For the first time in person since 2019, EY hosted a global analyst summit at the start of the firm’s Innovation Realized event, which was held at San Francisco’s Palace of Fine Arts. The 2024 EY Global Analyst Summit included at least 50 analysts, multiple main stages sessions and breakouts. The following special report highlights conversations between TBR and EY leaders during the event.

EY: ‘We are Business Engineers’

In a space designed to compel analysts, clients and partners to rethink EY’s innovativeness, creativity and technology capabilities, Pat Sullivan, EY’s global digital engineering leader, and Errol Gardner, EY’s global vice chair of consulting, kicked off the Global Analyst Summit by challenging attendees to see EY in a different light and appreciate how much had changed since the firm last hosted analysts, pre-pandemic, at a similar space in Boston.

 

Sullivan noted EY’s daily incorporation of AI, cybersecurity and cloud into consulting engagements, establishing one of the event’s themes: the breadth, depth and interconnectedness of EY capabilities. Gardner described the firm’s strategic marketing position, the value EY can provide by helping clients train and upskill their talent in the generative AI (GenAI) age, and the imperative EY sees in leading the market on sustainability.

 

Both Sullivan and Gardner stressed how much had changed at the firm and suggested the two days of presentations, breakouts and one-on-one discussions during the weeklong event would lead analysts to reconsider — to rethink — what they previously thought about EY.

 

Spoiler: TBR has tracked EY closely over the years, and the event confirmed and solidified TBR’s assessments while adding details around specific practices and a clear sense of EY’s strategic outlook beyond 2024. The following reflects TBR’s observations from the summit and analysis of EY.

‘The Best Edge We Have in Innovation Is the People We Have’

Professional services — especially any kind of consulting — depend entirely on talent. Despite business model disruption occurring across seemingly every industry, EY’s business model remains fundamentally unchanged: Bring the best people to a client’s problem.

 

Underpinning this business model traditionally has been an apprenticeship-based talent development and management model that has seen tweaks and improvements (EY’s badges program stands out) but remains in place, even as generational demands and expectations change, technologies such as GenAI threaten to replace people, and the people adjust and readjust to in-office, remote and hybrid work policies. Garder noted that career experiences are the single biggest thing that motivates people, especially younger professionals, to look for “possibilities, not just job security.”

 

In this human capital management maelstrom, EY’s strengths, including attracting, promoting and retaining its own talent, can likely be credited to the firm’s own People Advisory Services practice (see TBR’s special report EY Puts People First: Navigating Growth with Human-Centric People Advisory Services). Amid the competitive and sometimes chaotic market, EY’s talent strategy relies on reskilling professionals, including through an apprenticeship model, rather than acquiring those professionals and providing them with the top technology.

 

In addition to the blocking and tackling of human capital management, Gardner said the cultural shift requires training “more people to get used to the fact that change is constant, transformation is constant.” TBR believes EY has consistently told a talent story that revolves around upskilling to retain and attracting — not acquiring — talent. Even if this year’s Global Analyst Summit did not lead TBR to rethink its assessment of EY, the consistent talent message from all the EY leaders further cemented TBR’s understanding of the firm as being adept at using its culture to inculcate a talent-centric ethos.

EY’s AI Proposition: ‘Take the Toil Out of People’s Work’

Rooted in a robust data and partner story, EY’s AI strategy aims to disrupt both EY’s and clients’ business models. Five years ago, AI was one of the five demo stations featured at the EY Global Analyst Summit in Boston. Not surprisingly, this time the technology had earned a main stage presentation, followed by a dedicated breakout session.

 

While GenAI continues to dominate news cycles and is influencing EY’s investment and go-to-market strategies, the firm is not new to AI. EY Fabric, a global foundational technology platform, has continued to provide the critical distinction for the firm by being run as one global operating model. It now acts as the cornerstone for the next phase of EY’s AI strategy. EY Fabric’s intelligence layer underpins both technical and functional AI patterns, which are necessary to support the firm’s efforts to drive platform-enabled services revenue.

