Strategy consultants are having to transform themselves and the way they work in response to changing client demands, the impact of digital technology on businesses and the big four accounting and advisory firms and Accenture trying to muscle into their space.
The big four, made up of KPMG, Deloitte, EY and PwC, believe their ability to deliver a packaged end-to-end solution for clients gives them an edge over the strategy firms.
KPMG
The partner in charge of management consulting at KPMG Australia, Ian Hancock, reckons "traditional strategy service as a standalone capability is being disrupted".
"The importance of understanding the implementation of the strategy is critical to determining whether the strategy is going to be successful," he said.
"So having a very good understanding of the operational implications of the deployment of the strategy is fundamental to setting the strategy."
Margaret Cowle, who is the partner in charge of KPMG Australia's global strategy group, said the business development cycle had also been dramatically shortened.
"Clients are looking to focus on shorter cycle times," she said, due to "the impatience of the market, the impatience of customers, customers' changing preferences, disruption and convergence".
"It's not about strategy, then implementation; it's about strategy and implementation," Ms Cowle said.
Mr Hancock added: "We are providing transformation services. Most of our clients in order to drive operational efficiency have stripped out all costs from their business at this point. As a consequence when they have initiatives to do, they just don't have the capacity any more within the organisation to deliver."
Deloitte
John Meacock, the chief strategy officer at Deloitte Australia, said clients now expected the consulting process to be a shared journey.
"I think it's changed from doing a 12-week strategy project into partnering with them to transform their business," Mr Meacock said.
"It is bringing global expertise, digital, artificial intelligence [and] automation capabilities in a package that allows them to go on that journey, rather than the silo of a strategy."
"Clients have got sick of projects they can't implement."
He said Deloitte's consulting arm consisted of about 2000 people and had experienced high double-digit growth over the past few years.
"I don't think strategy is dead," he said.
"There is always going to be a role for strategy consultants, as part of transformation.
"Amongst the big houses, I don't see further consolation but it'll be harder for mid-tier [strategy firms] to survive."
EY
The managing partner of Oceania advisory at EY Australia, Bill Farrell, said his firm's integrated approach had hit the right note with clients.
"[There is] still plenty of focus on operational efficiency, customer experience/innovation and how to grow in stagnant or even declining markets and ensuring the risks of execution in large programs is managed," he said.
"We are also seeing an increased focus on 'Purpose' and how to engage people to drive innovation and results in volatile environments.
"Plus a growing focus on issues such as cognitive computing, advanced analytics and robotics process automation."
The firm has built a 70-strong strategy business in Oceania with 255 people across the Asia-Pacific region and 1200 globally in the past four years.
He said the firm's Oceania strategy business had experienced 60 per cent growth in the past year.
PwC
PwC's Neil Plumridge drolly notes that "clients don't want the 50-slide strategy deck in isolation anymore".
"There are plenty of idealistic strategies lining filing cabinets around corporate Australia," Mr Plumridge, the managing partner of consulting at PwC, said.
"Clients want pragmatism in their strategy and they want to be deeply involved in both strategy and execution, with a partner to supplement skills they don't have.
"This means real skin in the game not expensive project management."
Mr Plumridge said that PwC had 25 partners and 117 staff in its specialist Strategy& division and that revenue was growing strongly, by 10 per cent in 2014-15 and nine per cent in 2015-16.
The future of consulting
- Platforms: eBay for consultants takes on McKinsey
- Buyers: Clients want consultants to implement, upskill staff
- Skillsapien goes niche, Expert360 staffs up
- Revealed: How much BCG, Bain and McKinsey make
- Technology: Inside Accenture's 'new approach to strategy'
- BCG, Bain and McKinsey forced to rethink their own strategy
- Deloitte, EY, KPMG and PwC eye up strategy consulting market
- Gender at the Boston Consulting Group, Bain and McKinsey
- Promontory Financial Group and IBM tie up to apply AIÂ to bank regulation
- PiP, Port Jackson Partners focus to compete against strategy firms
Â
