Why Volkswagen’s Position On Consulting Firms Is Good News For The Hackett Group

Posted on May 12, 2017


In a recent post, I had indicated that I was waiting to hear back from The Hackett Group regarding their acquisition of Jibe Consulting and the possibility of doing an interview on my radio show.

While I am still waiting for their Global Communications Director to get back to me, there were two points of discussion on which I indicated to him that I would focus the segment.

The first is on what the Jibe acquisition means to the consulting industry. Specifically the KPMGs and Deloittes of the world. This is the topic for today’s post.

Just as an aside, the second was the parallels between Hackett’s Jibe acquisition and the NIGP-Periscope “partnership.” But again, that is for another day.

Going back to the consulting angle of the story, The Hackett Group is firmly entrenched in the Fortune 1000 world. In other words, they are a source of intelligence and market data for many of these large corporations. With the Jibe purchase, they can now extend their “service offering” to implementing “Oracle Enterprise Resource Planning (ERP) and Human Capital Management (HCM) solutions.”

According to the May 9th press release, Hackett will now be able to “fully support clients’ Oracle Cloud Business Application implementation efforts in finance, procurement, manufacturing, supply chain and human capital.”

So why does this pose a threat to consulting firms like KMPG and Deloitte?

The answer can be found in today’s article in The Drum News Why Volkswagen’s media boss won’t buy media from a consultancy.

Apparently, consulting firms are looking to buy agencies and get into the “media” game.

Volkswagon’s head of communications and media planning Oliver Maletz doesn’t think that this is a good idea.

Specifically, Maletz issued a warning (and the word warning was used) that “the likes of Accenture and Deloitte” should not “compete” head to head with media agencies. His reasoning was based on the belief that if a “management consultancy did buy an agency, it would still be lacking the expertise it would get from one that solely committed to providing that service.”

How does the Hackett deal fit into the Maletz equation?

The knowledge and expertise that consulting firms lack in the media business are similar to their “expertise” shortfall in the Oracle cloud applications world (and beyond).

Consulting firm expertise is rarely if ever indigenous. They are the epitome of the Branson edict  “If somebody offers you an amazing opportunity, but you are not sure you can do it, say yes – then learn how to do it later!”

Of course, this has worked very well for Branson, but not so much for the consulting industry’s clients.

The Hackett Group has the customer relationships, firsthand industry knowledge, and indigenous expertise that the consulting firms do not have. This Jibe acquisition is the missing piece of an end-to-end strategy that should make the “chameleon-like” consulting firms very uneasy.

There is is however another side of the coin to this story. I will talk about this in my next post.


Posted in: Commentary