Will consultants suffer from pre-election slowdown?
With the sheer volume—and range—of news stories bombarding voters about the upcoming Presidential election, one may be forgiven for thinking that businesses across the US have ground to a halt as workers everywhere gather around water coolers to discuss the latest goings-on. True, there has been plenty to talk about—perhaps more than is usually the case in the run-up to an election—but talk, thankfully, does not generally equate to a business slowdown.
In fact, in mature economies such as the US, elections usually don’t have that much direct impact on business (it would be different if we were talking about Brazil or India, for example, where one political party tends to be more pro-business than the others, so who wins will shape the future economy). That’s not to say there’s no impact at all, and indeed it’s quite normal for upcoming elections to affect government and public sector spending on consultants. As an election grows nearer, there may be a flurry of activity on public projects to showcase a new achievement, or simply get things signed off, but in the final run-up, fewer decisions are made and it’s rare for new initiatives to be commissioned. But this is normal, and despite the headlines and the hype, all the evidence this year is that the usual pattern is being repeated: there’s some sign of client slowdown and inertia, but is it worse than in previous election years? Probably not.
Indeed, when we spoke to US consultants earlier this year, many were dismissive of the likelihood of the election having any impact on the volume of consulting work: if anything, many of them assumed that this election would have even less bearing on business than usual. “The political process seems as irrelevant to business as it appears to mainstream American life,” said one managing partner we interviewed. “People are trying to keep the election out of their minds—it's a bit of a circus act,” commented another. “If your business shrinks this year and you try to blame the election, I think you should be looking for a new job.”
More recent conversations with consulting partners evidence a greater degree of concern about the impact of the election. One area that has been affected already is regulation and other forms of direct government intervention. With Republicans and Democrats taking very different attitudes to financial regulation, for example, banks are starting to defer decisions until the result of the election is known. Already some consulting firms are reporting a slow-down in new work in this sector, and things are unlikely to change much before the middle of next year. Other regulated industries, e.g. energy, utilities and, of course, healthcare, could also be affected in this way.
The market is also starting to be affected more broadly—with the election only weeks away, consultants are reporting concerns about its impact on client attitudes, and a general slowdown in decision making. Although current projects are ongoing, clients are becoming hesitant about signing off new work: things are very much on hold until the outcome of the election is known. Although speed of decision-making could be restored quite quickly once the election is behind us, it will undoubtedly have kicked a bit of a hole in the volume of new business for consulting firms across the year.
But although those consultants who were dismissive of the ‘electoral effect’ earlier this year were maybe a bit too unconcerned, all these impacts could be written off as being so far, so predictable. In this case, however, that’s not quite the whole story. The worrying aspect here is that what the election appears to be doing is contribute to a general backdrop of uncertainty within the business community, with anxieties about the election adding to numerous other worries. And there is a lot to worry about: Concerns about interest rates rising, wobbles in the stock markets, low oil and commodity prices, an economic slowdown in China, fears about terrorism, slow economic growth in western Europe, and now the upheaval launched by Brexit—to name but a few. This accumulation of concerns can only be bad news for the US consulting market with the likelihood that client confidence will take a hit and spending decisions made much more difficult. With this market having seen strong growth for the last six to seven years, it could reasonably be assumed to be already nearing the point where we could expect to see a cyclical downturn—and this is a possibility made all the more likely by this climate of uncertainty.
The obvious conclusion to reach here is that there is a danger that this could result in something of a perfect storm, with the election having a much bigger impact than expected. Put another way, the election could effectively be the straw that breaks the economic camel’s back, slowing growth in the consulting market along the way.
