- Public sector
- Emerging markets
- Previous interview
- David Thomlinson's biography
- Accenture company profile
David Thomlinson, Accenture's UK managing director is in a confident mood. With the recession over, he is seeing business spending money on IT again, and Accenture reporting encouraging financial results.
"We are feeling actually, after 18 or 24 months of a really competitive environment very confident right now, " he says. " Having had some challenges in the market in the last 18 months we are back in a growth position."
"Companies, having battened down the hatches for a couple of years, are now seeing the opportunities. How they grow, how they drive efficiency, so really across all sectors we are seeing new big opportunities."
The company's latest results show the steep revenue declines that hit Accenture in 2009 are over. Turnover rose 8% year on year in the company's third quarter results reported in June. Consulting revenues were up 9% and outsourcing up by 7%.
In the UK, Accenture's second largest market outside the US, the upturn has been driven by financial services as capital markets, retail banks, investment banks and insurance companies start spending on IT again.
Even the government's decision to call IT suppliers into Whitehall to negotiate cost savings in government IT projects could be an opportunity, he says.
Accenture has drawn up a list of recommendations showing how the government could use IT to save money, ranging from rationalising IT across government to greater use of cloud computing.
"You can negotiate [cost reductions] but actually, given the government's challenge and urgency, there could be an opportunity now to take some quick. bald and decisive actions to really make a difference," he says.
For once, though, Thomlinson says he is glad Accenture UK doesn't have more public-sector work.
"Unlike some of our competition, where it dominates the business, the public sector is actually the smallest portion of our business" he says. "I spent the last three years complaining that it needs to be more, but right now I am okay with where we are."
Accenture's newly rediscovered confidence should not be mistaken for complacency, Thomlinson insists.
"We are in a competitive world. We need to continuously challenge ourselves, looking at our cost base. We need to continuously develop our cost base to deliver the right level of profitable growth."
Globally, Accenture has a three-pronged strategy to grow the business as the economy picks up. Accenture's priority is to drive growth in its core business: management consulting, technology and business process outsourcing. "We see a lot of white space and opportunities to grow there."
At the same time the company is making significant investments in new business and technology areas that could generate growth in the future.
"New breakout areas include cloud computing where we have a very significant investment. We are building capabilities and defining engagements for our clients. But it would also include digital and mobile," he says.
"Sustainability is a very big area. We are actually leading our European sustainability business out of the UK and there is tremendous interest in that right now. That includes smart buildings and smart cities."
And Accenture is exploiting opportunities in emerging markets. Two years ago the company identified Brazil, Russia, India, China, South America and South Korea as strategic growth markets.
Thomlinson is particularly close to China. He was previously responsible for running Accenture's resources and utilities business, which has a strong presence in the country.
"Our business in China is led by Chinese people. It's not like an American or a foreign company coming in. We are actually operating along local customs," he says.
This approach helps Accenture avoid a lot of the political difficulties that can arise when foreign firms move into new countries.
"Whenever we do a geographic expansion, we make a long-term commitment and build local capability. So we don't grow a market by flying in the expats. But we actually look to recruit the best people, train the best people and take the long-term view."
Accenture has always made adding value to its clients' business a priority. It's a concept that is drummed into Accenture consultants during their development. But in the UK, Thomlinson says he wants to drive this strategy harder.
"We live in a competitive market. What I want to do is make sure the experience, the value, that Accenture can deliver is superior. Clearly that is not just something for me to say or put in a Powerpoint slide, but it has to be the experience of our clients, day in day out."
"In some cases people in the IT business get focused on delivering projects, delivering people and writing reports. What I want to do is measure by the value we deliver to clients."
"The best way to sell future work is to have clients talk about the value we have delivered," he says.
"There is no single answer to that. It's making sure the work we do has a strong business case, making sure we really share with the client all the work we are doing and what value we are creating. Whether that is quantitative, in terms of financial savings, or qualitative, in terms of culture change, retraining, and new capabilities of people."
Thomlinson acknowledges that Accenture will have to work hard to grow its business in the face of increasingly intense competition.
