PLACE HAVE YOU OBSERVED IN THE LAST FEW YEARS?

• Principally, the UK market is becoming much more competitive. Largely due to there being more players in the market place, and budgets being cut whilst expectations rise.

• Clients are expecting more ‘value’ in many ways - by results, service, expertise and fee structure. More and more, fees are tied to results, with greater focus on measurable outcomes & ROI.

• Projects have become shorter.

• Additionally, specialist knowledge & niche focus is being perceived as the benchmark of excellence, and expected to continue gaining gravitas.

• VALUE and SPECIALISM are the buzz words.

Q: HAVE YOU MADE ANY STRATEGIC CHANGES TO

YOUR CONSULTANCY PRACTICE?

We’ve become ever more narrowly focused on a market segment that we identify through a number

of common demographics, structural, behavioural and situational factors. As a result, we’ve become better at qualifying in/out more accurately and

earlier.

We’ve also moved away from day rate based fees to

value-based charging (this has helped boost the notional day rate significantly). Bob Apollo

Yes I have, and I’ve started to make alliances with other other consultants and consultancies.

Ihsan Al-Zanki

We are moving more towards knowledge transfer as this gives us the ability to help clients over a longer

time frame, imbeds knowledge within the company, and reduces the pressure on our internal resources - and from our perspective becomes a variable

(project) cost rather than a fixed cost. We are also looking at new business models for consultancy

delivery.Andrew Wilcock

Other than aligning our focus and resources to

further exploit the shift to international business, no further strategic changes.

John Atkinson

9 / 29

Pre 2008 I was happy to be small business focused.

Then I effectively had 2.5 years away from consultancy as MD of a small business. When I

returned to the market I found that interest in using consultants had declined markedly. In many instances, clients were preoccupied with cost rather

than value. I have therefore elected to sell my services as ‘contracted resource‘ rather than as a

consultant. David Oldroyd

Within the practice we have restructured ourselves

to focus on strategic objectives. But with the key difference of being the conscience of the internal

colleague and customer. Whilst supporting on the ground delivery, we have identified and developed a nucleus of consultants that can work with the

senior stake holders around the business, to identify and articulate a more holistic and longer term view

on change and transformation.

This proposition is being uniquely packaged by looking at ways to drive and deliver the short term

benefits. But rather than simply banking the savings, we are looking at reinvesting and longer

term benefits. This has meant further developing the ‘run-rate’ savings, cost profile, and revenue profile models (to provide a holistic end-to-end

view). In addition, challenging the structure from functional to value-stream based accountability; by

truly looking at the big picture and working of Organisational and Operational design. Kit Patel

Yes. Given my background (EDS, Perot Systems etc) my practice was very out-sourcing focused. Out-

sourcing in the interim has been a crowded market, as well as suffering from excessive commoditisation. I have since wound up my

company (1stadvisory Ltd ) and incorporated Advisorment Ltd under the commercial mantra of

‘manage, market, mentor‘ (website under construction). George Ryder

Yes. I’ve lost faith in the validity of the consultancy model basically. I’m turning my practice into more

of an investment company (investing in the results of the consultancy we deliver).Marco Busi

I originally set out trying to work with local SMEs

(Dumfermline, Scotland). I have put this on the back burner and will take suitable work anywhere

for anybody. I still have a preference for smaller sites and smaller organisations. I wish to develop a business base in Scotland.

Stephen Murphy

As an internal consultant I’ve seen more work come

into my team than expected. We have made a conscious shift away from sheep-dip training and taking over smaller projects to train the trainer

training, and taking over larger diagnostic pieces of work.

Anon

Not really. Eagle Partnerships, my business since 1996, has always operated in a flexible manner. It

has always been recognised by it’s ongoing customers as being an extension of their business,

and providing a cost-effective and excellent service. Winning 4 Wales operates in the same way.Anne Morris

Specialising in one area, instead of spreading our consultancy thinly: results in maximum focused

performance and reputation...we focus on the automotive engineering sector.Dave Beck

I have tried to make strategic change to my practice but have only limited success in moving into new

areas. You get labelled and people do not see beyond it. Also, there is a reluctance to have new eyes looking into a problem.

Lenn Todd

No, but I network harder, and always look to help

as many people as possible in the hope there will be a referral back. Mark Davies

Move to specialism rather than generic project management etc.

Stephen McComb

Yes. Focus early 2013 on product, and then message. Just as I would advise my own clients.