Zoe Stumpf is Head of Consulting Market Programme at Source Global Research
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Marketing matters: from IBM to Kyndryl
Prior to joining Kyndryl as Chief Marketing Officer, Maria had a 25-year career at IBM, most recently as the tech giant’s CMO where she oversaw all marketing professionals and activities across North America, Canada and Latin America. She has held senior global marketing positions in a variety of disciplines and business units across IBM, most notably strategic initiatives in Smarter Cities and Watson Customer Engagement, as well as leading teams in services, business analytics, and mobile and industry solutions. She is known for her work with teams to leverage data, analytics and cloud technologies to build deeper engagements with customers and partners.
With a passion for marketing, business and people, and a recognized expert in data-driven marketing and brand engagement, Maria talks to Business Chief about her new role, her leadership style and what success means to her.
You've recently moved from IBM to Kyndryl, joining as CMO. Tell us about this exciting new role?
I’m Chief Marketing Officer for Kyndryl, the independent company that will be created following the separation from IBM of its Managed Infrastructure Services business, expected to occur by the end of 2021. My role is to plan, develop, and execute Kyndryl's marketing and advertising initiatives. This includes building a company culture and brand identity on which we base our marketing and advertising strategy.
We have an amazing opportunity ahead at Kyndryl to create a company brand that will stand apart in the market by leading with our people first. Once we are an independent company, each Kyndryl employee will advance the vital systems that power human progress. Our people are devoted, restless, empathetic, and anticipatory – key qualities needed as we build on existing customer relationships and cultivate new ones. Our people are at the heart of this business and I am deeply hopeful and excited for our future.
What experiences have helped prepare you for this new opportunity?
I’ve had a very rich and diverse career history at IBM that has lasted 25+ years. I started out in sales but landed explored opportunities at IBM in different roles, business units, geographies, and functions. Marketing and business are my passions and I landed on Marketing because it allowed me to utilize both my left and right brain, bringing together art and science. In college, I was no tonly a business major, but an art major. I love marketing because I can leverage my extensive knowledge of business, while also being able to think openly and creatively.
The opportunities I was given during my time at IBM and my natural curiosity have led me to the path I’m on now and there’s no better next career step than a once-in-a-lifetime-opportunity to help launch a company. The core of my role at Kyndryl is to create a culture centered on our people and growing up in my career at IBM has allowed me to see first-hand how to prioritize people and ensure they are at the heart of progress in everything Kyndryl will do.
How would you describe your leadership style?
I believe that people aren't your greatest assets, they are your only assets. My platform and background for leadership has always been grounded in authenticity to who I am and centered on diversity and inclusion. I immigrated to the US from Chile when I was 10 years old and so I know the power and beauty that comes from leaning into what makes you different from other people, and that's what I want every person in my marketing organization to feel – the value in bringing their most authentic self to work every day. The way our employees feel when they show up for themselves authentically is how they will also show up for our customers, and strong relationships drive growth.
I think this is especially true in light of a world forever changed by the pandemic. Living through such an unprecedented time has reinforced that we are all humans. We can't lead or care for one another without empathy and I think leaders everywhere have been reminded of this.
What’s the best leadership advice you’ve received?
When I was growing up as an immigrant in North Carolina, I often wanted to be just like everyone else. But my mother always told me: Be unique, be memorable – you have an authentic view and experience of the world that no one else will ever have, so don't try to be anyone else but you.
What does success look like to you?
I think the concept of success is multi-faceted. From a career perspective, being in a job where you're respected and appreciated, and where you can see how your contributions are providing value by motivating your teams to be better – that's success! From a personal perspective, there is no greater accomplishment than investing in the next generation. I love mentoring younger professionals – they are the future. I want my legacy as a leader to include providing value in work culture, but also in leaving a personal impact on the lives of professionals who will carry the workforce forward. Finding a position in life with a job and company that offers me a chance at all of that is what success looks like to me.
What advice would you give to your younger self just starting out in the industry?
I've always been a naturally curious person and it's easy for me to over-commit to projects that pique my interest. I've learned over years of practice how to manage that, so to my younger self I’d say… prioritize the things that are most important, and then become amazing at those things.