2014 will go into the records as a positive year for the UK management consulting sector. More than 90% of firms have either met or exceeded their fee income expectations for the year, with around half saying that their fee income is markedly up, according to a survey from the MCA.
Every year the Management Consultancies Association (MCA), the representative body for management consultancy firms in the UK, conducts research among its members to gain insight in key market developments. Its latest report – titled ‘End of Year Report 2014’ – reviews performance in 2014 versus previous forecasts, and looks at predictions for 2015 growth. The study is based on the feedback of MCA members (roughly 50 firms), which according to the association employ around 35,000 consultants and represent 60% of the UK consulting market.
The statistics reveal that consulting executives are buoyant about growth. Demand was particularly strong in financial services, retail and public services, in terms of volume three of the larger segments within the industry. Infrastructure was another fast growing segment: 60% of consultancies recorded an increase in infrastructure advisory – 20% marked and 40% slight. From a functional perspective, Digital was a key driver, and is “booming according to the MCA”, with over half (52%) of the consulting firms indicating a marked increase in digital advisory work.
As a result of the positive market developments, almost all (92%) of the MCA member firms reported that they had met or exceeded their fee income expectations for the year, and in around half of the cases the increase was marked. Based on the positive developments, the MCA concludes that “consulting may have achieved double digit growth in 2014”, although definitive numbers will only be available next year. In 2013 the MCA members grew by 8%.
Going forward, three quarters of consulting firms report that market conditions are good or excellent and a similar number anticipate rises in consultant numbers, with half saying that this rise will be marked. In addition to the strong performance in digital and overseas work, the authors says that increases in operational consulting, business transformation and change management work are positive indicators of an increasingly active economy. Next year all MCA member firms expect to grow slightly or markedly, an outlook which has not been so positive in many years.