Altran acquires cybersecurity and logistics consultancies

16 August 2017

Altran has completed the acquisitions Italian logistics consultancy NEXT Ingegneria dei Sistemi, and Information Risk Management (IRM), a UK-based company specialising in risk identification, management and mitigation, with services ranging from strategic information consultancy to software and professional education. The purchases come as Altran attempts to further consolidate on impressive revenue growth in 2016, through a campaign of aggressive expansion.

French multinational Altran saw consolidated revenues grow by 9% to more than €2,120 million in 2016, and the consulting firm has continued pushing to expand in the following year to further boost that growth. The consultancy, which then saw its growth lifted by the completion of five acquisitions across its network, has continued to look to an aggressive acquisition strategy to deliver this, with its global employee count fast approaching 30,0000.

Founded in 1999 and headquartered in Rome with operations across Italy, NEXT has a total workforce of circa 230 employees. The combination of Altran and NEXT will see these employees join Altran’s own pool of talent, enabling the delivery of end-to-end embedded hardware and software solutions to clients in the Defence & Aerospace sector. NEXT, an Italy-based embedded software company which primarily serves clients in the Defense, Aerospace and Rail industries, provides customers with advanced software products and services. Its client portfolio includes key industry players such as Leonardo, Telespazio, Thales Alenia Space and Bombardier Transportation. By obtaining NEXT, Altran hopes that it can re-inforce its position in the sector, which has seen it gain notable contracts including working in partnership with Rapita systems and Oxford University on aviation technologies.

Altran acquires information risk management

The acquisition of IRM meanwhile see Altran attempt to enhance its Cyber Security offering, as the firm seeks to make the most of increasing market interest in the prevention of cyberattacks. IRM already caters to a diverse base of commercial and governmental clients, including BNP Paribas, Telefónica, and even the UK Ministries of Defence, Transport, the Cabinet Office and GCHQ (including a strong alliance with its newly established UK National Cyber Security Centre (NCSC). However, Altran will hope the two firms combined can grow this portfolio even further.

Following high-profile cases such as the global WannaCry hack that hit NHS networks earlier in 2017, companies are increasingly keen to address emerging and highly demanding Cyber Security risks arising from trends around digital transformation and the large-scale use of technologies such as industrial IoT, and autonomous systems increasingly being thought of as essential to the future of business. Potential clients of Altran are also facing new and evolving regulations in Europe, such as the General Data Protection Regulation (GDPR), which could see FTSE100 companies fined as much as $5 billion at current rates of data breaches.

Headquartered in Cheltenham, IRM has a total workforce of 82 employees, including a senior management team featuring a high degree of experience within the information security risk industry. As a result, the co-founders Charles White and David Cazalet will remain in the business post acquisition, as Altran attempts to leverage their expertise to favour their client base.

Altran was advised legally on the deal by law firm Hogan Lovells, and on financial matters by Big Four firm EY, while IRM were advised on the M&A by Lincoln International, and on legal concerns by Harrison Clark Rickerbys.

Commenting on this acquisition, Dominique Cerutti, Chairman & CEO of the Altran Group, stated: "Cyber Security has become a global concern and an acknowledged priority for protecting the digital economy. It is key for the secure deployment of technologies around digital transformation, IoT, Industry 4.0 and autonomous vehicles. With the acquisition of IRM, there is a real opportunity for Altran to take a leading position in this space.”

Charles White, Co-founder and CEO of IRM, meanwhile added, "Altran and IRM have a shared vision to create a world class Cyber Security offering for the benefit of our clients and which will challenge and motivate our professionals as this exciting market evolves".

The deal follows the acquisition of Pricol Technologies earlier in the year, a deal aimed at boosting the firm's capability in the rapid prototyping space, adding around 520 staff to the firm as well as a number of proprietary technologies and processes.


Accenture's push into the creative sector is an identity crisis

18 April 2019

In its latest push into the creative sector, Accenture Interactive acquired New York and London-based ad agency Droga5 earlier this month, adding illustrious clients such as HBO, Amazon and The New York Times to its roster of clients. With the latest in a long line of similar purchases, Accenture Interactive further demonstrated its ambition of becoming the globe’s leading trusted advisor to chief marketing officers. Yet according to Ben Langdon, Chairman of Class35, Accenture’s strategy may be heading in the wrong direction.

