Management Consultants - Market Report

Released on = April 16, 2007, 3:07 am

Press Release Author = Bharat Book Bureau

Industry = Marketing

Press Release Summary = This report examines the UK management consultancy market,
which is undergoing major changes. The market only grew by 6% from 2001 to 2002, as
conditions in the management consultancy industry have become much more difficult.

Press Release Body =
Management Consultants - Market Report

This report examines the UK management consultancy market, which is undergoing major
changes. The market only grew by 6% from 2001 to 2002, as conditions in the
management consultancy industry have become much more difficult. Management
consultancy comprises nine sectors: outsourcing; information technology (IT);
corporate strategy and organisation development; financial and administrative
systems; project management; production and services management; human resources
management; marketing and corporate communications; and economic and environmental
studies.

Key Note estimates that the value of the UK management consultancy market was
£6.94bn in 2002. This excludes consultancy work that concerns overseas clients even
if it was negotiated in the UK.

In 2002, the major industries for consultancy were financial services,
telecommunications and transport. The vast majority of clients came from the private
sector.

A significant change in this industry is that the large accountancy firms have
withdrawn from the management consultancy market, while the global IT companies are
becoming ever more dominant. The big consultancy firms are very dependent on IT
clients and as a result, the tougher IT market has had a considerable impact on the
firms and on the industry as a whole. There have been thousands of job losses among
those consultancies that traditionally derive a large proportion of their revenues
from the IT sector. Problems in the IT sector were a contributory factor in the many
mergers during 2002. The merger of Logica and CMG is an obvious example.

The buyers of consultancy work are now much more sceptical and demanding, both in
terms of service and price. The collapse of Enron in the US has resulted in
negativity across the industry. For the larger IT projects, the major IT-based
consultancies will always be ahead because of the sheer scale of their resources,
but for other kinds of projects the smaller and medium-sized management
consultancies remain very attractive. A clear trend in 2002 was pressure on fee
rates. This is expected to continue throughout 2003.



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