Peter Jones

10 / 29

In 2010 I made a strategic change to move Beech

Tree away from offering multiple programmes for several diverse audiences, to offering services in

just one niche area: business ethics - as per my website, which was redesigned to reflect this. This won me a major client.

John Anfield

Yes. We have moved into a more strategic delivery

position and have developed an overseas company (Australia).Martin Riddell

Yes. Huge changes and they are ongoing - plans are nothing, planning is everything and has to be

kept under permanent review. The essence of it all is further niching, deeper value, more innovation, increased ‘layering’ - a process by which the

customer experiences s implici ty but the competition encounters complexity.

James Sale

Refocusing on our core competencies and a mix of junior and senior recruitment.

Anon

Bearing Point are making more of a shift towards

complimenting traditional consulting with asset based consulting. By this we mean that we are investing in assets that can be sold as services -

many firms are doing this: this is a trend in consulting that has building for some years.

Marc Burnett

Working with channel partners - they wrap their services around 4G software.

Bruce Lewin

Many. Re-organisation of internal teams to better

staff projects. Stress on internal knowledge transfer, development of Intellectual Capital. M&A to gain new skills/clients quickly.

Anon

I am in the process of changing my approach to be

more relevant, tying together marketing and operational functions.Rob Hines

Yes - specialise in high value add analytics.Alasdair Roberton

11 / 29

SUMMARY

HAVE YOU MADE ANY STRATEGIC CHANGES TO YOUR CONSULTANCY PRACTICE?

• A large number of consultants and practices have, or are intending to identify their specialisms and create a market niche.

• Many are looking towards new business models: some delivering more ‘knowledge transfer’ as it engages clients for longer and delivers additional ‘value’. Others bringing in assets such as software that can be sold as service packages.

• The continued focus on ‘value’ is leading the change to value-based charging.

• Companies are strengthening core competencies, to deliver expertly and ensure value-based charging delivers back.

• Some are moving into overseas markets.

Q: WHAT DO YOU THINK CONSULTANCIES NEED

TO DO TO THRIVE?Dedication, commitment, enthusiasm, structure, top level CEO / GM drive and leadership.

David Beck

Certainly be flexible - and up customer care standards.

Anne Morris

In my opinion develop niche specialisms to enable

clients to select appropriate expertise from the marketplace. This also enables collaboration/consortia bids.

John Atkinson

Evolve and listen to customer requirements and

feedback.Ihsan Al-Zanki

Radically change their profit model (basically charging out younger / less experienced consultants

as a higher price). Marco Busi

Flexibility is key. Listen to your customers needs

and wants but also evaluate what their level of understanding is - could it be that they are not sure

of what you can offer? Sometimes it’s worth doing a smaller piece of work to showcase what can be achieved - then the interesting stuff follows,

assuming you have done a good job.Anon

13 / 29

Adapt to current market conditions and look

outside the UK - languages are key to making this work (and fortunately my practice has most of the

important European ones). George Ryder

The whole market has become ultra-conservative.

You have had to have succ ess in the potential clients industry to be considered.

David Oldroyd

In essence they need to focus, although telling a client you can’t help them but you know a man

who can goes against the grain. Obviously they need lots of tools and techniques, but the major

challenge is to gain trust from their client base, preferably with 3rd party white papers and quality recommendations from existing clients.

Andrew Wilcock

Be focused, be experts and be practitioners rather

than pontificators.Bob Apollo

Skills and expertise that will deliver against the

specific requirements such as cost reduction, resolving operational issues, resolving quality

issues.Stephen McComb

Track record; network of referrals; the Ronseal effect

- do what it says on the tin; no waffle or time wasting; the ability to introduce others of equal

pedigree if you can’t deliver or it isn’t your expertise; ability to get right inside the issue empirically and with fact, and execute/implement/

assist with recommendations.Mark Davies

Say NO more often. I believe that the difficulties experienced over the past few years have meant that some consultancies have accepted

commissions that do not align with their core activities - with the result they have diminished

their reputation in the market place. STORM has avoided this tactic with the consequence that we have advanced our brand, particularly overseas.

Martin Riddell

Religiously focus on adding value and providing

real solution to problems; develop sector/industry focus; recruit great people; deliver great work.

Anon

Only sell what they can genuinely deliver and ensure that it is done in a high quality manner.

