Accenture reinvents itself (again)

By Fiona Czerniawska

If you don’t have the answer, change the question.

The question that’s been dogging the IT consulting sector since before the recession is what the business model is.  Specifically, it’s been about how consulting sits alongside technology services (systems development and implementation, outsourcing, and so on).  To date, we’ve heard two answers, neither of which has been particularly convincing.

Answer A has been to say that the consultants are really a sales force.  Less obviously geeky, they’re better able to engage clients outside the IT function in conversations about business issues.  In theory, this helps suppliers build stronger client relationships, create future sales opportunities and shore up prices.  The benefits for clients have been less clear – indeed, many complain that consultants can’t in such circumstances be objective but will always be looking ahead to sell the big IT project.  Answer B is ostensibly more attractive to clients because the focus is on post-sales delivery: “We provide you with a better service because we have an integrated mixture of consultants and technologists working together,” the suppliers’ argument runs.  In practice, clients aren’t convinced, not least because they find it hard to see the difference the consulting component makes – indeed, they sometimes find it hard to see the consulting component at all.

And that brings us to the nub of the problem.  If clients can see the join between the consulting and technology teams, then the teams clearly aren't that well integrated, but if they all look the same, what are clients paying a premium price for?  The result is that it’s very hard for a firm that combines technology and consulting to run smoothly.  Differences in recruitment, pay scales and culture, mean that the teeth on these two cogs don’t fit together but are constantly jarring and chipping at each other: one moment, the consulting cog seems to be driving the machine, the next, it’s the technology cog.  And constant tinkering with the mechanism has only made things worse.

You have to change the question.

So when Accenture starts presenting itself as a business services company, not one that merely combines technology, outsourcing and consulting, you sit up and pay attention.  Turning up at the firm’s recent analyst day in New York (we’re not fans of such things, but we make the odd exception), we’d steeled ourselves for a series of conventional presentations by line of service.  What we got was a series of people who stood up and talked about their businesses, as if they were just that – standalone businesses delivering services which ranged from accelerated R&D to more efficient policing.  It doesn’t really matter how the work gets done as long as it delivers results, was the message.  Instead of the question being about how the different bits of Accenture fit with each other, , it was about how Accenture can be a “holding company” for a portfolio of industry and functionally focused businesses.

Accenture has always been able to change (when it’s first advertising campaign talked of “metamorphosis in a world of change”, the firm was really talking about itself).  It was the first professional services firm to move into outsourcing; it was the first western firm to recognise the opportunities and threats rolled up in offshoring; when it lost its original name, it invented another.  Now it’s changing again – its competitors should take note.