Caribbean ExportCICMC Management Consulting Industry Report Management Consulting
Caribbean Export/CICMC: Management Consulting Industry Report Management Consulting Business Symposium 2 St. Kitts & Nevis 29 June 2010
Project Description Aims • Profile management consulting industry • Strategy for development of the industry Goals • Help local consultants access regional/external markets • Stronger industry to support development of region Process • Local surveys of suppliers and purchasers of services in: 1. 2. 3. 4. 5. 6. 7. • The Bahamas Barbados The Dominican Republic Jamaica The OECS (Antigua and St. Lucia) Trinidad & Tobago Martinique Draft report based on supply/demand gaps
The Market: Spending Amount Spent Yearly Percentage of (US$) Respondents Mid-point Share of Value (US$) Market Value $10, 000 - $19, 999 36% $15, 000 3% $20, 000 - $49, 999 18% $35, 000 3% $50, 000 - $99, 999 13% $75, 000 5% $100, 000 - $249, 999 14% $175, 000 12% $250, 000 - $499, 999 6% $375, 000 12% 13% $1, 000 65% $500, 000 or more
The Market: Approach to Consulting 60% 50% 40% 30% 20% 10% 0% Number of Consulting Projects Commissioned Annually 0 1 -2 3 -5 6 -9 10 or more • Few projects: consulting valuable add-on, not part of business model • High value spend on strategy or systems, smaller amounts on process -type services • Although small/young businesses need strategy, most spend on process services: need to show benefits to develop this market
The Market: Performance Client Satisfaction by Consultant Type 80% 70% 60% 50% 40% 30% 20% 10% 0% Local Regional Extra-regional Not satisfied Somewhat satisfied Satisfied • Satisfied + very satisfied: ▫ Locals: 82% ▫ Regional: 82% ▫ Extra-regional: 72% Very satisfied
Management Consulting Industry Profile 70% Number of Employees 60% 50% 40% 30% 20% 10% 0% 1 -4 5 -9 10 -19 20 -49 • 64% 1 -4 employees, 82% 9 or fewer 50 or more
Management Consulting Industry Profile Revenue in 1 -4 Employee Group (Average of 1. 45 professional staff) Revenue Bracket $10, 000 - $19, 999 $20, 000 - $49, 999 $50, 000 - $99, 999 $100, 000 - $249, 999 $250, 000 - $499, 999 $500, 000 or more % in Revenue Bracket 30% 26% 13% 5% 0% Midpoint $15, 000 $35, 000 $75, 000 $175, 000 $375, 000 - Revenue per Employee $10, 323 $24, 086 $51, 613 $120, 430 $258, 065 - • Productivity critical indicator of profitability • Productivity benchmarks: 2 xsalary min, 3 x good, 4 x very profitable • 2 groups exist: 1 -new/struggling firms, 2 -mature firms
Supply/Demand Implications • 65% of market value in large assignments, but only 13% of number of clients • 54% of clients spend under US$50 K annually ▫ Two-tiered market, weak middle • Quality issues thrown up by Group 1 firms ▫ Need for skills development • Flight to safety: big names on big value projects, small local firms pushed out ▫ Need for quality assurance-CMC • Still hard for Group 2 firms to tap top segment ▫ Need for market development/intelligence, alliances
Demand Side Recommendations • Develop market for higher value consulting, particularly strategy consulting ▫ Focus on MSME market to help small consulting firms ▫ Will help fill in weak middle • Need to educate customers on benefits of consulting, process and reasonable outcomes ▫ To do this use active (workshops, newsletters) and passive (information packages) techniques ▫ CICMC could provide consulting services to BSOs serving MSMEs; act as business cases and learning opportunities
Supply Side Recommendations • Marketing BDS: Benefit all firms ▫ Opportunity identification: Centralise gathering of market intelligence, advise on market trends ▫ Improve positioning in key marketing channels: Alliances between Caribbean firms, partnering with extra-regional firms (member directory) ▫ Guidance in preparing marketing material ▫ Guidance in responding to tenders • Professional BDS: Benefit Group 1 firms ▫ Develop technical and consulting competency, CMC and advisory services ▫ Advice on defining service offering, consulting operations (setting fee rates, management systems) ▫ Provide quality assurance supplementing CMC
Implementation • CICMC to lead implementation, support from CE, form strategic alliances with national industry associations where they exist ▫ Appoint a Strategy Director to act as point person, draft implementation plan based on Strategy ▫ Lobby on behalf of industry in ongoing initiative to regulate management consulting • Goal is sustainability: Need for CICMC to become service driven industry association, eventually decrease role of CE ▫ Self-reliant associations: membership fees, fee-based services, professional/promotional events
Thank you
- Slides: 12