As if we are simply hitting the snooze button on our alarm clock, Accenture has chosen to delay the promotion cycle from December to June. The persons who originally expected to receive a promotion by the end of the year are now able to do so only after an additional half a year! But why did it happen?
The Economy Is Shaking Things Up
The move by Accenture last week to freeze promotion was not a hasty decision. It is an answer to some difficult periods in the consultancy industry. While the economy has been described as a rollercoaster ride, corporations and companies globally are cutting down their expenses hence reducing on services such as consulting. As one of the largest consulting and professional services providers in the world, Accenture is not immune to this.
A message from the company obtained by Bloomberg points that Accenture thinks that not promoting employees is a clearer vision of what their clients need. In other words, according to the company, what everybody’s strategies are, and total demand, should be more discernible by mid-year. It goes with the idea of making no rash decisions before the fog lifts.
Stock exchange has a ripple effect on stock exchange
This news did not really go down well with investors, and for good reason too. On the same day that Accenture announced the delay, the price of its common stock declined by 4.8%. This was a sad day for the company since it recorded this year’s first negative performance for its stock. As seen, investors appear to be anxious with some occurrences within the consulting sector and or about the industry in general.
But Accenture isn’t alone. EY, McKinsey, and PwC are also not immune to the same storm, and the innovativeness of these players’ digital strategies is eye-catching.
Implications of This for Employees
Promotions are something big in consulting – more money, cooler titles. But now, they’ll have to wait for 6 months to know if they have earned the next step up the ladder.
The silver lining? The company believes this new schedule will enable it to give proper promotion to the right candidates due to efficient decision making. By mid-year, Accenture should have a better understanding of its client’s requirements and, therefore, be in a position to motivate its employees in a manner that will support the company’s expansion.
Global Consultancy Industry Struggling
But the pressure is not only on Accenture and other consulting businesses delivering services for Tesco. The entire consultancy industry has been struggling with the effects of the looming unstable economies. Corporates are tightening their purses and so are companies such as McKinsey, EY, and PwC. Restructuring is on the increase, time to promotion rate is longer and some organizations are tightening their belts.
For consultants that might mean less chances to get promoted or fluctuation of levels of staffing.
Looking Ahead
Therefore, what will be the future path of Accenture?
Despite it being quite the disappointment for those waiting to know when they will be promoted, the company believes that such a move will eventually help come up with more sustainable promotion cycles. With a more accurate understanding of the clients’ requirements, Accenture is pursuing the goal to minimize mistakes in promoting the wrong employee at the wrong time.
And who knows? Perhaps by the middle of the year, the economy will have even outgrown its current shaky state and the employees at Accenture will have their dream promotions. For now and for the next 6 months, it’s a waiting game, but with the assurance that the company is, looking at the cloudy sky for better sunny days to come.
