Direct contact builds trust, respect on local level
At the end of September, consultancy firm PwC opened an office of its own in Gy?r which will soon have 20 employees. We spoke to the two leaders of the new branch office, auditors Kornélia Lett and Dieter Joachim Böhm, and to Armin Krug, who has been assisting German clients for years at PwC in the framework of the German Business Group, and asked them about the reasons for establishing the office and what the company hopes to achieve with this step.
Armin Krug, Dieter Joachim Böhm and Kornélia Lett head up PwC’s new office in Gy?r. Krug says: “The days of what I could describe in exaggerated terms as simply sitting there and waiting for the telephone to ring as a Big Four company are over. Anyone wishing to be successful today needs to make an effort, get out of the comfort zone, go to potential clients, seek out new business actively and be open about what they have to offer.”
How is the economic region of northwest Hungary developing?
Kornélia Lett: It is continuing to develop very dynamically, far above the national average. Last year the economic performance of Gy?r-Moson-Sopron county grew 20 per cent compared to 2009 and by 11 per cent in the first half of this year.
Is growth in Gy?r not slowly coming up against its limits, in particular with regard to supply of suitably trained employees?
Armin Krug: The local government is doing a great deal to ensure the steady supply of employees. It is working intensively to modernise Gy?r’s training infrastructure, partly by involving local investors. In the process of opening our office I found Mayor Zsolt Borkai to be a very agile, goal-oriented man. He has a lot of ideas regarding new infrastructure projects for his city, such as the conversion of the old Rába site, the further renovation of the city centre, the construction of more bridges and the improvement of childcare. To achieve all that, he needs additional tax revenues, which in turn requires further investments. He is also aware that Gy?r is in competition with other industrial locations such as Bratislava in Slovakia. Based on such considerations he will do everything in future to maintain his city’s attractiveness to existing and new investors. The success story of Gy?r will continue and now we are also part of it.
How did you come to establish your office in Gy?r?
Dieter Joachim Böhm: That step for us is a natural consequence of our growth. PwC has also undergone a similar development in other countries in the region. In Poland and the Czech Republic there are several regional offices alongside the head office in the capital. Gy?r is a very interesting location for us with a relatively large field of industrial companies and service companies. There are also, however, entirely practical reasons for opening an office in Gy?r: increasingly frequent visits to clients in Gy?r itself or in the region, and the associated travelling, cost our colleagues a lot of time. That time can now be put to better use. It is simply more efficient to have a small team permanently on site. The opening of the office is the result of a planning and sounding-out phase over a year and a half.
Armin Krug: It is about more than just saving on travelling time. The establishment of our Gy?r office is also in line with the worldwide strategy PwC 2016, which envisages ambitious growth from all members of our group. Based on an analysis of potential, in Hungary we came to the conclusion that we can only continue to grow in Budapest – and from Budapest – to a small extent. At the same time there is very dynamic growth, in northwest Hungary in particular. We therefore decided to be active where there is high growth potential. We have begun in Gy?r owing in part to the consideration that growth here is very strongly driven by the automotive industry, a field in which PwC is very well positioned worldwide.
With modern means of communication, is having a physical presence really all that important?
Kornélia Lett: Yes, definitely. Since we decided to open an office in Gy?r we have stepped up our relations with the local community and the local government. We regularly take part in various events of the business community. Since it became known that we wish to become active locally with our own office we are much better received than when we were solely a Budapest-based company. A local presence is also very important for building trust.
Armin Krug: Nothing can replace direct contact with people on a local level. That is the only way in which we can properly get to know their needs, concerns and wishes. It is also a question of respect. If I want to win somebody’s trust and ultimately their business, I need to go to them and avoid giving advice from the Budapest high horse. If, once the deal is secured, I get in my car to Budapest and barely visit the client again after that, it doesn’t make such a good impression. It is much better in terms of trust if you are directly approachable on a local level. That is valued. We are noticing that even now with existing clients, with whom we meet considerably more frequently than before. Even in this short time we have also won a new client, simply because we are physically on site. It is classic example of the theory that supply creates demand.
Dieter Joachim Böhm: What we don’t want to do is transport the Big Four idea from Budapest to Gy?r. We know that our global network is one of our strengths. However, it can also become a weakness if we are regarded as too large, too inflexible and unapproachable. That impression needs to be avoided. Of course it helps us that we have a small, flexible team locally.
