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Disruptive Technologies: How analytics, digital and cloud are coupling technology to strategy consulting

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The management consulting industry experienced significant consolidation and change over the last six months. The biggest management consulting vendors continued to grow in 1H13, but previous …

The management consulting industry experienced significant consolidation and change over the last six months. The biggest management consulting vendors continued to grow in 1H13, but previous acquisitions helped smaller firms grow faster. Surprisingly, technology-centric firms fared the worst, even as trends favored their expertise and deep technology experience. Technology Business Research Inc.’s fifth iteration of the Management Consulting Benchmark analyzes these changes, and a webinar on Wednesday, Feb. 12, 2014, will highlight high-level findings of this unique research, including how disruptive technologies affect the market, the imperative to train and/or gain the right skills, and shifts in the management consulting landscape.

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  • 1. TBR’s Management Consulting Benchmark Research Highlights and Outlook Disruptive technologies: How analytics, digital and cloud are coupling technology to strategy consulting Technology Business Research (TBR) Quarterly Webinar Series Feb. 12, 2014 TBR T E C H N O L O G Y B U S I N E S S R ES E AR C H , I N C .
  • 2. Management Consulting Benchmark Highlights and Outlook: Webinar Presenters TBR Patrick Heffernan Senior Analyst and Engagement Manager, Professional Services Practice Email: patrick.heffernan@tbri.com Twitter: @TBR_PatrickH Stephanie Artigliere Analyst, Professional Services Practice Email: stephanie.artigliere@tbri.com Twitter: @stephaniea715 Jen Hamel Research Analyst, Professional Services Practice Email: jennifer.hamel@tbri.com Twitter: @jenhameltbr Harry Norton Research Analyst, Professional Services Practice Email: harry.norton@tbri.com Twitter: @harrynortontbr 2 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 3. Management Consulting Benchmark Highlights and Outlook: Webinar Overview TBR TBR’s Management Consulting Benchmark delivers unique insight and value through in-depth analysis in a concise, consumable format Clients gain advantages and a better understanding of revenue opportunities through our reports and their personal relationships with TBR. • The Professional Services Practice publishes quarterly and semiannual reports, continually covering 33 vendors. • TBR’s Professional Services Business Quarterly Management Consulting Benchmark Of those vendors, 16 are included in our Management Consulting Benchmark. o o Financial modeling and TBR insights help customers gain a better understanding of vendor business models. o TBR reports and webinars are responsive to client timelines, clear and concise, and provide insights across multiple layers of a vendor’s organization and infrastructure. o 3 TBR reports are unique for their deep holistic analysis of leading vendor businesses. TBR’s strategic assessment provides an impartial check on a vendor’s progress in its strategic objectives. TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 4. Management Consulting Benchmark Highlights and 2014 Outlook: Key Trends TBR Disruptive technologies permeating all layers of management consulting forced vendors to ally, acquire or reorganize to meet client demands Management Consulting Benchmark Vendor Trends for 2014 Leaders: The top of the pack increased market share and improved portfolio offerings, growing ever more dominant. SOURCE: WWW.PERSONALBRANDING.NET Acquire and Ally: Vendors bought talent and intellectual property, or partnered to get the same. SOURCE: WWW.JUSTWEB.COM.AU SOURCE: WWW.NEWSYSTEMSTHINKING.COM 4 Reorganization: Some vendors reacted to market and competitor pressures by reorganizing, taking a new approach to addressing customers’ consulting needs. TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 5. Management Consulting Highlights and 2014 Outlook: Key Trends TBR At the start of 2013, emerging technologies permeated all aspects of management consulting, prompting organizational changes Strategy-centric vendors were ramping up technology consulting capabilities. Solutions-led firms were leveraging legacy technology expertise to gain permission in the strategy space. And the Big Four continued to grow, providing end-toend offerings. SOURCE: TBR’s 1H13 MANAGEMENT CONSULTING BENCHMARK 5 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 