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by Vault Consulting Editors | November 04, 2008

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"There is no loyalty bonus in publicly listed companies." - So says one recent poster on the Accenture message board. Talk of layoff worries is especially rife in the Accenture sphere. Current Accenture employees note that the firm has made a decision to lay off staffers that are currently on the bench, and colleagues attest to receiving emails from HR asking them to log all activity while they're not assigned to client work. This goes even for consultants who have been profitable for the year. (As of this writing, Accenture has been unavailable for comment.)

And if the prior recession serves as any indication of how the firm will behave this time around, things aren't looking great. One staffer offers this ominous report: "In 2001, it was literally done by who was staffed. I saw highly rated people go before sustained. Being unstaffed was the deciding factor. Tuesday was the day. If you got an octel on Tuesday saying come downtown, meet with partner, you were finished. Mondays were busy days doing backups and CD burning."

Accenture insiders advise their fellow consultants to get up off the bench and stay billable, even if it's just internal work. They suggest that those who can get themselves on long-term projects are the best off. As it so happens, though, Accenture is firmly situated in the outsourcing industry, which means that many of those long-term projects are tied to offshore delivery sites, employing cheaper foreign labor.

While this fact doesn't work in favor of "expensive" North American consultants, it does provide a cushion for the company as a whole (which would hopefully benefit all employees in the long run). A recent Economist discusses how the current financial crisis will affect the outsourcing industry, especially in light of the fact that financial services work now accounts for 30-40 percent of the industry's engagements. While many predict that outsourcing will be affected in the short term, as faltering banks delay or cancel outsourcing contracts, the prevailing wisdom holds that in the long term, outsourcing will likely be none for the worse, as financial institutions turn to outsourcing again to boost efficiency and protect margins. After all, once you've visited the shores of cheap labor (which in India, frankly, is not so cheap any more), it's hard to go back. The article points out that firms like Accenture and IBM, which have both outsourcing and consulting services to fall back on, will ultimately be better off than their outsourcing-only counterparts.

But just to make sure that IT outsourcing services providers stay on top of their game, Gartner has recently made key recommendations for them to survive the crisis unscathed ? or as unscathed as possible. At the root of these recommendations is the notion that IT companies need to boost their business performance, focusing on human capital, rather than just delivering technology services. "Innovation is a human activity, and it's not always about new technology," said Kathy Harris, a Gartner vice president and analyst.

I guess the moral of the story is, crank up "Eye of the Tiger" on your boom box and get your butt off that bench, even if you're just running up and down the court. Because when the coach comes to pare down the team, he's looking first at the guys panting on the sideline, regardless of how many points they had during the rest of the season.

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Filed Under: Consulting

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