 

The recently launched EY.ai, a unifying platform, leverages EY Fabric as its technology backbone, allowing EY to deliver the necessary tools and technologies, backed by over 10,000 AI-skilled professionals, as many digitally mature clients pivot from proof-of-concept GenAI discussions to scaled deployments. In September 2023 EY launched EY.ai EYQ, an ecosystem of GenAI capabilities powered by EY Fabric, in addition to upskilling EY employees in AI learning and development.

 

While EY Fabric provides the necessary link to managed services, the platform also connects well with partner technologies. For example, Fabric provisions with EY IP (e.g., analytics, optimized business processes) on top of their partner capabilities such as SAP (NYSE: SAP), Snowflake (NYSE: SNOW), ServiceNow (NYSE: NOW) and Microsoft (Nasdaq: MSFT) to expedite delivery and value to their clients. Microsoft underpins the cloud-first EY Fabric and coinnovates with EY on the hooks into customer data.

 

ServiceNow provides the base workflow shell for many of the EY managed services workflows. These relationships further amplify EY’s enterprise transformation value proposition. We believe EY is aware of its strengths as the firm continues to collaborate with partners, including technology and services companies, to ensure it maintains service quality and protects its brand.

 

As with any technology, use cases accelerate time to market, so EY is tapping into its internal transformational efforts as well as across its broader portfolio, including its tax, audit and risk assurance practices, to demonstrate value. Earning and sustaining client trust through audit-grade transparency play to EY strengths but also heighten expectations, especially as vendors often struggle to highlight the golden opportunity of data.

 

With EY transforming its own business model to account for the implications of AI, building a repeatable framework around three pillars — augment (inject AI streamline ways of working with AI-enabled professionals), disrupt (prioritize and execute an AI refactoring of EY’s portfolio) and drive repeatability with GenAI platform and agents (driving new revenue through repeatability) — the firm has an opportunity to test its risk-taking boundaries, as executing on such disruption often requires broader internal consensus, which is not an easy task and is especially harder for Big Four firms.

 

Pivoting from a traditional time-and-materials commercial model to an outcomes-based setup is not a new concept, but EY’s aspiration to make the firm’s AI-enabled services offerings 10 times better and 10 times cheaper will also test the firm’s ability to monetize the technology not just as a service enabler but as a software asset. (Note: During the event, EY claimed it was the 30th-largest software provider. TBR will publish a separate blog post on EY’s software and assets practice.)

 

Strong examples within EY’s Third-party Risk Management solution helped bring ambition to life and highlighted what analysts can expect as the firm applies its own business transformation efforts at scale with clients. On one hand, EY’s “cheaper” and “better” messaging raises questions about the firm’s decision to position AI as a loss leader to drive consulting and managed services opportunities.

 

On the other hand, it would be dismissive for us to put “AI” and “loss leader” in the same sentence, given the opportunity the technology presents to generate high fidelity, data-driven insights and accelerate time to value. Contextualizing data at scale will help EY stand out from a crowded market, but only if clients and technology partners can equally praise the firm’s value proposition and service delivery execution.

‘EY Does a Great Job Providing Confidence in the Market’

Following the failed attempt to split its consulting and audit business, EY now can prove critics wrong. The firm is developing a profile of a solution broker that has the depth and breadth of knowledge of just a few but critically important technology providers, where much of the ecosystem development is occurring.

 

Selling business outcomes orchestrated by EY, and by a collection of partners, enables EY to disrupt the status quo in the traditional bilateral services technology vendor relationships and evolve toward multiparty vendor support. The concept of ecosystem with EY as an orchestrator plays to the firm’s strengths as long as EY stays focused on delivering client outcomes through the best-suited technology.

 

During a main stage presentation, Greg Sarafin, EY’s global alliance and ecosystem leader, hosted three of the firm’s top alliance partners, including Microsoft, SAP and ServiceNow. This is not the first time Sarafin and EY have taken that approach. Back in November 2022, during EY’s Global Data and AI Summit in Malaga, Spain, the firm brought six of its data and AI partner companies, ranging in size and portfolio offerings, to present onstage: Databricks, IBM (NYSE: IBM), Microsoft, RelationalAI, Snowflake and UiPath (NYSE: PATH).

