Similarities between the GCC and South East Asia

I’ve recently returned from Singapore, where, braving the poisonous smog, I was fortunate enough to interview a wide range of  consulting firms about the South East Asian consulting market. Our report on the South-East Asian market will be out soon but in advance of publication I thought it was worth shining a light on what seemed to me, to be some striking parallels between the South East Asian and GCC markets, and the opportunities and challenges that consulting firms operating in them are facing.

On almost every level there are similarities in these two fascinating markets. Beginning with size, there is little to divide them, with latest comparable figures* putting SE Asia at $2.3bn and the GCC at $2.2bn. Both have witnessed very strong growth levels (SE Asia: 7%, GCC: 18.6%), higher than those seen in most Western markets, although it would be unfair not to recognise that the GCC trumps South East Asia in this case.

Both regions have been, and continue to be, affected by instability or uncertainty of some kind; in the last twelve months both markets have witnessed the impact of political, social or economic upheaval. The impact of external global economic crises have also taken their toll on both consulting markets, whether it’s the continued depression of the oil price, the devaluing of the Yen or the Greek debt crisis.

In spite of all this, the figures look good. Growth remains strong. Confidence should be high. But the figures don’t always tell the whole story. In interviews with consulting leaders from both markets we detected a cautious attitude and a focus on risk that didn’t exist to the same degree previously, at least not in the GCC. In both markets consulting leaders seemed to recognise that the growth they’ve enjoyed in previous years could no longer be relied upon and that they now had to adjust to something a bit different.

But the biggest similarity in the two regions is arguably the dichotomous mix of mature and immature individual consulting markets that sit within them and that present their own unique opportunities and challenges to firms in terms of market entry and market penetration. In reality we know that there is no homogenous ‘GCC’ market for consulting, just as there is no ‘South East Asian’market. The real consulting opportunities exist in isolated, unique and individual countries within these regions, and consulting firms from both markets are on a continuous journey to overcome the barriers to entry and success that lie in their way, be they barriers of language, culture, talent, economic or political difficulties, or a mix of them all.

Market entry is arguably more of a challenge to South East Asian based firms, where the differences between the countries are starker than those in the GCC. The UAE and Kuwait are far more similar than Singapore and Myanmar, for example, where there’s a chasm of difference. That’s not to say that there aren't market entry challenges in the GCC, though. Capitalising on opportunities in markets such as Saudi Arabia can be just as difficult for a consulting firm; as we recognised in our 2015 report. Getting the balance right, building a diverse regional portfolio, is crucial, and firms across both regions are trying to work out where to place their bets.

All of this is dependent on the final and most significant challenge – and opportunity - that exists in both regions: talent. How to find it, grow it, retain it, deploy it, in the right way, for the right countries, and even for the right clients. Firms around the world are dealing with this but the pressure in these regions is significantly higher and getting the strategy right makes the difference between success and failure.

No one seems to have the magic answer to the question of talent, and the answer is likely to be different from firm to firm, country to country and region to region. But the blatant similarities between the GCC and South East Asian markets leave me wondering why we see so little evidence of collaboration between them, when they must have so much to learn from each other. In facing up to their challenges, as well we their opportunities, surely two heads are better than one.

(*from 2013)