Ensure that the product being offered is refined before trying to sell it. Where appropriate join with

others who carry truly complimentary skills to provide a seamless service, and take away the need for the client to manage the interface. Set realistic

timescales to deliver the end product/service and if possible try to beat those durations - but do not

promise optimistic and almost impossible deadlines.

Look for the smaller niche markets which

differentiate the service and genuinely provide something the clients will need/benefit from. Resist

the current trend to ‘sell what it looks like rather than what it is’.Ian Luke

Keep reinventing themselves and think of the value they can provide.

Anon

A difficult one to answer. If you are by yourself, do you compete with established businesses who have

teams and more collateral to invest in marketing and promotional activities. I guess find common

ground with strategic partners, but my answer to 4 alludes to how difficult this may be.Rob Hines

Partner, innovate, collaborate, be creative, offer value, deliver service.

Peter Jones

Have something new to say - quick, short, focused ‘micro consulting’ offers are what the market is

responding to.Alasdair Robertson

For large consultancies to prosper they need to be able to articulate what value they can bring over and above what the associate pool can deliver.

Many businesses are now enhancing their own internal capability to enhance their value

propositionMarc Roberts

14 / 29

SUMMARY WHAT DO YOU THINK CONSULTANCIES NEED TO DO TO THRIVE?

• Listen more & evolve to meet the customer and market.

• Align with your core competencies and only deliver high quality.

• Develop a niche and build these specialisms and expertise further.

• Be dedicated and structured, and always focusing on adding value.

• Look beyond the UK market.

Q: WHAT DO YOU THINK ABOUT STRATEGIC

ALLIANCES WITH OTHER CONSULTANCIES?

Eagle Partnerships has always worked and formed

strategic alliances with other consultancies. Winning 4 Wales operates the same policy.

Anne Morris

If knowledge and experience of the alliance business/personnel is known then it should be

explored in certain circumstances.David Beck

A positive opportunity. Key in my opinion is like- minded thinking, approach method and clear contractual arrangements.

John Atkinson

Why not. Consultants range from general business

to people like myself with very specific manufacturing skills. If you have similar shared

values then get in there and build on each others strengths. I have often thought of work as ‘adventures with my mates’ rather than something I

do to make money.Stephen Murphy

When right, fabulous! When wrong, catastrophic. We use a BS11000 approach to strategic partnership which facilitates clarity and a clear exit

strategy at the beginning of collaborative work.Martin Riddell

16/ 29

Depends on the scale and pedigree - the other

consultancy needs to deliver to your standard as a minimum.

Mark Davies

They don’t work because rarely 1+ 1 = 3Marco Busi

I truly believe that it is good and beneficial for all parties.

Ihsan Al-Zanki

Not convinced....ties yes, but alliances may sometimes work counter-productively. A better way

to see it would be looking at your USP and mapping which consultancies you need to have ties

in; which you need to have as allies; and which you are direct competition with. A bit of stress in the system is not a bad thing.

Anon

Great idea but the established ones are not that

interested unless you bring a client base and complimentary skill sets.George Ryder

I think this would be a beneficial thing in practice, as it leverages the experience and knowledge base

of a wider population. This allows for cross fertilisation of techniques and thinking across industry segments, and also leads to innovation.

The core skills in improvement and change management are common, but the application of

these cannot be a ‘one size fits all’ approach some of the ‘Big 4’ would suggest by the industry segment that they are working with. An example of this is

demonstrated by one of the recent engagements we had, where we worked with two external

consultancy services (one from the ‘Big 4’ - let’s call them ‘X’ . The other ‘Y’ has worked with them for years). The topic was regarding spans of control in

the operation, and X suggested an approach similar to what had been recommended with other FS

clients they had worked with. This was ‘sold’ to senior stakeholders on the credibility of X’s brand - whilst Y looked at the proposition, and having

insight of the business understood that the model simply can not be applied wholesale across a group

due to the nature of the work and systems requiring support. The pilot area was not successful with the

proposition X put forward, but with some minor

tweaks that X, Y and my team came up with, we demonstrated benefit to adopting a revised model.

Had X and Y worked together and leveraged each others strengths, it would have saved significant time and cost, and improved credibility as well as

relationships.

Another example of cross pollination of techniques

used in different industries can be seen in recent breakthroughs in the oil industry - as a direct result of the techniques used in medicine for a number of

years, thus proven and just requiring some adaptation.

Not only is this industry based, but there is also an element of learning from R&D in multiple areas that can be used in a segment other than where it is

being investigated.

