EY has recorded the global combined revenue for June 2023 as US$49.4b. EY is investing in the latest technologies, innovation, and partnerships. The partner layoff is the hot news that shows the change in the business model of EY. The blog takes a tour of the walk of the big four firms. The global accounting firms set the business climate and demands. The big four firm’s growth is an inspiration. The challenges with the firm create a corporate story. The corporate story tells the employment opportunities, salary growth and economic development.
In EY, the partner layoffs are focused on the advisory sector. The EY business changes are in the USA. The partner lay-off is the impact of the cost-cutting strategy of the company. The revenue slowdown pushes the company towards cost-cutting strategies. The company is planning to reduce the partnerships. The reduction is affecting the auditing and consultation arms of the company. The EY had recorded a historic successful year in terms of revenue in June 2023. The company is having an increase of 14.2 per cent in the revenue growth segment. The corporate social responsibility programs of EY have impacted the lives of 127m people around the world. EY has plans to impact positive ripples with one billion people by 2030.
The reports say that the percentage of layoffs is 10 in consultation and 4 in strategy and transactions. The firm is concentrating on specialised and auditing services. The real numbers are 100 in the consultation division and 30 in strategy and transactions. The partners work at the junior and senior levels. In April, the company planned to lay off around 3000 US staff. The post-pandemic performance is slower than the expectation of the analysts. The other big companies Deloitte, KPMG and McKinsey are reducing the workforce to shoulder with the changes in the market. The company want to split the services of auditing and consultation the revenue from consultation stands at $22.17 billion. The consultation services are bringing in nearly 45 per cent of profit to the company. The American region is giving nearly 48 per cent of the firm’s revenue. In 2024, the new Chairperson, Janet Truncale is taking in-charge. The authorities feel that the new chairperson will take the Big Four firm beyond the proposed split of business with failures.
EY wants to work as a standalone company:
Big four firms offer different types of services under one roof. The idea behind these services is to attract more clients and remain competitive. If the audit firm operates with less competition and focuses on one service, the revenue may increase. EY wants to reduce the competition and associated issues from other services. The partner layoff shows the breaking down of the business. The partners working in the largest member of the big four firms decide the operations and directions of the company. The general thought is that the big four firms had over-hired the partners. Now it is the time to lay off the partners and restructure the business. The head of EY’s American unit says that the company is facing resource challenges. After the restructuring, EY plans to list the auditing firm in the stock market listing. EY plans to work as a standalone company in the field of advisory business. The advisory unit of EY is generating a revenue of around $18BN. The audit business wants advisory capabilities. So, some of the partners are interested to be in association with the company. Consultants and auditors of EY firm are working as a part of the global audit firm. The plans of EY also say that the new business units will be a standalone and one-compete clause.
EY Awards 2023:
Ernst and Young are appreciating entrepreneurship. In India, Sajjan Jindal from JSW group won the Entrepreneur of the Year award for 2022. K.P.Singh, DLF group won the lifetime achievement award. And Deepak Bagla, Invest India won the special jury award. The categories to encourage entrepreneurship are as follows: start-up, manufacturing, financial service, services, real estate, consumer products, life sciences and healthcare, and business transformation. The names that resonate the Indian businesses are as follows: MedGenome, Borosil group, IDFC First Bank, safexpress, Cipla, prestige constructions, Vedant fashions, and Gujarat fluorochemicals. The national-level entrepreneur of the year for 2023 in the USA is Michael Happe of Winnebago Industries. EY is a global company that represents the growth of multiple places. EY Awards operates in 60 countries and 145 cities around the world. The celebration of the talents enhances the positive energy. EY recognise the individual talents and company profile. The company enlarge the space for creating a positive impression.
Difference between big four and mid-tier firms:
- Big Four companies employ graduates and professional graduates. The opportunities are huge in the big four firms.
- Mid-tier firms are more in numbers with a small number of client base. The opportunities are comparatively less in mid-tier firms.
- Big Four companies employ professionals with specialised knowledge.
- The operations of mid-tier accounting firms are tiny and traditional. The mid-tier firms do not offer specialised services.
- Big Four firms handle big clients.
- Mid-tier firms handle small and big clients.
- Big Four firms offer high salaries and other benefits to the employees.
- Mid-tier firms offer average salaries and more learning opportunities.
- Big Four firms add more partners to satisfy the large clients. The staff of the big four firms are promoted as partners to handle regional and specialised work.
- Mid-tier accounting firms employ fewer employees and have no partners.
- Big Four companies have international networks.
- Mid-tier companies have fewer international networks.
- Big four firms work in a hectic schedule. The working hours in a Big Four firm are longer.
- Mid-tier firms offer monotonous and challenging work. The working hours in a mid-tier accounting firm are fixed. Professionals working in mid-tier accounting firms learn to multi-task different department work.
The partner layoff in Ernst and Young is a sign of restructuring the company. The company wants to excel in consultancy services with less competition. Ernst and Young offer specialised services to large clients around the globe. The company also encourage regional talents with the Entrepreneur of the Year award. The company is good in CSR activities.