 

EY’s approach to partners is different from many of its peers’ as the firm does not go to market with a particular vendor unless EY uses that vendor internally. Adopting a customer-zero approach to its alliance partners elevates EY’s trustworthiness, a key element in the firm’s efforts to act as an ecosystem enabler.

 

During the 2024 summit, the appreciation for collaboration between EY, SAP, Microsoft and ServiceNow at a multinational dairy company provided a strong use case for how each partner sees its value within the ecosystem supporting EY’s alliance-enabled business. EY’s partner-enabled business has become one of the firm’s key growth pillars. For example, EY has grown alliance-driven revenue from $1 billion in FY17 to $8 billion in FY23 and is on path to reach $10 billion in FY24.

 

Part of EY’s success is the firm’s ability to not pit partners against each other and to have specific solutions with specific partners that are not replicated across partners. This is a strategy we believe will be amplified moving forward as EY strives to grow its overall technology consulting and cloud business while also investing in proprietary software and assets.

 

While one can argue that EY is over indexed on Microsoft, given the relationship helps EY generate roughly 40% of its alliance-enabled revenue, EY’s SAP and ServiceNow businesses are also growing at a strong pace, testing the firm’s agility, especially as a result of SAP’s ever-changing priorities in terms of portfolio and commercial model adoption.

 

Pairing comments from the 2024 main stage presentations with both formal and sidebar conversations with EY’s SAP and ServiceNow practice leads, TBR walked away with a greater appreciation of the firm’s willingness to work toward establishing a preferred partner status with these vendors. For example, during an SAP breakout session, a joint EY and SAP client, a large semiconductor company that previously had not worked with a C&SI provider, discussed the value of the 360-degree relationship EY and SAP have and how that has helped with executing on a back-office transformation program and moving from on premises to cloud.

 

While that use case might appear as yet another SAP migration project, being able to convince a client that had not spent money on SAP and was now looking to try S/4HANA to optimize its supply chain process highlights EY’s ability to manage trust within the ecosystem.

 

Furthermore, now that Phase 1 of the project is complete, EY has the opportunity to not only continue supporting the client but also leverage the use case to create a three-way partnership between SAP, EY and the technology client and drive targeted conversations with clients grappling with similar issues, thus generating partner-enabled revenue from the client as well. Partner integrations with leading data service providers will be a critical component of adoption growth, creating an opening for EY to demonstrate its data orchestration capabilities and drive opportunities that could allow the firm to close the gap with Accenture (NYSE: ACN) and Deloitte in terms of its SAP practice revenue.

 

EY’s SAP strategy has required a sustained commitment to attracting and retaining the right talent, adeptly mirroring SAP’s various strategy shifts and building a credible — and substantial — collection of use cases. TBR has tracked EY’s SAP journey closely over the last decade and anticipates continued growth as the two companies see their strengths reflected in market demands. (Note: TBR is developing a research stream for 2024 focused on services providers’ relationships with back-office systems technology partners, including SAP.)

 

Meanwhile, ServiceNow’s recent purchase of EY Smart Daily Management, a connected digital worker application, highlights the trust and depth of the relationship. Both partners seek to expand addressable market opportunities within the operational technology space, where EY also manages strong relationships with Dell Technologies and PTC. Additionally, ServiceNow’s knowledge-managed text-to-code and text-to-app play will create capacity and opportunity for EY’s business consultants to conduct higher-value work with less need to add talent on the services deployment side.

 

People, technology and processes will remain the key pillars of EY’s ability to grow partner- and overall technology-related revenues. As the firm continues to invest in training and development initiatives across the organization to account for GenAI implications, developing dedicated career tracks will help EY strengthen ecosystem trust. For example, EY is in the process of designing the Distinguished Engineer track, which will be among the highest and toughest EY designations one can earn, helping EY to more closely transform its identity into that of a technology-enabled company.

 

Launching such a career track is a smart strategy and is in line with some of EY’s prominent partners such as IBM. EY understands the gap it must close with some of its services peers when it comes to C&SI revenue. But as long as the firm executes on doing cloud right, rather than pursuing a cloud-first strategy, EY has a chance to increase client and partner stickiness, especially as tech partners now face remaining performance obligations with clients, thus creating a consulting opportunity around FinOps, education and change management for EY.

