☛ Want the latest procurement and supply chain news delivered straight to your inbox? Sign up for the Supply Management Daily
2011 | Rebecca Ellinor
Cost cutting is back on the agenda for consultancy buyers as a result of
the uncertain economic
This is the
finding of the latest Sourceforconsulting.com quarterly report,
released today, which tracks the buying trends of about 200 organisations with a combined annual consulting spend of
around £2.5 billion. It said the threat of
sovereign insolvency and a European banking crisis is forcing businesses to look
at cost cutting.
Ed Haigh at Sourceforconsulting.com
said: “What will be interesting is to see the form cost cutting takes. Much of
the easy work has probably already been done and it seems unlikely that many
companies would have relaxed their grip on costs too much in the intervening
period, given the ongoing economic uncertainty.”
Difficult economic conditions mean nearly
40 per cent of consultancy buyers expect to spend more on advice about
operational efficiency over the next six months – an 11 per cent increase on
the number from the same period last year.
The report said half of private
sector clients (outside of financial services) are expecting to seek advice
from strategy consultants, with manufacturing, pharmaceuticals and energy the
sectors in most need of their assistance.
A third of clients are also expecting to increase
expenditure on IT consulting. However, demand looks as though it may be far
weaker in the financial services sector than it will be in the rest of the
private sector as regulatory work is driving the agenda in this sector.
The report also found that with record levels of unemployment across Europe
(recently hitting a 17-year high in the UK), HR services are increasingly in
demand. As people are laid off, HR consulting firms are getting involved in helping
organisations to reshape.