Finally, I would question how well global

consultancy firms utilise best practices from around the world in tackling the challenges faced by their clients, and whether there is an opportunity to

leverage internal best practice as a stepping stone to strategic alliances.

Kit Patel

I am a fan of alliances but most of the market is not. It fails to recognise that the sum of all parts is often

better than the one whole. David Oldroyd

They can work, but informal tactical alliances are quick and easy to set up. More formal alliances are a bit of a challenge - size does matter here! In large

organisations systems will tend to be against them as it can take weeks to put together a memorandum

of understanding, which does not interfere or conflict with another persons project.Andrew Wilcock

We haven’t seen the value of partnering with other consultancies. We have seen value in partnering

with specialists in other related parts of the eco-system - for example, sales trainers, digital marketing agencies, and telemarketing companies.

They are all part of the ‘whole product’ and are all practitioners rather than consultants.

Bob Apollo

17/ 29

Only works if it is blind to the customer and is often

needed to meet a requirement.Stephen McComb

These are a good idea if they are genuinely complimentary, deliver a saleable package and a product that is of benefit to the client. Quality of

service must be equally as good from all parties in the alliance. If the reasons for the alliance are for

geographic or resource availability reasons then the need to ensure genuine quality of service from all parties is very important. For the clients sake, such

alliances need to be properly and legally set up even if the partners feel relaxed about the

relationship.

The reputation of a good consultant can be effected by who they team up with. An alliance that really

combines complimentary services under one banner can be a Godsend to a client who doesn’t

want the problem of interface management, if it is well delivered and properly managed.

Management of the alliance’s services needs to be

through one focal point to avoid conflicting messages to clients.

A genuine alliance will be more likely to succeed than those consultancies who sell a wider service but in truth can not deliver. They can enable

flexibility of operations to suit the market if managed correctly and thus more opportunities.

Ian Luke

Can be very useful, but it is vital that the value proposition is very clear and that ‘2 + 2 = 5’ !

Anon

If you are in a good niche, alliances are less

important. If you are in an alliance, it needs to be tightly formed.Bruce Lewin

M&A is the way for bigger organisations. Niche consulting firms do collaborate.

Anon

I have discussed this with several people over the past few years, but one of the biggest stumbling

blocks seems to be ‘who leads’ and ‘under whose brand’ and what the different levels of charging may

be. At the end of the day, it may be that it comes

down to trust - which can only come over time.

Maybe it depends on how you classify a

consultancy: is it someone who merely advises, or is it hands-on in development of projects or even in terms of providing a service through their expertise?

Rob Hines

We should see the emergence of virtual networks to

compete with the big boys.Peter Jones

All in favour - it’s what we thrive on.

Alasdair Robertson

18/ 29

SUMMARY

WHAT DO YOU THINK ABOUT STRATEGIC ALLIANCES WITH OTHER CONSULTANCIES?

• Above all, parties MUST deliver to the same standards & share values. Otherwise far from achieving enhancement, reputation will be diminished.

• Beneficial, especially in the emerging ‘niche’ marketplace, as it can leverage experience & knowledge.

• Clear contractual arrangements help it run smoothly and manage expectations. BS11000 supports collaborative working, and a clear exit strategy at the beginning of the collaborative work (excellent guidance can be found at www.bs1100.com).

• Bad experiences have put some off, whilst others create informal alliances as needed.

Q: WHAT TRENDS DO YOU FORESEE OVER THE

NEXT FEW YEARS?

I see a big need developing in my area as the

economy refocuses on manufacturing, and manufacturing is returned to the UK. There are more people as say, Head of Division nowadays,

who are just saying ‘continuous improvement - here’s the cash now just get on with it’ knowing

full well the cost benefits will be huge.

As manufacturing organisations have trimmed back on manpower, I think they will start to use good

quality, effective consultants rather than permanent staff to develop their organisations

Stephen Murphy

A further move from generalists to specialists with a

closer client focus upon measurable value delivery.John Atkinson

More emphasis on practices who can work abroad

and are adaptable. More risk sharing. More results based charging typically for defined pieces of work/

projects. George Ryder

Local business investment hubs, business skills hub,

practice leaders emerging.Peter Jones

20 / 29

I think organisations will need to become much

more flexible and speed up the route to delivery significantly to compete in the market place, where

customer expectations are shifting more rapidly than at any point in the past.

