TechnologyAccounting SoftwareInterview: Bruce Petter – Setting a course at the MCA

Interview: Bruce Petter - Setting a course at the MCA

Bruce Petter has finally taken the helm at the MCA, signalling a change of direction for the organisation. He talks to Mick James about how the Association could help UK plc.

After a long and highly celebratory handover Bruce Petter is now firmly established at the helm of the Management Consultancies Association.

The final symbolic curtain will come down on the Brian O’Rorke era later this year when the Association relocates from its current base in the former executive director’s Belgravia home and seeks more traditional office accommodation elsewhere.

For now, Petter sits at the head of an organisation that, although largely created and driven by the vision of one man, is acutely aware of the need to move to its next stage of development.

“Brian O’Rorke did a splendid job, holding it all together,” he says.

“Now we’re at a very interesting point in the development of the MCA.

The members who appointed me desire a slight change in direction, more focus in what we do. On the basis of what we have built so far we can have an MCA that is both more focused and wider ranging.”

O’Rorke always claimed that the consultancy industry was a very young one, and that it could not be said to be mature until a major consultancy appointed an MD from industry instead of from the ranks. By coincidence, this is exactly what has recently happened at PA Consulting, so perhaps what we see now is the MCA emerging into young adulthood as it “leaves home” and embarks on a new direction.

A trade association has a number of constituencies to address on behalf of its members: clients, the government (which of course is also a client), and the general public. Petter sees one of his most urgent tasks as trying to establish with the membership its own views in this respect. “Until you get a very clear steer you can’t address the other priorities, whether with clients, the public, or perhaps most importantly, the government.”

Petter on government

One gets the impression that, for Petter, government is the key target to aim at, an area where the MCA can most successfully exercise leverage and deploy its expertise. This may in turn lead to the MCA evolving into a different beast from the one we are familiar with. Petter believes that it is time consultants started to develop a broader view of the context in which their work is situated.

“I believe consultants should form views on government policy,” he says.

“That is traditionally the remit of the trade association, to comment pertinently on government policies. I want to lift the eyes of management consultants beyond issues like ‘the Euro’ and ‘the Year 2000 problem’ and focus on what are we going to look like as UK plc in the year 2010 and beyond. We need to look at the pinches that clients are suffering, to ask what does ‘competitiveness’ mean?”

The role of the trade association, therefore – and this applies in spades to a management consultancy trade association – is to act as a pro bono adviser to government. “The MCA has to start proposing change, both in ‘UK plc’ and in Europe, even lobbying for legislation,” says Petter.

“This means a change of attitude within MCA, provided the membership are willing to go along with it. We have to make sure that whoever we are talking to we show them we have lifted our eyes off the tarmac and are looking at the hills in front of us.”

Petter accepts that attempts by the consultancy industry to take the high ground in matters of public policy will inevitably attract criticism from a press that see any initiative by consultants as a cynical attempt to drum up business.

He is, understandably, aware of this but impatient with the arrogance and naivete displayed by many business writers who still cling to the negative stereotype of consultancy:

“That cynicism will inevitably occur but I don’t think it reduces the relevance of what I’ve said,” he says. “The government is asking for this type of comment from the MCA, it’s doing its own work on the topics and employing its own management consultants on the work.”

Petter believes that the volume of “ill-informed” comment is coming down, but what remains still makes him angry:

“If 97 per cent of the top 200 UK companies and the government use management consultants on a repeat basis then either they’re all party to the most enormous conspiracy or there is a real value to management consultants as wealth creators, as experts in the latest techniques, as access points to valuable resources like outsourcing. How can these writers be arrogant enough to assume that the chairmen of public companies are being misled and are failing to extract value for money for their shareholders? It just doesn’t stack up!”

Petter on education

One area where Petter believes consultants can contribute is education.

“In their relationships with universities and schools, consultants can try to change some of the attitudes to work,” he says. “This is the era of the portable personal pension, we no longer expect to work for one firm or in one industry for life: management consultants who work in all industries can help people prepare for that. The MCA in turn can increase educators’ awareness of consultancy.”

Other areas where Petter believes the reservoirs of experience and competency represented by the MCA membership could contribute to government policy include competition law and cutting through the mass of regulations and inconsistencies that still bedevil the European Union.

“There are different rules and regulations concerning mergers, there are no common standards on competitions,” he says. “It’s hard to see the point of a single currency if you don’t have common competition laws or common social regulations.”

Consultancies are also in a unique position to reflect and comment upon the changes currently shaping the business and political landscape, he says.

“Government has lost the ability to effectively control business in a global economy,” he says. If anybody is involved in the globalising economy it is consultants: like it or not the management consultant, with his global presence, is in a position to comment globally. Consultants will spot the pinch-points in the global economy, they have to assess the competitive situation throughout the world and therefore have a relevant view which should be listened to.”

The MCA’s ability to deliver in these areas crucially depends on the support it receives from its members. Petter is well aware of the “client comes first” mentality, but says he has been delighted by the willingness of senior individuals in MCA member firms to make time to see him.

“It’s sometimes difficult for me to get to see my members but a lot of people have cancelled important appointments to see me and I’m very gratified by that.” A lot of the MCA’s work will depend on pro bono contributions from members, and Petter is not above taking a leaf out of the consultancy textbook and paying for the use of outside resources.

