The economic downturn could boost small groups

It is sad indeed for Identica to lose a client and staff in the Icelandic bank crash (see News, page 3). It will be little solace that its work for Icelandic bank Icesave was shortlisted for an effectiveness award when the call came.

We can only hope that others in UK design escape that particular storm – or manage to weather it. According to UK media, local authorities and charities are among those most at risk from Icelandic banking collapses, so consultancies working in those sectors may be vulnerable.

The rest of us face other cuts in the downturn – witness the cancellation of Jason Bruges Studio’s Ephemeral City installation for the Onedotzero festival in London, axed this week after sponsors withdrew – and for some they may prove terminal. The demise of medical product design specialist Pearson Matthews earlier this month was attributed largely to clients cancelling projects, wiping some £500 000 off the consultancy’s books within a month.

Pearson Matthews’ story is cautionary. For years design groups have striven to get access to top client management and bring design to the boardroom. Having achieved this, the problem Pearson Matthews had was that the ‘blue skies’ projects it was involved in were easier for clients to axe when times got tough. Groups working on projects for which a market is already established might be safer.

But it is not all bad news. Our trawl of smaller consultancies suggests that business is, if anything, picking up (see News Analysis, page 9). Lower overheads and greater flexibility can give them the edge when times are tough, and it doesn’t have to compromise creativity.

But the bigger groups can make it through if they keep their wits about them. Most have already restructured in anticipation of the shift and have global interests that might lessen the impact.

Economic downturn or not, clients still need to communicate to customers and staff, and bolster their products and services. It’s up to designers to help them find the most effective way to do it.