Guest
Sept 2007
Report on the FEACO meeting in Budapest
Interview : Antoine Beuve-Méry
President of FEACO, Brussels
The European Federation of Consulting Firms Associations
The congress allowed us to observe and confirm the up turn of the consulting activity which started about 2 years ago.
Mister President, at the FEACO conference more than 200 consultants attended the event, with participants coming mostly from Europe and a few foreign delegations representing Japan, China, India and the USA. Time has passed since then. Is it possible today to make an assessment of the conference in terms of economical figures, consulting market and trends in the professional field ?
Antoine Beuve-Méry : I would say that the conference allowed us to observe and confirm the upturn of the consulting activity which started about 2 years ago. Today almost all European countries show a strong increase in their consulting activity.
Like Germany, which according to your 2006 FEACO report has become the first consulting market in Europe.
Antoine Beuve-Méry : Exactly. There are some surprising facts, although our new way of calculating the FEACO statistics may have introduced a certain bias. On the one side there is Germany that has become the first European consulting market and on the other side there is the rise of the Central European States. As regards Germany two reasons come to mind. First, a recovery of the German economy, second, an effect of scale : Germany is the largest economy in Europe and what is more, the Germans have become more inclined to using consulting in a natural way, leading to this increase in volume. This being said, the United Kingdom remains the «Grand Dame » of consulting and the most dynamic market. We must understand that many topics regarding Europe are managed from England, the utilities market for instance, the evolution of the economic regulations, and so on... and to address those topics, skills are mainly found on the London business floor... This explains this tremendous outcome : 1% of the UK GDP is generated by consultancy. That figure is far more reduced for Germany and France.
A France which is now being outrun by Spain ! What can be said about that ?
Antoine Beuve-Méry : I would say that this requires a more detailed analysis of the figures and it must be decided whether we talk about the overall sales or the breakdown of the activity into Business Consulting and Management Consulting. In Spain there is only one association for management consulting. In France there are basically two : Syntec Conseil en Management (Management Consulting) and Syntec Informatique (IT and IT Consulting), which opens the door to different modes of calculation. If we add up IT Consulting and Management Consulting, France stays far ahead. This being said, don’t forget that Spain is very dynamic. The increase of the Spanish economy is topping +3.5% when in France this is only 2%; this explains in the long term the positive evolution of the Spanish consulting activity.
We observe on a daily basis a real dynamism in the Spanish consulting market which seems to be supported by the European Commission bidding and tendering activity. Reality or fiction ?
Antoine Beuve-Méry : As all southern economies, Spain is developing rapidly and is consuming consulting services like never before. No doubt the Spanish economical boom contributed mostly to this situation, notably through the development of services centers, which are popping up everywhere, as they did in Barcelona. There was not even one 5 years ago.
The 2006 FEACO congress was held in the East, in the same line as the 2003 congress in Ljubljana and Athens in 2004. It was therefore bound to address topics such as the remarkable development of the former Eastern Europe, those countries we call now the Central European States. What can be said about that ?
Antoine Beuve-Méry : To understand what is happening we must keep in mind that the accelerator factor for the consulting activity results from economic growth. For the moment they are merely catching up with the Western European countries. They must close the gap and still have a long way to go before their economies will be aligned with ours; so, despite a strong economical growth they still show relatively weak levels of activity. Their markets are only starting up and are still undergoing big changes, and as they are in the fast lane this generates a tremendous need for consulting support. However, it is not easy to draw too many conclusions from the consulting growth, because when everything goes wrong consulting does well, and when everything goesright, demand for consulting is high as well, so generally the consulting sector does well whatever the economic situation.
So we see consulting proper in the East. What about Hungary, which’ federation VTMSZ was the co-organizer of the Budapest conference, is this country recognized as an opportunity by the French consultants who attended the meeting ?