Keeping It All Together: Supply Chain, Cybersecurity and Managed Services

Everest, the elephant that left the room at the Global Analyst Summit, provided a common, if unintended, theme connecting many of the breakout sessions: EY brings clients a wide range of professional services capabilities, with cross-firm collaboration and coordination more central to EY strategy than ever before. TBR attended breakout sessions in addition to the ones detailed below and will provide details in future EY-specific reports and within the upcoming Management Consulting Benchmark.

‘I Believe Supply Chain Can Change the World’

On the main stage during a presentation titled “How EY teams are helping provide value for a new economy in which businesses, people, and planet thrive” and the following discussion of EY’s sustainability offerings, Sheri Hinish, EY’s global sustainability, technology and ecosystems leader, set the bar high for the subsequent Supply Chain breakout session with her comment about the supply chain’s world-saving ramifications.

 

Glenn Steinberg, global supply chain and operations leader, and Matthew Burton, EMEIA supply chain leader, did not shy away from the challenge and made a compelling case for EY’s role as a leading consultancy and supply chain orchestrator. Steinberg described his firm’s value promise as “resilient, sustainable and tax-efficient supply chains,” notably highlighting tax as a component, which was a prevalent sentiment throughout the event. Steinberg said over 6,000 EY supply chain professionals support “90% of the 50 largest supply chains and 75% of the Fortune 500,” while cautioning that EY cannot serve those clients alone: “You need an ecosystem to deliver.”

 

Burton and Steinberg added that while the firm’s offerings include pure cost-containment engagements, the supply chain practice earns most of EY’s annual revenue from transformational consulting and implementations.

 

Turning back to tax, Burton said the firm has found upward of $100 million in tax savings for clients through supply chain transformation engagements. At the same time, Burton noted that “nearly every [supply chain] project includes a sustainability component … and that percentage is growing.”

 

In TBR’s view, the seemingly seamless connections between EY’s supply chain, tax, cybersecurity and sustainability professionals — not to mention its strategy, transformation and cloud practices — in an unexpected way underscored Gardner’s main stage comment that we are currently in an “era where it’s not about one organization or a single buyer.”

 

Gardner was stressing the importance of EY as an ecosystem partner to technology vendors, academic institutions and other ecosystem actors, but the supply chain leaders highlighted that even within EY, getting the most value comes from tapping into multiple parts of the organization — echoing, fittingly, supply chains.

EY Cybersecurity and Risk: ‘Their Chore Is Our Core’

During a breakout session dedicated to cybersecurity and risk, EY Global Cybersecurity Leader Richard Watson and Global Risk Consulting Leader Whitt Butler described the firm’s go-to-market strategy as rooted in confidence in EY’s capabilities and assurances to clients that the firm can bring the best collection of ecosystem technology partners, most notably Microsoft, Splunk, ServiceNow and CrowdStrike (Nasdaq: CRWD), to any transformational engagement.

 

Butler highlighted EY capabilities around internal audit modernization, responsible AI, resilience (including getting in front of supply chain shocks) and digital risk management. Watson stressed EY’s strengths in cybersecurity transformation, incidence resilience and response, and trusted AI, as well as EY’s fast-growing Cybersecurity Managed Services business.

 

Watson added that Cyber Managed Services currently contributes approximately 30% of the firm’s cybersecurity revenues, and EY expects to reach a 50-50 revenue split between consulting and managed services work by 2030.

 

In mid-2023, TBR spoke at length, over multiple meetings, with EY cybersecurity leaders and noted that in the maelstrom that is cybersecurity, EY has “demonstrated a willingness and ability to play well, enhancing the technologies and capabilities of strategic alliance partners and vetting, nurturing and accelerating the development of smaller firms without compromising EY’s core value proposition around trust and transformation.”

 

TBR stands by that assessment a year later and notes that among the various breakout sessions during the San Francisco event, the cross-practice alignment between Cybersecurity & Risk and Supply Chain stood out, reinforcing another point TBR made in its 2023 special report: EY has shown a “commitment to seamless and highest-quality security services at any client’s location, including the necessary talent on the ground lends credibility to EY’s claim that the firm is a market leader for cybersecurity.”

