Yes, I know that a few of my last posts have had to do with Accenture, but with Tiger in the news and CEO William D. Green recently making the rounds at the country's largest newspapers, it's a hard company to avoid. Today, Green spoke with the about what Accenture did right and what it did wrong throughout the roller-coaster ride of 2009. Of course, he mentions the expected difficulty of balancing short-term and long-term expectations, striving to retain clients and touches upon recent organizational changes within the firm—no surprises there.
But the most interesting comment, to me, was when Green talked about the recent consolidation in the technology space, with large software companies (Dell, Xerox, HP) acquiring services providers with the goal of being large, one-stop-shops for clients. This industry shift is not really news, as I've written about it on a number of occasions, but it's an important point when financial recovery is the issue at hand.
When times are uncertain, it's generally in a company's best interest to refocus its objectives and renew its attention on the things it does best and on the things that have worked for it in the past—this will only increase its chances of coming out of the recession heading in the right direction. Of course, growth is a natural goal for any firm, and yes, many clients are enamored with the thought of a company that can do it all for them. But when push comes to shove, it's not always the best strategy for a company to move into new areas in a shaky economic climate.
As Green puts it, "I think any product company that gets into the service business has to take a few deep breaths because the difference is night and day. [One] company is about products, the [other] company is about people. It is a very hard thing to do to get a product company culture and a service company culture to coexist." And when asked how he thinks Accenture will be able to compete with a mega-corporation that claims to offer clients everything, Green puts his faith in the client, saying, "Customers are smart. They get that if it seems too good to be true, it probably is. We have much of our compensation tied to the results that we generate on behalf of the companies. Nobody else in this business works that way."
Of course, it's impossible to tell at this point whether Dell's or Xerox's ventures into the service business will be successful. And, in truth, they may very well be—those companies certainly have the size and the track record to go the long haul. But the fact of the matter is that in a recession, the safer course is generally the one that's tried and true—the one that's worked for you in the past and the one that clients know they can rely on.
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