Administrative & General Management Consulting Services (U.S.)

NAICS 2022 code 541611. The North American Industry Classification System (NAICS) is the federal system used to define and count U.S. industries.

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1. Overview

This is the core of the "management consulting" business: firms that sell advice. A company, nonprofit, or government agency hires them to set strategy, plan a budget, reorganize, cut costs, pick a site, launch a venture, or fix a broken process — and pays for the consultants' time and judgment [1]. There is no product on a shelf; the inventory is people and expertise, and the raw material is billable hours.

It is a people-and-reputation business with very little physical capital. Clients buy knowledge, judgment, and the capacity to execute change. That makes the industry a leveraged bet on how willing organizations are to spend on transformation: it tends to grow faster than the overall economy when businesses are confident and investing (technology upgrades, restructurings, deals), and to contract quickly when clients freeze budgets.

Both kinds of investor meet this industry, but in different ways:

• Public-market investors can own a handful of listed firms — most prominently Accenture — plus government-focused and specialty advisory firms (Section 4). The most famous names (McKinsey, the Big Four accounting networks' advisory arms) are not publicly traded.
• Private-market investors meet it constantly: buying consulting boutiques directly, backing them through private-equity (PE) funds, or acquiring sponsor-owned platforms. It is one of the most active PE roll-up areas in the market, with over a thousand firms bought and merged in a single recent year [19].

Our judgment: attractive long-run demand and light capital needs, but earnings that swing hard on consultant utilization, client budgets, talent retention, reputation, and — increasingly — how artificial intelligence (AI) reshapes the work.

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2. What it is and how it's structured

In scope (541611): advice and assistance on general and administrative management — strategic and organizational planning, financial-management consulting (but not investing money for clients), records and office planning, site selection, new-business start-up, and business-process improvement. It also captures general management consultants that offer a full spread of services to a client [1].

What it explicitly excludes — adjacent, separately coded industries, not part of 541611:

• 541612 Human Resources Consulting — compensation, benefits, personnel policy [1]
• 541613 Marketing Consulting — pricing, sales forecasting, marketing strategy [1]
• 541614 Process, Physical Distribution & Logistics Consulting — operations and supply-chain advice [1]
• 541618 Other Management Consulting Services [1]
• 541511 / 541512 Computer/IT consulting and systems design (technology implementation)
• 561110 Office Administrative Services — running an organization's back office, versus advising on it [1]
• 551114 Corporate, Subsidiary & Regional Managing Offices — a company's own head office
• 523940 Portfolio Management and Investment Advice — a firm that actually manages money or gives investment advice is coded here, not in 541611 [1]
• 561312 Executive Search; 611430 Management-development training
• Government program administration, classified in Sector 92 (Public Administration) [1]

This matters for reading the numbers. NAICS classifies each establishment by its primary activity, so the giant brand-name firms spread revenue across several codes — strategy in 541611, technology in 541511, HR in 541612, and so on — and no single code captures a McKinsey or a Deloitte in full. Internal corporate strategy teams and government employees doing similar work are not counted as market revenue at all.

Ownership mix. Three very different structures coexist:

• Partnerships — the elite strategy houses (McKinsey, Boston Consulting Group [BCG], Bain & Company, Kearney) and the Big Four accounting networks' advisory arms (Deloitte, PwC, EY, KPMG, each a global network of separate local member firms rather than one listed parent) are owned by their partners.
• Public corporations — Accenture and a group of government and specialty consultancies (Section 4).
• A very long tail of tiny firms — sole practitioners, boutiques, and privately held mid-size players (e.g., Alvarez & Marsal), increasingly owned or backed by private equity (e.g., Guidehouse, owned by Bain Capital).

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3. How big it is (federal figures)

U.S. official statistics for NAICS 541611. Dollar amounts originally reported in thousands are shown in billions.

County Business Patterns (CBP) is the Census Bureau's annual count of employer businesses; the concentration ratios (CR4/8/20/50) are the share of revenue held by the largest 4, 8, 20, and 50 firms.