Managed Services: Evolving Toward $9B

During EY’s Managed Services session, Paul Clark, EY’s global vice chair of managed services; Scott Mullan, EY’s data and insight managed services leader; and Sameer Sinha, an EY technology consulting and finance & data technology partner, discussed the current state of EY’s Managed Services practice and highlighted recent advancements through the firm’s partnership with GE.

 

EY projects the practice will generate $9 billion in EY’s FY24 owing to four main trends: speed, AI proofs of concept, industry layers, and interoperability of data and intelligence. EY looks to evolve the practice, bringing in new domain and industry expertise to transform clients’ business processes and address challenges beyond traditional business functions.

 

Through its work with GE, EY developed the Finance Data Lake (FDL), which connects the talent at GE to data and outcomes. Through the platform, EY was able to centralize and consolidate GE’s back-office functions, providing greater visibility into back-office operations and improved productivity. Further, EY improved GE’s divestiture management by creating three separate businesses enabling a commercial mode. Using the FDL platform, EY can pursue subindustries while also delivering core capabilities that enable users to leverage data insights, enhance user experience and manage a unified data model.

 

EY’s Managed Services continues to focus on people and asset-based functions to support core business needs, enabling EY to provide clients with the tools and services needed to leverage data and insights, experience, and productivity. Leaning on its sector and domain expertise positions the practice to execute on technology needs through a services lens, bolstered by EY’s ecosystem, enabling clients of the Managed Services practice to achieve business function outcomes.

EY-Parthenon: 10 Years of Staying Focused on the Biggest Problems

EY’s 10,000-plus-employee strategy consulting sub-service line, EY-Parthenon, which has been part of the firm for more than 10 years, remains focused on clients’ big-spend events: large transactions and transformations. During the Strategy breakout, Barak Ravid, EY-Parthenon’s Americas leader, and Pierre Beaufils, EY’s Global Business Consulting leader, detailed the firm’s changes and current focuses of EY-Parthenon.

 

Divest, sell and spin activities continued to remain a core piece of the practice as many clients consolidated business operations, requiring the establishment of new operating models. Further, EY delivers on Sell & Separate, Buy & Integrate, and Diligence services.

 

Ravid and Beaufils emphasized the strength of EY-Parthenon’s team and leaders, growing its scale to deliver on client needs and expand the business. Further, hiring both lateral and executive talent extends the strategy brand and enables EY to work closely with its clients on these bigger spend areas. EY-Parthenon focuses on strategy and execution to provide clients with the sales strategy and channels as well as pipeline management they need to progress and navigate in a new operating environment.

People and Organization: Transform and Transact

The People and Organization breakout, led by Joe Dettmann, EY’s Global People Advisory Services Solutions Enablement leader; Maya Smallwood, EY’s Global People Advisory Services People experience leader; Jonathan Sears, EY’s People Advisory Services Global Technology leader; and Randy Beck, EY’s Global and Americas Organization & People Field of Play leader, focused on the influence of AI on people management and resource strategies. The leaders discussed three main points: transact to transform; “humans at the center” and the importance of people; and insight to action.

 

With people experience as a core element of EY’s People Advisory Services, the EY leaders discussed cultural transformation and the importance of bringing talent to the center of the transformation, lessening the uncertainty caused by transformation. For example, as EY has integrated its technology tools within People Advisory Services, it provides analysis on where disruption lies to help manage the impact AI has on the organization. Further, following the analysis, organizations can adjust compensation and talent management measures to reap the benefits of transformation projects.

 

Data and analytics have changed the way People Advisory Services influences client decisions, providing dashboards with insights over spreadsheets of data, equipping clients to gather insights and best practices. To upskill and reskill talent following the business decisions, the EY leaders discussed the use of GenAI to create educational videos as opposed to previous in-person training sessions, which took longer and were more expensive. Keeping true to the themes of the sessions, the leaders indicated the old way of transformation only sought to transform; using the technology and tools enables clients to both transform and transact.

