2. Welcome to Consulting
2
We are going to do our utmost to
make this experience profitable for
you and the Clients, enjoyable and
true to the experience gained in
major consulting companies
Consulting is not easy, but it is
rewarding and you can gain
enormous experience and insight
into top level business thinking in a
very short period of time
It requires commitment and
dedication plus a willingness to
sacrifice oneself for the Client and
the Team
This course is an attempt to
introduce you to the basics of
consulting and give you some basic
tools and a roadmap
Thanks and enjoy the course
We welcome you! Jones Graduate
School of
Business
3. Agenda for this presentation
3
Part I
Introduction
The presenter
Architecture and
Accounting
Conceptual Framework
Why do companies hire
consultants?
Consulting styles and
models
Hypothesis based
Consulting
Key Frameworks
Part II
The Consulting Process
Part III
Presenting your
Recommendations
Conclusions and closing
thoughts
Jones Graduate
School of
Business
4. Concepts on Consulting
Part I
Support Material for the ALP Course
Jones Graduate School of Business, Rice University
6. The Presenter, Consultant and Architect
Lin Giralt has a 30 year career helping companies improve their performance.- both as a
Consultant (20 yrs) and as an Agribusiness Entrepreneur, Sales and Operations Manager and
Construction Manager for over half a dozen buildings
He joined Booz Allen & Hamilton in 1992, rising to Senior Associate and Project Manager in the
Andean Region. He founded Lambda Consultores in Caracas in 1997 and Lambda International
Consultants in Houston in 2010
Mr. Giralt's specialty is linking strategy with operational improvements to ensure that strategic
thinking is integrated with organization, business processes and the client IT platform.
Valuation of SME’s and integration of Consulting recommendations to Value Based Impact is a special area of
interest
Among the many companies that he has consulted to are: a leading softdrink manufacturer, a
leading valuables transportation company, dealers for two prominent German automobile
companies, a leading Car Rental franchisor and various telcos, banks and financial companies.
His practice has been divided between Fortune 5oo firms and family owned companies
He has an MBA from The Wharton School of the University of Pennsylvania, a Master's in
Architecture from Rice University and a B.A. in Architecture and Urban Planning from Duke
University
He has been active in community activities, having been President of the PTA at his children's
school, President of his Homeowners Association, was Board Member of the Wharton Club of
Caracas, and President of the Duke Club of Venezuela. …there were only a couple of Rice grads
in Caracas, but he currently serves on the Rice University Graduate Alumni Committee
He is married with two college age children. He is an avid golfer, squash player and reader of
military history, strategy and political biographies.
6Jones Graduate
School of
Business
7. Architecture and Accounting have a common uncle
7Jones Graduate
School of
Business
Fra Luca Bartolomeo
de Pacioli
Accounting and
Merchant Arithmetic
Tractatus mathematicus
ad discipulos perusinos
(merchant arithmetic and
algebra)
Summa de arithmetica,
geometria, proportioni et
proportionalita
(double entry ledger
system)
Mathematics and Magic
De viribus quantitatis
Architecture and
Proportions
De divina proportione
www. wikipedia.com
8. Some other links between Architecture* and
Consulting (1)
8Jones Graduate
School of
Business
Discover
problems
and needs
Research
information
and get
data
Develop
preliminary
solutions;
Test and
evaluate
Modify and
evolve
Provide
solutions
1. Similar Iterative Processes
R
e
v
i
e
w
R
e
v
i
e
w
R
e
v
i
e
w
R
e
v
i
e
w
Stay close to your client to keep your client
* and other creative professions
9. Some other links between Architecture and
Consulting (2)
9Jones Graduate
School of
Business
1I . No right or perfect answer – just approximations
Architecture
Multiple design ‘schools of
thought’, methods and styles
Consulting
Multiple frameworks for
analysis and different firms
10. Some other links between Architecture and
Consulting (3)
10Jones Graduate
School of
Business
1II . Don’t fall in love with your answer
– there is always a better one coming
Architecture
Evolution that incorporates building
technology and new lifestyles
Change in consumer tastes and
need to incorporate current visions
Consulting
Evolution that is impacted by
technological change and change
in consumer lifestyle
Development of new frameworks
and evolving organizational
paradigms
11. Some other links between Architecture and
Consulting (4)
11Jones Graduate
School of
Business
IV . Long hours of analysis and in reviewing and
designing solutions
Architecture
Reviews of designs and changes
that require redesigning many inter-
related parts
“God is in the Details”
Consulting
Data review and rejection of
previously assumed hypotheses
require a reevaluation of the entire
direction of the project
“The Devil is in the Details”
12. Some other links between Architecture and
Consulting (5)