6. Management Consulting Benchmark Highlights and 2014 Outlook: Key Trends TBR Top revenue and growth performers maintained leads, creating greater distinction between management consulting leaders and laggards Management Consulting Benchmark Vendor Trends for 2014 Leaders: The top of the pack increased market share and improved portfolio offerings, growing ever more dominant. SOURCE: WWW.PERSONALBRANDING.NET Acquire and Ally: Vendors bought talent and intellectual property, or partnered to get the same. SOURCE: WWW.JUSTWEB.COM.AU SOURCE: WWW.NEWSYSTEMSTHINKING.COM 6 Reorganization: Some vendors reacted to market and competitor pressures by reorganizing, taking a new approach to addressing customers’ consulting needs. TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 7. Management Consulting Benchmark Highlights and 2014 Outlook: Performance TBR Deloitte, the Big Four and McKinsey dominate management consulting but are growing at different rates, increasingly leaving McKinsey behind The Big Four’s share of the market is increasing as management consulting revenue grows, reflecting the advantages those firms have (size, scope and reach) Dollar amounts in both graphs are in US $ millions 7 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 8. Management Consulting Benchmark Highlights and 2014 Outlook: Performance TBR Mixed results across verticals, service lines and geographies reflect a turbulent year and point toward substantial changes in 2014 Accenture’s energy position and BCG’s APAC geographic revenues reflect two companies poised to grow faster than their peers in 2014 Dollar amounts in both graphs are in US $ millions 8 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 9. Management Consulting Benchmark Highlights and 2014 Outlook: Key Trends TBR Firms are acquiring or partnering to better align to disruptive trends Management Consulting Benchmark Vendor Trends for 2014 Leaders: The top of the pack increased market share and improved portfolio offerings, growing ever more dominant. SOURCE: WWW.PERSONALBRANDING.NET Acquire and Ally: Vendors bought talent and intellectual property, or partnered to get the same. SOURCE: WWW.JUSTWEB.COM.AU SOURCE: WWW.NEWSYSTEMSTHINKING.COM 9 Reorganization: Some vendors reacted to market and competitor pressures by reorganizing, taking a new approach to addressing customers’ consulting needs. TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 10. Management Consulting Benchmark Highlights and 2014 Outlook: Acquisitions and Alliances TBR Acquisitions in 2013 positioned vendors to delivery emerging technologyinfused offerings in 2014 Vendors buy and ally to fill gaps in technology expertise and IP and to broaden global brand presence In 1H13 nearly every benchmark vendor invested in additional technical training and knowledgesharing platforms, with most seeking external assistance in recruiting technology-experienced talent, developing training programs for sales and delivery teams, and enhancing marketing messages around emerging technologies. • As disruptive technologies continue to permeate all levels of clients’ organizations, vendors leverage acquisitions and alliances to strengthen consulting and implementation capabilities across service lines, either to fend off competitors or to enter new markets. Select Management Consulting Acquisitions • Vendor Acquired Target LOB Accenture Change Track Research Technology Deloitte Bersin and Associates Organization Booz & Company Management Engineers Strategy EY Greenwich Consulting Strategy EY Semphonic Technology EY J&M Management Consulting Operations KPMG Hackett Group (Oracle Practice) Technology KPMG Plato Consulting Technology Oliver Wyman Corven Strategy Mercer Hall Consulting Operations Aon Hewitt Dempsey Partners Operations SOURCE: TBR’S 1H13 MANAGEMENT CONSULTING BENCHMARK 10 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 11. Management Consulting Benchmark Highlights and 2014 Outlook: Acquisitions and Alliances TBR PwC’s acquisition of Booz surprised the market and made complete sense — right fit, right size, right culture, right capabilities By purchasing Booz & Company, PwC advances four major revenue growth drivers: Talent acquisition o Global prestige as a top-tier consulting firm • Geographic expansion o Market-leading presence in the Middle East • Vertical specialization o Deep understanding of retail sector • Emerging technology expertise o Booz Digital • Dollar amounts in US $ millions ... while keeping pace with Big Four peers and Solutions-led firms 11 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 12. Management Consulting Benchmark Highlights and 2014Outlook: Acquisitions and Alliances TBR McKinsey allies with Lufthansa to target the growing Euro aviation market Latest McKinsey alliance shows it can take multiple paths to portfolio expansion <$1 Million $20 Million James O. McKinsey founds McKinsey. 