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The contractor-consultant relationship – destined for divorce

Contractor-consultant relations are often a thorny topic.

Unions between the two parties frequently end in the two parting ways.

It was an issue I touched on when writing my recent feature on the state of the consultant market.

Take Balfour Beatty’s takeover of Parsons Brinckerhoff: a union that only lasted four years before the engineer was again sold and absorbed into WSP. The same thing happened with Mouchel when it was bought by Kier in 2015 and its consulting arm sold to WSP just 16 months later.

Both sales were financially beneficial to the contractors involved, but they still demonstrate that the respective companies perhaps weren’t a good fit for each other.

Elsewhere, while Aecom continues to conduct contracting work in the US, it pulled out of this market in the UK earlier in the year.

While contractors having consulting arms may not be a viable trend going forward, at least in this country, there is still a lot that they can learn from consultants … from a distance.

Consultants with their higher profit margins and greater willingness to invest in new technology will continue to play a vital role in, among other things, major infrastructure projects and planning for worsening effects of climate change. It’s difficult to see how being absorbed into a contractor would do anything but hinder this function.

All the consultants I spoke to waxed lyrical about digitisation, with one even terming it a “mega-trend for the industry”.

The moves made by consultants certainly reflect this.

Mott MacDonald announced a partnership with Microsoft in March to found a cloud-based ‘smart infrastructure’ platform. The consultancy also announced the creation of a 3D digital twin for the city of Sheffield, which allows data such as air quality and weather to be used in infrastructure planning decisions.

WSP’s Nick Offer said that he’s finding that even complex drawings and Revit drawings are starting to be automated and carried out by AI.

Such developments are exciting for the industry but can have a less positive impact of contributing to driving down consultants’ rates.

One area that consultants have also been leading on is leveraging a global presence to provide fresh perspectives, options and workforce.

Façade and glass engineer specialist Eckersley O’Callaghan has experienced a remarkable rise in its 15-year existence and now has six offices around the world.

Dealing with projects further afield has allowed the practice to accumulate valuable knowledge on how to prepare buildings for the effects of seismic activity or typhoons, such is the local expertise in these phenomena.

Other consultants spoke of the benefits that a global presence has had in mitigating the effects of Brexit on their UK business, not to mention the ability to have staff working around the clock in different time zones to finish projects in double-quick time.

Again, though, this last point also feeds into the ‘race to the bottom’ issue. Employees in Asian countries will likely be paid less than their European counterparts.

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