Transcript GENERAL TRENDS IN THE MANAGEMENT CONSULTANCY IN CENTRAL

SPECIALITIES OF
MANAGEMENT CONSULTING IN
NEWLY JOINED AND
CANDIDATE COUNTRIES
by Janko ARAH
BUDAPEST, NOVEMBER 9th, 2006
Newly Joined and Candidate Countries
Newly Joined Countries:
Estonia, Lithuania, Latvia, Poland, Czech Republic, Slovakia, Hungary,
Slovenia, Malta and Cyprus (8 new members are bordering Western Europe)
Candidate Countries:
Bulgaria, Romania, Croatia and Turkey
There are 8 members (out of 24) in FEACO from Newly Joined and Candidate Countries:
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•
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Bulgaria (BAMCO)
Croatia (UPS – AMC)
Cyprus (CYBCA)
Czech Republic (APP)
Hungary (VTMSZ)
Poland (SDG)
Romania (AMCOR)
Slovenia (AMCOS)
GDP per capita in PPS
(EU-25: 100 – 17.900 euros)
Source: Eurostat
90
83,3
80,6
80
73,8
69,5
70
60,1
60
52,1 49,8
47,2
50
55
61,4
48,8
Niz1
32,134,7
40
30,7
30
20
Turkey
Croatia
Romania
Bulgaria
Cyprus
Malta
Slovenia
Slovakia
Czech R
Poland
Latvia
Lithuania
Estonia
0
Hungary
10
Real GDP growth in 2005
12
10
8
10,4
9,8
7,5
7,4
6,1 6,1
5,5
6
4
3,5
4,3 3,9
3,8
5
Niz1
4,3
2,3
2
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to
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Po a
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C nd
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ch
Sl R
ov
ak
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H
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Sl ary
ov
en
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M
al
C ta
yp
r
Bu us
lg
ar
R
om i a
an
C ia
ro
at
ia
Tu
rk
ey
0
•
Source: International Risk & Payment Review, October 2006
Inflation, annual ave. in 2005
10
9
9
8
7,7
6,9
7
Source: International Risk & Payment Review, October 2006
Turkey
Croatia
2
Romania
2,5 2,5
Bulgaria
Slovakia
Czech R
Poland
Latvia
Lithuania
Estonia
0
3,3
Cyprus
2,2 1,9
2,7
Malta
2,7
2
1
•
Niz1
3,8
Slovenia
3
5
Hungary
6
5 4,1
4
Unemployment in % in 2005
20
17,8
18
16
17,8
16,2
14
12
10
10,2
8,3
8
7,9
6,9
10,1
7,3
6,5
5,8
6
•Source: International Risk & Payment Review, October 2006
Turkey
Croatia
Romania
Bulgaria
Cyprus
Malta
Slovenia
Hungary
Slovakia
Czech R
Poland
Latvia
0
Estonia
0
3,4
Lithuania
4
2
9,5
Niz1
The European MC-Market
Composition by Country/Region, 2005 in %
Source: Feaco 2006
38,9
27,5
Niz1
9,7
4
3,7
3,5
2,6
5,6
Ne Ita l
y
th
er
la
nd
Ea
s
st
er
n
E
O
th
er
s
Fr
an
ce
Sp
ai
n
No
rd
ic
R
4,7
UK
G
er
m
an
y
45
40
35
30
25
20
15
10
5
0
Estonia – some general information on MC
-
leading country in the Baltic region, small c. & market
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culture for consulting is very young, no clear market leader
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3 sectors in MC:
- big companies (KPMG, PWC, E&Y and D&T)
- local companies: technical oriented, young staff, MC mainly for
export
- many individuals (hard to find clients, strong competition)
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ECA was established in 1992; has 35 members
-
accepted as a partner by governmental institutions
Latvia - some general information on MC
- Association of Business Consultants - founded in 1995 and
has 67 members
- association's members services are HR management,
economy, marketing, organisation's management, IT, legal
services, production and technology
- main goals of LBKA
- Latvian MC market trends
- current activities of LBKA
- implementation of CMC standards
- elaboration of training programs
- involvement in common EU projects
Slovakia - some general information on MC
-
-
MC manage their Slovak operations from Prague
small private companies, specialized agencies, banks,
broker firms, investment companies, foreign trade
organizations, different information centers, trade and
industrial chamber, and some of the universities
small and start-up businesses represent a specific area of
MC
National Agency for Development of Small and Medium
Enterprises (NADSME), the network of Business
Innovation Centers (BIC) and Regional Advisory and
Information Centers (RAIC)
Comparison of Management Consulting
in Selected Markets
TurnoverMC Market
in MC*
Poland
Czeck R
Hungary
Slovenia
Romania
Bulgaria
Growth
GDP
Pop.