1959: McKinsey opens its first European office in London. $7.7 Billion Projected 2013 2006 1967 1926 1935: Marshall Field & Co. is McKinsey’s first major client. $4.4 Billion ~2009: McKinsey Solutions established. 2010: Anil Kumar pleads guilty to insider trading. 2010: NM Incite established. 2011: McKinsey acquires Henry Rak Lumics 2012: Rajat Gupta convicted for insider trading. McKinsey Solutions Lumics McKinsey Solutions continues to leverage previous acquisitions and alliances to improve and/or create new solutions: • Acquisition Henry Rak was integrated into the Periscope solution. • Acquisition Finalta became its own, standalone offering for retail banking. • Partner ClickFox was leveraged as its own stand-alone solution. • Joint venture with Lufthansa Technik (Lumics); McKinsey will target opportunities in the aviation market, specifically in Nordic countries such as with the Nordic Aviation Capital and, most recently, the Nordic Initiative for Sustainable Aviation (NISA). • The joint venture with Lumics is similar to McKinsey’s joint venture with Nielsen Company (NM Incite), as the alliance was fueled by clients’ demand to harness the power of the social media market through Nielsen’s BuzzMetrics monitoring service. • In the public sector, we are seeing multiple engagements which involve the modernization of aircraft in the Australian, U.K., U.S., and Middle Eastern markets (specifically the U.A.E.). SOURCE: TBR’S 1H13 MANAGEMENT CONSULTING BENCHMARK 12 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 13. Management Consulting Benchmark Highlights and 2014 Outlook: Key Trends TBR While acquisitions and alliances helped some firms adapt, others such as Accenture reorganized to meet evolving customer demands Management Consulting Benchmark Vendor Trends for 2014 Leaders: The top of the pack increased market share and improved portfolio offerings, growing ever more dominant. SOURCE: WWW.PERSONALBRANDING.NET Acquire and Ally: Vendors bought talent and intellectual property, or partnered to get the same. SOURCE: WWW.JUSTWEB.COM.AU SOURCE: WWW.NEWSYSTEMSTHINKING.COM 13 Reorganization: Some vendors reacted to market and competitor pressures by reorganizing, taking a new approach to addressing customers’ consulting needs. TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 14. Management Consulting Benchmark Highlights and 2014 Outlook: Reorganization TBR Accenture Strategy will target increased demand for strategy services at the intersection of business, technology and operations Management consultants and technology consultants are paired to address client needs Business Technology Operations Accenture Strategy Technology Consultant Management Consultant SOURCE: TBR AND ACCENTURE 14 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 15. Management Consulting Benchmark Highlights and 2014 Outlook: Reorganization TBR The Accenture Digital Platform will help the firm brand its mobility, analytics and cloud technology capabilities to meet clients’ digital needs While PwC’s and Accenture’s investments in digital over the past 12 to 24 months have mirrored one another, their paths have varied Recent PwC Investments in Digital Acquisitions • Booz & Company (2H13/1H14) • BGT (2H13) • Ant’s Eye View (2H12) • Logan Tod & Co. (1H12) Recent Accenture Investments in Digital Acquisitions Alliances Alliances ThoughtWorks (2H12) • Acquity Group Ltd. (2H13) • Fjord (1H13) • avVenta Worldwide (2H12) • Hybris (2H13) • Demandware (2H13) Accenture Interactive Booz Digital Accenture Digital Platform SOURCE: TBR RESEARCH 15 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc. Accenture Mobility Accenture Analytics