Accenture is competing directly with IBM, which has a global reach and range of expertise that matches Accenture's. Indian offshore companies such as TCC, Infosys and Cognizant are competing with Accenture for application outsourcing. And in Europe companies including Cap Gemini, Atos Origin and Logica are vying for work.
Accenture's strategy is to differentiate itself from by positioning itself as a premium brand. That means striving to be the best in technology consulting, systems integration, technology consulting and outsourcing. "We need to invest capabilities, specialist skills and so on," he says.
But it also means bringing together expertise from all these areas, to provide a service that is more than the sum of its parts.
"Rather than just doing management consulting, or just competing with the Indian pure-plays for systems integration, we would like to bring a clear point of view of what high performance means to industry," he says.
"How do we use our management consulting capabilities to create new business models, to really drive in high performance business processes. How then do you use technology to sustain and improve that capability and how do you link in outsourcing."
The other plank in Thomlinson's strategy is people. The company announced plans to recruit 50,000 staff worldwide in June. It invests heavily in selecting and developing the right people.
"One of the things very high on my personal list of priorities is the diversity of our workforce. It's a very high priority globally," he says.
It is no longer true that Accenture UK's consulting arm is dominated by Oxbridge educated males, Thomlinson suggests.
"Last year we were in the Times top 50 places where women want to work. In the last couple of months we were in the top 30 of Stonewall's gay-friendly ranking. So the old image some people would have as Accenture as macho elite, I think we have really changed."
The IT industry is going through some sweeping changes. The growth of the cloud, the trend towards smaller deals and the commoditisation of IT are a challenge for a company that has made its reputation on premium services and multi-million deals.
Accenture has not been slow to adapt, says Thomlinson. As competition from offshore suppliers has increased, Accenture has steadily built up its own offshore resources - the Accenture global delivery network.
"I think we now have 85,000 people offshore. That obviously is in response to the need to be cost-effective," he says. "But we can then add value in terms of smarter thinking and better industry knowledge on top of that."
IT may be becoming more commoditised, but Thomlinson says he cannot see the demand for added-value services disappearing. "The smart thinking is about how you can really make a difference," he says
"One of the things we are looking at now is the next wave of technology changes. Cloud computing is very important. In a way, I think cloud computing will fundamentally change the nature of how businesses will operate. We are doing some significant engagements. We are working with our alliance partners as well."
Accenture has been criticised the amount it invests in research and development - particularly pure research. It certainly has not won any Nobel prizes for its research, unlike its rival IBM. But for Thomlinson it is an unfair comparison.
"We do a lot of thought leadership. We have research programmes by each industry grouping. We have actually built up a lot of research support in India now. In terms of our capability, in the US we have a high performance centre of excellence. So I think I would probably push back against that."
"But ultimately we are not an R&D business. Coming up with research papers - while we do it - I would not say it's a core aspiration of ours," he says. "There are lots of academics and people at universities that do that. We also have a business to run here."
"If I was going to summarise the aspiration for Accenture: we are seeking to become one of the world's greatest companies, really making a difference. Through being successful ourselves, through delivering high value and creating great success for our clients."
|Biography of David Thomlinson, UK MD Accenture|
|September 2007||Appointed senior managing director for geographic strategy and operations. He is responsible for leading Accenture's geographic strategy and operations.|
|September 2006||Thomlinson took over responsibility for leading Accenture's business in the United Kingdom and Ireland|
|June 2003 to September 2006||Thomlinson led Accenture's resource group, which provides consulting in energy, utilities, chemicals and natural resources, as group chief executive. Before that, he was managing partner of resources in Europe, Middle East and Africa and led Accenture's utilities industry group in North America.|
|1992||Became a partner.|
|1977 to 1986||Thomlinson spent nine years with the international engineering firm Ove Arup. He was involved in the design and construction of major building projects, including the headquarters of the Hong Kong and Shanghai Bank in Hong Kong.|
|Education||Degree in civil and structural engineering from Sheffield University, England. Professional Chartered Engineer and a member of the Civil and Structural Engineering Institutions.|