Consulting firm Simon-Kucher looks back at stellar year

11 February 2019 Consultancy.eu

Simon-Kucher & Partners, a consultancy with 38 offices globally, has continued its strong growth trajectory. The firm last year saw its revenue grow by a staggering 23% to €309 million. 

At the end of 2010, Georg Tacke, then and still the CEO of Simon-Kucher & Partners, was ecstatic after he announced that the firm had broken through the barrier of €100 million in fee income. Eight years down the line Tacke, could be no happier as he looks back at what is one of the consulting industry’s most successful growth stories. 

Simon-Kucher & Partners was founded in 1985 in Germany. After years of domestic growth, the firm opened its first office abroad in 1996, in the US. In the intervening years, growth has accelerated, with headcount currently at 1,300 consultants and staff. The privately-held company specialises in strategy and sales & marketing consultancy, segments which some of its partners describe as “the sunny side of consulting”. 

Last year, Simon-Kucher grew by 25% in its home market Germany, much higher than the average growth rate in the country, estimated at 8.4% by the BDU, the association of management consulting firms in Germany. “This confirms what we have always stated: the German market is not yet saturated. We still see many opportunities here,” said Tacke.

Revenue of Simon-Kucher & Partners (€ / million)

In neighbouring the Netherlands, Simon-Kucher booked 22% revenue growth. Onno Oldeman, managing partner of the firm’s office in Amsterdam and a global board member, said: “We are seeing growing demand for commercial initiatives aimed at sales and margin improvement – our focus and specialisation on these two topics means we are well positioned to capitalise on the opportunities.”

The UK organisation can look back at a “great year”, according to Mark Billige, head of the UK arm and also a global board member. “This was especially true in more data driven industries where we’ve been working to build client capabilities in dynamic and digital pricing,” he added.

Bumper performance was however noted in the US (35% growth) and China (>40%). “China is becoming increasingly important for the international consulting market. At the moment the share is still low – but if the positive trend seen in recent years continues, China will soon become a permanent fixture for the industry,” forecasted Tacke. As it stands, China’s management consulting industry is valued at $4.5 billion, comparable to Australia’s sector ($5 billion), but still a fraction of the US’s $60 billion industry.

From a service perspective, digitisation was again the firm’s star performing service line. Tacke. “Many companies have invested enormous amounts in digitalisation over the past few years. But they are seeing low impact. The solution is therefore smaller, clearly defined, and highly profitable digitalisation projects, rather than just digitalisation for digitalization’s sake. This is exactly where companies turn to us for our support and expertise.”

A report by Simon-Kucher released late 2017 found that the majority of digital transformations in fact fall short of achieving topline growth. In the firm’s vision, leaders should focus more on digitising where things really matter to the bottom-line – value creation and monetising commercial opportunities – instead of over-focusing on cost-cutting and streamlining operations.

Reflecting on the outlook for the current year, Tacke said “The forecast for 2019 is optimistic – we have set a revenue target of €350 million.” To this end, the management consulting firm expects to hire over 400 new consultants this year.

Related: Simon-Kucher charts course for a successful future (interview with a board member).

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