With more ‘kick starter’ organisations/enterprises

challenging the status quo; and more ’24/7’ always on; and instant gratification expectations - there

will be wholesale shifts in business models.

No one will be allowed to ‘rest’ on market share/successes of the past (e.g. significant negative press

and drop in share price for Apple for not pushing innovation enough with the iphone5; Microsoft

loosing global organisations from their client lists for Windows and Office support; Blackberry dip as a result of not meeting the speed of delivery of

competitors).

As such consultancy services will also need to help

organisations develop and change their approach and model. The key challenge for an organisation such as LBG (who are not early adopters and

relatively risk averse) is how to move forward and drive that change at a group level, given all the

challenges it faces. This is where astute consultancy services will be truly able to add value.Kit Patel

Given that HMRC get to a position that is equitable for all, then consultancy and interim usage should

increase as more and more businesses concentrate on their core skills and contract out change related costs.

David Oldroyd

The relative importance of the cost of labour will

decrease further and faster in comparison to the importance of the cost and availability of capital, which may mean less work for off-shoring

consultants and more work for manufacturing consultants. However, our manufacturing tends be

very productive (Nissan & Toyota for example) so the number of jobs returning will be a fraction of those needed to complete the same tasks in China

or India. As many companies now have Lean or Six Sigma as their process improvement systems, and

this is being forced down the supply chains, the next big leap will come with the growth in advanced manufacturing strategies. These will

include additive manufacturing, robotics and bio-

engineering which will produce models which are totally new.

Andrew Wilcock

Companies will move away from large consultancies and will use smaller contractors.

Ihsan Al-Zanki

Niche consultancies with a clear focus and

accumulated knowledge and best practice will thrive.Bob Apollo

Less cash to waste but money to invest in things that really make a difference.

Mark Davies

For STORM the future is clear. We will further develop our business in Australasia and continue to

deal with valued clients in the UK and elsewhere.Martin Riddell

An increase in company outsourcing, thus more opportunity for consultants. A wider range of possible functions that a consultant could provide.

A greater need for consultants to be wary of their clients from the point of view of professional

indemnity cover, even for the very best in the market as there is a growing trend for a more critical outlook to be taken by clients.

A lot more IT related consultancy products/services. An increase in corporate governance aspects of

consultancy. Solution based services will be more in demand. Greater competition between consultants.

Ian Luke

Ability to respond to the large gaps that will appear

as organisations realise they have lost a lot of staff but still need to deliver. Therefore efficiency and productivity of existing resources is going to be a

key skill and sales message.Stephen McComb

Increase in SaaS. Opportunities from globalisation and virtual working. Impact of disruptive technologies.

Anon

21 / 29

More of what I’ve written in response to the

question ‘what changes in the marketplace have you observed in the last few years?’

Anon

Potentially more consultants come into play, especially on the technology front. Admittedly,

advances in this field are great, but will it end up having a long term benefit if in the rush to get

ahead, management practices and customer experience are not taken into consideration or even ignored.

For example, I recently had some interaction with a content marketing company trying to get me

onboard as a customer OR form my point of view as a potential marketing solutions provider for my clients, as I had expressed a real interest in finding

out more about them from either point of view. Needless to say the whole experience was in the

main unprofessional and disappointing, as they failed to understand where I coming from and were disjointed in their approach. A business crying out

for some consultancy but do they care enough to do something about it.

Rob Hines

Big players becoming less relevant.Alasdair Robertson

There will definitely be a place for consultancies working with good practice and flexibility. We will

have to show the gain in productivity, profit, service etc therefore value for money.Anne Morris

More overseas contracts & huge reduction in skills base (all disciplines).

Dave Beck

Agile approach to customer demand, scalable solutions as more and more global companies

struggle to save on costs; doing more with less.Anon

22 / 29

SUMMARY WHAT TRENDS DO YOU FORESEE OVER THE NEXT FEW YEARS?

• Continuing move from generalist to specialist.

• Niche consultancies with clear focus.

• More focus on ‘value’ and consulting fees being tied to results delivered.

• Changing business models and creative billing propositions.

• Overseas opportunities.

• Opportunities as organisations move forward, and feel the gaps of previous staff loses - the space being filled by consultants.

• An increase in software/technology/SaaS.

Q: WHAT ARE YOUR BIGGEST CONSULTING

CHALLENGES?Growing my business in the next two years and

expanding my customer base. I am planning to evolve my specialisation to serve the market.

