Managed Services & Alliances help Drive PwC in EMEA

PAC recently attended an analyst event by PwC, where the company showcased some of the client stories and propositions that have made it one of the fastest-growing consulting and IT services providers in Europe.

Based on our preliminary rankings, the company has broken into the 25 largest IT services providers in the EMEA region, following growth that topped the 20% last year. Since the “Big Four” group sold its consulting wing to IBM back in 2002, it has steadily rebuilt its capability around an increasingly technology-centric focus.

PwC’s core proposition is to help its clients accelerate their transformation. This could be at the business level of operations or finance, or from an IT perspective, accelerating the journey towards cloud migration and legacy modernization. The appetite for change is underlined by the company’s own research, which found that 40% of business leaders don’t believe their business model will still be relevant in 10 years.

At the event, we heard from several C-suite client executives that cited the depth of PwC’s industry domain expertise as a key reason for selecting the company as a partner. One European retail bank highlighted PwC’s ability to help the CIO build the business case for core platform modernization by helping them understand how other organizations in similar positions had successfully progressed. The CIO also underlined how during the “build” phase of the engagement, PwC had worked to ensure that the client’s internal team built the knowledge and skills to be able to take control on the “run” phase as quickly as possible. 

PwC put the spotlight on its Managed Services business, which is emerging as a key part of its transformation proposition. This division challenges traditional approaches to business process outsourcing by transforming and running the end-to-end processes of a specific function, while shaking up the underlying technology platforms. A good example is PwC’s work with a major automotive parts manufacturer, where it implemented a new Salesforce-based e-commerce platform to support its European dealer network, while PwC effectively ran all the supporting processes as an independent business, from fulfilment through to onboarding, marketing and legal support.

In this case, a key element of the commercial model was for PwC’s fees to be tied to the successful delivery of specific business outcomes, and a willingness to put “skin in the game” was a feature of a number of client engagements highlighted at the event. The Managed Services division recently unveiled a new 400-capacity delivery center in Egypt, to support existing sites including its primary hub in Belfast. The company expects growth to come from the renewal cycle of legacy BPO deals, and greenfield opportunities triggered by factors such as carve-outs from private equity-owned businesses.

PwC recently grabbed the headlines when it announced that at group level, it would invest $1bn in Generative AI and explore how it could enhance both its internal activities and those of its clients. PwC’s UK division has already identified more than 300 potential use cases, and it is currently prioritizing them based on how rapidly they can unlock value in a “safe” manner. Amid the current wave of concern over how Generative AI can be regulated, PwC believes that its deep experience in risk and regulation puts it in a strong position to help customers put the right building blocks in place to ensure that they can scale their initiatives within the appropriate guardrails. Further PwC investments focus on preconfigured digital assets and platforms (e.g., PwC’s banking platform Tysl) to expand industry-specific capabilities.

The company’s alliances strategy is critical to its momentum, with 70% of its business having a partner supporting the client engagement. PwC has eight strategic alliance partners, supplemented by an ecosystem of more focused tie-ups, and its pipeline of opportunities relating to these partners has grown massively in the last couple of years. Part of this success has been underpinned by its EMEA Impact Centre, which brings together a team of pre-sales, sales and solution architect experts to ensure that they work with their partners in a consistent way that leverages best practice.

One of the areas where PwC has really risen to prominence is in the SAP services space. It is currently supporting the largest S/4 HANA deployment in Europe at a global manufacturing organization, and we heard from a senior executive at a large energy provider about the critical role that PwC played as part of a team of services partners that delivered a hugely challenging SAP S/4HANA modernization project during the course of the pandemic. The project has many great lessons for any SAP customer that is battling to put together the right business case, stakeholders and suppliers for a major migration, and has won industry awards as a result. PAC recently ranked PwC as one of the ten largest SAP consulting and systems integration partners at both a worldwide and EMEA level, and the company now draws upon a team of more than 14,000 SAP S/4 HANA professionals globally.

The company’s talent strategy will be critical to its future ability to scale, and while PwC has been more active on the M&A front in recent years, one of its biggest assets is its ability to attract and upskill young talent. One of the firm’s top technologists told us that it has a strong track record in attracting developers that are keen to hone and grow their skills within a specific industry and in tackling real business problems. PwC has one of the most innovative HR strategies in the business, and it will be interesting to watch how it evolves as the company looks to build on its current momentum.