Looking for growth in the Benelux consulting market?

“Well, in our country,” said Alice, still panting a little, “you'd generally get to somewhere else — if you run very fast for a long time, as we've been doing.”

“A slow sort of country!” said the Queen. “Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!”

The ‘Red Queen Effect’ precisely captures the mood of the Benelux consulting market, a market in which consultants congratulate themselves if they’ve managed to keep their income stable from year to year – at least according to our new research.  Why are things so bad? Consulting in the region has been disproportionately dependent on the financial services and public sector, both of which have been under pressure.  (The UK market has a similar structure, but there these two sectors are often countercyclical, losses in the one being offset by gains in the other.)  Globalisation, especially in the manufacturing sector, should have been a driver for growth in consulting, but too many companies are moving head-office functions to other, often emerging, geographies.  Levels of confidence and investment remain low and the tax regime continues to give freelance workers a financial advantage, making it hard for both consulting firms and their clients to attract and retain the staff they need.

Many big firms are quietly reducing their footprint in the region.  They share with their smaller rivals little optimism that things will change significantly in the future.  Moreover, excellent local language skills make it as easy to export Benelux consultants to more resilient markets, as it does to bring consultants in from elsewhere as the need arises.

So is that it then?  Should we gently draw a veil over this particular consulting market?  Last year we said that the solution lay in re-inventing the consulting firm, joining sides with the freelance consulting market on the basis that you couldn’t beat it.  But we’re no longer sure if that’s enough.  Indeed, looking at most of the conventional strategies for growth in consulting – innovation, targeting mid-market clients, specialisation or diversification – it’s hard to believe that any of them would have a significant impact.

Desperate times call for desperate measures.  Consulting firms in other countries may feel frustrated that clients don't take them up on their offer to tie fees to results, but  for Benelux firms the issue is altogether more pressing: it may be the only way they’ll get paid in the future.