What these numbers say:

• Small average unit. About 8 employees per establishment (869,457 ÷ 104,494) and roughly one establishment per firm — an industry of many small shops, not a few big factories.
• Labor is the whole business. Payroll ($105.9B) is close to half of revenue ($219.1B), and average pay works out to roughly $122,000 per employee (payroll ÷ employees) — a high-wage, white-collar workforce [4].
• Extremely fragmented. The four largest firms hold about 17.8% of revenue, the top 50 about 36.9% [3]. The HHI — a standard concentration gauge that runs from near zero (many equal competitors) to 10,000 (a monopoly) — is just 118, far below the ~1,500 level U.S. antitrust agencies treat as "unconcentrated" [3]. Despite a few globally famous brands, revenue is spread across roughly 100,000 firms.

The undercount caveat. These employer-based counts understate the industry at the small end. CBP counts businesses with paid employees; it omits the vast population of nonemployer consultants — independent, one-person advisory practices filing as sole proprietors. Solo consulting is one of the most common self-employment categories in the country, so the true number of "firms" in the spirit of 541611 runs well beyond the ~102,000 employer firms here. (Our federal file contains no nonemployer count, and no average billing rate, utilization rate, or operating margin — so those are not estimated.) At the top end, the count fragments the largest players across neighboring codes (Section 2). Private-sector estimates of the broader U.S. management-consulting market therefore run higher and vary entirely with where each source draws the boundary — on the order of $125–130 billion for a narrow "management consultancy" definition, up to roughly $408 billion under IBISWorld's wider 2025 industry definition [17]. The global consulting market is estimated at roughly $350–360 billion [18].

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4. The investable universe

For public-market investors, pure exposure is limited — the marquee firms are private partnerships, and no listed company maps cleanly to 541611 because each combines consulting with technology, outsourcing, government contracting, accounting, or restructuring. The listed options are one mega-cap plus a cluster of government and specialty advisers. Figures below are most recent full-year revenue; only part of the larger firms' revenue falls strictly in 541611.

NYSE = New York Stock Exchange; Nasdaq = Nasdaq Stock Market; FY = fiscal year.

Indirect / partial exposure: Marsh McLennan (NYSE: MMC) owns strategy house Oliver Wyman and HR consultant Mercer; IBM (NYSE: IBM) and CGI (NYSE: GIB) sell consulting bundled with technology and systems integration; Gartner and several IT-services firms (Cognizant, Infosys) run consulting arms [27][28].

Major private and other owners — where most of the industry actually sits:

• Strategy partnerships: McKinsey & Company (~$16B revenue, ~40,000 staff after 2024–25 cuts) [12]; BCG (~$13.5B, 2024) and Bain & Company (~$7B) [13]; Kearney; and privately held Alvarez & Marsal.
• Big Four advisory arms: Deloitte, PwC, EY, KPMG — partner-owned member-firm networks; their combined advisory revenue runs into the tens of billions.
• PE-owned platforms: e.g., Guidehouse, which Bain Capital bought from Veritas Capital for $5.3 billion in 2023 [14], plus a long list of roll-up platforms.
• The tail: ~100,000 boutiques and independents.

Bottom line: apart from Accenture, listed pure-play consulting is small and skews toward government contractors (Booz Allen, ICF) and specialty advisory (FTI, Huron, CRA). Broad exposure to elite strategy consulting is essentially unavailable in public markets.

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5. How the money works

Consulting profit comes from a simple engine with three levers [15]:

1. Bill rate vs. cost (rate arbitrage). A consultant is billed to the client at a multiple of their salary; the gap between the hour's price and the consultant's pay is the gross margin.
2. Utilization. The share of a consultant's available hours actually billed to clients. Idle ("on the bench") time is pure cost — a few points of utilization move profits sharply, making it the single most-watched operating metric.
3. Leverage (the pyramid). How many junior and mid-level staff work under each partner. Partners "find" the work and own the client relationships; managers "mind" delivery; analysts "grind" the analysis. Wider pyramids (more juniors per partner) magnify partner profits — general management work typically runs 4:1 to 8:1, while pure strategy runs leaner (1:1 to 2:1) because clients are paying for senior insight, not staff count [15].

