By Yao Tang - Business Development Manager
Companies across industries are expanding their consulting divisions through a mix of strategic acquisitions and internal growth. This trend is driven by the rising demand for integrated solutions, the pursuit of high-margin revenue, and the imperative to support clients through digital transformation. In this article, we explore the strategies behind these expansions, highlight key examples from various sectors, and discuss the HR challenges that arise when integrating consulting roles into existing compensation structures.
Expansion Across Sectors
The trend toward incorporating or expanding consulting capabilities is evident across a range of sectors—from technology to private equity, specialized industries, and traditional accounting—where companies are leveraging strategic acquisitions and internal growth to meet the rising demand for integrated, expert advisory services.
A. Technology Firms Moving Beyond IT Services
Technology companies are increasingly shifting from their traditional focus on IT services to broader consulting roles. For instance, NEC’s acquisition of ABeam Consulting in 2023 represents a strategic move to expand its advisory offerings. Similarly, in 2023, Accenture’s acquisition of InfinityWorks—a leader in agile digital transformation solutions—underscores the growing demand for integrated advisory services. In addition, other types of firms are also responding to this trend; for example, EY’s 2022 acquisition of Nuvalence has enhanced its digital transformation expertise, reflecting a broader industry move toward offering comprehensive, end-to-end consulting solutions.
B. Private Equity’s Interest in Consulting
Private equity firms are capitalizing on the high-margin revenue potential of consulting services. The ongoing discussions by Apax Partners to acquire a majority stake in CohnReznick, along with Inflexion’s 2025 acquisition of Baker Tilly Netherlands, reflect a broader trend of investing in professional services with established consulting practices. These moves are not only financial transactions but also strategic efforts to diversify revenue streams and build more resilient business models.
C. Specialized Industry Consulting
In specialized fields such as life sciences, biotech, and pharmaceuticals, targeted acquisitions have become a key strategy. Sia Partners’ 2022 acquisition of Latham BioPharm, for example, deepened its expertise in these sectors. By focusing on niche advisory services, firms can offer tailored solutions that address the specific regulatory and operational challenges inherent in these industries.
D. Accounting Firms Strengthening Their Advisory Services
Accounting firms have long offered professional advisory services, and many are now expanding these capabilities. PwC’s 2023 acquisition of Sagence boosted its data and digital transformation advisory, while Deloitte has expanded its digital consulting presence in both the U.S. and Europe. KPMG’s acquisition of Russell Reynolds Associates and Grant Thornton’s 2024 partnership with New Mountain Capital further underscore the trend of blending traditional accounting services with modern consulting approaches.
Key Drivers Behind the Expansion
Several factors are motivating firms to broaden their consulting capabilities:
- Digital and AI Expertise: The rapid adoption of technologies such as cloud computing, automation, and AI has created an urgent need for expert guidance. Consulting services now play a critical role in helping organizations navigate digital transformation.
- Revenue Diversification: Consulting provides recurring, high-margin revenue streams that complement other business areas. This diversification is particularly attractive in a volatile market environment.
- Client Demand for Integrated Services: Clients increasingly seek comprehensive, end-to-end solutions that combine strategic advice with practical implementation. Firms are responding by integrating consulting services into their broader offerings.
HR Challenges in Integrating Consulting Roles
Integrating consulting roles into established compensation structures presents several HR challenges:
1. Differing Compensation Structures
- Consulting Models: Often include performance-based bonuses, accelerated salary progression, and equity incentives at senior levels.
- Corporate Models: Typically rely on fixed salary bands and standardized annual raises.
- The Challenge: Balancing these models to avoid pay disparities while remaining competitive in both markets.
2. Incentives and Career Progression
- Consulting Firms: Employees expect rapid promotions and profit-sharing opportunities.
- Traditional Corporations: Generally emphasize structured career growth based on tenure.
- The Challenge: Designing career paths that attract top consulting talent without undermining traditional career progression models.
3. Recruitment and Retention
- Consulting Talent: Often drawn to project-based, performance-driven roles but tend to be more mobile.
- Corporate Talent: Typically prefer longer-term, specialized roles with predictable career paths.
- The Challenge: Crafting recruitment and retention strategies that effectively appeal to both types of professionals.
4. Accurate Benchmarking of Compensation
- Consulting Benchmarks: Usually compared against peer consulting firms.
- Corporate Benchmarks: Often aligned with industry-specific salary norms.
- The Challenge: Developing a hybrid benchmarking approach that reflects both consulting and corporate compensation standards to ensure internal equity and external competitiveness.
How Vencon Research Supports Compensation Strategy
Vencon Research plays a crucial role in helping firms navigate these HR challenges by providing detailed compensation benchmarking for consulting roles. With access to comprehensive market data, organizations can align their pay structures with industry standards while maintaining competitiveness and internal equity. Whether expanding a consulting division or restructuring compensation strategies, Vencon Research offers insights that support strategic growth and stability.
For more information on aligning your compensation strategy with industry standards, please contact Vencon Research to learn how our services can support your organization’s strategic objectives.