Spurred by foreign manufacturers` eagerness to increase their efficiency, management-consulting firms are growing worldwide and some are challenging U.S. dominance of the field, an industry leader said.
”Consulting once was viewed as an American field. There are now German consulting firms that are as good as if not better than American ones,” said Edward Hendricks, president of the Association of Management Consulting Firms, based in New York.
The market for consultant services is worth about $5 billion in Europe, compared with $13 billion in the U.S., Hendricks said.
Consulting firms have appeared in the former East Bloc countries. In Africa, consultants are providing their services with the use of U.S. Agency for International Development funding, Hendricks said.
The reasons for the proliferation of consulting firms vary. ”In the former Soviet Bloc, there is a lot of privatization going on. They want advice on how to enter the competitive world market. In Germany, it`s because of unification; how to integrate the two Germanys.”
The leading areas for which firms seek consultants` assistance are information technology and insurance, he said. ”Insurance firms have to plan on a pan-European outlook and how to market their products and streamline operations to meet with increased demand,” he said.
The market for consultants is ”most vibrant” in Germany, Hendricks said. The British market is down because of recession, he added.
”In some countries, such as Czechoslovakia, with a potentially large market, consultants will hesitate until the political situation works itself out,” Hendricks said.
Japan is a hard market for foreign companies to crack because Japanese firms are well established, he said. ”As China becomes a more active participant in the world economy, it will become a very important market,” he added. ”There are already some Australian companies there.
”India, which I thought would be a large market, has not grown to realize its potential,” Hendricks said.
A number of major accounting firms have small operations in Africa, he noted. In addition, there are alternative avenues for consultant involvement, Hendricks added.
”Botswana and other African countries are getting consultants who are funded by the U.S. (Agency for International Development),” he said. ”They use retired consultants.”
Ernest Boluc is such a volunteer consultant. The agency funds a program that sends retired executives to the developing world in return for paid expenses, Boluc said.
The program is administered through International Executive Services Corp., Stamford, Conn.
