Management consulting market of the GCC region grows to $2.8 billion

15 May 2018 5 min. read

The management consulting market of the GCC has grown to $2.8 billion, driven by an expanding digital landscape and the region’s series of ambitious national transformation agendas.

According to figures from Source, a UK-based research consultancy focused on the consulting industry itself, the management consulting sector of the combined nations of the Gulf Cooperation Council (GCC) – Saudi Arabia, the UAE, Bahrain, Kuwait, Qatar and Oman – has grown in 2017 to a worth of $2.8 billion, rising 7% on the previous year’s $2.6 billion and growth rate of 6%.

The slight uptick in the growth figure suggests the market is getting back on track after the dramatic dip in global oil prices from the second half of 2014 through to 2016, where the crash to below $30 per barrel from a pre-plunge high of over $110 put paid to a local management consulting growth rate that had been tracking at around 20%. 

Unsurprisingly, the implications of such a dive in oil prices have led to manifold transformational consequences for the region at large, and as such, the local management consulting sector – with both negative and positive impacts. The slow-down in the industry growth rate in recent years (as well as issues surrounding late payments) was readily attributable to the shrinking national budgets.

Size of the GCC management consulting industry

Yet, the reemergence of rising growth rates can be in part put down the other side of the coin; local GCC governments now increasing their consultancy spend to diversify economies away from a reliance on energy commodities. This trend, encapsulated in the full range of bold, fast-moving national transformation programmes unveiled in the wake of the plummeting oil prices, also points toward ongoing positive growth rates for the management consulting sector forecast for the coming year, and likely the foreseeable future.

This is especially the case for Saudi Arabia, which at approximately $1.3 billion last year is already by far the largest regional consulting market, growing at above 8% in 2017 and tipped by the report to return to double-digit growth this year on the back of Saudi Crown Prince Mohammed bin Salman’s radical social and economic modernisation measures in the Kingdom.

The UAE too, as the region’s second largest market at a fraction above $790 million, is tipped to continue with its healthy growth, especially with the upcoming Dubai Expo 2020 drawing closer, while the third biggest GCC management consulting market of Qatar (at above $340 million last year) can look forward to the 2022 FIFA World Cup, with both nations keenly focused on legacy planning for their respective international events.

Together with the region’s suite of National Transformation Programmes – with the public sector accounting for close to a third of the GCC consultancy spend at a 7.3% growth rate last year – is the global shift toward digitisation, impacting, as is the case across the world, just about every sector of the Gulf economy and driving the consulting market through digital transformations and a range of associated factors such as cybersecurity and data storage.

The technology sector, as a result, was the fast-growing consultancy field in the region for 2017, leading to an increased diversification in offerings from the big professional service and consulting firms seeking to capitalise and both compete on strategy as well as implementation – many of which have been ramping up their presence and bolstering their expertise in the region over the course of the past decade, and continue to do so at an increasing rate now.Size of the GCC consulting industry

Increasing activity

Such is the volume of work on offer, and the sheer size of the contracts up for grabs (with Saudi Arabia for instance reported to be in the process of consolidating its consulting channels into colossal single contracts), the national and digital transformation projects sweeping the region have led in the past couple months alone to Deloitte establishing a Digital Delivery Centre in Riyadh, and A.T. Kearney launching a National Transformations Institute in Dubai to serve the greater Middle East.

Accenture, meanwhile, a Dubai Expo 2020 technology Partner, has stated its intention to establish a permanent digital hub at the expo legacy site, and EY late last year unveiled its advanced multi-million dollar regional cybersecurity centre in Oman. In addition to organic growth, last year McKinsey & Company acquired the Saudi management consulting firm Elixer, while other firms have expanded into the region for the first time, including Accuracy with a new office in Dubai, and Andersen Global, with the addition of Alem & Associates. Global firm Mercer has also extended its digital offering to Saudi Arabia as well as the UAE.

In terms of notable projects, The Boston Consulting Group, which opened its office in Riyadh in 2015, has been helping the Saudi government plan for the landmark rollout of public cinemas, while Oliver Wyman has been supporting the development of the Kuwaiti bourse and Arthur D. Little has joined Dubai’s Dewa and Saudi Aramco in co-operation talks. In addition, Big Four firm KPMG, which is recording strong growth in the region, last week signed an MoU in Qatar to support 2022 FIFA World Cup legacy planning, and Roland Berger has joined Bahrain’s financial technology hub FinTech Bay as founding partner.

Another of the Big Four leaders demonstrating significant growth in the Middle East, at 8% in revenue terms for 2017, is PwC, with a staff of over 2,400 professionals now based in the region – 1,000 of those in Saudi Arabia. The dramatic changes unfolding in the GCC, as a response to global megatrends, has recently inspired the firm to develop a new strategy framework which seeks to provide future-proofed solutions, while the firm’s strategy arm Strategy& has previously suggested that the governments of the GCC should consider establishing dedicated behavioural insight units to support their national transformation agendas.