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  Alan Leaman, CEO of the MCA, discusses MCA’s newest report Consulting in 2013.

MCA members expect 2013 to be markedly better

LONDON — In a new MCA research report published this week, Consulting in 2013, around a third of member firms told us that they expect their fee income to be ‘markedly up’ in 2013. A further 43% predicted that they will grow by up to 5%. At this stage, we expect the revenues of the whole UK consulting industry to grow by around 5% this year.

These growth rates are modest when compared with the regular double digit expansion that was achieved prior to the financial crisis of 2007-08. But they are still impressive in the current context of sluggish growth in UK GDP and continuing low levels of investment in the economy as a whole.

It is important to remember, as well, that this growth has been achieved despite a particularly rapid decline in public sector consulting work, down according to our data by around a third since its peak. Management consultancies have proved to be extremely adept at responding to this turn-around. The UK’s consulting industry has a lot to be proud of in its recent performance.

How are UK-based consultancies managing to battle against these headwinds? Our report suggests at least two answers.

The first lies in their growing ability to win work and expand overseas. We expect this to continue in 2013 and beyond. Consultancy will find opportunities wherever business change is rapid and the barriers to entry are not too steep.

At the same time, the onward march of technology is improving the ability of large client organisations to operate in a truly global way; increasingly they want to see products and services delivered to consistently high standards across the world, while also delivering economies of scale and the benefits of a consistent approach to change and performance improvement.

We anticipate more opportunities for UK-based consultants to work on international projects that enable global companies to deliver these step changes in performance.

This continuing rise in the significance of technology is shaping another driver of consulting performance. In a recent IBM survey of CEOs, technology was ranked as the most significant external influence on business success over the next three years. The MCA’s own research of consultancy buyers, conducted for us by Research Now, suggests that getting the use of IT right remains the largest reason for purchasing consulting services.

2011 saw significant growth in IT consulting in the management consulting industry. We expect this growth to have continued through 2012 and to be reflected in the industry’s 2013 performance.

The adoption of new technology, together with the seamless co-ordination of existing technologies, is driving improvements in business performance and customer service. An external perspective or implementation programme can be invaluable. Business and IT are now inextricably linked and consultancy is making it happen.


Consulting in 2013 is available for staff at all MCA member firms to download free from the MCA website. It can be purchased by non-members. (www.mca.org.uk/research-reports)

__________________________
Alan Leaman is CEO of the Management Consultancies Association (MCA), the voice of management consultancies in the UK. With over 55 members the Association’s memberships comprises around 70% of the UK consulting industry, estimated to be worth £8bn in 2009, employ more than 40,000 consultants and work with over 90 of the top FTSE 100 companies and almost all parts of the public sector.

 
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