Sustainability Is Front and Center and Has to be ‘Infused’ Into Everything

When EY leaders discussed climate change and sustainability during both the main stage presentations and a special breakout session, they echoed many of the event’s overall themes around talent, partnering and technology. In addition, EY leaders stressed the firm’s dedication to setting an example through its own sustainability commitments (TBR will dive deeper into this topic in our upcoming Decarbonization Market Landscape, scheduled to publish in July).

 

As part of EY’s strategy to advance broad societal goals around climate change and sustainability — while playing to the firm’s own strengths as an ecosystem orchestrator — EY leaders mentioned cooperation with various nongovernmental organizations and academic institutions, including advocating for standards that promote trust and transparency. Unsurprisingly, EY leaders noted regulatory and reporting changes will be a key source of revenue growth for the firm’s Climate Change and Sustainability Services practice. Assurance is now a global sustainability issue, driven in part by U.S. companies with European operations being compelled to adhere to European Union requirements.

 

During a sustainability breakout session, EY leaders noted that many engagements begin with clients seeking capabilities and skills needed for specific sustainability-related issues. EY, which has more than 4,000 professionals dedicated to sustainability and climate change-related services, can bring highly specialized capabilities to address specific problems, and then pivot to broader strategy, transformation and tax consulting services to meet clients’ wider range of sustainability needs.

 

Widening the scope to all professional services, EY Global Climate Change and Sustainability Services Leader Matt Bell noted that “it will be hard to sell anything in professional services without considering sustainability.”

‘Rethinking Is a Deep Process’

Rethinking clients, partners and portfolio offerings requires a commitment by leadership, something that we experienced firsthand at EY and that has set a high bar for the next Global Analyst Summit. The constant presence of multiple EY leaders and partners who were engaged throughout the event provided ample opportunities to have both formal and informal conversations.

 

During the event, TBR captured insights and assessed EY as the firm irons out its new go-to-market strategy. Transformation and the need to recalibrate an organization’s portfolio and skills are topics often discussed by EY peers, but many lack EY’s approach to change, which consists of three steps: recognize that change permeates all layers of the firm and its ecosystem stakeholders; pivot quickly to execute against those changes; and help clients optimize existing assets now, rather than rattling on about digital transformation programs.

 

Following EY’s 2019 Global Analyst Summit, we wrote: “Like a ship making course corrections while still navigating toward a desired destination, EY has adjusted its business model, folded asset-based consulting and managed services into traditional consulting and committed to emerging technology.” Five years later, as EY continues to maneuver in choppy macroeconomic conditions, we believe the compass readings are even more clear: EY must be the partner of choice for clients and alliances that matter.

 

TBR believes EY’s post-Everest, post-pandemic, GenAI-era strategy will center on three poles: industry expertise, deep-seated technology alliances, and selectivity around clients and opportunities. One consistent element highlighted during the 2023 GenAI hype cycle that has persisted into 2024 has been technology-centric ecosystem players turning to consultancies, such as EY and peers, for domain knowledge.

 

Making AI useful in a business setting requires an understanding of the business setting. Sullivan’s description of EY as “business engineers” fits perfectly within current market trends and can help EY maintain its position in the AI, GenAI and broader technology ecosystem. And within that ecosystem, EY has turned its go-to-market restrictions into an asset: As EY Americas SAP Strategy Lead Jesse Rothermel noted to TBR, EY’s audit responsibilities with Oracle, Salesforce and Workday “give SAP some extra confidence” in working with EY. This is making lemonade out of lemons, perhaps, but it is also how TBR sees EY’s strategy as the firm’s technology partnerships continue to evolve into deeper, more intertwined and more aligned alliances.

 

Lastly, TBR expects EY will focus on using the breadth of its offerings to go deeper with select clients, potentially forgoing an expanded client base in an effort to bring as many of its consulting, tax and technology services to those clients whose needs are most aligned to EY’s capabilities. TBR anticipates EY’s next strategy will focus on being industry experts with tighter-than-average technology alliances that can address clients’ every professional services need.

 

TBR will continue to assess EY’s evolving business model and GTM strategy and will include our analysis in the upcoming Management Consulting Benchmark profile on EY, ecosystem intelligence report series, and Digital Transformation and Professional Services reports and benchmark coverage.