Growth
in mio.
240 (300) 10,0% (30) 3,5% (5,6) 38
390 (400) 2,9% (4) 6,1% (3,7) 10
251 (226) 11,0% (5) 4,3% (3,9) 10
120 ( 90) 8,9% (10) 3,9% (4,6) 2
200 (107) 20,0% (35) 5,0% (8,1) 22
56 ( 56) (7) 5,5% (5,3) 7
* In mio EURO in 2005 and (2004)
Source: Feaco, Survey 2005-2006
Key Figures of Selected European MCMarkets, 2005 (2004)
Country
Turnover per
Consultant (EUR)
Czech R
46,791 (50.000)
Hungary
55,134 (65.000)
Slovenia
57,554 (65.000)
Poland
24.000 (
Romania
-
Bulgaria
20,000 (20.000)
-
)
(50,000)
Specialities in MC
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97,4% of the 61,6 billion Euro MC turnover in Europe was
generated within the Western-European countries and 2,6% in
CEE in 2005
- MC has developed significantly
- typical daily fees: 100 – 1.300 EUR
-
potential growth rate varies between 2,9 – 20 %
(4 - 35 % in 2004)
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MC can be optimistic about the future
- the importance of reliable local partners will increase,
due to language barriers, to the knowledge of the local
business culture and to local client contacts
- privatisation and public market projects
- private sector and services such as business strategy,
organisation development, human resources and IT
consulting
- clients seek not only advice, but implementation and
operation services as well
- speed, quality and value added, comprehensive
solutions are going to be of key importance
- outsourcing - a key driver of the industry development
Outsourcing:
- from invoicing to advanced research and
development
- Accenture, Capgemini, IBM
- some multinationals, like Lufthansa, General
Electric...
- economic benefit - capital involved
- CEE cannot compete with China or India on
wage rates, but it has other advantages:
- broad knowledge of European languages
- for call centres, it is better to have them in the
same time zone, to enable them to respond
quickly
- geographic proximity
Specialities of MC in Slovenia
-
pro-active promotion activities (awards)
Networking; Consulting cluster
Relation to national government
Changes in top managements
SME’s looking for strategies and HR
Local communities (consortium for
development funds, EU projects etc.)
Czech Republik Management Consulting
Market by Service Line (390 mio euros)
OS; 21,0
OUT; 21,0
D&I; 7,5
BC; 29,0
IT; 35,0
Source: FEACO
Hungary Management Consulting Market by
Service Line (251 mio euros)
OS; 17,8
OUT; 0,8
D&I; 4,1
IT; 19
BC; 58,3
Source: FEACO
Slovenia Management Consulting Market by
Service Line (120 mio euros)
OS; 8,0 OUT; 2,0
D&I; 12,0
IT; 3,0
BC; 75,0
Source: FEACO
Romania Management Consulting Market by
Service Line (200 mio euros)
IT; 15
OS; 40
BC; 35
OUT; 5
D&I; 5
Source: FEACO
Bulgaria Management Consulting Market by
Service Line (56 mio euros)
Outsourcing
5%
HR
24%
Strategy
31%
OM
30%
IT
10%
Source: FEACO
Daily Effective CEE Partner/Manager Fee
Rates – Contrasting Countries & Firm Size
Daily Effective Day Rate (EUR)
1400
1200
1000
800
600
400
200
0
Hungary
Top 40 Consultancy
Romania
Slovenia
Medium & Small Consultancy
Daily Effective CEE Senior Consultant Fee
Rates – Contrasting Countries & Firm Size
900
Daily Effective Day Rate (EUR)
800
700
600
500
400
300
200
100
0
Hungary
Top 40 Consultancy
Romania
Slovenia
Medium & Small Consultancy
Daily Effective CEE Consultant Fee Rates –
Contrasting Countries & Firm Size
Daily Effective Day Rate (EUR)
700
600
500
400
300
200
100
0
Hungary
Top 40 Consultancy
Romania
Slovenia
Medium & Small Consultancy
feaco forward programme
2006-2008
 Establishment of a clear operational
framework
 Development of prospectus
 Once a year ExCo meeting in one of the
countries
 Promote the temporary placement of staff
member of CEC association in large WE
association
 Have ExCo representative at each
medium/large scale event organised by
National Associations
Thanks
for your attention.