  • 16. Management Consulting Benchmark Webinar: 2014 Research Outlook TBR Consultancies are expanding strategy capabilities around cloud, analytics, mobility and digital as clients modernize business models PSP Research 2H13 Topics • Syndicated Investments in strategies to help clients adopt disruptive technologies How are vendors shaping go-to-market strategies  to fuel growth as disruptive technologies become increasingly tied to business goals and strategies? Use of acquisitions to gain expertise in niche areas and expand local market presence Are vendors choosing to invest in acquisitions to  build out global management consulting delivery capabilities and deepen local market presence? Addressing EMEA as two separate regions (Europe and MEA) Which vendors have organizationally changed to multiple regions to accommodate the vast  differences between Europe and Middle East & Africa? Vertical Specialization of Management Consulting: Energy and Retail How are vendors leveraging alliances, acquisitions and/or thought leadership development to  penetrate growth verticals? • Which vertical markets are vendors prioritizing for go-to-market and resource investments? Vendor Reports: o McKinsey & Co. o Deloitte Consulting o Bain & Co. o Booz & Company o Boston Consulting Group o Accenture o IBM GS o Capgemini • Management Consulting Benchmark 2H13 Report Key Themes • SOURCE: TBR RESEARCH AND ESTIMATES; COMPANY DATA AND ESTIMATES 16 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 17. TBR Questions? 17 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 18. Management Consulting Benchmark: Webinar Contact Information TBR Patrick Heffernan Senior Analyst and Engagement Manager, Professional Services Practice Email: patrick.heffernan@tbri.com Twitter: @TBR_PatrickH Stephanie Artigliere Analyst, Professional Services Practice Email: stephanie.artigliere@tbri.com Twitter: @stephaniea715 Twitter: @TBRinc SlideShare: www.slideshare.net/TBR_Market_Insight YouTube: www.youtube.com/user/TBRIChannel Jen Hamel Research Analyst, Professional Services Practice Email: jennifer.hamel@tbri.com Twitter: @jenhameltbr Harry Norton Research Analyst, Professional Services Practice James McIlroy Vice President of Sales Email: mcilroy@tbri.com Telephone: 603.929.1166 Email: harry.norton@tbri.com Twitter: @harrynortontbr 18 TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc.
  • 19. TBR Professional Services Practice Syndicated Coverage TBR PSP Syndicated Research Coverage IT Services Vendors Public Sector Vendors Benchmarks (Benchmark XLS data also available) • Accenture • Atos • Capgemini • CGI* • Cisco Services • Cognizant • CSC • Dell Services • Fujitsu • Genpact* • HCL Technologies • HP Services • IBM Global Services • Infosys • KPN Corporate Market* • Tata Consultancy Services • T-Systems • Unisys • Wipro IT Services • Xerox Services • Booz Allen Hamilton* • CACI International* • General Dynamics IS&T* • L3 Communications* • Lockheed Martin IS&GS* • ManTech* • Northrop Grumman IS&TS* • Raytheon Intelligence, Information & Services* • Global Delivery Market Landscape • Healthcare IT Services Vendor Benchmark • IT Services Vendor Benchmark • Management Consulting Benchmark • Public Sector IT Services Vendor Benchmark • Software Alliance Benchmark Healthcare IT Services Vendors • Accenture HITS* • CSC HITS* • Dell HITS* • HP HITS* • IBM HITS* Management Consulting Vendors • Bain & Company* • Booz & Company* • Boston Consulting Group* • Deloitte Consulting* *Semiannual publication • McKinsey & Co.* TBR Quarterly Webinar Series | 2.12.14 | www.tbri.com | ©2014 Technology Business Research Inc. 19
  • 20. About TBR Contact Us Technology Business Research, Inc. is a leading independent technology market research and consulting firm specializing in the business and financial analyses of hardware, software, professional services, telecom and enterprise network vendors, and operators. 1.603.929.1166 info@tbri.com www.tbri.com 11 Merrill Drive Hampton, NH 03842 USA Serving a global clientele, TBR provides timely and actionable market research and business intelligence in formats that are tailored to clients’ needs. Our analysts are available to further address client-specific issues or information needs on an inquiry or proprietary consulting basis. TBR has been empowering corporate decision makers since 1996. To learn how our analysts can address your unique business needs, please visit our website or contact us today. TBR T E C H N O L O G Y B U S I N E S S R ES E AR C H , I N C . This report is based on information made available to the public by the vendor and other public sources. No representation is made that this information is accurate or complete. Technology Business Research will not be held liable or responsible for any decisions that are made based on this information. The information contained in this report and all other TBR products is not and should not be construed to be investment advice. TBR does not make any recommendations or provide any advice regarding the value, purchase, sale or retention of securities. This report is copyright-protected and supplied for the sole use of the recipient. Contact Technology Business Research, Inc. for permission to reproduce.

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