2008 was brutal on many counts and I suspect most people will be happy to see it pass. Our two main markets – the US and the UK – suffered economic slowdowns, housing slumps, financial dislocation and more. In the US we’ve had twelve months of recession and things don’t look set to improve anytime soon.

Against this backdrop I think we’ve done pretty well – our revenues will be up just over 20% on 2007 which is good, but nothing compared with our 5-year CAGR to 2007 which approached 60%. And I think 2009 will be much harder than 2008: discretionary budgets will be lower and clients will focus on cutting costs where they can. Cost cutting is never fun but it is something we can do. Our business model means we can help clients move costs from fixed to variable as well as lower hourly rates, even compared to other offshoring and outsourcing options.

One welcome trend is that our work has been moving from ad hoc and occasional assignments to regular and planned work. We still do a lot of work as and when clients ask, but over recent years its gone from close to 100% ad hoc to about 50% regular. As they get to know us it’s an easy shift for clients to make – they get used to us through occasional assignments and then typically ask us to take on functions completed in-house or by other outsourcers. Clients seem to value being able to delegate away chunks of their business so they can focus on higher value tasks. This might mean we write newsletters, do daily or weekly searches to monitor issues, prepare competitor profiles, track earnings releases etc, leaving them free to do more talking, analysis and thinking.

I’m heading back to my Christmas slumbers but will back soon with a look forward to 2009…