That all sounds very plausible. So why did you hesitate for so long?
Armin Krug: There was sufficient growth potential in Budapest earlier. Of course in general the business climate was also more favourable before the crisis. The days of what I could describe in exaggerated terms as simply sitting there and waiting for the telephone to ring as a Big Four company are over. Anyone wishing to be successful today needs to make an effort, get out of the comfort zone, go to potential clients, seek out new business actively and be open about what they have to offer. For example, we are well positioned to offer consultancy services to large companies but we also have a lot to offer SMEs, which is less well known. That is one of the messages we would like to convey to our potential clients locally in Gy?r. We have impressed on our Gy?r staff that they should not focus on selling but should show interest, listen and look to see what issues the companies have. Without knowing that, you cannot advise companies properly on the local level.
Even so, companies in Gy?r have had partners locally that offer them support in terms of auditing or accounting.
Kornélia Lett: Gy?r is a very developed region. There are a lot of companies here for whom the know-how of local consultants is no longer sufficient for their further growth and improving their competitiveness.
Armin Krug: We offer services that were not available at all or in such depth before, such as subsidy and investment consulting, process optimisation and improvement of IT management. We are helped in this aim by the huge know-how that we have built up in Budapest, our many years of experience and of course our worldwide PwC network. Incidentally it is not a one-way street. Just as we help Hungarian firms locally, we also assist foreign companies interested in investing in the west Hungary region.
Will you increase your chances by offering special, lower prices outside Budapest?
Armin Krug: There is competition everywhere. However, it is not our approach in either Budapest or the northwest Hungary region to “buy” clients by offering artificially low fees. Essentially we always look at what the client needs; whether they need the full programme or just a special solution. It is always solely about solutions; they need to be developed in such a way that the client clearly recognises the value to their company. Then the client will be willing to pay us suitably without problems. Our service doesn’t have a market price, like that of a commodity. We create value for the client, which we would like to be paid for fairly.
How quickly do you aim to become profitable?
Dieter Joachim Böhm: Some clients from the region are already being transferred from the Budapest head office to our Gy?r office. We assume it will be roughly a year before we are in the black.
With Audi your company already has a large prestigious client in any case.
Armin Krug: That is certainly true but our office was not opened solely for Audi. However, it is a fact that the Audi factory in Gy?r and the Volkswagen factory in nearby Bratislava are at the core of the automobile cluster there. The existence of both those factories provides suppliers with a multitude of opportunities.
Dieter Joachim Böhm: Of course ahead of opening our office we asked Audi about its opinion. The feedback was encouraging: swifter and better responsiveness was valued in particular. I would like to stress, however, that Gy?r does not stand solely for the automotive industry. Companies in many other sectors are present in the region, to which we would also like to offer consulting services.
How will your office develop further?
Kornélia Lett: In the first stage we have rented a 150-sqm office in the Leier City Center. That provides room for around 20 employees. The core team consists initially of employees from Budapest. My colleague Böhm and I will move specially to Gy?r for this office. That means that in the short term we will be capable of offering all basic PwC services locally as a one-stop shop. Once our PwC culture has been established locally we will increasingly recruit employees locally. Our medium-term aim is an office with 30 to 40 employees.
So will your new office be a miniature version of your Budapest head office?
Armin Krug: Certainly. It will be a fully functional office with its own employees. However, beyond the basic set-up we don’t intend to duplicate everything here. After all our new office will be closely connected to the Budapest head office and its resources. Incidentally, like in other PwC countries we would like to set up a centre of excellence in some of our branch offices here in Hungary too. It is self-evident that the Gy?r competence centre will be tailored to the automobile industry. In the future that special know-how will benefit all clients in Hungary and in the neighbouring countries. However, our Gy?r office will not only be a smaller edition of the Budapest office in terms of its set-up but will also follow its philosophy. In Gy?r we wish not only to earn money but also to give something back to the city and play a part in the community. On the first Saturday in October, for example, we spent the whole day renovating the dilapidated external facilities of a kindergarten in Gy?r together with a client of ours. We have also recently helped a ladies team obtain national sport funding with our expertise, free of charge.