A press release on Accenture’s website announcing the acquisition sits next to a quote stating that “brands aren’t built through advertising” – a huge contradiction from a consultancy firm hell-bent on becoming the ‘CMO agency of choice’. It’s not alone of course. The entire consulting industry wants a piece of the creative pie right now. In addition to Accenture Interactive, recent acquisitions by PwC Digital, IBM iX, and Deloitte Digital meant that in 2017, for the first time ever, four of the world’s ten largest creative agencies were consultancies.

So just what it is that Accenture wants to achieve from this? For one thing, it’s clearly trying to be a digital transformation business. A one-stop creative shop rivalling more traditional models, it wants to lure CMOs in with the promise of lower ad spend and a “more impactful customer experience”. At the same time, though, it’s still in thrall to those same slinky, shiny branding and advertising agencies it’s attempting to disrupt. The Droga5 acquisition and that of Karmarama a few years before are both testament to this.

There’s a fundamental problem with this, though. Digital transformation businesses don’t sell to CMOs. These people have enough on their plates trying to transform their own marketing skills in order to keep up with an ever-changing market – they just don’t have the time or the energy to concern themselves with digitally transforming a whole business. If Accenture’s purpose is digital transformation, then going after creative agencies is barking up the wrong tree.Is Accenture's push into the creative sector an identity crisis?

Worlds apart

Perhaps more importantly, these two industries are worlds apart in terms of the way they think. Creative agencies are all about ideas, campaigns and consumers. Digital businesses, on the other hand, are customer-driven – they think in terms such as lifetime value, measurement, and efficiency. Customer-led thinking is an entirely different beast to consumer-led thinking.

The reality is that the arrival of digital and an all-encompassing obsession with technology, measurement and social has led to the death of agencies in a reductive, zero-sum, efficiency-focused battle with brands. Indeed, agencies have become so obsessed with the latest tech fads, they’re beginning to forget how brands work. Worse still, they’re beginning to forget how brands are built. And, by forgetting, they’re destroying their own values.

Killing creativity

All things considered, it really feels to me as though Accenture is a chip leader in a game it doesn’t understand. Expensive acquisitions like these show that they’ve got the big money, but they don’t appear to have any idea what they’re doing with it. Take talent, for example. The best talent in the creative industry right now is out in the market; it’s not tied to any one agency. Both agencies might well be at the top of their game, but why would a consulting firm waste so much money on buying them when they could hire high-quality creative talent on a contingent basis instead?

As their presence in the top 10 creative agencies shows, there is a growing trend in which Accenture, like many of the other big players, are buying up agencies as if they were nothing more than keywords. What they’re really buying, though, is a collection of credentials, clients and IP. Unfortunately, the talent that created those credentials aren’t going to stay at the business, the clients that hired the agency in the first place won’t be interested in buying what is basically just another part of Accenture, and the IP never really existed to begin with.

Droga5, for example, was one of the few agencies that did great brand work the old-fashioned way – undoubtedly something that made it attractive to Accenture in the first place. The irony, though, is that by leading it further away from the way of working that made it so special, the consulting giant will kill its creativity.

“Accenture Interactive has been dazzled by its ambitions to become the CMO agency of record…. But, in flashing its cash, it is spending millions on acquiring nothing of any value.”

If pressed, the recently acquired agency staff at Accenture will tell you just how dysfunctional the new arrangement is. They’re largely unfulfilled. Rarely do they feel their work has any sort of meaning or purpose. What’s more, the different disciplines have found little or no common ground, and find it hard to work together as a cohesive whole. It’s not surprising, then, to see talented people leaving in droves.

Beyond the window dressing 

It’s clear, then, that consulting firms and creative agencies are no easy bedfellows. But in his company’s defence, Accenture Interactive’s Senior Managing Director for North America, Glen Hartman, described its culture as being “far, far away from what a stereotypical consulting firm would look like. Our office and studios look a lot like Droga5’s.”

In demonstrating a belief that office design equates to workplace culture, this statement serves as an illustration of how confused Accenture is right now. It wants to justify its new strategy so badly, it’s started dressing like a creative agency. But if you look beyond the window dressing and see that you and your partners are speaking a different language with a different purpose, selling to different people in a different market, there’s no getting away from the fact that you’re different.

Accenture Interactive has been dazzled by its ambitions to become the CMO agency of record, and it wants to dazzle others with its new direction. But, in flashing its cash, it is spending millions on acquiring nothing of any value.

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