Antoine Beuve-Méry : Absolutly. Hungary, which co-organized the conference, seems to have caught the attention of the participants, particularly of the French. Hungary is still a slightly closed market due to its terribly difficult language, Magyar, and this mostly because procurement rules require that tenders are written in Magyar and, because, for historical reasons (former Austro-Hungarian Empire of the Habsburg), much of the local business is done in German. As long as the German language remains predominant, the entry ticket is quite high for French speaking consultants who are considering opening a local office. But for those who are still questioning whether they should, the answer is yes, provided that they have a sustainable activity. Despite the Hungarian dynamism, a calculation demonstrates that Poland far exceeds the Hungary and stays the privileged place for foreign investments. To exemplify this I remind you that 30% of European subsidies go to Poland. So, differences in scale aside, I would compare Hungary to Belgium more than to any other state, even if it cannot in the same way show for any leading industry (in Belgium you have Solvay, in Finland Nokia, in Holland Philips, in Czech Republic Skoda, etc...). Therefore, Hungary remains a very important market for western consultants, but it remains a difficult one.
Comparable to Greece ?
Antoine Beuve-Méry : Certainly but there again I would refrain from making too hasty comparisons. The Greeks export their consulting services to the Balkans and the Mediterranean area, master the English language and are well represented in Brussels.
A survey by IBM in 2006 shows innovation as being the main concern within firms.
Romania and Bulgaria entered the European Union in 2007. In Romania there exists a tradition of French as a second language, and a Francophile inclination, and we are impressed by the quality of the French spoken by Romanian consultants, even if they have spent only little time in France. This certainly offers new opportunities to the French consultancies. What can be said about the entry of these two new states in the Union ?
Antoine Beuve-Méry : Romania and Bulgaria are integrating in the Union in 2007 and will therefore become eligible to the European Regional Development Programmes, targets 1-2-3, whereas until now they were only eligible to Programmes reserved to the accession countries such as the PHARE Programme. The intra-community development support will give them an additional boost in their development that should compare to the one we observed in Greece and Portugal. We wholeheartedly wish this for them.
As regards the rest of Europe : is it possible to link the high growth in consulting we can observe at the moment to the development of innovation within the enterprises ?
Antoine Beuve-Méry : Absolutely. To illustrate this point, I want to mention a survey carried out by IBM in 2006, which shows that innovation is the main concern of firms. Not just technological innovation, but also how to accomplish the practical work, to open the internal processes and turn them to exterior. This explains the tidal wave of e-Business that we observe today and which acts in a way as a relay to the first ERP big systems wave. The first one appeared in the mid 90’s and culminated in the year 2000, when the enterprises chose to let go of their old legaciesto replace them by new ERP which allowed an efficient start of the Y2K and led the way to a smooth changeover to the Euro. This second wave of the e-Business is of a different kind. What matters now is to support new ways of doing the work, which implies big changes at the level of the processes themselves as well as at the level of the information systems that support them. Before opening up your electronic gateway to your clients and your suppliers, you must have tidied your house. The opening of your own world through the web and e-Business is rich in opportunities, but it is also an open window to the inner parts of your enterprise. Gartner and IDC in their surveys indicate that systems architecture is essential to the set-up of online commercial services. This is the reason why the high demand for consulting is likely to continue.
Does this mean that we are going to see a slowdown in systems integration and tailored software development to the sole benefit of software parameter setting which needs no development at the client site and less consulting support ? When I say this, I am referring to the FEACO figures which indicate that sales are split between ~ 50% Management Consulting, 30% Outsourcing and only 19% Systems Integration and IT Consulting...
Antoine Beuve-Méry : Effectively. But systems integration is far from being dead. We are not going to put integration on the shelf of useless accessories. There are still many projects ongoing in this domain and there remains a lot of work for tomorrow because systems become more and more complex and heterogeneous. So I assure you that systems integration still has a bright future.
We see an increase in BPO (Business Process Outsourcing). Is this just a commercial communication artifact or is it a real phenomenon ?
