Business School
Sept 2007
Report on the FEACO meeting in Budapest
Interview : Dr Gonda György
Professor, Head of the Department of Management Studies,
International Business School of Budapest
Dr György Gonda is an economist, and a specialist of trade. He was formerly President of VTMSZ, the Hungarian association of management consultants, and is now professor at the International Business School of Budapest, in charge of the Management Studies as Head of the Department.
Doctor Gonda, you are a well known economist and a long time practitioneer of consulting. Before reviewing the state of the economy and the management consulting sector, may we start with a few elements on your career and your consulting activity?
Dr György Gonda : I am an economist and I started as a businessman 35years ago in foreign trade.I spent 5 years in New York as a commercial councelor then changed to management consulting. I have been a Partner and director of management consulting division of Ernst and Young in Budapest.. Then from 1997 to 2000 I was Director of Consulting services at Price Waterhouse then at PricewaterhouseCoopers after the merging. I have been the President of VTMSZ, the Hungarian association of management consulants for 4 years (president elected for 2 years renewable twice). Now I am still a member of the board.
And a professor...
Dr György Gonda : Right. I am the Head of the Department of Management Studies at IBS, the International Business School of Budapest, where I teach Management Theory, Corporate Governance and Change Management. I’am also a part time consultant with a private consultancy (GVT)I set up in 1995 and which was a sleeping company since then. [GVT has a staff of 2]. So I am part time at the Business school and part time consultant.
From your economic knowledge and your everyday practice how would you define the Hungarian economy?
Dr György Gonda : Well we have 10 million people, 2 in Budapest (a sequel of the Habsbourg Empire). Actives are 4,3 to 4,4 millions, Unemployed 0,5 millions, so workings are 3,6 millions among which we have O,9 millons Civil Servants, including teachers, family doctors... to the staff of the opera house and state national theatre...Traditional sector is the agriculture and food industry but nowadays their contribution to GDP is only 7-9 percent. Machinery industry is the number one exporter, 70 percent of GDP is coming from the service industry (banking, insurance, costruction, tourism, etc.) The privatization practically has been finished in the late 90s.. FDI (foreign direct investment) per capita is the highest in Central and Eastern Europe. You can find 80% of Fortune TOP 500 companies in Hungary in production, service industries, utilities , etc. Hungary is an important service provider for outsourcing and service centers.more info on : leading sectors, traditionals sectors, privitizatized, newly privatized, acquisitions from abroad... We joined the European Union 2 years ago and practicaly 90% of our GDP comes from the private sector.
And how is this economy going at the moment, what are the trends?
Dr György Gonda : We practicaly fly together with other nations at the European level. Now the private economy is in good shape. The GDP is growing by 4,1% this year. So it is good, even if the prospect for next year is only 2,6% due to our new very massive and strict budget restriction.
Will this impact the Management Consulting sector?
Dr György Gonda : Not that much. The annual growth for MC is 5-6% mostly due to the fact that the private sector is flourishing. Also the state is reorganizing, downsizing itself, so the slowing of the economy would not impact significantly the MC industry.
How specific is that Hungarian MC market?
Dr György Gonda : We have about 3000 management consultants in the country with 200 to 300 registered management consultancies . The industry is characterized by small and medium size consulting companies. There can be thousands of individual consultants, whom about the professional association does not know.
And the trends for the MC market?
Dr György Gonda : We have good market forcasts for the next 5 to 6 years. Corporate life is excellent, ready for hiring consultants, find new profit sources, and the European Union will provide 23 billion E for the next 7 years (in the so called Nation Development Plan n°2) to assist infrastructure which will give great money to the consultants too.
What are the main practices customers are demanding at the moment?
Dr György Gonda : There is a huge demand for CRM (Customer Relationship Management), SCM (Supply Chain Management), CF (Corporate Finace activity), and “ traditional ” consulting : Cost Reduction, Restructuring, Business Process Reengineering, Change Management, Organizational Development. The demand comes from the industry, energy and the utilities, the public administration, the financial sector, the media and communications, already privatized. As I said 90 % of the GDP comes from the private sector, [and newly privatized activities].
What might be the opportunities for newcomers in this MC field?
Dr György Gonda : Market liberalization has been the drive behind the development.The first privatizations came at the end of the 80s of last century century and the firts international MC companies came with it. Now big and medium sized consultancies are here : Roland Berger, BCG... If newcomers want to come there is no problem. Provided that they bring some interesting skills to the market, they can come and may cooperate with local cabinets, because of culture and language.
Does it mean that any foreign consultancy must do parteneering with a local cabinet?
Dr György Gonda : Nothing is obligatory. If something was obligatory the Hungarians will not do it. That is the reason why only English is obligatory...even if we still have people speaking Russian. So you can speak English and local partners are not necessary but to get acquainted with the business, legal, etc. environment you must have local partners. If you want to realy market your services you have to make strategic alliances.
To conclude, what might be your ultimate words to our readers?
Dr György Gonda : The gates are open ! We would be glad to have common projects as soon as they can be made possible with any foreign company, and consultancy. Since your practices and your acquaintance to the EU matters are [sound], peole here would like to work together on EU projets and would enjoy to benefit from your west experience. And this is especially right for France which has an enormous experience in development matters.
