management. These capabilities had been built up organically in two prior firms, Coopers & Lybrand and Price Waterhouse, and these firms had merged in 1998 to create PwC and therefore PwCC. 

Corporate scandals such as Enron, Tyco and Worldcom led
regulatory authorities to push for a greater independence of audit practices. In most cases this meant separating and disposing of ‘consulting’ businesses held by PwC, E&Y, KPMG and Arthur Andersen. Pressure was also applied to major corporates to limit the business done by the consulting and advisory arms of such firms where audit services were also provided to these clients. As PwC was the largest firm, the impact of these forces was that the consulting arm of PwC was increasingly encountering substantial reductions of business from major audit clients.

PwC examined the case for separation of parts of the firm to meet this regulatory pressure and decided on a disposal of PwCC. For this to happen the following steps had to be taken:

• separate the PwCC Businesses from the PwC business in each country
• integrate those business into cohesive entities in Europe, Middle East and Africa (EMEA), Americas and Asia Pacific as three major building blocks for the sale of the business globally
• prepare the global business for sale by demonstrating the power of the globally integrated business and by enhancing reporting and control systems and infrastructure and publish a Prospectus for flotation on NYSE
• find a buyer – either by flotation, trade sale, financial investor or combination
• complete a deal acceptable to PwC, PwCC partners and the relevant third parties

The first two steps were completed by a programme called ‘Operational Readiness’ which separated the PwCC businesses in all countries and then integrated them into three regional entities which in turn combined to create a global business.

The third step was completed by the preparation of a prospectus and meeting the reporting and control requirements of a US public company. This included presentations to investment banks, lawyers, reporting accountants and other external parties prior to an intended Initial Public Offering (IPO).
In parallel with the IPO process, various discussions were held with trade buyers including IBM and also with financial investors to generate the best alternative options for the sale of the business.

Preparations for the IPO continued almost to conclusion but during the parallel discussions, IBM emerged as the option that would provide the best synergies between the two organisations and would lead to a new world leader in consulting and systems integration. IBM would also provide the easiest way to deliver the public reporting requirements by using its own systems and reporting and compliance approaches. An agreement was reached in principle in 30 days for IBM to buy PwCC and then integrate its own consulting and systems integration business into the enlarged business to be called IBM Business Consulting Services (now called IBM Global Business Services). The agreement in principle was consummated by legal completion in over 50 countries in 60 days to produce the world’s largest consulting and systems integration business in October 2002.

During the first few years of PwCC, David had led the largest industry group in the firm – Commercial and Industrial. In 2001 David was then asked to take on the leadership of PwC Consulting in EMEA. David’s role as the EMEA leader was to lead each step of the process. This involved:

• leading the separation and integration of the PwCC businesses in each country in EMEA by leading roadshows with partners to explain the intent and how it could be realised – including an indicative ‘vote’ supported by over 90% of partners
• preparing for the IPO as part of a global team producing a prospectus and presenting to investment banks, financial institutions and trade buyers
• working with IBM to produce a compelling vision for the merged business and plan its integration of the PwCC business. Help formulate appropriate terms for the sale of the business
• securing partner votes in each major country in EMEA to complete the transaction

And in parallel, continue to lead and run the PwCC business in very challenging market conditions. These combined activities required leadership skills in clarity of thinking, organisational ability and very substantial communications activity to present a potential investor with a realistic and attractive picture for the business. It was also necessary to present very clear options for the PwCC partners who were faced with leaving a firm that many had assumed they would remain part of for the rest of their careers.

Vic Luck, David’s predecessor as Managing Partner of PwC Consulting in EMEA, recalls:

“It was no surprise to me to see how magnificently David handled the twin tasks of continuing to lead PwCC in EMEA through a tough trading period and concurrently playing such a major role in shepherding the business into a new home in IBM. David possesses an extraordinary combination of people orientation and task-focus which enabled him to communicate a compelling vision of PwCC as part of IBM and to direct the smooth integration of the combined businesses. David’s style was based on ‘leadership from the front’ using both logic and emotion in appropriate measure. His ability to generate trust in his partners, PwC firm-wide and prospective buyers was based on his belief and confidence in his vision and strategies but also his ability to execute and deliver results.”

Doug Elix was the IBM Executive Vice President responsible for the acquisition. He later commented:

“I was swayed in great part by the way you thought about things and the values you personally held. And then we were into the reality of executing what we had dreamed about….. There you were in the thick of it, doing exactly what you said you would do. There’s nothing more pleasing than seeing the actions equal the words.”