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Back to ConsultingIn Europe
Consulting in Europe is always an adventure, agreed panelists who shared their experiences representing established firms as well as fledgling ones on the Continent.
Two "massive" differences between Europe and America tend to greet consultants, said Nick Braden, an associate principal at McKinsey & Company. The first difference, he said, is that boards of big European companies find the new economy "frightening."
"They are very, very frightened to have to turn the whole company on its head," Braden observed, "to look for new businesses, become very transparent, move people around in departments, reallocate resources."
European corporations, he said, often put up strong resistance to what he called "getting it"truly understanding the stakes, and acknowledging that if they don't shift their thinking, their companies are not going to survive. "There's a resistance to understanding that the new economy is here, is here to stay, and it's a big deal," said Braden.
Once these European companies do "get it," however, they can usually summon the resources to move much faster than companies in the United States.
Panelists also remarked upon what they view as a sea change in the ways consulting work is carried out and talent is recruited.
It's a tough time for consultancies, observed Anthony Tjan (HBS MBA '98), director and executive vice president of two-year-old ZEFER Consulting. "The knowledge worker has essentially become a free agent," he said. What this development translates to, according to Tjan, is that consulting firms need to understand how quickly consultants can bolt, "how fickle the mindset has been, how many people have shifted from coming in and doing something that was their passion.
"Now, in their hearts, they are transactional."
Power lies in the "recruitee," not the recruiter, said Tjan. Executives who run consulting firms, then, are forced to give the consultants more freedom, a greater diversity of assignments, and even the opportunity to invest with clients. As an employer, he added, "It forces you... to go beyond the more traditional aspects of consulting."
Building Europe, company by company
Candidate countries for European Union integration are setting their sights eastward as much as westward, according to executives with experience in the region.
In a conference panel titled "European Integration: Business Opportunities in an Expanding Europe," business people from a private sector wing of the World Bank Group, two consulting firms, The Coca-Cola Company, and a financial services firm considered the impact of EU expansion vis-a-vis business.
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"Europe as a continent is, for perhaps for the first time ever, reinventing and redefining itself," marveled Cem M. Kozlu, of Coca-Cola's Central Europe and Eurasia Group, which includes nine countries that are EU candidates. Europe is changing itself consciously and dramatically, he continued, and this has made business at least somewhat more predictable.
Companies in nations closest to Europe have been and are being integrated into the European business community without even waiting for political changes to take place, pointed out several panelists. Meanwhile, western corporations venturing beyond Eastern Europe now find themselves competing with Central European-based firms. In Uzbekistan, for example, Coca-Cola competes with a distributor based in Prague, said Kozlu. Stephanie von Friedeburg of the World Bank's International Finance Corporation added that two large companies that she works with in Poland and Hungary both insist that their future is east.
Despite an increase in business opportunities both east and west, however, some EU candidate countries still have a long way to go, cautioned von Friedeburg.
"When I look at Central Europe and the EU," she said, "the one thing that always strikes me is that each country is fundamentally different. Each country, in terms of where it is on the development curve, needs to be looked at individually.
"Only 3 percent of global capital flowed into Central Europe in the last ten years," she added. "And of that 3 percent, 55 percent went to Poland and to Hungary. There are a lot of other countries that have not had adequate structural reform, do not understand the rule of law ...
"As American and Western European companies move into Central Europe and even further into Eastern Europe, that's what they're finding. And that's why capital flows have been substantially smaller than what you would anticipate.
"There's a lot of work to be done, especially when you get outside Poland and Hungary."
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