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  • 1.  
  • 2. Introduction to Management Consulting Dr. Joe O’Mahoney 2007
  • 3. Today’s Learning Objectives
    • To give an overview of the course
    • To know the definition, history and purpose of management consulting
    • To understand the consultancy market: the main players, industry segmentation, clients and trends
    • To gain an overview of the consulting life-cycle
    • To understand the basics of approaching cases, guestimating and analysing.
  • 4. The Agenda
    • The Course
    • What is Management Consulting?
    • Who are Management Consultants?
    • Clients
    • Analysing Cases
    Management Consulting
  • 5. The Course
    • Practical, Practical, Practical……
    • Case-based (Harvard)
      • Develops skills
      • Get jobs
      • Highest retention rates
    • To…
      • Understand Consultancy
      • Analyse businesses
      • Develop solutions
    • No...
      • Books
      • Theories
      • Bullshit
  • 6. The Course Pt. I
    • Introduction to Consulting
      • Overview of Consulting
      • Designing your own firm
    • Proposals and Planning
      • Planning, Costing and Proposing
      • Assignment: Speaker from StayMobile Ltd.
    • Strategy Consulting & Market Analysis
      • Analysing Trends
      • Making Recommendations
    • IT & e-Commerce
      • Requirements Management
      • E-business
  • 7. The Course Pt. II
    • Dark Sides of Consulting
      • Stress, manipulation and exploitation
      • Illegal trades: Enron, Parmalat, WorldCom
    • Speaker Day 1: Consulting Work
      • EDS & Deloitte
      • Managing Delivery
    • Speaker Day 2: Analysis with SSM
      • Jeremy Hilton: Private Consultant
      • Methodologies & Modelling
    • Speaker Day 3: Consulting Careers and CVs
      • IBM
      • Getting a job & getting on
  • 8. What is Management Consulting?
  • 9. Historical & Future Trends
    • Big player recovery from 2000 - 2003 (DotCom bust)
    • Accountability (Chinese Walls, Enron, Sarbanes-Oxley, Basel II)
    • Diversification (M&A, Internationalisation, Sectors)
    • Image (MBAs, Up selling, Over-charging, Facsimile Consulting)
    • Projects (outsourcing, e-business, protection vs. emergent markets)
    • Competition (numbers, approved lists, proven track record, sceptical clients)
    Razorfish, Sapient, Viant, iXL Experienced hires Niche: outsourcing, e-business, BPR 1990 - 2000 Arthur Anderson, KPMG, IBM, Deloitte, E&Y Graduates, MBAs Technical & Financial Specialisms 1970 – 1990 McKinseys, Bain & Co., Boston Consulting Group MBAs & Academics Strategic Management 1940 – 1970 AD Little, Booz, Allen, Hamilton, AT Kearney. Academics Technical Analysis 1890 – 1940 Typical Firms Hires Focus Dates
  • 10. The Biggest Consulting Firms
    • Accenture (IT, Operations, HRM)
    • Cap Gemini (IT, Operations)
    • CSC (IT, Operations)
    • IBM BCS (IT)
    • PWC (IT, Operations, HRM)
    • KPMG / Bearing Point (IT, Operations)
    • Deloitte (IT, Operations)
    • McKinsey & Co. (Strategy, Operations)
    • BAH (Strategy, Operations)
    • Mercer (Strategy, HRM)
    • Anderson (Operations)
    • A. T Kearney (Strategy, HRM)
    • Monitor (Strategy)
    • BCG (Strategy)
    • A.D. Little (Strategy)
    • Bain & Co. (Strategy)
  • 11. Segmentation
    • Industry
      • Telcos - Health
      • Digital Media - Manufacturing
      • Finance & Banking - FMCG& Retail
      • Utilities - Transportation
    • Function
      • Strategy - HRM
      • Operations - IT (incl. e-business)
    • Sector
      • Non-profit
      • Public
      • Private
  • 12. A Consulting Typology / Utilities Technology Providers Software Providers Service providers McKinsey IBM A.T. Kearney Oliver Wyman Deloitte Accenture PwC CSC EDS Scient Sapient Diamond Strategy Consultants
  • 13. Sector Analysis Pt. I
    • Strategy
      • Direction, Long-term plans & High-level goals
      • Lever to implementation
      • Bain & Co. - BCG
      • McKinseys - Monitor
    • Operations
      • Day-to day running of firm, Reaching, strategic goals
      • Re-engineering, outsourcing, supply-chains
      • Accenture - Deloitte
      • Cap Gemini - CSC
  • 14. Sector Analysis Pt. II
    • IT
      • Systems development, implementation
      • Business focused requirements
      • IBM - AMS (American Management Systems)
      • Accenture - CSC
    • HRM
      • Strategic alignment of people function
      • ERP, training, culture change, competence management
      • Accenture - PWC
      • Mercer - AT Kearney
  • 15. Consulting Products Products have a name, a methodology, an application and great PR Consultants are charged with introducing ‘fashions’ Stern Stewart Stewart Economic Added Value 1993 CSC Hammer & Champy BPR 1993 Bain & Co. Reichheld Core Competencies 1990   MIT Peters & Waterman TQM 1998 Strategos / Harvard Hamel & Prahalad Value Chain Analysis 1985 Monitor / Harvard Porter Five Forces 1980 BCG Henderson Portfolio Analysis 1976 Organisation Consultant Product Dates
  • 16. Who are Management Consultants?
