InSights by Vencon Research – Andy Klose and Ewin Harbauer – October, 2020 – Compensation, Consulting
COVID-19 currently influences all of our lives and its constraints will have continued effects on the consulting industry, especially with regards to communication within firms and with clients and on how work for clients is delivered. Our survey’s results show operational changes are expected, as, for example, “working from home” has become and will continue to be an alternative “modus operandi”. All this is also expected to have a positive impact on the attractiveness of consulting as a job, especially with regards to the work-life-balance of consultants with families. At the same time, none of our survey’s respondents indicated reducing or planning to reduce consultants’ pay.
Starting in early 2020, the COVID-19 crisis has become a drastic influence on our lives. In the light of the potential economic, financial, and other impacts of this world-wide crisis Vencon Research initiated a “Pulse Survey” in September 2020 to gather information on how the consulting industry has reacted to the crisis. We were particularly interested in finding out if the measures taken and implemented by firms also had an effect on job descriptions and on remuneration, especially for client-facing staff. We furthermore wanted to find out whether these changes represented temporary solutions or a “paradigm shift” in how the consulting industry operates.
The key findings of the survey can be summarised as follows:
- Three-quarters of respondents reported “travelling” to have been a “normal” part of the existing job profile of their consultants / client-facing staff.
- Meanwhile, all responding firms have largely eliminated the day-to-day travel typically required of their client-facing staff, for example for project delivery.
- Many firms have furthermore significantly reduced face-to-face time spent with their clients.
- All respondents had invested to ensure their client-facing staff can work efficiently from home.
- In this respect, client data confidentiality and data security have come to the forefront and may be a matter that requires additional review and improvement.
- Most respondents signalled a significant change in how their business was being conducted and delivered. For example:
- Communication with clients was previously often completed face-to-face and has now been forcedly changed to being conducted primarily via online tools.
- The delivery of client work would normally be completed on client premises or from the contracted firm’s office. Today instead, consulting work is often organised and completed from the consultant’s “home office”.
- Clients seem to accept these changes in how consulting work is delivered.
- However, during the feedback of the survey results, some clients mentioned that “selling on” into existing projects has become more difficult as a direct result of the lack of “face-to-face” time (i.e. coffee, lunch and dinner time) with key client representatives.
- Almost 2/3rds of respondents were additionally considering operational changes, such as a reduction in office space.
- During feedback discussions with respondents, a potential move of office space to less prominent (and less expensive) areas of the city, due to limited in-house client meetings and the introduction and use of working from home alternatives, was also mentioned.
- The measures mentioned above have a radical influence on the work-life-balance generally offered by and associated with the consulting industry, whereby:
- Close to 60% of respondents expect to see a positive impact on the intrinsic “attractiveness” of the consulting job.
- Furthermore, more than half of respondents expect to be able to offer a better work-life balance to their client-facing staff, especially due to reduced travel requirements, working from home, etc.
- They also expect to be able to more successfully hire and retain female consultants and thus anticipate an improved gender-split, especially at the more senior levels.
- Most respondents expect these changes to be longer term, i.e. to continue to strongly influence the job of consulting even after the COVID-19 crisis and well into the future.
- Interestingly, while discussing these results with clients, we also heard another point of view, namely that although reduced travel was seen as an attractive benefit for staff with families (mostly more senior), junior staff (i.e. those without families) actually complained about the lack of travel during COVID times. These anecdotal responses seem to confirm what 15% of respondents stated in the survey: due to the aforementioned changes, the job of consulting will become less attractive, especially for those more junior employees who actually like and prefer the travel aspect of the job.
- Although a number of firms experienced a significant reduction in business and have put at least some of their consultants on furlough, none of the participants reported actually reducing remuneration. Neither the base salaries nor targeted bonuses of their client-facing staff were reduced, even when considering a potential change in the consultant job profile (for example due to less travel, more time at home or the like).
- This result however does not reflect any potential short-term reductions in remuneration e.g. due to an introduction of furlough.
- This is partly confirmed by our 2020 salary surveys which continue to show increases in the remuneration offered to consulting staff in many countries. These increases may however result from the timing of salary reviews as most firms had completed and in part already implemented changes in remuneration before the COVID crisis hit their markets.
- Although increases in target remuneration were seen, unfortunately most firms will not be in the position to pay out the targeted bonuses in full in 2020 (or at a similar level as for 2019).
Should you have any further questions or would like to receive more detailed information on this topic, please reach out to us at firstname.lastname@example.org.
Andy Klose is an Associate Partner at Vencon Research International and heads the firm’s consulting unit.
Erwin Harbauer is a Partner at and co-founder of Vencon Research International.
Vencon Research International is a leading provider of compensation benchmarking and research as well as of compensation and performance-related consulting services for professional service firms, especially for audit and tax, management consulting, and IT services firms. Vencon Research International provides services to a full range of clients in more than 75 countries worldwide and is proud to name more than 85% of the world’s major consulting and/or professional services firm its clients.