Antoine Beuve-Méry : It is a real phenomenon which sometimes has a real innovative aspect in the sense that the goal is no longer to outsource peripheral corporate activities ( HR, Compensations, IT...) but to outsource part or the totality of what is considered as the core business.
So let us have a new rendezvous at the next FEACO meeting in Warsaw on October 2007
Outsourcing bring us to the internationalization of consulting. With many participants from all over the world, the conference was very international, therefore certainly not easy to organise. What can be said about the conference in terms of its organization?
Antoine Beuve-Méry : We have had many participants as usual. I found that it was a high flying event and that the Hungarians had organized it very well. A new element was the networking event that we introduced in order to allow the participants to have bilateral meetings with other consultants. This was very successful and highly appreciated by the participants. The aim was to have consultants from the many countries and different sizes of firms meet and network. Over 40 people from among the 200 conference participants took part in this session. For a first time event, this is can be considered rather successful and we have received very positive feedback, so we are pleased.
To conclude this interview, I would like to ask you, Mister President, what part from among the many elements of the conference will you ultimately retain ?
Antoine Beuve-Méry : I would say that today there is no Léonardo da Vinci or Pic de la Mirandole. One sole man cannot be good in all fields anymore. Each person and any each company is good at only one domain, its own, and for the rest it must rely on outside support. And this is where consultants enter the game. If they were, according to a common joke, only people that tell you the time when looking at your own watch, they would have disappeared since long. In fact they are change management agents and if we consider the enormous need for change in Europe and the huge demand for it, it is quite clear that there is room for high quality consultants, especially since the consulting industry has a new role to play in meeting the Lisbon Agenda. So let us have a new rendezvous at the next FEACO meeting in Warsaw on 4 October 2007.
Words collected by Bertrand Villeret
Editor in chief
ConsultingNewsLine
Transaltion
To know more :
www.feaco.org
Whoswoo :
Antoine Beuve-Méry
Images :
B. Villeret pour ConsultingNewsLine. Copyright B. Villeret / Quantorg 2006
Copyright
RH&M 2006 - 2007Sept 2007
Report on the FEACO meeting in Budapest
Interview : Antoine Beuve-Méry
President of FEACO, Brussels
The European Federation of Consulting Firms Associations
The congress allowed us to observe and confirm the up turn of the consulting activity which started about 2 years ago.
Mister President, at the FEACO conference more than 200 consultants attended the event, with participants coming mostly from Europe and a few foreign delegations representing Japan, China, India and the USA. Time has passed since then. Is it possible today to make an assessment of the conference in terms of economical figures, consulting market and trends in the professional field ?
Antoine Beuve-Méry : I would say that the conference allowed us to observe and confirm the upturn of the consulting activity which started about 2 years ago. Today almost all European countries show a strong increase in their consulting activity.
Like Germany, which according to your 2006 FEACO report has become the first consulting market in Europe.
Antoine Beuve-Méry : Exactly. There are some surprising facts, although our new way of calculating the FEACO statistics may have introduced a certain bias. On the one side there is Germany that has become the first European consulting market and on the other side there is the rise of the Central European States. As regards Germany two reasons come to mind. First, a recovery of the German economy, second, an effect of scale : Germany is the largest economy in Europe and what is more, the Germans have become more inclined to using consulting in a natural way, leading to this increase in volume. This being said, the United Kingdom remains the «Grand Dame » of consulting and the most dynamic market. We must understand that many topics regarding Europe are managed from England, the utilities market for instance, the evolution of the economic regulations, and so on... and to address those topics, skills are mainly found on the London business floor... This explains this tremendous outcome : 1% of the UK GDP is generated by consultancy. That figure is far more reduced for Germany and France.
A France which is now being outrun by Spain ! What can be said about that ?
