Large advertising firms likely prey for consulting and IT giants

19 May 2017

One of the top six advertising groups is likely to be purchased by giants in management consultancy or IT, who are increasingly encroaching on the lucrative advertising market, according to a mergers and acquisitions adviser.

The prediction comes in the wake of the high-profile acquisition of Australian creative design agencies The Monkeys and Maud by consulting and technology firm Accenture, and is a sign of things to come in the words of Ben Tolley. Tolley, a partner at Clarity, the company which advised the sister design firms on the deal, recently stated that he expected bigger acquisitions to follow over the coming years, with global systems integrators and IT firms growth “compared to the relative size of the ‘big six’ minnows" who make up the world’s largest ad groups.

The largest of these, WPP, is half the staff-size of Accenture, whose stock market capitalisation is also more than double that of the ad-firm. The other ‘big six’ firms – Omnicom, Publicis Groupe, Interpublic, Dentsu and Havas – are significantly smaller companies, making further M&A activity an inevitability remarked Tolley. The push from the consultants follows changing client demands for integrated digital services, as well as dynamics in the professional services industry including globalisation and blending of service areas – Tolley added that the growing capacity of professional service groups to utilise technology to make the best use of market data means their role is becoming increasingly similar to ad agencies.

“There’s a certain amount of wishful thinking on the part of the marketing services firms about there being a culture clash between the consultancies and system integrators and software companies on the one hand and creative businesses on the other,” Tolley claimed. “The reality is what those firms [in management consulting and IT consulting] are doing in marketing services is very similar,” he said.

Large advertising firms are likely prey for consulting and IT giants

Golden Monkeys | Maud

Based in Sydney, The Monkeys agency has been praised for innovative design and campaigns over the past decade, most recently receiving an award for 2017 APAC Creative Agency of the Year by Mumbrella, Australia’s leading marketing publication. The group were also past recipients for Agency of the Year from AdNews, B&T, Campaign Asia, Campaign Brief, among others. Its team of 130 employees have been behind a slew of breakthrough brand campaigns in the region, including Telstra’s: Thrive On; Meat and Livestock Australia’s You Never Lamb Alone and, most recently, QANTAS’s Dreamliner launch. 

Their acquisition, along with sister company Maud, meanwhile builds towards Accenture fortifying the firm’s role in the ad market, through its campaign and design wing Accenture Interactive (AI). The new deal will bolster AI’s full suite of digital customer transformation services, which the company provides to chief marketing officers and chief digital officers, as the group hope to supply creative solutions in design, marketing, content and commerce.

“The Monkeys has created provocative ideas that have redefined the industry and delivered innovative customer experiences,” head of Accenture Interactive Australia and New Zealand, Michael Buckley, confirmed, “This acquisition further differentiates Accenture Interactive as a new breed of agency providing CMOs with innovative thinking and a new set of connected capabilities to win in today’s experience-led economy.”

Accenture’s move builds on several previous bolt-ons in the advertising field, including the purchase of Belgium-based design firm Kunstmaan, German creative agency SinnerSchrader, Dutch mobile agency MOBGEN, and UK creative agency Karmarama last year. With the ‘Big Four’ accountancy and consultancy firms PwC and Deloitte are also building large advertising presences, among others, reportedly worth over $750 million and $1.6 billion respectively, advertising groups will undoubtedly continue to be considered desirable assets as the firms seek to effectively exploit this new front.

Related: Space between consulting firms and creative agencies is converging.


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First Consulting helps BDO to build new RPA capability with UiPath

22 March 2019

Global accounting and consulting firm BDO is working on its own digital transformation, as it looks to pioneer the use of Robotic Process Automation in its work. Business consultancy First Consulting is helping BDO with designing the RPA journey and building its internal RPA capability.

Robotic Process Automation describes a process that utilises software programmed to autonomously carry out basic tasks across applications, reducing the burden of repetitive, simple tasks on employees.  Able to be developed and deployed in a matter of weeks, RPA is highly cost-effective and can typically demonstrate returns on investment within a few months. It has been known to dramatically improve the speed and accuracy of processing, resulting in a quicker and higher quality of service to customers.

Last year, BDO explored the value of Robotic Process Automation, concluding the technology has the capacity to bolster the firm’s service offerings as well as internal operations. On the back of this analysis, the professional services firm incorporated RPA into its ICT strategy for the coming years. This has already seen the first robot delivered at BDO, which has since been taken into use by the business.

First Consulting helps BDO to build new RPA capability with UiPath

First Consulting is advising BDO on all aspects of deploying and scaling up the technology across the organisation – from capability building, governance structure and processes to architecture and IT infrastructure. The joint team of BDO and First Consulting have, meanwhile, also taken the first steps to set up an internal RPA capability.

BDO faces a key year for its operations, particularly in the UK where it has recently become the fifth largest provider of audit and advisory services in the country. As the firm looks to further grow its junior auditing market lead over the Big Four, the effective deployment of innovations such as RPA could prove key in the coming period.

With RPA on board, BDO’s ICT department aims at increasing the satisfaction of employees by removing a range of often boring (repetitive, administrative) tasks. By automating such tasks, productivity can also be increased at the professional services firm, as its staff will be freed up to spend more time performing value-adding activities. On top of this, RPA can execute tasks and processes with a lower margin of error compared to humans, enhancing BDO’s internal operations.

Working with RPA vendor UiPath, during the project at BDO, First Consulting has sought to apply its best practice RPA growth model methodology. The approach differentiates between three different growth phases, starting with RPA, structuring RPA, and scaling RPA.

Project results are delivered through an agile approach. According to the engagement partners, the following results were achieved in a period of six weeks:

  • Developed a first robot process that directly creates value for the business and contributes to the 360 degree customer view by migrating information from two systems to another system;
  • Advice and implementation plan on the technical design in relation to RPA, ICT guidelines, a security questionnaire and a basic infrastructure;
  • A roadmap for setting up an internal RPA capability, including the following components: processes & governance, change management and capability building & training;
  • Plan for setting up benefits tracking / monitoring as well as reusability of robot process components.

So far, First Consulting and BDO have enjoyed a pleasant and productive cooperation, achieving “tangible results” along the way. According to First Consulting’s team engaged by the project, the close match between the firms’ norms and values proved a key success factor. In the coming period, First Consulting and BDO are investigating opportunities to develop a digital capability in other areas of BDO’s business.

Roel van Overdam, Head of RPA at First Consulting, said of the collaboration, “Our pragmatic, no-nonsense approach has clearly paid off.”

Related: First Consulting: Is RPA implementation going in the right direction?