Advice for IT consultants

IT consultants are experiencing increased demand but more competition. An interesting article in The Economist – titled “Advice for consultants”  on June 2^nd 2011, offers some advice , similar to my experiences in the Database server and IT consultants  market over the last couple of years.

Demand for consultants increased since 2009

The first point they raise is demand for consultants increased since 2009. Companies are hiring consultants to assist in growth oriented activities , whereas in 2009 the focus was cost-cutting. Merging systems and technology platform roll outs.

In some ways this remains accurate. Large companies are investing in projects such as  Data Centre upgrades but in any proposal clients are demanding ways of saving money . Two examples are 1)management pressure to virtualize 2)server consolidation and licensing.

Consulting firms are diverse in nature

The second point is that consulting firms are diverse in nature. Consulting firm types are:

a) Elite Strategy Consultancies such as McKinsey & Co

b) Smaller Strategy consultancies such as A T Kearney

c)  Big Four – KPMG, Deloitte ,PwC, Ernst & Young

d) Technology Consultancies such as IBM and Hewlett-Packard

 I would add to the list smaller software companies who’ve built their reputation around a particular technology platform , such as DB2 or SQL Server. They still make a small percentage of consulting spend , but are often hired by larger consultancies

Consulting expected to grow 

The third point is strategic consulting expected to grow  1.1% by 2014 ,Operations-management consultancy expected to grow 5.5% by 2014 and IT consultants by 3.9 %

 

This fits in with the current trend of large IT investment , introduction of post-banking crisis systems such as Solvency 2.

 

Companies are oversupplied with MBA educated managers

The fourth point is companies in USA and Europe are oversupplied with MBA educated managers , many are ex consultants. These managers make the decisions when to bring in expertise.The requirement for that expertise is growing. One of the reasons is emerging markets. Another reason is “downstream” work

Adding to those reasons , I include a) integration of third party systems , such as modelling infrastructures b) infrastructure changes , particularly the trend towards restructuring IT departments to developing an Operations layers of subject matter experts, and outsourcing development. Read more on Outsourcing DBA tasks to an Offshore IT company

 

More Senior Consultants and less Junior Consultants 

 The fifth point is clients are requesting fewer teams of consultants comprised of juniors and seniors – but rather, less juniors and more seniors – who work alongside the existing staff

The trend is towards specialist temporary labour. Consulting is analysed in terms of value for money. The days of the Powerpoint wielding consultant are over.

 This is undeniable. Clients are far better at assessing the value of an IT consultant. IT consultants are in demand – but preference is given to consultants who can bring value from other projects i.e experience. I’ve been involved in projects where a large consultancy will swamp the project with juniors , who appeared to not do much but organise the paperwork. I’ve seen far less of this in the last couple of years.

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