Ihsan Al-Zanki

Being in the right place at the right time. Resisting the temptation to undertake work at which we do

not excel.Martin Riddell

The next role; job; introduction - and the huge footprint of the big players who try to be all things to all men and their dog!

Mark Davies

Cash flow, work acquisition, technical (digital/

mobility) refreshment.George Ryder

Enough hours in the day to deliver all the work we

are being asked for - long may it continue!Alasdair Robertson

Fee structure.Neil Morecraft

Balancing time working in the business as opposed

to on the buiness.John Atkinson

Finding the money - investors or corporates.Peter Jones

Convincing the clients of the need to change to

achieve their objectives.Stephen McComb

24 / 29

Making sure we continue to generate more revenue

from our expertise - and creating sources of long-tail revenue.

Bob Apollo

Growing profitability, but quickly. Comes down to striking the balance between capacity and demand.

Anon

Consistent service quality. As the big guys expand

and acquire they use their name to edge out the smaller competitors, putting pressure on the smaller guys to be more innovative and economic. Finding

the niche market/getting the ‘edge’. Getting in the door as the number of consultancies grows and

grows.Ian Luke

Time is the biggest challenge, and balancing this

resource between selling, enabling and delivering projects. In theory it would be simpler just to

concentrate on selling, but that would mean I wouldn’t add value to the client (and it wouldn’t be interesting).

Andrew Wilcock

Find ways to get a foot in the door. Getting clients

to focus on value. Transferring skills into new markets. Keeping up with change and selecting where and how to develop USPs. Finding alliance

partners with a desire to play a different game. Most tend toward initially accepting work together

and then try to undermine the relationship by abusing it.David Oldroyd

Getting the right people.Anon

The single biggest challenge is how to transform business processes on shoe-string budgets, after many years of Lean and Sigma based improvement.

There are ways to do this, but it requires the ability to clearly articulate a vision and strategy,

communicate effectively at all levels, and manage conflicting priorities on a scale not previously experienced. This has to be combined with the

ability to inspire and lead with trust and confidence as well as suggest/sell the ‘radical’ in a way that it

does not feel daunting to the audience. In addition to this, having the right mix of skills, knowledge

and expertise within the team to execute and

deliver on the plans is a challenge - when there is a finite resource pool internally and cost pressures to

limit external spend (learning from the external consultants, and sharing the learning where possible is a must). Ensuring that you drive

improvement in the consultancy team, up skill, and share best practice/learning across a diverse remote

workforce is also a key focus area. Kit Patel

Growth

Marco Busi

Getting leads in Scotland and developing business

here. I find the business environment very very conservative.Stephen Murphy

Ensuring the results of consultancy shows true improvements and value and the consultancy is

prepared to be evaluated.Anne Morris

Easy - always client culture and behavioural

change.David Beck

Building enough credibility and network presence to be noticed or offering a number of services to underpin consultancy, either internally or though an

umbrella approach involving carefully selected suppliers.

Rob Hines

Simple. Very few projects.Len Todd

Obtaining the number of high quality Lean consultants. I have found using the associate

network a far better way of selecting the capabilities I need. This can also be 50% more cost effective than using a well known consulting partner, who

also pull from the same pool. Marc Roberts

Managing the pipeline.Anon

25 / 29

SUMMARY

WHAT ARE YOUR BIGGEST CONSULTING CHALLENGES?

• Work acquisition and growth.

• Balancing time between developing business and servicing existing business.

• Managing the pipeline and cash flow.

• When the market is short on projects, resisting the temptation to do work that you don’t excel at.

• Fee structure.

SO, IN CONCLUSION...

• The market place is crowded and competitive, and those thriving will stand out by quality, expertise and capacity to

show ‘value‘.

• That ‘value‘ and the measurable results delivered will be tied to fees.

• Increasingly, knowledge transfer will become part of the consulting service, as will software.

• Technology will advance speed and process, enhance the client offering, and become part of the extended value-

package that includes knowledge transfer & software as a commodity to sell on.

• As the consultants ‘niche’ more and more, strategic alliances will grow if standards and values match.

• Natural worldwide market convergence - brought about by technologies - may see many more companies looking

beyond the UK.

• All sole practitioners and consultancies share common challenges with fewer and shorter projects, and balancing

time between developing business and delivering to clients.

• Growth was a challenge shared by all.

• Growth would seem to depend on all of the elements above.

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