Wavestone acquires UK's fast growing IT consultancy Xceed Group

06 April 2018 Consultancy.uk

International consulting firm Wavestone has acquired Xceed Group, a fast growing technology consultancy with sixty employees across offices in London, Edinburgh and New York. 

On Wednesday, Wavestone reported that it was close to bolting-on a major player in the UK, which would significantly bolster its digital proposition. Now, two days down the line, the acquisition has been confirmed by Reza Maghsoudnia, Wavestone’s Director of Strategic Development. “With this merger, Wavestone not only bolsters its footprint in London and New York, but also enhances its ability to address global programmes. Xceed also enriches Wavestone’s client portfolio with complementary global accounts across the finance services industry.”

Established in London in 2003, Xceed Group is a technology consultancy specialised in implementing large IT transformation programmes for major financial services organisations. Its services revolve around the planning and delivery of complex IT change programmes, and include offerings such as managing digital transformation, modernising banking platforms, enhancing IT infrastructures, IT sourcing and business-IT alignment. Xceed Group focuses on the financial services industry (accounting for 80% of its revenues), serving banks, insurance companies, asset managers and financial data processors, among others, both in the UK and internationally. 

Wavestone acquires Xceed Group

For Wavestone, the deal marks another strategic move in its ambition to realise an ambitious plan for Wavestone 2021, when it aims to become a pan-European consulting firm positioned in the top tier segment of the consulting industry. “This acquisition accelerates our international development,” said Maghsoudnia, “and will play a key role to enrich Wavestone’s value proposition in the UK and the US.” In the UK, Wavestone launched in 2015 when it acquired Hudson & Yorke, while in the US, the firm launched organically under its former umbrella Solucom, but accelerated significantly when it acquired a large share of Kurt Salmon. A year later the group, which now has 2,600 consultants globally, rebranded as Wavestone

UK and US offices

As part of the deal, Xceed Group’s 60 employees – of which the vast majority is located in London – will join Wavestone’s offices in the UK capital and New York. The Flexible Infrastructure Managed Services (FIMS) business of Xceed Group has been excluded from the deal, as the unit has been carved-out from the group and retained by the current shareholders of Xceed Group. The current leadership of Xceed Group – Andy Boyes, Jim Hennigan, Sridhar Vedala, Stuart Riley and Tariq Surty – will remain in their management role, and report to Wavestone’s Managing Partners in the UK and France, where the international consultancy is headquartered.

To ensure a smooth integration into Wavestone, John Casserly, the CEO of Xceed Group, and the other shareholders of the company, will support the merger during a 6 to 12 month transition phase. Commenting on the joining of forces, Casserly said it was a fantastic opportunity for the firm, as Xceed Group will be able to benefit from a larger business force, with a greater international dimension. “This is really good news for Xceed's clients and staff. The two companies provide complementary services and share a common footprint in the financial services sector.  Wavestone have an exciting growth plan and I am very pleased that the team at Wavestone recognises the part that Xceed can play in that plan.”

Earlier this year, Xceed Group celebrated its third consecutive year in the Sunday Times Lloyds SME Export Track 100; a list that ranks UK’s top 100 SME’s with the fastest growing international businesses. Looking ahead, Casserly highlighted that the IT firm has “huge ambitions” to grow as a business. “We are continuing to help our clients to deliver technology enabled business change in more and more locations both in the UK and internationally.”

Wavestone is listed on Euronext Paris. The £13.3 million revenue-base of Xceed Group will be incorporated into Wavestone’s books for the 2018/2019 financial year. Meanwhile in France, Wavestone was recently named the best consulting firm to work for in the country, ahead of the Big Four and other major rivals.

Related: Wavestone leverages unique culture and agility to fuel further growth.


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

18 April 2019 Consultancy.uk

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.