The global consulting market, valued at $860 billion, demonstrated significant resilience in 2023 despite rapid digitalization and evolving client needs across industries. To navigate this dynamic landscape, competitive intelligence (CI) is crucial. Evalueserve's CI program exemplifies this, providing stakeholders with key insights into competitors, market trends, and external factors.
Let’s have a look at three key drivers from our CI analysis that emerged in 2023, propelling the growth of consulting firms and reshaping the industry's trajectory during the year.
- Generative AI (GenAI): Transforming the consulting landscape through automation and enhanced productivity
- Focus on the MENA Region: Catering to the growing demand for expertise in the Middle East and North Africa
- Upskilling & Workforce Transformation: Prioritizing employee development and diversity to meet evolving industry needs
Delving deeper into how these pillars have influenced the consulting landscape and what they mean for the industry's future.
Generative AI
Generative Artificial Intelligence (AI) technology emerged as a transformative force in the consulting landscape, with projections indicating that over 41% of work in the Professional Services industry will be automated by 2030.
Major firms like PwC, Deloitte, KPMG, EY, and Accenture made significant investments in GenAI aimed at harnessing the power of AI to automate repetitive tasks, enhance productivity, and deliver more value to clients. PwC allocated $1 billion in the US, €150 million in Germany, $418 million in China, and CHF 50 million in Switzerland. Deloitte committed $2 billion globally, while KPMG and EY invested $2 billion and $1.4 billion respectively, with Accenture leading with a $3 billion investment over three years.
Quickly adapting to this technological shift, consulting firms integrated Generative AI into their internal operations by deploying innovative tools such as KPMG's Kaichat, Deloitte's Dartbot, EY’s EY.ai, and PwC’s ChatPwC to improve service delivery.
The adoption of Generative AI consulting enabled firms to achieve significant efficiencies, with some reporting a remarkable three-month payback period on investment.
Focus on MENA region
With 80% of Middle Eastern CEOs being optimistic about their companies' economic prospects for 2024 and an even larger group being optimistic about the overall economy, the Middle East became a focal point for consulting firms. Starting in 2022 and moving into 2023, companies such as Arthur D. Little, PwC, Roland Berger, FTI Consulting, Deloitte, and Ankura established new offices, launched regional headquarters, and enhanced their service offerings to cater to the growing demand for their expertise.
Accelerated digital transformation in the region, driven by economic diversification plans like Saudi Arabia's Vision 2030, saw PwC Middle East's strategic alliance with the Digital Government Authority, Accenture's collaboration with the Qatari ICT Ministry, and Deloitte’s AI institute in Saudi Arabia, along with the Future of Government initiative, leading the transformation wave.
Aligning with localization rules in Saudi Arabia aiming for 40% Saudi nationals in its consulting workforce by 2024, efforts to hire and develop local talent intensified with KPMG onboarding 260 new graduates and PwC welcoming 140 Saudi nationals, representing over 30% of their total graduate intake.
Upskilling & Workforce transformation
Amid a persistent 'war for talent', the consulting sector faces significant challenges, with over 100,000 management consultants employed across more than 350 offices in the UK alone, and a considerably larger workforce globally. Embracing hybrid working models, firms in the consulting sector aimed to enhance employee satisfaction and retention rates.
With organizations reporting a shortage of skilled tech workers, the firms focused on equipping employees with the skills needed to navigate an increasingly digital and complex business landscape, consulting firms launched a slew of initiatives aimed at fostering continuous learning and development and shifted their hiring focus to prioritize skill sets over traditional recruitment criteria. Initiatives such as Cyber Impact Bootcamps and AI academies underscored the industry's commitment to equipping employees with the requisite skills to thrive in an evolving digital ecosystem.
Recognizing the importance of nurturing a diverse and inclusive workforce, consulting firms increased their focus to increase the representation of underrepresented groups. KPMG aims to increase the representation of Black and Latinx employees by 50% by 2025, while PwC aims to promote 42% women and 19% from an ethnic minority background to partner within their July cohort.
Conclusion
By embracing AI technologies, focusing on regional growth opportunities, and prioritizing workforce development, consulting firms positioned themselves for success in an increasingly dynamic and competitive landscape. These pillars are not only reshaping the consulting industry but are also setting the stage for its growth in 2024 and beyond. As the industry continues to evolve, it will be interesting to see how these pillars shape the future of consulting.
Stay Ahead with Evalueserve's CI Solutions:
To know more of such trends and stay ahead in the market, leverage Evalueserve's Competitive Intelligence (CI) solutions like Insightsfirst platform. In this data-driven era, leveraging CI platforms like Evalueserve's Insightsfirst is crucial. It provides real-time access to insights on market developments, trends, and competitor actions, empowering you to:
- Uncover new possibilities
- Make informed decisions
- Stay ahead of the competition
By embracing CI and staying informed about emerging trends, consulting firms can continue to thrive in this dynamic and evolving market.