  • 17. What is a Management Consultant?
    • Not the brightest and the best
    • Not all Harvard MBAs or even business students
    • Not Magicians, Preachers or Witch-Doctors
  • 18. Skill Profile
    • Skills:
      • Outstanding interpersonal skills
      • Great Presenter
      • Excellent at writing reports
    • Knowledge:
      • Generalist business knowledge
      • Methods & Frameworks
      • In-depth specific skill
    Depth of expertise: skill or knowledge based Broad set of general consulting competencies
  • 19. Basic Salaries (UK)
    • Graduate £20 – 26k
    • Junior Project Lead £30 – 35k
    • Team Leader £40 – 60k
    • Senior Consultant £60 – 80k
    • Principle Consultant £70 – 100k
    • Partner £100k +
    • + 10 – 20% bonus
    • + car
    • + health care, share options
    • Highest salaries earned at niche consultancies
  • 20. Design your own Consultancy
    • In pairs: you and 20 consultants wish to start your own medium-sized consultancy. You will consult on general strategic management issues such as mergers and acquisitions, outsourcing and new product development.
    • Write 10 scenarios (5 each) that you think might be likely to occur whilst running this consultancy. What functions, departments and skills will you need in the consultancy. Sketch a brief organisational design and strategy outlining:
    • Skills Required
    • Structure & Function
    • Major Costs
    • Key problems
  • 21. Clients
  • 22. Marketing Consultancy Work
    • Finding a problem
      • External threats
      • Mimicking others
      • Falling behind: benchmarks
      • New opportunities
    • Marketing Consultancy
      • Links with top academics / Business Schools (HBS, MIT, Sloan)
      • Links to conferences, institutions,
      • Publications: books, journals, the press
    • Getting in
      • Free surveys / research
      • ‘ Solution’ stories
      • Referrals
      • ‘ Jumpers’
  • 23. Why Employ Consultants?
    • Expertise
    • Objectivity
    • Someone to blame
    • To save money
    • External knowledge (e.g. best practice, benchmarking)
  • 24. Types of project
    • Providing Advice: should I launch this product?
    • Project Design: how should I launch this product?
    • Implementation: install a system that will pay suppliers
    • Functional Management: run our department for us
  • 25. Working With Clients
    • Defining the project
      • Open  Closed questions: Predicament > Definition > Solution
      • Key Decision Makers
    • Enticing the Client
      • Free analysis
      • Free juniors
      • Corporate entertainment
    • Successful Projects
      • Contract, contract, contract
      • Clear goals, roles & procedures
      • Boilerplating & reuse
      • Quick measurable wins
      • Solid Conclusions
      • The person not the project
  • 26. The Consulting Life-cycle
    • Initial Contact
    • Project Definition
    • Initial Analysis
    • Formal Proposal
    • Contract
    • Project Implementation
      • Data Collection
      • Data Analysis
      • Decisions / Plan
      • Intervention
    • Review
    Initial Contact Definition Proposal & Contract Data Collection Data Analysis Decision-making, Planning Intervention Disengaging Review
  • 27. The Consulting Life-cycle Initial Contact Definition Proposal & Contract Data Collection Data Analysis Decision-making, Planning Intervention Disengaging Review
  • 28. Analysing Cases
  • 29. Case 1: LightBox Inc.
    • I am the CEO of a light-bulb manufacturer. I have developed an ever-lasting light-bulb.
      • How much should I sell it for?
      • What will the increase in our share-price be?
  • 30. Additional Information
    • It cost £20 million to develop the product.
    • It costs £5 to make the product
    • Normal Lightbulbs
      • Cost £0.5 to manufacture
      • Are sold to distributers for £0.25
      • Who sell to retailers for £0.50
      • Who sell to the customer for £0.75
    • What about the markets?
      • Cannibalisation?
      • Government?
  • 31. Case 2: Three
    • The Company
      • Hutchison Whampoa
      • Owned by Li KaShing ($20bn)
      • Family interests of $630bn
      • Owns ports, telecoms, property (Hong Kong)
    • The Context
      • 3G Telecoms: video & music over the phone
      • 1999: UK first gov. to sell 3G licences
      • 2000 – 2005: Followed by most others
  • 32. Case 2: Three
    • The Decision
      • Should Hutchison buy a 3G licence in the UK?
      • How much should they pay for it?
      • What strategic issues should they look out for?
  • 33. Links
    • http://www.vault.co.uk
    • http://www.mca.org.uk
    • http://www.mbajungle.com
    • http://www.consultingcentral.com
    • http://www.feaco.org
    • http://www.mca.org.uk
    • http://www.amcf.org
  • 34. Questions?