12Jones Graduate
School of
Business
V . Build around certain solid principles
Architecture
Form follows function
– Louis Sullivan
Less is More
- Mies Van der Rohe
Architecture depends on Order,
Arrangement, Eurythmy, Symmetry,
Propriety and Economy
- Vitruvius
Consulting
Macro and micro economic principles
Theories of strategy, financial analysis,
marketing and organizational behavior
plus the impact of technology on
business
It is our intention to help you understand these
16. Why do companies hire consultants?
Strategic
Provide an objective third-party viewpoint on strategic planning,
marketing, operations, capital structure and other long term issues
Act as an impartial third party in evaluating organizational functions,
operations, and results
Be the outside resource that acts as an 'agent for change‘ as BPR Project
Manager
Perform valuations and strategic analyses prior to M&A’s
Evaluate and develop Business Plans
Evaluate changes in performance subject to changes in strategy or organization
Technical and Operational·
Oversee or conduct special projects that require a knowledgeable outside
resource
Create internet, marketing and promotional materials
Support and resolve MIS and IT issues
Write technical product bulletins and manuals
Develop and conduct training courses / workshops specific to a company's
needs
Provide technical advice in product development or manufacturing areas
Troubleshoot immediate issues involving as operational performance
http://www.acs.edu.au/info/distance-and-online-education/professional-
courses/consultant-course.aspx
16Jones Graduate
School of
Business
17. There are internal and external consultants
Internal Consultants External Consultants
17
Long term, salaried advisors to top
management
Generally in charge of internal projects
for operational improvement
Vertical long term organizational
knowledge is required
Work hand in hand with existing
personnel and within the organization
Generally – with exceptions - do not
challenge status quo
Are not called upon to review internal
issues where an unbiased , external
viewpoint is needed
Short term contract based advisors to
top management
In charge of specific change
management projects
Horizontal knowledge of external
factors is required
Work with, but outside of, personnel
and internal organization
More likely to challenge status quo
Called upon when it is important to
have an unbiased external viewpoint on
internal issues
Jones Graduate
School of
Business
Internal vs. external consultants
18. There are Technical and “Strategic”
consultants
Technical and Operational
Consultants Strategic Consultants
18
Focused on one area of expertise
Human resources
Financial management
Operations
Information Technology
Sales and Marketing
Tends to be one individual practitioner
Generally report to one of the operational
units
Generally come from the industry
Supply expertise in one field and very
related to the industry
Short term focused rather than long term
vision
More likely to offer incremental improvements
More “Horizontal’ in their expertise
Span different disciplines and integrate
various fields of knowledge within the team
More team focused than individually
oriented
Generally report to C Level
management
Consultants are not from a specific
industry, but supply expertise across
various industries
In major firms, there is specialization in
projects in one industry, or even one client
Tend to be Strategic and Long term
focused
Prone to give “game changing”
viewpoints
Jones Graduate
School of
Business
Technical vs Strategic consultants
19. For this presentation we are going to focus on
“Strategic” and External consulting
Your presenter does not know much about Technical
or Opertional consulting and only some about
Internal consulting (One year experience with
Verizon)
These positions evolve from within industries… vary
from industry to industry
Have a strong vertical focus and are mostly learned within
an ‘on the job’ setting
Frameworks are not as important as in depth technical
knowledge
Many technical consultants do more than “consult” they
are the unquestioned experts in their field
Internal consultants are valuable in their horizontal
knowledge of a company
19Jones Graduate
School of
Business
22. Build Tree from the Issues/Questions
22Jones Graduate
School of
Business
Issues /
Questions
MECE Logic
Further
Breakdown
Questions to Ask/
Data to Collect
Breakdown the issue into logical categories and begin asking questions
MECE= Mutually Exclusive, Completely Exhaustive (… and
exhausting)
www.ruf.rice.edu/~jgsmcc/Rice_Case_Workshop.ppt
Hypothesis Analysis
23. Example
Issue tree: Profit = Revenue minus Costs
Jones Graduate
School of
Business
Drug Co.’s operating margins are lower that
Walgreen’s as a result of poor operations and
lower revenue
Drug Co. generates less
revenue per location, per
square foot
What’s happening in the
market?
•Regulatory changes?
•Industry trends?
–Consolidation? (1)
–Diversification of product
base? (2)
•Competitors? (3)
–Walgreen’s
–Eckerd?
•Substitutes? (3)
Drug Co.’s operations are
not as efficient (cost wise)
as Walgreen’s
•Store specs?
–Size of store (1)
–Hours of operation
•Product mix?
