Consulting market of Germany grows to €25 billion

03 March 2015

The German consulting market has grown by 6% last year to a value of €25.2 billion, reveals recent research form the German association of management consulting firms. For 2015 the outlook is even better, with a growth of 7% forecasted on the back of growing demand for advisory services and a number of booming domains such as digital and financial services.

According to the BDU* – the German counterpart of the Management Consultancies Association (MCA) in the UK, the German management consulting industry employs around 106,000 consultants, housed by roughly 15,400 consulting firms. The total workforce in the industry is said to be around 130,000.

Over the past decade, the German consultancy market has consistently grown in size, to its current value of €25.2 billion, making it the second-largest consulting market in Europe, after the UK. Ten years ago, in 2005, the market was estimated to be worth €13.2 billion, and following strong back-to-back growth the industry reached €18.2 billion prior to the outbreak of the financial crisis. Similar to other European advisory markets, 2009 was a dark year for the industry, though in the case of Germany the damage was limited to a contraction of 3%. Since, the German consulting market has recovered, and more recently has been steaming ahead – last year the market grew by 6%, and this year a growth of 7.4% is forecasted.

Size of German Consulting Market

Positive outlook
Looking ahead, BDU’s research shows that executives in the industry are buoyant about growth, painting a similar picture to that brushed by their UK counterparts two months ago in a study by the MCA. Only one in ten consulting firms expects a drop in sales, with the majority of companies stating they expect revenues to increase. Middle sized consultancies are the most optimistic, on average believing they will attain a growth rate of almost 10%. 

From an industry perspective, the financial services (+8.1%) and energy and utilities (8.0%) sectors are forecasted to be the key growth drivers. Digital – a market which is booming globally – is not surprisingly the main functional area driving growth, the overlarge majority of the participants expecting related revenues to rise. The boom will have repercussions for thought leadership strategies, however, with three-quarters of consulting firms highlighting that so-called ‘Digital Labs’ and/or digital research think tanks will increase. 

Consulting firms
The German consulting market is dominated by a number of globally familiar names, including the likes of the Big Four, as well as Accenture, BearingPoint and Mercer. In the strategy consulting segment the market is led by the five US-based global market leaders (McKinsey, BCG, Bain, Strategy& and Oliver Wyman), however, the German based Roland Berger and Simon-Kucher & Partners have substantially larger market shares compared to elsewhere across the globe. The German market also boasts several names that may be less familiar internationally, yet in the DACH region (and in the case of some, also beyond) belong to the established pack. An overview of the 10 largest German origin consultancies**.


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- New strategy of Roland Berger aims to triple size 

It is important to keep in mind that associations and analyst firms use different definitions for defining the management consulting market. According to Kennedy for instance, the German consulting market is worth around $14 billion, while UK analyst firm Source values the market at just under $6 billion. In the case of the latter, the scope centres around the market for the ~top 250 consultancies, with both Kennedy and BDU using a broader scope.

* BDU = Bundesverband Deutscher Unternehmensberater.

** The overview presents global revenue and total number of consultants.


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.