Antoine Beuve-Méry : I would say that this requires a more detailed analysis of the figures and it must be decided whether we talk about the overall sales or the breakdown of the activity into Business Consulting and Management Consulting. In Spain there is only one association for management consulting. In France there are basically two : Syntec Conseil en Management (Management Consulting) and Syntec Informatique (IT and IT Consulting), which opens the door to different modes of calculation. If we add up IT Consulting and Management Consulting, France stays far ahead. This being said, don’t forget that Spain is very dynamic. The increase of the Spanish economy is topping +3.5% when in France this is only 2%; this explains in the long term the positive evolution of the Spanish consulting activity.
We observe on a daily basis a real dynamism in the Spanish consulting market which seems to be supported by the European Commission bidding and tendering activity. Reality or fiction ?
Antoine Beuve-Méry : As all southern economies, Spain is developing rapidly and is consuming consulting services like never before. No doubt the Spanish economical boom contributed mostly to this situation, notably through the development of services centers, which are popping up everywhere, as they did in Barcelona. There was not even one 5 years ago.
The 2006 FEACO congress was held in the East, in the same line as the 2003 congress in Ljubljana and Athens in 2004. It was therefore bound to address topics such as the remarkable development of the former Eastern Europe, those countries we call now the Central European States. What can be said about that ?
Antoine Beuve-Méry : To understand what is happening we must keep in mind that the accelerator factor for the consulting activity results from economic growth. For the moment they are merely catching up with the Western European countries. They must close the gap and still have a long way to go before their economies will be aligned with ours; so, despite a strong economical growth they still show relatively weak levels of activity. Their markets are only starting up and are still undergoing big changes, and as they are in the fast lane this generates a tremendous need for consulting support. However, it is not easy to draw too many conclusions from the consulting growth, because when everything goes wrong consulting does well, and when everything goesright, demand for consulting is high as well, so generally the consulting sector does well whatever the economic situation.
So we see consulting proper in the East. What about Hungary, which’ federation VTMSZ was the co-organizer of the Budapest conference, is this country recognized as an opportunity by the French consultants who attended the meeting ?
Antoine Beuve-Méry : Absolutly. Hungary, which co-organized the conference, seems to have caught the attention of the participants, particularly of the French. Hungary is still a slightly closed market due to its terribly difficult language, Magyar, and this mostly because procurement rules require that tenders are written in Magyar and, because, for historical reasons (former Austro-Hungarian Empire of the Habsburg), much of the local business is done in German. As long as the German language remains predominant, the entry ticket is quite high for French speaking consultants who are considering opening a local office. But for those who are still questioning whether they should, the answer is yes, provided that they have a sustainable activity. Despite the Hungarian dynamism, a calculation demonstrates that Poland far exceeds the Hungary and stays the privileged place for foreign investments. To exemplify this I remind you that 30% of European subsidies go to Poland. So, differences in scale aside, I would compare Hungary to Belgium more than to any other state, even if it cannot in the same way show for any leading industry (in Belgium you have Solvay, in Finland Nokia, in Holland Philips, in Czech Republic Skoda, etc...). Therefore, Hungary remains a very important market for western consultants, but it remains a difficult one.
Comparable to Greece ?
Antoine Beuve-Méry : Certainly but there again I would refrain from making too hasty comparisons. The Greeks export their consulting services to the Balkans and the Mediterranean area, master the English language and are well represented in Brussels.
A survey by IBM in 2006 shows innovation as being the main concern within firms.
Romania and Bulgaria entered the European Union in 2007. In Romania there exists a tradition of French as a second language, and a Francophile inclination, and we are impressed by the quality of the French spoken by Romanian consultants, even if they have spent only little time in France. This certainly offers new opportunities to the French consultancies. What can be said about the entry of these two new states in the Union ?
Antoine Beuve-Méry : Romania and Bulgaria are integrating in the Union in 2007 and will therefore become eligible to the European Regional Development Programmes, targets 1-2-3, whereas until now they were only eligible to Programmes reserved to the accession countries such as the PHARE Programme. The intra-community development support will give them an additional boost in their development that should compare to the one we observed in Greece and Portugal. We wholeheartedly wish this for them.
As regards the rest of Europe : is it possible to link the high growth in consulting we can observe at the moment to the development of innovation within the enterprises ?
