Consulting and services firm Deloitte has swooped on boutique Canberra advisory and operational support practice Analytics Group ahead of a raft of policy changes anticipated to flow from the change of government and its ensuing Commission of Audit and Budget.
The company says it is gearing up for an anticipated increase in demand for high level advice from senior level bureaucrats as new measures including efficiency dividends and funding cuts start to bite the public service and agencies are required to find ways of coping with smaller budgets yet still deliver their required outputs.
The buy reflects growing competition among consulting firms for premium work as the Abbott government seeks to rapidly curtail the amount of money spent on lower and mid-range privately acquired services such technology contracting and business process transformation by consolidating the machinery of government.
“The major thing they are facing is the fiscal stringency that has started to bite,” Deloitte’s Canberra Office Managing Partner, Lynne Pezzullo said, adding that the imposition of efficiency dividends on top of efficiency dividends had now made the financial pressure “quite severe.”
The acquisition of Analytics Group, which specialises in expert support for public sector chief financial officers, is a clear bid by Deloitte to round out its offering to federal clients by adding in capacity that will help Senior Executive Service level staff come to grips with shrunken funding allocations while still pursuing business cases for service delivery and performance improvement.
The acquisition dovetails neatly with Deloitte’s 2011 purchase of high profile consultancy Access Economics that added media savvy economist and commentator Chris Richardson to the group’s fold which has given it a prominent and influential voice to help push its ideas.
It also indicates that bigger firms see finite window of time to gear-up to cash in on changes and are increasingly willing to pull out the chequebook to buy in revenue streams at speed rather than relying on slower organic growth.
At the same time, Deloitte Digital, which specialises in realising opportunities for innovation and efficiency, has also set up shop in the national capital in an effort to cater for demand from agencies that have been clearly told to get their act together in terms of exploiting new technology and online service provision.
A key capability that Analytics Group brings to the table is a sharp eye and deft hand for pushing down agency procurement costs and wrangling contracts as well as developing business cases and funding submissions.
An essential tool in that process is being able to drill into agency data, especially in financial systems, so that they way money is spent not only becomes more readily visible, but can be modelled and tested to provide a firm evidence base for proposals.
A persistent issue that all public sector agencies face is that there is often little incentive for them to internally develop efficiency measures because of the potential to lose out on future funding for re-investment as occurred under the Gershon Review.
“We are entering a period in the evolution of the public sector where internally focussed SES roles, such as those of the CFO, have become key to the future of most portfolios, increasingly challenged by fiscal and environmental pressures,” Ms Pezullo said.
“Across Federal and State Governments we are now seeing a strong drive to improve efficiencies through performance improvements and cost efficiencies. This team hire is part of the growth of our Canberra strategy and business transformation capability and will further boost the 10 partners we have added to our Canberra practice over the last year.”
Deloitte said Analytics Group partners Scott Alexander and Brett Streatfeild will now become Deloitte partners with the ability to tap into Deloitte’s other fields of expertise to grow their business.
“Our people will also be able to access the benefits of being part of the global Deloitte network, the innovative brand and their culture with increased opportunities for career development,” Mr Alexander said.
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