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PwC’s new UK managing director has launched an overhaul of its operations in the country which will involve the creation of a standalone technology and artificial intelligence unit, a move which bosses say could be ‘destabilizing » for staff.
The Big Four accounting firm told employees last week it would embark on a reorganization of areas of the business affecting around 2,700 employees and associates, adding that it was part of its “new vision to become the preeminent firm ”, according to a report. document consulted by the Financial Times.
As part of the plan, PwC will create a “digital delivery unit” focused on technology innovation, AI engineering, cloud and data. The firm will also reshuffle parts of its advisory, transactions, risk and tax practices by moving and merging certain functions, creating six new teams.
It is the biggest internal overhaul of PwC’s UK business in years. It is also the latest reorganization of a major accounting firm as the industry seeks to adapt to changing client demands and find how best to structure its new AI consultancy business, which partners see as a lucrative growth area.
The realignment will create disruption for around a tenth of PwC’s UK workforce, which will be moved to new teams and service lines. Reorganizations within professional services firms can often lead to jostling for positions within the company.
Laura Hinton, managing partner of PwC in the United Kingdom, runner-up behind Marco Amitrano in the race to lead the company earlier this year, was dispatched to break the news to staff last week in a pre-recorded video message.
In the message, a transcript of which was seen by the FT, Hinton said the reorganization was aimed at “simplifying” the business and “reducing duplication”. She added that this would “create scale and increase our impact in the market”.
“I know that for some, change can seem empowering, while for others it can be unsettling,” Hinton said. “As we continue to adapt to our customers’ needs, it’s important that we all get used to being more agile, while continuing to support each other.
Details of Amitrano’s broader strategy for the company will be shared with more than 1,000 associates in briefings Wednesday, according to several people familiar with the matter.
This comes after a difficult period for the industry, with PwC last month reporting a drop in the average salary of partners as revenue growth slowed and rising costs and provisions for legal disputes weighed on profits.
Rival Deloitte, which embarked on a redesign of its global operations earlier this year to cut costs and reduce group complexity, also saw a decline in average associate compensation and lower growth.
PwC’s reorganization is not aimed at cutting costs and will not result in further layoffs, according to a person briefed on the plan. Last year, the company cut hundreds of jobs amid a market downturn and also launched a round of layoffs. “silent layoffs” in the UK earlier this year.
Hinton said the new digital delivery unit would house 900 “technologists” and work across the company’s various service lines. It will also receive a “market-oriented name.”
“These plans are a work in progress so, even though we don’t have all the details or all the answers, we still wanted to share them now to be open and transparent,” she said.
Separately, executives at the consultancy shut down speculation that PwC was considering selling Strategy&, the firm’s strategy consulting arm, to Bain & Co, or any other buyer, telling staff that industry rumors were not accurate, according to an email viewed by the firm. FT.
In a statement to the FT, Amitrano said the changes “reflect our strategic focus on clients, technology and PwC’s global network. They will allow us to collaborate more easily and mobilize teams to better meet customer needs.” The changes will come into effect from January next year.