–Prescription versus general
merchandise (2)
–Brand prescriptions versus
generic (2)
–Compounding as a % of
prescription
•Locations?
–Do Drug Co.’s locations
hurt the business?
–Traffic at a Walgreen’s
versus Drug Co. &
Competitors (3)
•COGS?
–Does Walgreen’s have an
advantage due to buying
power?
–How does product mix
affect COGS?
–Pricing?
•Fixed costs
–Rent – Is Drug Co. cheaper
as a result of location?
–Wages and salaries?
–Size of locations?
–Number of employees?
•Variable costs?
MECE Hypothesis
Should be part of
Cost or Revenue
or is not MECE
www.ruf.rice.edu/~jgsmcc/Rice_Case_Workshop.ppt
24. Issue tree: Profit = Revenue minus Costs
Jones Graduate
School of
Business
Drug Co.’s operating margins are lower that
Walgreen’s as a result of poor operations and
lower revenue
Drug Co. generates less
revenue per location, per
square foot
Drug Co.’s operations are
not as efficient (cost wise)
as Walgreen’s
•Walgreen has higher margin
products in mix
•Walgreen sells more per SF
and per Store
• Walgreen has larger stores
•Locations?
–NO Information here
•Indications that Walgreen has
lower costs, because of EOS
through larger stores and
higher margins, but have no
ABSOLUTE cost data
• No information as to
attractiveness and relative
traffic of store locations (???)
• Cannot really conclude based
on information given
MECE Validation?
www.ruf.rice.edu/~jgsmcc/Rice_Case_Workshop.ppt
25. Typical Profit Analysis Tree
25Jones Graduate
School of
Business
Profits
Revenues
No. Units
Product A
Product N
Price per
Unit
Product A
Product N
Costs
No. Units
Product A
Product N
Cost per
unit
Product A
Product N
Do in Absolute and Percentage of
Sales terms; Current Year and 3-5 yr
trend line
• Distribution Channel
• Geographic location
• Seasonality
• Per Client Segment
• Per Key Client
• What drives changes
in Units or Price/Unit?
• Fixed vs Variable
• Base product costs
• Raw Material
• Labor
• Overhead
• Depreciation
• Marketing / Sales
• Administrative
• Financial
• Extraordinary items
26. Type of firms (1)
26Jones Graduate
School of
Business
Universe
Capital
Intensive
Fixed
Capital
Direct
Assets
Indirect
Assets
Intellectual
Capital
Direct
Assets
Indirect
Assets
Labor
Intensive
Direct
Labor
Product A
Product N
Indirect
Labor
Product A
Product N
Cost trees and breakdown vary between these two types of companies
• Costs are more
related to capital
expenses and
investments
• May show up more in
Depreciation and
Amortization
• Will probably be tied
into product at the
COGS/Depreciation
level
• Costs are related
to labor costs
• Can be Direct or
Indirect
• Will be tied into
product at the Direct
Cost level
27. Type of firms (2)
27Jones Graduate
School of
Business
Universe
Manufacturing
B2B
Direct Assets
Indirect Assets
B2C
Direct Assets
Indirect Assets
Service
B2B
Product A
Product N
B2C
Product A
Product N
Do in Absolute and Percentage of Sales terms
• Cost Structure fill
follow traditional
• Material
• Labor
• Manufacturing or
Transformation
Costs
• Depreciation will be
imbedded in costs
• Costs are
principally Labor
and Overhead
Costs (w/o
Materials or
Depreciation)
29. “Half the battle is understanding the
problem” – Victor Cheng
29
Business Situation
Profit Problem (Price, Cost, Volume)
Business Situation & Strategy:
Entry Strategies, New Businesses,
Competitor Actions
Merger and Acquisitions
Supply and Demand
Business doesn’t Work Well
Frameworks to Consider
Profit = Revenues – Costs
Separate Fixed vs Variable, Direct vs
Indirect
Competitive Positioning and
Capabilities
Market Attractiveness
Demand and Supply Curves
Dynamic Game Theory
Corporate fit and synergies
What does the finished co. look like?
