2006
Forrester report: 'Look to PA to strengthen sourcing deals'
By
Sean Sweeney with Christine Ferrusi Ross and Christine E. Atwood
Beyond the usual IT services suspects: PA Consulting Group
Forrester Research Inc. ,
22 May 2006
A recent Forrester report has identified PA Consulting Group as 'a solid option for those that need help with outsourcing agreements'. The following is the report in full.
Executive summary
When companies look for consulting help, well-known firms like McKinsey & Company, Accenture, and IBM Global Services consistently appear on their short lists. Over the years, these consultancies and others have developed solid brands by using the greatest consulting sales tool: a successfully delivered project. But many firms want to work with smaller, lesser-known boutiques, and Forrester clients are asking for more information on providers that are less well-known than the global major players. For firms looking to engage other players, PA Consulting Group (PA), with 63 years of experience, is a solid option for those that need help with sourcing agreements.
Target audience
Business process executive, IT sourcing and procurement executive
PA has a strong European brand but has US-centric aspirations
PA Consulting Group is a global management and technology consulting firm with nearly 3,000 resources in more than 35 countries. Founded in 1943, its brand and reputation is one of the strongest in the Europe, particularly in the United Kingdom, where it was founded and is headquartered. Its consulting staff consists of approximately 60% from industry, 30% from consulting, and 10% from graduate school. Currently, 350 resources reside in the US, with a target of 1,000 in five years. The consulting firm also has a successful ventures practice, PAGroup ventures, and a strong sourcing advisory group. The firm focuses by vertical industries and along four strategic services. Specifically:
- PA’s government vertical is the strongest in the UK, while energy leads the US practice. Overall, PA divides its portfolio into six industry sectors: Financial Services; Government & Public Sector; Manufacturing & Automotive Industry; Energy: Electricity, Gas, and Oil; Infrastructure & Development; and Life Sciences and Health Services.
- Strategy and marketing services help with mergers and increasing shareholder value. PA helped build Novo Nordisk’s new strategic innovation unit, aligning R&D with its new corporate vision to be the leading innovative company in diabetes care. The firm also designed the implementation approach for a global learning management solution for a US-based pharmaceutical firm.
- Business transformation focuses on post-merger integrations and process change. PA won awards for its post-merger integration project for Lloyds TSB Bank and re-engineered Deutsche Bank’s trading capacity and process.
- IT services assist with sourcing advisory and IT strategy. A sourcing highlight in the US
market was PA’s recent work with Sabre Holdings. PA worked with Sabre during its negotiationwith EDS, leading to a $2.2 billion, 10-year outsourcing contract.
- Technology consulting services help with product development and technology strategy. PA helped Orange deliver new infrastructure and customer products faster to the market without increasing headcount. The result was an estimated £30 million per year of direct costs benefits.
Recommendations
Look to PA to strengthen sourcing deals
Firms should consider PA if they:
- Are North American firms that have large operations in Europe. The majority of PA’s
consulting resources reside in Europe, as do a significant number of its clients. Its strategy, however, is focused on building a strong US and Asian presence. For North American-based companies that need native European expertise, PA has expertise that other firms may not have.
- Need sourcing help. Forrester finds PA’s sourcing services to be a strong option for vendors that need outsourcing advisory services. With more than 500 sourcing consultants across the Americas, Europe, and Asia Pacific, PA generates approximately 30% of its revenue from sourcing-related work. The firm assists in the entire end-to-end outsourcing life cycle - sourcing strategy, RFPs and business case development, negotiation, transition support, and supplier management - or for engagement in only one phase of the life cycle.
- Want innovation that has been tested in the field. PAGroup ventures adds differentiation
and expertise to PA’s existing consulting capabilities. For firms that are looking for innovation but want solutions and ideas tested and validated, PA has a successful tracking record on incubating technology firms while leveraging and training its consultants within these ventures.
- Desire independent technology advice. As an employee-owned consultancy, PA provides impartial advice for the right business solutions. It does not have alliances and partnerships with major technology vendors, and one team engages its clients, from sales to delivery, providing consistency through project life cycles.
Source: 'Beyond The Usual IT Services Suspects: PA Consulting Group' - a Forrester Research Inc. report by Sean Sweeny, published 22 May 2006. Forrester Research, Inc., 400 Technology Square, Cambridge, MA 02139 USA
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