PricewaterhouseCoopers completed its acquisition of Booz & Co. last week, renaming the management consulting firm as Strategy& (pronounced “Strategy and”).

The new name is intended to reflect the strength in strategic consulting that Booz is supposed to bring to PwC. The deal was originally announced last October and represents the latest move in PwC’s effort to build its consulting and advisory business (see PwC Plans to Merge with Booz & Co.).

“We fundamentally believe that today there is an unmet need in the market, particularly for companies that are competing in the global market, where they have cross-border competition and are trying to drive their own strategies,” Miles Everson, the leader of PwC’s U.S. Advisory practice, said in an interview last Friday. “The unmet need is the ability to connect strategic intent directly with impact in the business and get the ultimate results.”

Everson said that PwC saw an opportunity in the acquisition for doing more strategic consulting for clients. “We believe as a firm we’re very strong in our existing business around the trust and transparency side of the equation and on the ability to help our clients execute their strategic intent, but where there’s been a disconnect on performance for many companies is between the strategic intent and the actual ability to execute it,” he said. “So by bringing Booz & Co., which is being branded Strategy&, into the fold with our organization, you really have in our opinion the only firm that can connect that strategic intent along with the professional services firm that can help you execute on that strategic intent. It’s more of a seamless ability to go figure out where and how you’re going to make money and then go do it.”

Everson sees a difference in the consulting business that PwC sold to IBM in 2002, compared to the kind of business it is creating now.

“I think there's an important distinction to be made with what we were 14 or 15 years ago versus the advisory business that we’re building today,” he said. “Our previous consulting business had a heavy emphasis on large-scale ERP systems implementations. It was very heavy on the detailed tech configuration and development, whereas today we’re bringing together a set of capabilities that are very deep in terms of areas of expertise from a management consulting perspective with technology enablement. But you’ve got to get the balance right between technology versus the management consulting, how you solve complex problems, etc. We want to be the professional service advisor around all of the complex issues, without being a firm that’s going to go outsource your IT environment. It’s a very different strategy, with a different ability to acquire and retain the right type of talent and solve complex problems.”

Everson doesn’t see the acquisition as one that will expand a particular niche for PwC, but he looks at it in broader terms. “The primary expansion here as it relates to this combination is the expansion of focusing on capabilities-driven strategies —what are the true capabilities of a company, understanding those capabilities and then using those capabilities to go compete,” he explained. “That’s the execution piece that we talk about when we talk about strategy, and the impact is executing on them. From our perspective overall, we have our advisory business and we have our tax and assurance business. Having a firm that is very well rounded on understanding the capabilities needed to compete in a global environment and to compete successfully is critically important to our ability to understand companies and to think about how they’re competing and whether or not they have the right capabilities to be successful. That’s the piece that’s incremental here. What we’re focused on right now in terms of the build-out of what we’re doing is to make sure that we bring more strategic insights into how companies are competing. What we liked about Booz & Co. and their approach to strategy is not just saying what should my aspirational strategy be, but what are the capabilities that you as an organization are best at and therefore allow you to compete most effectively in the market.”

Everson has been running PwC’s U.S. Advisory practice since last July. He started out in PwC’s assurance practice and became an assurance partner in 1998. He later ran the firm’s global risk business as a global relationship partner and then headed the U.S. financial services advisory business.

“I spent a lot of time working with companies that have complex business models or compete in complex industries,” he said. He believes that background enables him to bring together an understanding of accounting with the ability to think about PwC’s business from an advisory perspective.

“How do you complement our traditional core businesses around accounting and tax, or assurance and tax, with an advisory business?” he said. “Our focus going forward is to continue to execute on what we refer to as a ‘one firm model’ where you deliver the more comprehensive solution by leveraging all components of our firm, not just one line of service.”

He sees the Booz acquisition as giving PwC a competitive edge over other Big Four firms.

“When you think of the other Big Four, which is just one group of competitors in terms of the way we think about it, is it’s one thing to talk about having execution and strategy capabilities, but I think by all observable measures we are the only firm that has really gone out and said we’re serious about having strong strategy capabilities,” he said. “By picking a strategy firm that focuses on the capabilities of an organization that’s very core to what we do as a firm anyway, it takes it to the next level. We fundamentally believe that we’re the only firm that has true strategy understanding and capabilities, and we’ve done [an acquisition] with a firm that thinks about strategy from a capabilities-driven perspective, which complements how we think about helping our clients go solve and execute on complex problems. I don’t think any of the other Big Four firms have that capability. It’s one thing to hire a few strategy people. It’s another to make a serious investment and bring in the firm that really invented the term ‘management consulting’ to begin with.”

Everson declined to comment on whether PwC is planning further acquisitions along the same lines of similar advisory firms.

“We can’t ever comment on anything in terms of prospective specific transactions,” he said. “But we are going to continue to aggressively and prudently build out our capabilities as a firm to continue to supplement wherever we have gaps. For the most part our short-term focus is to be on making sure that we get the proper integration of our two organizations together. We’re always looking for additional deals and/or capabilities to fill out our platform, as we refer to it, so we’re not necessarily holding back, but at the same time we’re pretty disciplined and surgical about the types of organizations that we buy. It’s not opportunistic. It’s very deliberate.”

Everson doesn’t see a particular niche that the firm needs to fill right now. “I don’t think there’s an individual niche per se that we need to go buy into anytime in the near future,” he said. “I think what you’ll see is we may do some small things here and there, but right now our focus is on making sure that we make the most out of this current combination.”

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