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Battling with the boom

Viewpoint - The boom in the consultancy sector presents challenges for the industry, says Nelson Ogunshakin.

The Association for Consultancy & Engineering's State of Business 2006 showed that the consultancy and engineering sector is booming.

Eagle eyed observers in the City have sat up and taken note of the positive outlook for growth. However, this comes with its challenges in terms of resourcing to meet the high levels of demand.

This year has already seen the successful stock market listing of consultant Scott Wilson, which has joined the likes of Waterman, WSP and White Young Green. The listing was well received by investors who were attracted by the future earnings visibility of these businesses and healthy sector growth prospects.

However, the positive trend in workloads will have implications for future resourcing.

The 2006 survey once again echoes the findings of ACE's investigation of skills in our sector. The conclusions of our 'recruitment and retention' investigation act as a blueprint for government, industry and education in nding solutions to what 75% of respondents, said is their chief concern.

I believe this outcome is further re cted in the survey's dings on utilisation where responses suggest that consultancy and engineering rms are currently working at an average utilisation rate of 78%. This is very high when compared with management consultancy rates of 65%.

Beyond the traditional solutions such as outsourcing, overseas recruitment and mergers, ACE would encourage its members to collaborate to effect best team solutions in delivering major projects.

ACE would urge public sector bodies to take note of the capacity constraints facing the consultancy and engineering market.

As a client, the public sector accounts for 40% of total construction industry workload and as such, must take the lead in setting procurement processes that incentivise training, staff development, and delivery of best value for money.

Public sector clients should understand that forcing down fee levels to an unsustainable level will cause a brain drain from the consultancy and engineering sector.

The largest consultancy and engineering businesses have reported a combined overseas market accounting for about a third of their total industry turnover.

The expected further growth in the international marketplace provides testimony to the respect held for UK consultancy and engineering firms. The high quality of service delivery is also apparent by the level of repeat workloads achieved by businesses in our sector. Clients go back to the rms they know and trust, for the delivery of their future projects.

Our industry has many challenges to face. To effectively address these challenges will require client leadership, more Government and corporate investment in the professional skills base, and closer collaboration across the supply chain.

ACE will play a key role in being a catalyst to effect a sustainable change for the industry.

Nelson Ogunshakin is the Association for Consultancy & Engineering's chief executive

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