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Arthur D Little has proven to be an enduring brand in the consulting profession.
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Having struck hard times that took the firm to the brink of extinction in 2001, Arthur D Little is now re-emerging as a powerful consulting brand. Our Management Consultancy guru Mick James uncovered the challenges and opportunities that ADL now face…
Arthur D Little – back from the brink
It’s nearly 120 years since Arthur D Little founded what was arguably the world’s first management consultancy, and despite some problems early this century the firm that bears his name still exists. As a research chemist with expertise in synthetic fibres Little was also famous for proving that you could—literally—make a silk purse out of a sow’s ear, and that’s quite a metaphor for what’s happened recently in the consultancy industry. The upheavals the industry have gone through have ultimately provoked a new wave of vitality and energy that is spreading through the industry.
Nowhere is this more true than the formerly staid strategy and operations sector, currently flavour of the month with clients. Often seen as having been “niched” by the audit firms, and no threat to the rest of the industry, now these firms are on something of a roll—and they are clearly dangerous when hungry.
Like A.T. Kearney, who we wrote about last week, ADL have ground to make up. After having gone into Chapter 11 in 2001, the firm was sold off to a number of buyers. The French conglomerate Altran acquired the worldwide rights to the Arthur D Little brand as well as the operations in Europe, Asia and Latin America, but this left significant holes in the network, notably in the US and the UK.
According to global CEO Richard Clarke, the Arthur D Little brand has proved a powerful weapon in rebuilding that presence.
“A common comment we get is ‘where have you guys been?” he says. “The brand itself still has enormous and strong equity–it’s both an opportunity and a challenge for us.”
With offices in Boston, Houston, Chicago and New York the firm has already gone a long way to achieving its target. Now London and Asia are major areas for investment and growth.
“Strategy and operations consultancy is reckoned to be growing at between 5 and 10 per cent per annum, and we’ve achieved year on year growth of over 10 per cent,” says Clarke. “From the perspective of issues of scale we aim to get to critical mass by scaling to two to three times that size in the next five years.”
Although the Altran group which owns ADL own nearly 200 companies operating in consultancy and related areas there are no plans to try and stitch them together into a monster consultancy, although Altran companies do work together and where it makes sense some firms — such as the Johnson Group in the US – may be transferred under the ADL brand. However the group is prepared to invest in the growth of ADL, which Clarke sees as part of the considerable impetus in the market now for independent strategy and operational consultancy.
UK managing director Rick Eager agrees:
“Clients are a lot more selective in the way they buy consultancy now they are looking for experts, people with genuine knowledge,” he says. “Rather than take a whole team that goes through to outsourcing and implementation they’re looking for the best experts they can find at the strategy end, they’re more willing to pick and mix.”
This movement is also reflected within the industry.
“Because of the trend towards outsourcing and offshoring some of large firms are offering strategy advice for free,” he says. “In some cases we are finding that many senior partners at these firms are very keen to move to a firm like ADL who are in the business of providing independent strategy advice.”
To capitalize on the trend away from the “one-stop shop” ADL is recruiting at all levels, looking for new blood both from industry and the universities that can help it capitalize on its key differentiators of innovation and managing complexity.
A rich seam of recruitment for the firm has been graduates in engineering and science
”Quite a number of our consultants graduated in something technical,” says Eager. “A lot are chemical engineers because they already think in process terms, it’s the way their minds have been taught.”
While the ADL brand is still well known at client level, it is less so among graduates and so the firm has had to reestablish itself as a destination of choice for the ambitious young graduate.
“With the brand it’s important not to use it the wrong way,” says Eager. “Our tradition represents a culture and a way of working, but we also need to create new and innovative products and services for clients, and differentiate ourselves in the market place. You don’t do that just by looking to the past.”
Related link: Business & Strategy consultancies are increasing their use of Associate & Freelance consultants. Click for the latest short-term contract consulting roles
All views expressed in this article are those of Mick James and do not necessarily reflect the views of Top-Consultant.com and Consultant-News.com.
Contact Mick with your views or suggestions at:
[email protected]
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