Antoine Beuve-Méry : Absolutely. To illustrate this point, I want to mention a survey carried out by IBM in 2006, which shows that innovation is the main concern of firms. Not just technological innovation, but also how to accomplish the practical work, to open the internal processes and turn them to exterior. This explains the tidal wave of e-Business that we observe today and which acts in a way as a relay to the first ERP big systems wave. The first one appeared in the mid 90’s and culminated in the year 2000, when the enterprises chose to let go of their old legaciesto replace them by new ERP which allowed an efficient start of the Y2K and led the way to a smooth changeover to the Euro. This second wave of the e-Business is of a different kind. What matters now is to support new ways of doing the work, which implies big changes at the level of the processes themselves as well as at the level of the information systems that support them. Before opening up your electronic gateway to your clients and your suppliers, you must have tidied your house. The opening of your own world through the web and e-Business is rich in opportunities, but it is also an open window to the inner parts of your enterprise. Gartner and IDC in their surveys indicate that systems architecture is essential to the set-up of online commercial services. This is the reason why the high demand for consulting is likely to continue.
Does this mean that we are going to see a slowdown in systems integration and tailored software development to the sole benefit of software parameter setting which needs no development at the client site and less consulting support ? When I say this, I am referring to the FEACO figures which indicate that sales are split between ~ 50% Management Consulting, 30% Outsourcing and only 19% Systems Integration and IT Consulting...
Antoine Beuve-Méry : Effectively. But systems integration is far from being dead. We are not going to put integration on the shelf of useless accessories. There are still many projects ongoing in this domain and there remains a lot of work for tomorrow because systems become more and more complex and heterogeneous. So I assure you that systems integration still has a bright future.
We see an increase in BPO (Business Process Outsourcing). Is this just a commercial communication artifact or is it a real phenomenon ?
Antoine Beuve-Méry : It is a real phenomenon which sometimes has a real innovative aspect in the sense that the goal is no longer to outsource peripheral corporate activities ( HR, Compensations, IT...) but to outsource part or the totality of what is considered as the core business.
So let us have a new rendezvous at the next FEACO meeting in Warsaw on October 2007
Outsourcing bring us to the internationalization of consulting. With many participants from all over the world, the conference was very international, therefore certainly not easy to organise. What can be said about the conference in terms of its organization?
Antoine Beuve-Méry : We have had many participants as usual. I found that it was a high flying event and that the Hungarians had organized it very well. A new element was the networking event that we introduced in order to allow the participants to have bilateral meetings with other consultants. This was very successful and highly appreciated by the participants. The aim was to have consultants from the many countries and different sizes of firms meet and network. Over 40 people from among the 200 conference participants took part in this session. For a first time event, this is can be considered rather successful and we have received very positive feedback, so we are pleased.
To conclude this interview, I would like to ask you, Mister President, what part from among the many elements of the conference will you ultimately retain ?
Antoine Beuve-Méry : I would say that today there is no Léonardo da Vinci or Pic de la Mirandole. One sole man cannot be good in all fields anymore. Each person and any each company is good at only one domain, its own, and for the rest it must rely on outside support. And this is where consultants enter the game. If they were, according to a common joke, only people that tell you the time when looking at your own watch, they would have disappeared since long. In fact they are change management agents and if we consider the enormous need for change in Europe and the huge demand for it, it is quite clear that there is room for high quality consultants, especially since the consulting industry has a new role to play in meeting the Lisbon Agenda. So let us have a new rendezvous at the next FEACO meeting in Warsaw on 4 October 2007.
Words collected by Bertrand Villeret
Editor in chief
ConsultingNewsLine
Transaltion
| Link to the French version : |
 |
To know more :
www.feaco.org
Whoswoo :
Antoine Beuve-Méry
Images :
B. Villeret pour ConsultingNewsLine. Copyright B. Villeret / Quantorg 2006
pour ConsultingNewsLine
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