Andersen Consulting

Andersen Consulting
William Murphy · CC BY-SA 3.0 · source
Name	Andersen Consulting
Foundation	0 1989
Fate	Renamed to Accenture in 2001
Location	Chicago, Illinois, United States
Key people	George Shaheen (CEO)
Industry	Management consulting
Parent	Arthur Andersen

Andersen Consulting. It was a global management consulting firm established in 1989 as a separate business unit within the worldwide Arthur Andersen accounting organization. The firm rapidly grew to become a leading advisor in business process reengineering and the implementation of large-scale information technology systems, notably for Fortune 500 clients. Its evolution was marked by a significant and contentious split from its accounting parent, culminating in a landmark arbitration and its subsequent renaming to Accenture.

History

The entity was formally launched in 1989, consolidating the consulting practices from various Arthur Andersen member firms around the world into a single unified organization. This restructuring was driven by the explosive growth of the information technology advisory market and the need to manage potential conflicts of interest with the traditional audit practice. Under the leadership of managing partner George Shaheen, it embarked on an aggressive expansion, establishing a strong presence in key markets across Europe and Asia-Pacific. Its early growth was fueled by major contracts with corporations and governments seeking expertise in integrating new enterprise resource planning systems from vendors like SAP and Oracle Corporation.

Services and operations

The firm's core offerings centered on business strategy, technology implementation, and change management. It developed a renowned methodology for business process reengineering, helping clients redesign operational workflows to achieve dramatic efficiency gains. A major service line was the large-scale installation and customization of complex enterprise software packages, requiring deep technical teams and project management discipline. It also built substantial practices in systems integration, outsourcing, and later, internet-related consulting during the dot-com bubble. Its operational model was a global network of partner-owned firms, coordinating under the Andersen Worldwide umbrella alongside Arthur Andersen.

Separation from Arthur Andersen

Tensions with Arthur Andersen escalated throughout the 1990s over issues of profit sharing, governance, and market encroachment, as the consulting arm's revenues began to rival and then surpass those of the accounting audit practice. The conflict culminated in 1997 when the partners voted to seek complete independence, triggering a mandatory arbitration process under the rules of the International Chamber of Commerce. The lengthy and acrimonious proceedings, held in Paris, finally concluded in 2000 with a ruling that required a final separation and awarded the consulting practice the majority of its assets but mandated the forfeiture of the Andersen name.

Rebranding to Accenture

Compelled to abandon its established name, the firm launched an extensive internal and external rebranding campaign. In January 2001, it unveiled the new name Accenture, a portmanteau suggesting "accent on the future," which was selected from thousands of submissions. The change coincided with a successful initial public offering on the New York Stock Exchange in July 2001, symbolizing its full independence and new corporate identity. This transition was strategically managed to retain key Fortune 500 clients and global talent during a period of significant market uncertainty following the collapse of the dot-com bubble.

Legacy and impact

The firm's legacy is profoundly embodied in the continued success of Accenture, which grew into one of the world's largest professional services networks. The bitter separation and the subsequent Enron scandal that led to the dissolution of Arthur Andersen validated its strategic decision to become independent. Its pioneering work in IT-driven business transformation set industry standards and influenced the service models of major competitors like IBM and Deloitte. The landmark arbitration case remains a frequently studied example of partnership disputes and corporate divorce within professional services.

Category:Management consulting firms Category:Companies based in Chicago Category:Defunct companies based in Illinois