The new market of insurgents in UK's consulting industry

24 January 2019

Since Arthur D. Little – the world’s oldest management consultancy, was founded in 1886 – firms have repeatedly executed a similar model, striving to land it in a better fashion than their predecessors and competitors. According to Ross Robinson, a Director at “challenger consultancy” Ignata Consulting, the business model of management consulting has basically not changed in more than 100 years. Below, Robinson reflects on how new market insurgents are reshaping the industry.

Although an industry now worth over £180 billion globally, of which around £10 billion sits in the UK alone, the consulting industry is now becoming subject to significant displacement and challenge. Facing an array of new threats, ranging from technology advances to the controversial Brexit, the traditional consulting model as we know it is now full of uncertainties, and in turn has left itself wide open to disruption. 

As I and many other consultants and clients witness, project after project, cracks in the facade are starting to show. Gradually but surely, the traditional consulting model we had all come accustomed to is becoming more fragile than agile. With a sea of sameness and entrenched in longstanding, outdated and over-bureaucratic structures, it now faces a number of new challenges, one of the largest of which, starts from within… The individuals and expertise that once formed its backbone and drove its lucrative revenue streams are dispersing, in-turn creating market of insurgents. Such network organised firms or groups of independent consultants consist of highly-skilled individuals who are able to offer clients a more dynamic, versatile and value-driven engagement style.

The new market of insurgents in the consulting industrySome refer to these ‘rebels’ as the white collar gig economy. Until recently the gig economy was often associated with low-paid, insecure work, with millennial hipsters and brands such as Uber and Deliveroo springing to most minds. However, a ‘professional gig economy’ is thriving in the background and, although very much in stealth mode, it is changing the face of management consulting as we know it, with an increasing number snatching work from right under the noses of the industry giants. In the UK economy alone, it is estimated that over a fifth of UK management consulting projects are attributable to independent consultants – accumulating in a sum of over £2 billion and growing.

This untapped and often overlooked opportunity, which many would argue is hiding in plain sight, is gaining traction at pace, with business leaders seeing it as a welcome alternative to the over-political, body-shaped, partner models that had come too accustomed to. With a growing independent workforce of highly experienced, and often entrepreneurial professionals [the UK counts 2 million freelancers], these leaders can now tap into an increasingly dynamic, effective and value-driven talent source, which ultimately provides them with greater control, flexibility and an increased ease of contracting – pulling in exactly the right expertise, as and when they need it. 

This changing dynamic also presents new opportunities for the individual practitioners that are fuelling this movement. As specialists, high in knowledge-capital, and usually ones to demand autonomy and flexibility, they now find themselves in a market where opportunity is rife, however having spoken with a wide array of people in this position, fighting down the doors isn't always that easy and they face a number of early-market obstacles.

How do clients source independent consultants?

Leaders lack confidence or familiarity with this new market

To fully embrace these on-demand independents, business leaders need to be sure they are getting the right skills, at a competitive price. But increasingly important is also ensuring they are the right fit for the organisation. At present, according to Source Global Research, quality control is the number deterrent for using independent professionals – with business leaders sometimes viewing this route as high risk. 

Leaders face red tape and outdated policies

Many organisations lack agility across their hiring and resourcing functions, with outdated processes and complicated hiring arrangements. Leaders often tempted to challenge the norm face significant red-tape. This in-turn means effort over reward becomes questionable. Unfortunately for those keen to rock the boat, evidence then shows in order to limit risk they constrict their search to their immediate network – in turn comprising their opportunity to get the very best person for the task in hand.

Independents & their sales pitch often lack shazam

Although independents are responsible for their own success, their go-to-market strategy often lacks the conviction, polish and content it needs to subtly catch business leaders attention. Whether down to lack of time, research, preparation or creativity, independents need to remember they are often up against larger entities, existing relationships and are playing into a hugely competitive, and very new market. To grab attention and deter leaders from their normal habits they need a serious lump of Shazam!

Like all market evolutions, there are some growing pains, however this changing dynamic means those organisations who are willing to kibosh the red tape and capitalise quickly on the insurgent market, unlock the opportunity to dramatically change the way their organisations utilise talent to operate. With access to undeniably the biggest on-demand talent pool available, they have the potential to dramatically transform the way their organisations do business.

Related: Firms concerned about growing competition from boutiques and independents.

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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.