Pricing formats: time-and-materials (hours × rate), fixed-fee projects, ongoing retainers, managed services, and increasingly value- or outcome-based fees tied to results. Fixed-price work carries execution risk — a bad cost estimate turns an attractive project into a loss. Government work is often cost-plus or capped under federal contract rules (Section 7), which adds backlog visibility but exposes the firm to appropriations, protests, and scope changes.

What investors watch: utilization, realization (getting paid full rate rather than discounting), revenue per consultant, attrition (especially of senior "rainmakers"), backlog (contracted future work), bookings (newly awarded work), and cash conversion. Because there is almost no physical capital, strong firms throw off cash — Accenture generated roughly $10.9 billion of free cash flow and booked $80.6 billion of new work in fiscal 2025 [6]. For private firms, reported profit must be normalized for owner/partner compensation, founder selling expenses, and acquisition costs before it means anything.

The AI wildcard. Generative AI (GenAI — software that produces text, code and analysis) is both a demand driver (clients pay consultants to help adopt it) and a threat to the model itself: if AI automates the junior-analyst "grind," the classic pyramid compresses — potentially lifting margin per consultant but shrinking the headcount a firm can bill [15].

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6. What drives demand

• The business cycle and confidence. Consulting spend is discretionary. Companies buy advice when they are investing in growth, restructuring, or doing deals; they cut it first in a downturn.
• Waves of change. Each technology or regulatory wave creates advisory demand — currently AI adoption, digital transformation, cybersecurity, cloud migration, and cost-cutting programs. Surveys show a large majority of organizations now use AI in at least one function, and clients are raising AI-related budgets while demanding faster, clearer return on investment (ROI) [16].
• Mergers, restructurings and distress. Deal advice, integration, carve-outs, turnarounds and bankruptcies drive counter-cyclical specialty demand (FTI and Huron lean this way).
• Government budgets and policy. For the government-heavy names (Booz Allen, ICF), demand tracks federal appropriations, defense/intelligence priorities, and each administration's stance on using outside contractors — currently a headwind (Section 9).
• Regulatory, geopolitical and supply-chain complexity. New rules (privacy, financial regulation, tariffs) and PE portfolio-company improvement programs both generate work.

A note on forecasts: the U.S. Bureau of Labor Statistics (BLS) projects employment of management analysts — a closely related occupation — to grow 9% from 2024 to 2034 [22]. That is an occupational forecast, not a revenue forecast for NAICS 541611, but it points the same direction: above-average growth.

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7. Regulation

Management consulting is one of the least directly regulated professional services: unlike law, accounting, medicine, or investment advice, there is no license required to call yourself a management consultant and no single overseeing agency. Regulation bites at the edges, mostly per engagement:

• Government contracting rules. Firms selling to Washington operate under the Federal Acquisition Regulation (FAR), General Services Administration (GSA) schedules, and security-clearance requirements. FAR organizational and consultant conflict-of-interest (OCI) rules (Subpart 9.5) can bar a firm from advising both sides of a matter or from bidding on work it helped shape [24], and federal contracts can require a written code of business ethics, compliance training, and disclosure of credible evidence of misconduct [25]. The Small Business Administration (SBA) sets a size standard for 541611 of $24.5 million in average annual receipts — below that, a firm qualifies as "small" for set-aside contracts [5].
• Conflicts of interest and false claims. A consultant that misuses its position or misleads a government client faces real liability. The landmark case: McKinsey advised both federal health regulators and opioid maker Purdue Pharma on related matters, and in December 2024 agreed to pay $650 million to resolve criminal and civil investigations (including over $323 million under the civil False Claims Act) — the first time a management-consulting firm was held criminally responsible for advice that aided a client's crime; a former senior partner pleaded guilty to obstruction of justice for destroying records [20].
• International anti-corruption. Cross-border work triggers the Foreign Corrupt Practices Act (FCPA), which bars bribery of foreign officials and requires accounting controls and compliance programs, with successor liability in mergers and acquisitions (M&A) [26].
• Auditor-independence rules. The Sarbanes-Oxley Act (SOX) and the Public Company Accounting Oversight Board (PCAOB) restrict accounting firms from selling many consulting services to companies they audit — the central reason the Big Four have repeatedly wrestled with separating audit from advisory [21].
• Straying into regulated turf. A consultant that crosses into managing money or giving investment advice triggers Securities and Exchange Commission (SEC) registration — which is why that activity is coded elsewhere (523940) and kept at arm's length.
• Voluntary AI guidance. The National Institute of Standards and Technology (NIST) AI Risk Management Framework is voluntary guidance, not a blanket federal AI law — but it is itself a source of AI-governance advisory work [23].

