Dutch management consulting market shrinks to 1.17 billion

02 June 2014 Consultancy.uk

The Dutch consulting market has over the past contracted with roughly 0,5%. For the coming year the outlook is slightly positive, although the recovery will be significantly lower compared to neighbouring countries such as Belgium, Germany and the UK. These are the key conclusions from an analysis of Consultancy.uk based on recent market data.

Every year analyst firm Source looks into the state of the Benelux consulting market. The researchers look at the development of the market size for each of the three countries and the key developments per industry, functional area and firm type*.

According to its latest report, released last Friday, the Benelux consulting market has stabilized over the past year at roughly €1.87 billion. With a share of 62% The Netherlands is the largest market in the region, followed by Belgium (€625 million) and the tiny Luxemburg (€77 million).

Benelux Consulting Market

From a sector perspective, three sectors managed to book growth: Healthcare, Financial Services and Pharma and Biotech. Expertise areas that performed well are financial consultancy, technology and operations. The field of HR and change management faced for the second year in a row the largest contraction: -2.9% last year and -8% in 2012.

Benchmark

With a total value of €1.167 billion, the top of the Dutch management consulting market equates to just over 3% of the US market and nearly one-fifth of the UK market, Europe’s largest base for consulting firms. Yet looking at the performance over the past years, the Dutch market is underperforming its peers in terms of growth. While major Western consulting markets such as the US, UK, Germany and the Nordics have found their way back to growth, the market in The Netherlands has contracted for 5 years in a row now. Last year the market shrank with 0,5%, the year before with 3,5% and during the height of the crisis years the impact is estimated to be even larger.

Consulting Market Size

From a firm perspective results are mixed. Some firms such as for instance BDO, Conclusion, Deloitte and Rijnconsult have come strongly through the crisis, while at the other end of the spectrum several renowned firms such as Nolan, Norton & Co and VLDV have buckled under the pressure.

Outlook

For 2014 and beyond, the Dutch consulting market is expected to further recover, although it will continue to lag neighbouring countries in terms of growth. Finance and technology consulting are most likely to be the frontrunners, driven by trends such as digitization, analytics and increased regulation in the banking sector.

* Source defines the consulting market as ‘management consulting services’ yet excludes areas such as tax advisory, audit, the implementation of IT systems, the delivery of outsourced/offshored services and HR compensation and benefits administration. In addition, it excludes corporate finance fees from its estimate of the M&A segment (part of Strategy). On top of that, the revenue estimates only take into account mid-sized and large-sized consulting firms (>50 consultants) and focuses on the work they do for mid- and large-sized clients. As a result of the relatively ‘narrow definition’ the estimates of Source are substantially lower than those of for example FEACO and Kennedy Information.

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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.