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  Management Consultancy recruitment specialists Prism pen this occasional column providing market insights for consulting candidates and recruiters alike.
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In this piece they identify the rebound in change management and human capital consulting that has taken hold in recent months – and some of the firms doing the hiring in this space…

With the improving fortunes of the Management Consulting sector over the last 18 months or so, it has, from a recruitment consultant’s perspective, been interesting to see which parts of the sector have recovered most rapidly and to what degree.

It is generally accepted that the fortunes of the Management Consulting sector, in line with the economy, tend to follow a cyclical pattern, with certain types of consulting services being more appropriate – and therefore easier to sell – in certain economic climates. Through the poorer market conditions of 2001/early 2004 most consulting work had an emphasis on managing and reducing cost, whether through outsourcing, procurement and strategic sourcing optimisation, maximising benefits from existing IT systems, or process change and downsizing. In the last 18 months, more growth-orientated ‘value-add’ consulting services have become increasingly to the fore, with a corresponding impact on recruitment requirements.

One area which was notably subdued from a recruitment perspective during the downturn was Change Management, primarily encompassing organisational, cultural and other people or HR-related change, particularly when compared to the sustained buoyancy that had prevailed through the mid & late-1990s. This isn’t surprising, given that much of this type of consulting work is perhaps perceived by CEOs to be far harder to quantify in terms of bottom-line benefits, and therefore classified by them as a luxury ‘nice to have’ option – more appropriate for times of growth, M+A activity and when there is more cash to spare. (In the same vein, the first areas where cutbacks occur when times get tough tend to be people-related:- recruitment, training and development).

However, in the past 12 months, Prism has experienced a sustained, increasing demand from clients for candidates with high calibre Change Management consulting skills. This demand is from all quarters – major globals, Big 4, generalist business consultancies and specialist boutiques – and seems to encompass all accepted subsets of ‘people-related’ consulting work. As expected, the usual drivers for buying such consulting services remain as in previous growth markets, but there are a few differences.

Mark Spears, Practice Leader of Atos Consulting’s 100-strong People and Change service line, commented:

“We expect to grow the practice by at least 20% this year, with significant volumes of work across a variety of client engagements. Much of this remains focused on major organisational change programmes, merger and post-merger integration, and ensuring the successful delivery of major SI solutions, but it is also increasingly leading to new areas of intervention with clients.”

Similar growth patterns are also being experienced by specialist Human Capital Consulting and Services provider Buck Consultants. Alan Gibbons, European Head of Human Capital Consulting at Buck Consultants, who is spearheading Buck’s expansion in the region, observed:

“There are 2 main factors driving this increased awareness of what good HC consulting can achieve. Firstly, record levels of M & A activity more often involve deal-makers who understand that good change management practices create rapid post-merger synergies. Secondly, the new wave of more mature outsourcing activities often include a holistic assessment of how better people practices create a more effective service. Both factors are closely linked to ensuring business success follows major change.”

A significant feature of the returning market that Prism has observed has been the way that most purchasers of consulting services have a far better understanding of what they want from suppliers and how to structure associated consulting fees. This increased maturity on the ‘buy side’ also appears to have extended into a much better appreciation of how crucial the ‘human component’ is in ensuring any kind of IT, process-related or other corporate organisational change is embedded and true value realised. As such, ‘people issues’ now seem to feature far higher up the CEO’s agenda.

Mark Spears again: “We are definitely dealing with clients who are more aware, informed and knowledgeable about how they want to work with their Consulting partners, although we have actually seen evidence of this for several years or more, rather than just the last 18 months or so. Clients are, to some degree, responding to mistakes of the past, where major projects did not produce the ROI they had hoped for, because insufficient time and resources were committed to the ‘people aspects’. They are also now much more able to take on some of this work with their own staff, for example core communications strategy and execution.

As such we need to demonstrate how we can add real value in all areas of our involvement. We are responding to this challenge partly through the quality of people we have in the People and Change practice – and those who continue to join us – and partly through the development and deployment of innovative services.”

Atos Consulting focuses on hiring genuine experts in the field, most of whom have deep knowledge gained through time in industry. Mark Spears’ practice has also found significant client buy-in to their work focusing on ensuring long-term sustainability of the change initiatives they lead for clients – providing a legacy for their clients through knowledge transfer and embedding best practice management techniques and processes. Innovation in the area of ‘visual communications’ has also had a major impact with clients.

Molten Group, established in 2003, is one of the consulting sector’s success stories of recent times. As the market returned, they identified an opportunity through both the drivers of that growth, and the different expectations clients had of their consulting partners, as Director Sally Harris describes:

“Constant change, amplified by M&A;, regulatory and competitive pressures and re-organisation is now the status quo for leading global organisations. Business processes are benchmarked, IT has been tested and is increasingly mature. Now clients are demanding more innovative ways of engaging employees to ensure the final remaining Achilles heel of major change – employee engagement and acceptance – is attained.

We have seen a definite change in the market with the majority of our clients now much more sophisticated in their understanding of people issues and aware of the communication challenges in addressing them. This is especially the case for global programmes with an intricate and distributed web of interested stakeholders – from employees impacted by the change to the most senior budget holders in the organisation.

Molten was established to provide high quality business consulting services and assist clients 'operationalise' their chosen business strategies – i.e. make change happen. We position ourselves between the ‘pure’ strategy firms such as McKinsey and Boston Consulting Group, and the systems implementers, integrators and outsourcers such as Accenture, Atos Origin and Cap Gemini. Our challenge as a consultancy is to de-mystify change and provide structure to the large programmes. This means we make the process of change understandable and provide a complete offering in Internal Communications and Employee Engagement which was not previously available in the market. Once we have simplified the challenge for our clients we not only provide them with a structured approach to their communications and engagement but can also support all aspects of execution.

We are delivering change using our seamless end-to-end service to a portfolio of the world’s leading organisations. Our utilisation rate is high, our pipeline solid and growing, and we don’t see any change to this situation in the short-medium term.”

In conclusion then, it seems that sustained growth in the Change Management space is set to continue for some time to come, providing ample opportunity for a variety of consulting firms. While there are some similarities in the type of work being done for clients, as compared to the ‘boom times’ of the mid-late 1990s, it also seems clear that there are several new drivers for the increased activity. Perhaps most notably however, it also appears that clients have a far better appreciation of the value that people and organisation-related consulting of the highest calibre can add – in all contexts and scenarios. As such, it may be that Change Management consulting is far less susceptible in the future to the cyclical nature of the wider consulting market. Certainly Plus ca change then, but not necessarily Plus c’est la meme chose…

To view the latest consulting opportunities being managed by Prism, please click here now

If you would like to discuss any of the points raised in this article, please contact Martin Hancock on 0207 681 6161 or email [email protected]
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