Words collected by Bertrand villeret
Editor in Chief
ConsultingNewsLine
To know more :
http://www.ibs-b.hu
Whoswoo :
Dr György Gonda
Images :
B. Villeret pour ConsultingNewsLine. Copyright B. Villeret / Quantorg 2006
Copyright
RH&M 2006 - 2007Sept 2007
Report on the FEACO meeting in Budapest
Interview : Dr Gonda György
Professor, Head of the Department of Management Studies,
International Business School of Budapest
Dr György Gonda is an economist, and a specialist of trade. He was formerly President of VTMSZ, the Hungarian association of management consultants, and is now professor at the International Business School of Budapest, in charge of the Management Studies as Head of the Department.
Doctor Gonda, you are a well known economist and a long time practitioneer of consulting. Before reviewing the state of the economy and the management consulting sector, may we start with a few elements on your career and your consulting activity?
Dr György Gonda : I am an economist and I started as a businessman 35years ago in foreign trade.I spent 5 years in New York as a commercial councelor then changed to management consulting. I have been a Partner and director of management consulting division of Ernst and Young in Budapest.. Then from 1997 to 2000 I was Director of Consulting services at Price Waterhouse then at PricewaterhouseCoopers after the merging. I have been the President of VTMSZ, the Hungarian association of management consulants for 4 years (president elected for 2 years renewable twice). Now I am still a member of the board.
And a professor...
Dr György Gonda : Right. I am the Head of the Department of Management Studies at IBS, the International Business School of Budapest, where I teach Management Theory, Corporate Governance and Change Management. I’am also a part time consultant with a private consultancy (GVT)I set up in 1995 and which was a sleeping company since then. [GVT has a staff of 2]. So I am part time at the Business school and part time consultant.
From your economic knowledge and your everyday practice how would you define the Hungarian economy?
Dr György Gonda : Well we have 10 million people, 2 in Budapest (a sequel of the Habsbourg Empire). Actives are 4,3 to 4,4 millions, Unemployed 0,5 millions, so workings are 3,6 millions among which we have O,9 millons Civil Servants, including teachers, family doctors... to the staff of the opera house and state national theatre...Traditional sector is the agriculture and food industry but nowadays their contribution to GDP is only 7-9 percent. Machinery industry is the number one exporter, 70 percent of GDP is coming from the service industry (banking, insurance, costruction, tourism, etc.) The privatization practically has been finished in the late 90s.. FDI (foreign direct investment) per capita is the highest in Central and Eastern Europe. You can find 80% of Fortune TOP 500 companies in Hungary in production, service industries, utilities , etc. Hungary is an important service provider for outsourcing and service centers.more info on : leading sectors, traditionals sectors, privitizatized, newly privatized, acquisitions from abroad... We joined the European Union 2 years ago and practicaly 90% of our GDP comes from the private sector.
And how is this economy going at the moment, what are the trends?
Dr György Gonda : We practicaly fly together with other nations at the European level. Now the private economy is in good shape. The GDP is growing by 4,1% this year. So it is good, even if the prospect for next year is only 2,6% due to our new very massive and strict budget restriction.
Will this impact the Management Consulting sector?
Dr György Gonda : Not that much. The annual growth for MC is 5-6% mostly due to the fact that the private sector is flourishing. Also the state is reorganizing, downsizing itself, so the slowing of the economy would not impact significantly the MC industry.
How specific is that Hungarian MC market?
Dr György Gonda : We have about 3000 management consultants in the country with 200 to 300 registered management consultancies . The industry is characterized by small and medium size consulting companies. There can be thousands of individual consultants, whom about the professional association does not know.
And the trends for the MC market?
Dr György Gonda : We have good market forcasts for the next 5 to 6 years. Corporate life is excellent, ready for hiring consultants, find new profit sources, and the European Union will provide 23 billion E for the next 7 years (in the so called Nation Development Plan n°2) to assist infrastructure which will give great money to the consultants too.
What are the main practices customers are demanding at the moment?
Dr György Gonda : There is a huge demand for CRM (Customer Relationship Management), SCM (Supply Chain Management), CF (Corporate Finace activity), and “ traditional ” consulting : Cost Reduction, Restructuring, Business Process Reengineering, Change Management, Organizational Development. The demand comes from the industry, energy and the utilities, the public administration, the financial sector, the media and communications, already privatized. As I said 90 % of the GDP comes from the private sector, [and newly privatized activities].
What might be the opportunities for newcomers in this MC field?
Dr György Gonda : Market liberalization has been the drive behind the development.The first privatizations came at the end of the 80s of last century century and the firts international MC companies came with it. Now big and medium sized consultancies are here : Roland Berger, BCG... If newcomers want to come there is no problem. Provided that they bring some interesting skills to the market, they can come and may cooperate with local cabinets, because of culture and language.
Does it mean that any foreign consultancy must do parteneering with a local cabinet?
Dr György Gonda : Nothing is obligatory. If something was obligatory the Hungarians will not do it. That is the reason why only English is obligatory...even if we still have people speaking Russian. So you can speak English and local partners are not necessary but to get acquainted with the business, legal, etc. environment you must have local partners. If you want to realy market your services you have to make strategic alliances.
To conclude, what might be your ultimate words to our readers?
Dr György Gonda : The gates are open ! We would be glad to have common projects as soon as they can be made possible with any foreign company, and consultancy. Since your practices and your acquaintance to the EU matters are [sound], peole here would like to work together on EU projets and would enjoy to benefit from your west experience. And this is especially right for France which has an enormous experience in development matters.
Words collected by Bertrand villeret
Editor in Chief
ConsultingNewsLine
To know more :
http://www.ibs-b.hu
Whoswoo :
Dr György Gonda
Images :
B. Villeret pour ConsultingNewsLine. Copyright B. Villeret / Quantorg 2006
pour ConsultingNewsLine
All rights reserved
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