Forward-looking judgment: expect procurement scrutiny of consultants (transparency, conflicts, value-for-money) to intensify, even as the core activity stays license-free.

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8. Competitive dynamics and consolidation

• A barbell market. At the top, a small number of global brands command premium pricing and mindshare. Below them sit ~100,000 firms competing on price, relationships and niche expertise — hence the very low concentration (Section 3).
• The moat is intangible. Firms win on trusted senior relationships, sector credentials, security clearances and government-contract access, proprietary data/methods/software, recruiting and retention, global delivery, and the ability to connect strategy to implementation. The asset walks out the door every night, so talent is both moat and risk.
• Strategic consolidation. Accenture is the industry's most active acquirer, closing dozens of deals a year (about 35+ deals for $3.8B+ in fiscal 2025) to bolt on capabilities [19]. Big Four and IT-services firms also buy consultancies to add skills fast.
• Private-equity roll-ups. Consulting is one of the most active PE consolidation lanes: trackers counted over 1,000 consulting-firm acquisitions globally in 2024, with PE buyers accounting for a rising share [19]. For sellers of small firms this is the dominant exit; for investors it is a way to buy the industry off-market. The Guidehouse deal (Bain Capital, $5.3B) illustrates sponsor appetite for scaled platforms [14] — though one transaction does not set a market-wide valuation trend. Integration risks — cultural fit, partner retention, client conflicts, and revenue leaving with departing talent — are the main constraints.

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9. Risks

• Cyclicality. Discretionary spend falls fast in downturns; utilization and bookings can drop sharply.
• Utilization risk. A hiring surge followed by weak bookings compresses margins quickly.
• Government-spending shocks. In 2025 a federal push to cut outside consulting — via the Department of Government Efficiency ("DOGE") initiative and GSA reviews of the top firms' contracts — put an estimated $65 billion of future fees under review, triggered contract terminations, and led firms including Deloitte and Booz Allen to announce layoffs; Accenture warned of a revenue hit from cancelled federal work [19]. Government-heavy names (Booz Allen ~99% federal, ICF ~half) carry concentrated exposure.
• AI disruption. GenAI could compress the pyramid economics that generate profit and lower the barrier for clients to do work in-house [15].
• Talent risk. Departing rainmakers can take client relationships with them; wage inflation and attrition erode margins.
• Reputational and legal risk. Conflicts, bad advice, or a scandal can be existential for a trust-based business — the McKinsey opioid case, plus procurement, corruption, and contractor-ethics exposure that can bring fines and lost contracts [20].
• Client/sector concentration. Specialty firms rise and fall with one end-market (restructuring demand, healthcare budgets, litigation volumes).
• Fixed-price and confidentiality risk. Bad cost estimates turn projects into losses; a data breach can end eligibility for sensitive work.
• Private-market opacity. Private firms disclose less, making quality, leverage, owner compensation, and client concentration harder to assess.

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10. How to invest and the outlook

Public routes. Evaluate each company by actual exposure, not by the word "consulting" in its name.

• The one large-cap: Accenture (ACN) — the closest thing to a diversified consulting index, though heavily technology-weighted.
• Government contractors: Booz Allen (BAH), ICF (ICFI) — higher exposure to federal budgets and, right now, to federal cost-cutting.
• Specialty / counter-cyclical: FTI (FCN), Huron (HURN), CRA (CRAI) — restructuring, litigation, healthcare and economic advisory that can hold up or even benefit when the economy weakens.
• Indirect: Marsh McLennan (MMC) for Oliver Wyman/Mercer; IBM and CGI for consulting bundled with technology.
• Key diligence questions: How much revenue is consulting versus technology/outsourcing? Is growth organic or acquired? Are utilization, pricing, attrition, bookings and backlog improving? How concentrated are customers and government contracts? Reserve valuation work (price-to-earnings multiples, dividend yields, backlog trends) for security selection — these are people businesses with thin balance sheets, so cash generation and organic growth matter more than assets.

