Overview Global Consulting Industry Market.
Businesses around the world have more and more to rely in consultancy to thrive through a more complex and disruptive fast changing economic, social and technological fast changing world. The consultancy industry is an increasing part of the business life and special as the international economy gets increasingly more volatile and software driven. In these scenario and as it stands the global consulting industry revenues – HR, IT, strategy, operations, management and business advisory services – will be about $470 billion in 2016, according to the company Plunkett Research estimative.
The numbers presented represent a reasonable growth from $449 billion during the previous year. In the U.S., consulting of all types, including management, scientific and technical, generated $257.6 billion during 2015, up from $233.9 billion the previous year.
Accounting and related services consultancy such as tax return preparation generated an additional $155.4 billion in 2015, up from about $145.2 billion during 2014, according to the U.S.Bureau of the Census.
Deloitte Consulting, PwC / Strategy& and EY Advisory are the largest consulting firms of the globe, reveals new research by Gartner. The Big Four accounting and consulting giants together hold 40% of the market, with the top 200 firms globally distributing nearly 80% of the $125 billion advisory market affirms consultancy.uk. in 10 largest management consulting firms of the globe.
Gartner, the leading global analyst firm, conducts a global yearly research in the state of the consulting industry. Its latest edition of the so-called ‘Market Share Analysis: Consulting Services’ looks into the development of the consulting market, as well as the market shares of the most important players in the landscape.
The Gartner analysts find that globally spending on management consultants has grown to $125.2 billion in 2014, up 6.1% from $118.1 billion in 2013. The top four largest “Consulting Firms” consulting firms, all with a heritage in the accountancy sector, known as the Big Four Deloitte, PwC, “EY” and KPMG, hold a combined 40% of the total consulting market.
A lot has been changing compared to a decade ago the Big Four firms have significantly increased their market share, through organic growth and dozens of acquisitions. The top 10 consultancies account for 52% of the market, while down the line the top 200 service providers with consulting services hold 79% market share, suggesting a non-fragmented and consolidating market according to the analysts.
Consulting a fast growing and a somewhat cyclical industry driven by change and fast moving tech.
“A consulting firm’s appetite for change, whether they are ready or not, has to be ravenous; otherwise, they will lose revenue and be out of the consulting game faster than expected. The need for a faster speed to change is no longer an option” Gartner research.
The years 2008-09 marked a challenging period throughout the world of business, in light of the global economic slowdown and shrinking corporate budgets and as digital shifted the global economy more and more the consultancy has been growing and changing to digital, tech and simple the process of change management.
In general, major consulting companies, including leading firms in management consulting and HR consulting, along with other advisories such as accounting firms, found themselves with substantial drops in business during 2009. An example is India’s largest outsourced business and technology consulting firms were complaining that clients were delaying or cancelling projects as 2009 began.
However, in recent years, consultancy corporate profits in general grew dramatically, meaning that executives are now more willing to authorize new consulting projects as long as they see the potential for a good return on the cost.
For example, India’s leading consultancies have recently enjoyed substantial growth in employee count and revenues, as have most of the global.
Plunkett Research highlights the positive factors for the consulting industry over the mid-term:
- 1. Continued growth in health care expenditures and significant changes in health care coverage are creating demand for consulting projects. This includes a focus on digital health records and a dramatic need for greater operating efficiencies and cost controls, creating a perfect environment for consulting.
- 2. In nearly all business sectors, consultancies that focus on projects that clearly reduce business costs and enhance operating profits in a reasonably short period of time will find a ripe corporate market (such as consultants who focus on cash flow enhancement, supply chain efficiency and manufacturing efficiency).
- 3. Vast new labyrinths of government regulation in the U.S. and in the UK/EU, for example in the banking and investment industries, are creating numerous opportunities for consultants who can show companies how to navigate rapidly changing relationships between government and industries, or deal with government oversight, particularly in financial services, environmental matters and health care.
- 4. Consultants who assist firms in lowering employee benefits costs are in high demand, as are those who specialize in change management, employee retention and employee productivity enhancement.
- 5. Consultants and advisors in information technology and mergers and acquisitions will be in high demand.
Until recently, consulting firms were enjoying stellar growth in emerging and rapidly developing nations such as China and Brazil. However, by 2015-16, China’s growth had slowed, and many formerly promising nations, including Brazil and Russia, were encountering serious economic problems.
The top specialties in the consulting field are led by management consulting and technology consulting. Management consultants assist companies with restructuring or strategy development, in order to enhance operating efficiencies, increase productivity and increase return on assets, as well as significant assistance in identifying and merging with other firms that are targeted for acquisitions.
Technology consulting companies offer skilled services across the full spectrum of technology needs. This includes consulting in telecommunications, software development, systems implementation and enterprise-level database enhancement. In recent years, much of this work has shifted to projects involving cloud computing, mobile apps and mobile tools for workers in the field.
Consulting firms based in India have carved out a very significant market share in this field. Other significant sectors within consulting include human resources and employee benefits consulting; risk management; industrial automation; logistics and distribution; and environmental and regulatory compliance.
Digital Consultancy
There will be a lot of disruption coming for the industry. As business models of consulting firms continue to change, special due to technology and AI advances consultants will have to stretch their skills and flexibility in order to redefine, reposition and differentiate their go-to-market approaches, capabilities and skills, and embrace new strategies to compete in the new world of digital fast forward innovative disruption business world.
The surviving and striving of the industry will rely in its capacity for keeping an healthy and pragmatic appetite for change, whether the firms are ready or not. Fast change is the new DNA for consultancy and it has to be bold and ravenous. The need for a faster speed in the global consultancy to change is no longer an option it is the only way.
With the advent of fast growing area of consultancy such as Digital consultancy, innovative disruption and Fintech the pace of chance will accelerate much further. Further more with the advent of Internet of Things technologies, big data platforms and special Blockchain the speed of dramatic disruption is bigger than ever. In this scenario the consultancy industry has to have a stronger lean startup pace rhythm towards technology. Consulting services and solutions have to drive the lead in innovation, and has to be creating an open business, open data sound consulting business and partnership network in the operations tech and digital transformation change management area.
To synthetise as the industry grows so does the challenges and opportunities and special the critical area that is leading and transforming the overall industry is the need to manage the businesses resistance to change, adapt and keep relevance while moving in the fast forward innovation, innovative disruption, digital acceleration and the necessary commitment by management teams and corporations, HR in the critical area for the management consultancy global industry.
Ingrid Maldine is a business writer, editor and management consultant with extensive experience writing and consulting for both start-ups and long established companies. She has ten years management and leadership experience gained at BSkyB in London and Viva Travel Guides in Quito, Ecuador, giving her a depth of insight into innovation in international business. With an MBA from the University of Hull and many years of experience running her own business consultancy, Ingrid’s background allows her to connect with a diverse range of clients, including cutting edge technology and web-based start-ups but also multinationals in need of assistance. Ingrid has played a defining role in shaping organizational strategy for a wide range of different organizations, including for-profit, NGOs and charities. Ingrid has also served on the Board of Directors for the South American Explorers Club in Quito, Ecuador.
