Simon-Kucher & Partners revenues break through €250 million barrier
One year after breaking the barrier of 1,000 employees, Simon-Kucher & Partners has reached another major milestone: a turnover of more than €250 million. The most important driver for the firm’s global growth is the demand in the area of digitisation in line with the broader developments in the consultancy market.
Over the past year the strategy and sales & marketing consultancy added more than €10 million in revenue to take its tally to over a quarter of a billion. This is the first time that the milestone has been reached by the firm, and one that was announced and planned for years ago. Simon-Kucher & Partners was founded in 1985 in Germany, and today has over 1,100 employees across offices in 23 countries.
In particular, the industries Software/Internet/Media, Financial Services (Banking and Insurance), and Consumer Goods/Retail contributed strongly to the growth in 2017. In all, these sectors’ digitisation was a main topic on the agenda.
“These sectors are particularly involved in digital transformation. Many companies are seeking answers to the coming disruption. Our consulting services are in extremely high demand in this arena,” said Georg Tacke, CEO of the consulting firm.
According to a recent study from Simon-Kucher & Partners, the majority of digital transformations fall short of achieving topline growth. With 67% of all industries finding themselves in the midst of a price war, as many firms see deteriorating margins due to heightened competition, such wasted potential can be the difference between success and failure for an organisation’s future growth prospects.
Interestingly, while consultancies are hired to advise on digital transformation to help clients better monetise commercial opportunities, a study by 9Lenses found that the industry itself has a challenge. While nearly 8 in 10 firms in the industry now offer digital services, 57% of those indicated that a digital approach has only somewhat, or not at all, enabled them to win more business, as the consulting sector struggles to leverage new technology for itself, despite advising others on how to implement it.
However, Simon-Kucher has seen a glut of work, being hired to work on sales, pricing and marketing, offering holistic end-to-end services from strategy to execution, to help clients realise the true possibilities of their digital transformation.
From a country perspective, the offices in Latin America and Asia saw the steepest growth curve. According to Tacke, “Compared to the United States and Europe, the consulting market in these regions is still relatively small, but we are expecting to see substantial growth this year.”
In Europe, the Nordics and the United Kingdom (Simon-Kucher is one of UK's top 50 consulting firms) contributed in particular to the firm’s successful business performance. “We haven’t seen any negative effects from the Brexit decision whatsoever,” Tacke added. The Dutch office, which is based in Amsterdam, was equally one of the star performers, growing its fee income by 28% compared to the previous year.
Future plans
For 2018, the plans of the consultancy firm are to push for further growth. International expansion wil continue with the opening of new offices in Chicago, Shanghai, Mexico City, and Cairo, with the latter marking the first on the ground presence in the African market. “For 2018, we expect strong growth. Order volume is up by over 20 percent from this time last year,” remarked Tacke.
The CEO, who joined Simon-Kucher just three years after its founding and has been leading the company since May 2009 (from 2009 to 2016 together with Klaus Hilleke), expects that the most important growth driver will continue to be digitalisation. Tacke added, “Until now, companies have approached digitalisation primarily in terms of technology, IT, and technical feasibility. In the future, businesses will have to focus more on delivering customer value and monetising innovative digital products.”
With the anticipated growth in 2018, the consultancy expects to add 300 professionals this year and near a revenue base of €300 million by year end.