Private routes.

• Private equity is the primary way to own the fragmented middle — buyout and growth funds are actively rolling up boutiques.
• Direct ownership / founder economics: small consulting firms are among the most common businesses to start and sell; valuations key off recurring revenue, senior-team retention, and client concentration, and profit must be normalized for owner pay.
• The elite strategy partnerships (McKinsey, BCG, Bain) and Big Four advisory arms remain closed to outside capital.

Near-term drivers (forward-looking):

• AI adoption is the biggest swing factor — a tailwind for advisory demand and a threat to the labor-leverage model at the same time [15][16].
• Federal spending policy is the key risk for government-exposed names through 2026 [19].
• The deal cycle: a pickup in M&A, restructurings and corporate investment lifts discretionary spend; a freeze hits it first.

Judgment: the long-run demand story (complexity, technology waves, regulation, deal activity) is intact and the industry has grown ahead of gross domestic product (GDP) for years, but the model is entering a genuine transition — AI reshapes both what clients buy and how firms make money — while government-facing firms absorb a real, near-term spending shock. The strongest firms will combine trusted advice with implementation, proprietary tools, and recurring revenue; commodity staff-augmentation and easily automated research are the most exposed to price pressure. Treat 541611 as a fragmented collection of business models, not one homogeneous sector: public investors get the cleanest, most durable exposure through diversified Accenture and counter-cyclical specialty advisers, while the fragmented middle is a private-market game.

