Thursday, July 16, 2009

Public Sector Consulting Reaches an Important Juncture

The public sector consulting market is a safe haven in a recession, and consulting firms know it. In an era where financial "safety" seems more myth than reality, consultancies are voracious for stable revenues. And to secure that stability, consultancies need only to provide clients with the industry expertise they demand.

According to new findings from the research firm Kennedy Consulting Research & Advisory, governments worldwide continue to invest in consulting and advisory services despite the failing economy and high unemployment; and the intensity of firms vying to get their share of the pie is at an all-time high. The impressive size and comparatively robust growth of the public sector market is prompting consultancies to build out their public sector practices, redeploying resources from across their private sector verticals with the prerogatives of maintaining consultant utilization and growing revenues.

"The changing role of government in the private sector business -- including nationalization, M&A facilitation, and bailouts -- simultaneously changes the solutions needed to satisfy demand," says Kelly Matthews, Associate Director of Research, Kennedy Consulting Research & Advisory. "Neither government staffers, nor specialty boutiques and defense contractors, which have dominated the public sector in recent years, possess the necessary expertise for disentangling the multiple crises afflicting the public sector. So now, governments turn to consulting firms that have successfully repositioned their private sector expertise to the government."

Budget deficits and the associated pressure to provide more services with fewer resources, combined with waning institutional knowledge are prompting public sector consulting service providers to deliver innovative and transformational solutions. Firms that can help government organizations realize cost savings and significant ROI in the short-term will be successful in winning business.

The implications of firms repositioning their private sector service suites to the public sector are significant for both buyers and providers of public sector consulting services, and are analyzed in Public Consulting Marketplace 2009-2012 -- part of Kennedy's ongoing research in its Public Sector Consulting Series. The new research scrutinizes key market trends and demand forecasts, by government segment, key geography, and the service lines of Human Resources, IT, Business Advisory, Strategy and Operations consulting.

In addition, Kennedy analysts have indentified the strongest consulting firms in the public sector consulting marketplace. They are featured in three distinct Kennedy Vanguards of Public Sector Consulting Practices -- one each for Management Consulting, IT Consulting and Business Advisory Services. Among the consultancies rated are: Accenture, A.T. Kearney, Aton Origin, Bain & Company, Booz Allen Hamilton, Capgemini, CSC, Deloitte, IBM, KPMG International, McKinsey & Co. Oliver Wyman, PA Consulting, PricewaterhouseCoopers and Roland Berger Strategy Consultants.

About Kennedy Consulting Research & Advisory

Since 1970, Kennedy Consulting Research & Advisory, a division of Kennedy Information, has been the world's leading source of market analysis on the Management Consulting and IT Consulting industries, serving the most highly regarded professional services firms and Fortune 500 companies across the globe. Kennedy provides accurate and reliable market sizing and forecasts for consulting services world-wide; needs analysis and vendor profiling for buyers of consulting services; timely and insightful intelligence on the top consulting firms in their respective markets; and operational benchmarks that measure consulting performance. Kennedy's research spans multiple service areas, client vertical industries, and geographies.

Kennedy's stand-alone consulting advisory unit, Kennedy Information Advisors, provides results-oriented strategic guidance to buyers and sellers of consulting services.

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