MCA News June 2010

MCA News â€" June 2010

Despite seeing revenues fall by 6 per cent in 2009, roughly in line with the contraction in the wider economy, the MCA's 2010 UK Consulting Industry Statistics Report says that management consultancies were in demand when it came to helping organisations improve their efficiency and save jobs. The MCA estimates that the UK consulting industry is now worth around £8bn.

Business process re-engineering work, which helps organisations strip out unnecessary costs by looking at processes in their entirety, grew by 5 per cent on top of a 31 per cent jump in 2008. The industry also helped organisations deal with the recession's impact on their staff - with a 6 per cent growth in HR consulting.

Strategy consulting was down by almost a quarter. The report says that this is usually the main casualty of any recession so far as the consulting industry is concerned and reflects the extent to which the buyers of consulting have changed their priorities.

MCA member companies have achieved significant improvements in their own productivity during this recession.  By the end of 2009, the average consultant was 7 per cent more productive for their consulting firm than 12 months earlier.

Overall, the numbers of people employed by MCA member firms fell by 15 per cent to 40,000. However, the number of senior people across the industry also rose by 10 per cent, an indication of consulting firms' willingness to invest in expertise and experience, even during the recession. By focusing on the value they add, consulting firms faced less pressure on fee rates than in previous downturns.

Demand for management consultancy in the financial services sector fell by 12 per cent during 2009 on top of a 6 per cent drop in 2008. But anecdotal evidence suggests recovery started in autumn 2009, with the sector commissioning a larger number of longer-term consulting projects.

Alan Leaman, Chief Executive of the MCA, said: "It was a difficult year for the industry, but MCA members have adapted quickly and focused on a high-value add strategy. While there were few parts of the private sector where demand for consulting services remained unscathed, there is already anecdotal evidence that the financial services sector is showing signs of a return to growth."

Visit the MCA website for further details and to download the summary report. [

That's all from MCA News for this month. Thanks for watching.