Covid-19 Pulse Survey 2021 Update: The Long-Term Outlook and Implications for the Consulting Industry
Between April and June 2020 Vencon Research conducted the first Pulse Survey in the light of the unseen and unknown economic, financial, and personal impact of the COVID-19 crisis.
This Update to the Pulse Survey is a result of many requests from our clients over the past months wanting to find out how other professional services firms have adjusted to the crisis. Not just questions about the near and long-term future but also about the measures taken to react to COVID-19 and which may be sustainable and/or change the future of work and business in the consulting industry.
Most participating firms operated in strategy consulting, followed by IT consulting/services and operations consulting. 51% of responses came from firms located in Western Europe, followed by North America (20%) and AsiaPac (13%); ROW responses were 16%. Responses were well distributed with regards to firm size; slightly more responses came from firms employing 50-249 consultants (27%).
Here are some of the “highlights” from the key findings of the survey:
Business Situation and Prospects
The outlook for the coming year was fairly positive: More than half of the firms (54%) expected COVID-19 to positively impact their business. Generally, the consulting industry was surprisingly optimistic: A total of 82% of the firms expected better business prospects, despite COVID-19.
Effects on Workforce
During the previous 12 months more than half of respondents (52%) stated they reduced hiring; Interestingly, 31% reported increasing hiring. More than half of firms (56%) expected to increase hiring in the coming 12 months based on largely positive expectations regarding their business situation. Most firms (78%) expected either no adjustment or a slight increase in their existing workforce after COVID-19; only 17% of firms expected a significant increase. The problems mentioned resulted from staff working too long, a lack of “down time” and/or “switching off”; “virtual” onboarding/training was also difficult.
Promotion, Compensation & Place of Work
Most firms (82%) provided the necessary support to allow employees to work remotely and/or work from home, including for example computer/laptop, high-speed broad-band internet access, headphones, video camera equipment, etc., as well as other benefits.
The mental health of employees was considered a major challenge during the COVID-19 crisis. Hence, almost all firms provided additional training (93%) and self-management assistance (88%) to ensure employees are not over-worked and do not face “burnout” or the like. However, only 34% actually tracked home office working time.
Firms reacted differently regarding compensation adjustments: “merit” based pay increases continued to be offered; however, bonuses were reduced or suspended.
The majority of firms (75%) expected office usage to be reduced in the future and expected “work from home” to be continued (to a degree). In particular firms implemented “work from home”, which has become a standard way of operating for many firms; at least partly.
Long-term Changes and Challenges
Flexibility of place of work is expected to increase as most respondents (89%) expected “work from home” to be permanently implemented, but at lower than current levels (min. 1 to max. 3 days p/w). With regards to the difficulties arising from the increased usage of “work from home” or “remote work” and other permanent changes in business operations most firms mentioned the “soft” factors (e.g. self-management, continued health and well-being, culture) that were and will be challenges faced by “work from home” policies.
Many firms (59% of respondents) expected Business Development (i.e. sales) to become more “virtualised”.
The Long-term Outlook
Interestingly, almost half of the firms (49%) expected things to get back to “normal” within a given time, i.e. to the conditions before COVID-19. On the other hand, 39% of the respondents stated that there will be no return to a “before”.
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Andy Klose is an Associate Partner at Vencon Research International and heads the firm’s consulting unit.
Erwin Harbauer is a Partner at and co-founder of Vencon Research International.
Vencon Research International is a leading provider of compensation benchmarking and research as well as of compensation and performance-related consulting services for professional service firms, especially for audit and tax, management consulting, and IT services firms. Vencon Research International provides services to a full range of clients in more than 75 countries worldwide and is proud to name more than 85% of the world’s major consulting and/or professional services firm its clients.