Steward Redqueen: Coca-Cola important to Croatia

11 October 2013 Consultancy.uk

Coca-Cola has over the past decades not only built itself a vital position within the community, in some countries it has also become a key driver of the economy. A new study from consulting firm Steward Redqueen shows that the famous beverage brand has over the past 18 years created 7,400 local jobs and contributed circa €4.4 billion to the Croatian economy, this comes down to an average 0.9% of the total national GDP in this period.

Socio-Economic Impact Study

In September 1968 Coca-Cola opened its first operations in Zagreb, Croatia’s capital city. Between then and now, it has grown its local presence significantly, currently employing 540 people divided in 2 plants. In honoring its 45 years jubilee, Coca-Cola decided to perform a Socio-Economic Impact Study on its Croatian operations. Based on previous successful working relationships with Steward Redqueen in The Netherlands, Italy and the UK, the Dutch-based consulting firm was hired to perform the analysis, in cooperation with Ethan Kapstein*.

The study, which took nine months from preparation to final report, shows that Coca-Cola contributed 33.8 billion HRK to Croatia’s overall economy over the past 18 years, which constitutes approximately 0.9% of the total national GDP in this period. The consultants quantify that out of every HRK spent on Coca-Cola, as much as 90% remains in Croatia. The direct contribution to the Croatian economy is value at 125 million HRK in taxes and 554 jobs and its indirect effect is much larger.

steward redqueen Coca-Cola

Two examples: For every 1 HRK Coca-Cola directly contributes, it indirectly contributes another 9 HRK to GDP, and for each job at Coca-Cola, the company provides another 12 jobs in the wider economy. “When I see how much Coca-Cola contributes to employment, it makes me want to drink more Coca-Cola” said the Croatian Minister of Entrepreneurship Gordan Maras after seeing the results of the in the research report.

Societal responsible entrepreneurship

In addition to the economic benefits, the consultants point out several other important contributions. The Coca-Cola system boosts knowledge transfer to local organizations and promotes local entrepreneurship in associated business domains. MVO is another key area. “Coca-Cola sets the right example in the local economy by promoting corporate social responsibility, investing in the education of its employees and organizing sports and eco projects for children and young people” said President Josipović.

Business Forum

The results of the study were recently presented in a special Business Forum that took place at the end of September in Zagreb, which was attended by key representatives from economic, political and non-governmental sectors, including the President Ivo Josipović. 

* Ethan Kapstein is a specialist in international economics. He currently is a professor of International Affairs at Arizona State University and is a well-known author in the field of economics and international relations. Over the past years Kapstein has been a consultant to many private and public sector organizations, including Coca-Cola.

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Project management industry adds £156 billion of value to UK economy

15 April 2019 Consultancy.uk

Project management has grown into one of UK’s largest areas of business over the past decade, amid the increasing ‘projectification’ of work. With the gross value added to the UK economy by project management estimated to be £156 billion, this trend is likely to continue in the coming era.

Despite the huge success of project management in recent years, until now there has been relatively little data available on the size of project activity. As a result, there has been a great deal of debate on things like the number of people involved in the sector, the number of projects, and how it contributes to economic output. Due to this need for clarity, APM, the UK’s professional body for project management (the largest organisation of its kind in Europe, with 28,000 individual members) commissioned economists from PwC to shed light on the industry's economic impact.

The research concluded that the profession makes a more significant contribution to the UK economy than the financial services sector. 2.13 million full-time equivalent workers (FTEs) were employed in the UK project management sector, generating £156.5 billion of annual gross value added (GVA). In comparison, the financial services sector contributes £115 billion, and the construction industry adds £113 billion.

Gross value added to UK economy

Commenting on the discovery, Debbie Dore, Chief Executive of APM said, “Project management runs as a ‘golden thread’ through businesses, helping to develop new services, driving strategic change and sector-wide reform.”

Who is a ‘project manager’?

To reach these estimates, PwC’s researchers used detailed models to map out the value of project management activity. They ultimately defined relevant ‘projects’ as “temporary, non-routine endeavours or rolling programmes of change designed to produce a distinct product, service or end result… [with] a defined beginning and end, a specific scope, a ring-fenced budget, [and] an identified and potentially dedicated team with a project manager in charge.”

Building on this, they then went on to define what the act of project management actually is. The job consists of applying “processes, methods, knowledge, skills and experience” so that clients can meet their objectives and bring about planned outputs or outcomes. The analysts added that this includes “initiating the project, planning, executing, controlling, quality assuring and closing the work of an identified and dedicated team according to a specified budget and timeframe.”

Importantly, it should be noted that the profession is not exclusive to only roles explicitly labelled as ‘project manager’, but to any role where specialist project management skills are used. This means that across sectors these roles can have very different titles, from the self-explanatory contract managers of procurement, or the campaign managers of advertising, to the likes of festival co-ordinators in the events sector, and many more. The roles in question also span all strategic levels of the profession, from strategic to tactical and operational positions.

Gross value added of project management profession

From a sector perspective, the financial and professional services, construction and healthcare industries make up almost two-thirds of the total project management GVA. At the same time, understandably, the UK Government has a huge project portfolio, which further drives the size of the GVA the sector contributes, thanks to megaprojects like HS2 and Crossrail.

Commenting on this to the report’s authors, Oliver Dowden, Minister for Implementation remarked, “Project delivery is at the heart of all Government activity, whether it’s building roads and rail, strengthening our armed forces, modernising IT or transforming the way government provides public services to citizens. Getting these projects right is essential if we are to ensure that we build a country that works for everyone.”

Throughout 2019, 26 major government projects were delivered, representing a fifth of the overall Government Major Projects Portfolio (GMPP) of 133 projects. According to the IPA annual report 2017-18, these represented a whole life cost of £423 billion. In addition to this were a plethora of smaller scale projects, and those in early development.

Elsewhere, with the increasing digitalisation of the economy impacting entities of all shapes and sizes, IT and digital transformations tended to dominate the projects of the UK scene alongside new product development projects, with a respective 55% and 46% of organisations in the research sample having undertaken these types of project in the past year. At the same time, this varied across sectors, and unsurprisingly, in the construction and local government sectors, fixed capital projects were the main project type undertaken.

Outlook

Looking to the future, 40% of business leaders expect project management will grow in the coming years due to the increased use of projects – or the ‘projectification’ of the UK. In a trend that has been witnessed elsewhere, organisations have to rapidly and continuously change in the digital age of business, driving the need for project management.

Outlook for project management services

An increased focus on value over cost – especially in the construction sector – and a forecast increase in the number of international projects are predicted to be key drivers of growth, according to the expert contributors. However, this will not happen in the absence of challenges; more than half of organisations expressed concern over the perceived impact of political uncertainty in the UK. Skills and capability shortages were also cited as a potential barrier by a third of organisations.

With regard to budgets, meanwhile, a third of those surveyed by PwC said they expect the size of project budgets will increase in the coming three years, while 40% anticipate a growth in project size. As the profession continues to mature, and as the recognition of the importance of good project management grows, it is expected that a greater proportion of project work will gain more distinct attribution to the profession itself, giving more recognition and appreciation to the role of the project manager.

Speaking on the findings of the study, Sandie Grimshaw, a Partner at PwC, concluded, “The project management profession is relatively new compared to some other professions, such as lawyers, teachers and doctors. However, as project management is a core competence vital to organisations in the UK, the profession is critical and will continue to grow in stature.”