BrazilThe 10 largest German management consulting firms
Germany’s management consulting industry is booming. Last year the consultancy sector grew to around €34 billion, up 7% on the year previous. While much of the industry is dominated by large international players such as strategic consultancies McKinsey & Company, Boston Consulting Group and Bain & Company, and the consulting arms of the Big Four giants, new analysis shows that management consultancies from German origin are outperforming the market.
According to data from the Germany’s association for management consulting firms, the BDU, the German consulting industry grew by 7.3% last year to a total market value of €33.8 billion. Digital was not surprisingly the main driver of growth, as organisations from across sectors are rolling out digital transformation projects in a bid to remain competitive and bolster their innovation power.
Germany is home to 19,250 consulting companies, with 87% of the total firms that generate annual sales of less than €1 million. At the top of the industry, it is a group of 40-50 players that dominate much of the market across the different areas of expertise, including strategy, mergers & acquisitions (excluding corporate finance services), operations, finance & risk, human capital and digital.
These leading management consulting firms – in terms of size – include practically all of the major consultancies that operate globally – Germany is for international players an instrumental market for European operations, as well as for serving the German-speaking markets of Austria and Switzerland (combined known as the DACH region).
From a home-grown perspective, data sourced from Lünendonk shows that Roland Berger is the largest management consultancy with German heritage. The company was founded by namesake founder Roland Berger in 1967 in Munich, and has since grown to one of Europe’s few strategy consulting firms that has what it takes to compete with the likes of US-headquartered McKinsey, Boston Consulting Group (BCG), Bain, Oliver Wyman, A.T. Kearney and Strategy&. With revenues of €600 million, Roland Berger is in size well ahead of other European strategic consultancies such as L.E.K. Consulting and OC&C Strategy Consultants (UK).
Simon-Kucher & Partners, a consulting firm specialised in sales & marketing, ranks second. The firm’s 1,100 employees generated €309 million last year, up from €172 million four years previous. The top three of German consultants is completed by Detecon, a subsidiary of Deutsche Telekom. Initially established as an in-house consultancy, the company has in recent years expanded its external consulting work, and now achieves more than half of its €215 million in revenues from clients other than Deutsche Telekom.
Fourth is Horváth & Partners, a Stuttgart based management consulting firm with seven offices internationally and six in Germany. The firm, a member of Cordence Worldwide, was one of the strongest growing firms in 2018, alongside Simon-Kucher and seventh-placed Porsche Consulting, and managed to break through the €200 million barrier for the first time in its history.
Q_Perior, founded in 2011 and headquartered in Munich, generated a turnover of €195 million, with zeb.rolfes.schierenbeck.associates (zeb:), a consulting firm dedicated to the financial services industry, hot on the heels of the firm, trailing with just €2 million in revenues. Porsche Consulting is a subsidiary of prestigious car giant Porsche – the in-house leverages its years of experience in automotive excellence to advise external clients on manufacturing, operations and customer excellence. Total sales of Porsche Consulting totalled €172 million last year.
The top ten of Germany’s largest home-grown consulting firms is completed by KPS (€172 million), a consultancy for the retail sector; d-fine (€145 million, a digital transformation specialist for the financial services industry; and goetzpartners, a consulting firm that supports clients with strategy, mergers & acquisitions and business transformation.
Combined, these ten leading German-origin management consulting firms managed to grow by 9.5% last year, outperforming the market average by 2.5%, lifting their revenues to €2.3 billion, of which an estimated 60% is delivered in Germany. The outlook for Germany’s home grown consulting jewels remains strong. According to Lünendonk’s researchers, their growth will break through the magical 10% barrier in 2019 (+10.3%), despite a volatile economic climate, with the need for customer experience and digital transformation the largest drivers.