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Sources

1. U.S. Census Bureau, "NAICS 541611 — Administrative Management and General Management Consulting Services" (definition, scope, exclusions), 2022. https://www.census.gov/naics/?details=541611&input=541611&year=2022
2. U.S. Census Bureau, "EC2200BASIC: Summary Statistics for the U.S.: 2022" (receipts, firms), 2024. https://data.census.gov/table/ECNBASIC2022.EC2200BASIC
3. U.S. Census Bureau, "Economic Census: Establishment and Firm Size (Concentration) Statistics for the U.S.: 2022" (CR4/8/20/50, HHI), 2022. https://api.census.gov/data/2022/ecnsize.html
4. U.S. Census Bureau, "CB2300CBP: County Business Patterns, 2023" (establishments, employees, annual and Q1 payroll), 2025. https://data.census.gov/table/CBP2023.CB2300CBP
5. U.S. Small Business Administration, "Table of Size Standards" (NAICS 541611 = $24.5M average annual receipts), 2023. https://www.sba.gov/document/support-table-size-standards
6. Accenture, "Fourth-Quarter and Full-Year Fiscal 2025 Results" ($69.7B revenue; ~790,000 people; $80.6B bookings; $10.9B free cash flow), 2025. https://newsroom.accenture.com/content/4q-full-fy25-earnings/accenture-reports-fourth-quarter-and-full-year-fiscal-2025-results.pdf
7. GovConWire, "Booz Allen Full FY2025 Revenue" ($12.0B; ~99% U.S. government), 2025. https://www.govconwire.com/articles/booz-allen-full-fy-2025-revenue-horacio-rozanski-ai-acquisition-reform
8. ICF International, "ICF Reports Fourth Quarter and Full Year 2024 Results" ($2.02B revenue), 2025. https://www.prnewswire.com/news-releases/icf-reports-fourth-quarter-and-full-year-2024-results-302387909.html
9. FTI Consulting, "Fourth Quarter and Full Year 2024 Financial Results" ($3.70B revenue), 2025. https://www.globenewswire.com/news-release/2025/02/20/3029543/33891/en/FTI-Consulting-Reports-Fourth-Quarter-and-Full-Year-2024-Financial-Results.html
10. Huron Consulting Group, "Record Fourth Quarter 2024 Financial Results" ($1.49B revenue), 2025. https://ir.huronconsultinggroup.com/news-releases/news-release-details/huron-announces-record-fourth-quarter-2024-financial-results-and
11. Charles River Associates (CRA), "Fourth-Quarter and Full-Year 2024 Financial Results" ($687.4M revenue), 2025. https://ir.crai.com/news-releases/news-release-details/charles-river-associates-cra-reports-fourth-quarter-and-full-6/
12. The Irish Times / Personnel Today, "McKinsey sheds 10% of staff" (~$16B revenue; ~40,000 headcount), 2025. https://www.irishtimes.com/business/2025/05/28/mckinsey-sheds-10-of-staff-in-2-year-profitability-drive/
13. Management Consulted, "Revenue of the Top 20 Consulting Firms" (BCG ~$13.5B 2024; Bain ~$7B), 2025. https://managementconsulted.com/revenue-of-top-20-firms/
14. Guidehouse, "Guidehouse Completes Transaction with Bain Capital" (Bain Capital acquires Guidehouse from Veritas Capital for $5.3B), 2023. https://guidehouse.com/news/corporate-news/2023/guidehouse-completes-transaction-with-bain-capital
15. Metric.ai, "Leverage Models in Professional Services," and Consultantsmind, "What's Your Leverage Model?" (utilization, leverage, bill-rate economics), 2025. https://www.metric.ai/blog/leverage-models-in-professional-services
16. McKinsey, "The State of AI" (majority of organizations use AI in at least one function; AI as a consulting demand driver), 2025–2026. https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai
17. IBISWorld, "Management Consulting in the US — Market Size," 2025. https://www.ibisworld.com/united-states/market-size/management-consulting/1421/
18. Management Consulted, "Consulting Industry Report" (global market ~$350–360B), 2025. https://managementconsulted.com/management-consulting-industry-report/
19. Fortune / Inc. / Middle Market Growth (Equiteq data), "DOGE consulting-contract cuts" and "consulting PE roll-ups / Accenture acquisitions" (>1,000 consulting deals in 2024; ~$65B federal fees under review; Accenture ~35+ deals/$3.8B+ FY2025), 2025. https://fortune.com/2025/04/03/doge-private-contract-crackdown-deloitte-consultancies/
20. U.S. Department of Justice / FDA, "Resolution of Criminal and Civil Investigations into McKinsey & Company's Work with Purdue Pharma L.P." ($650M total; >$323M civil False Claims Act; former partner charged with obstruction), Dec. 2024. https://www.justice.gov/opa/pr/justice-department-announces-resolution-criminal-and-civil-investigations-mckinsey-companys
21. Accounting Today / ProMarket, "Sarbanes-Oxley and Auditor Independence" (PCAOB restrictions on audit-firm consulting for audit clients), 2017–2023. https://www.accountingtoday.com/news/sarbanes-oxley-has-failed-to-address-the-problem-of-audit-firm-independence
22. U.S. Bureau of Labor Statistics, "Management Analysts: Occupational Outlook Handbook" (+9% employment, 2024–2034), 2025. https://www.bls.gov/ooh/business-and-financial/management-analysts.htm
23. National Institute of Standards and Technology, "Artificial Intelligence Risk Management Framework (AI RMF 1.0)" (voluntary guidance), 2023. https://www.nist.gov/publications/artificial-intelligence-risk-management-framework-ai-rmf-10
24. Acquisition.gov, "FAR Subpart 9.5: Organizational and Consultant Conflicts of Interest," 2026. https://www.acquisition.gov/far/subpart-9.5
25. Acquisition.gov, "FAR 52.203-13: Contractor Code of Business Ethics and Conduct," 2026. https://www.acquisition.gov/far/52.203-13
26. U.S. Department of Justice and SEC, "A Resource Guide to the U.S. Foreign Corrupt Practices Act," 2020. https://www.justice.gov/criminal/criminal-fraud/fcpa-resource-guide
27. IBM, "2025 Annual Report" (IBM Consulting), 2025. https://www.ibm.com/annualreport/
28. CGI, "2025 Annual Report" (IT and business consulting), 2025. https://www.cgi.com/en/node/161742