“It would enable me to say, I’m paying the going rate for this project, so I don’t inevitably slip down the pecking order,” he says.

Petter on Europe

The question of Europe also has a deep resonance for the MCA, where the traditional model of the national trade association is less and less congruent with the reality of its members’ businesses.

One MCA member firm is now Dutch-owned, and all the members have overseas clients. Could the MCA open itself up to membership from other countries?

Already some of the larger member firms are basically saying that the UK member practices that originally joined the MCA no longer exist, having been merged into European or even larger regional groupings. What would the MCA’s position be on a Italian firm that wished to join the UK MCA but practised mainly in Germany?

“States no longer reflect the way business is conducted,” says Petter.

“If the MCA does develop its resources as I hope it will then you have to look at European legislation: that will be the trigger point, when we start putting proposals to various European directorates on competition.” At this point the possibility of creating European federations of firms – rather than the current “association of associations” Feaco, may become a possibility.

“As trade associations we have to take on those issues because the people we are dealing with are already talking about them,” says Petter.

In the shorter term, there is much to do in widening the membership of the MCA within the traditional UK boundaries.

“We want to recruit more members, adding perhaps 10 or 20 over the next two years while retaining those we have, up to a maximum of about 50,” says Petter. “But we don’t want to be an ‘anyone can join’ organisation: I’ll be presenting a paper on new membership to the members later this summer.”

Targets for the MCA include four or five IT firms who are now firmly established in the consultancy world, some of the larger HR consultancies, and, of course, the ever-elusive McKinsey & Co.

“We do need to expand our financial base,” says Petter. “We need to be able to offer a wider range of services as people go into Europe, as we talk to government. You need to have the resources to do that, to get work done on a priority basis. Then the Association can operate less as an insurance policy or a club and more as an effective trade body,” he adds.

Currently Petter estimates that the MCA accounts for around 65 per cent of the consultancy fee income generated in the UK, and that member firms employ about 30 per cent of the UK’s consultants. Such is the MCA’s dominance of the very largest firms that expansion would probably only take the proportion of fee income up to 75 per cent. Is this increase worth the hassle of managing an increasingly large and potentially fissile membership?

“It is a fact of trade association life that the affairs of the association can be brought to a halt by minority views,” says Petter. “They are sometimes difficult to reflect but on the other hand it is essential that you should reflect this diversity of views.” He points out that as director of the Petrol Retailers Association he had to deal with 7,000 members and 4,000 member firms.

Petter on the IMC

Petter also hopes to open a new chapter in the MCA’s eventful relationship with the Institute of Management Consultants, shortly to re-emerge in all its finery as the Institute of Management Consultancy.

This rebranding and repositioning exercise – taking the stakeholder approach to all participants in the world of consultancy – has led to speculation of the possibility of a bitter “turf-war” breaking out between the two bodies.

However Petter believes there is more scope for co-operation than conflict and he welcomes the IMC’s more inclusive approach as complementary to his goal of “raising the eyes” of consultants.

“I see Institutes as being learned bodies, offering training and technical assistance, and I welcome the way the IMC is developing its qualification,” he says.

“Institutes are not trade associations, they have different agendas, and yes, occasionally there will be clashes. But we must learn to place our differences in context, and that means being able to discuss them.”

Petter doesn’t believe – as has occasionally been mooted – that the two bodies should merge, but believes that they should explore the possibility of subscribing to joint programmes, and maybe even creating efficiencies by sharing facilities.

“We can perhaps co-operate to a greater extent than in the past and where we do have joint policies we can speak together,” he says.

Petter’s background: from petrol pumps to the MCA

Born in 1940, he was educated at Marlborough and Sandhurst, serving a three-year commission in the army before unfortunately being invalided out in November 1963. “I had to start again,” he said, and joined the family firm VIP Petroleum (now part of Elf), where he learnt the ropes managing a petrol station in Manchester and going “on the road flogging fuel” before becoming PA to the general manager. But he soon decided to strike out on his own, moving to Total before being headhunted by Ultramar as marketing services manager. This, extremely broad role brought him into contact with all aspects of the petroleum industry and laid the groundwork for his next move.

“It equipped me nobly for my next role,” he says. “I had contacts throughout the industry through purchasing and pricing, had sat on government committees, had contact with the Department of Trade & Industry, the Office of Fair Trading and so forth.”

In 1986 the opportunity came up to become founding director of the Petrol Retailers Association. The lure of such a potentially influential and high profile role proved too much for Petter.

“As director of the PRA I’d talk to Chancellors, heads of oil companies, select committees – on topics I myself had instigated.”

Over a decade later Petter stepped down as director to work as an independent consultant to the OFT, contributing to a report on competition in the supply of petrol that was published this year.

Then the MCA opportunity arose – subject to stiff competition and an arduous selection process.

Petter believes there are many similarities between the worlds of petrol and management consultancy. He cites the example of Tesco and J Sainsbury wanting to join the PRA – a move he favoured.

“They wanted to have some input into, for example, environmental issues but the government wouldn’t talk to them, so they wanted to join the association,” he says. “That’s true of the MCA – even if you are Andersen Consulting, the government won’t talk to you about general management consultancy matters. There are issues only a trade association can cover, and the views of the smallest – or the largest – are their concerns.”

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