Corporate Fit issues vs. Financial
issues
Industry curves, capacity and costs
Cost curves: new vs. previous
Internal value chain functions
Analysis of functionalityJones Graduate
School of
Business
www.victorcheng.com; with adaptation by Lambda International Consultants
30. Mergers and Acquisitions Framework
Example of
Framework
Host
Company
Target
Company
Merged
Company
Suppliers Alpha , Beta Alpha More leverage
on Alpha
Buyers/Customers A, B, C B, C, D Complementarit
y
Products Delta ,
Epsilon
Iota, Omega Complementarit
y
Distribution
Channels
Gamma Gamma Greater
leverage
Key Capabilities Strong Medium Strong
Financial
Resources
Strong Medium Strong
www.victorcheng.com; with adaptation by Lambda International Consultants 30Jones Graduate
School of
Business
31. Suppliers Customers
Industry Rivalry and your
Competitive Position
Substitute
products
New
entrants
into Market
Competitive
Dynamics
Prof. Michael Porter’s Five Forces indicate how
Competitive Dynamics works to develop a Strategy
31Jones Graduate
School of
Business
Current
competitors
Michael Porter, Competitive Strategy
32. Cost
Service
Functional and
Image Product
Attributes / Quality
Innovation
/ Fashion
Competitive Dynamics:
How do businesses compete?
32Jones Graduate
School of
Business
Oscar Bernardes, Booz Allen & Hamilton
33. PEST Analysis (PEST+LE)
33Jones Graduate
School of
Business
POLITICAL
•ecological/environmental issues
•current legislation home market
•future legislation
•international legislation
•regulatory bodies and processes
•government policies
•government term and change
•trading policies
•funding, grants and initiatives
•home market lobbying/pressure groups
•international pressure groups
•wars and conflicts
ECONOMIC
•home economy situation
•home economy trends
•overseas economies and trends
•general taxation issues
•taxation specific to product/services
•seasonality/weather issues
•market and trade cycles
•specific industry factors
•market routes and distribution trends
•customer/end-user drivers
•interest and exchange rates
•international trade/monetary issues
SOCIAL
•lifestyle trends
•demographics
•consumer attitudes and opinions
•media views
•law changes affecting social factors
•brand, company, technology image
•consumer buying patterns
•fashion and role models
•major events and influences
•buying access and trends
•ethnic/religious factors
•advertising and publicity
•ethical issues
TECHNOLOGICAL
•competing technology development
•research funding
•associated/dependent technologies
•replacement technology/solutions
•maturity of technology
•manufacturing maturity and capacity
•information and communications
•consumer buying mechanisms/technology
•technology legislation
•innovation potential
•technology access, licencing, patents
•intellectual property issues
•global communications
www.CIPD.co.UK; www.businessballs.com/pestanalysisfreetemplate.htm
34. SWOT Analysis
34Jones Graduate
School of
Business
• Present
& Future
/ External
• Present
& Future
/ External
• Present /
Internal
• Present /
Internal
Strengths
Weakness
es
ThreatsOpportunities
SWOT (and PEST) are
not meant to be a static,
stand alone analyses
Original framework by Dr
Otis Benepe (SRI)
1. Values
2. Appraise
3. Motivation
4. Search
5. Select
6. Program
7. Act
8. Monitor and repeat steps
1 2 and 3
Robert Stewart, Marion Dosher, Dr Otis Benepe, Birger Lie, and Albert Humphrey. SRI
Urick and Orr, 1964, etc; see http://www.wiziq.com/tutorial/51376-SWOT-analyses
Match Strengths to Oppty and
Weaknesses to Threats
to develop Change Programs
37. McKinsey/ GE Industry evaluation matrix
37Jones Graduate
School of
Business
My
experience,
strengths
and abilities
How
attractive is
this market?GE & McKinsey & Co. Inc.
38. Product Life Cycle Curve
38Jones Graduate
School of
Business
Stage Characteristics
1. Market introduction stage
1.costs are very high
2.slow sales volumes to start
3.little or no competition
4.demand has to be created
5.customers have to be prompted
to try the product
6.makes no money at this stage
2. Growth stage
1.costs reduced due to economies
of scale
2.sales volume increases
significantly
3.profitability begins to rise
4.public awareness increases
5.competition begins to increase
with a few new players in
establishing market
6.increased competition leads to
price decreases
3. Maturity stage
1.costs are lowered as a result of
production volumes increasing and
experience curve effects
2.sales volume peaks and market
saturation is reached
3.increase in competitors entering
the market
4.prices tend to drop due to the
proliferation of competing products
5.brand differentiation and feature
diversification is emphasized to
maintain or increase market share
6.Industrial profits go down
4. Saturation and decline stage
1.costs become counter-optimal
2.sales volume decline or stabilize
3.prices, profitability diminish
4.profit becomes more a challenge
of production/distribution efficiency
than increased sales
Theodore Levitt “Exploit the Product Life Cycle” Harvard Business
Review, November 1965.
40. Small companies need to be smart and find
niches using their capabilities
40Jones Graduate
School of
Size of company Capabilities Time Horizon Resources
Large Enormous Long term Considerable
Medium Constrained Medium term Moderate
Small Focused Short term Limited
Company
size
Capabilities
Large
Small
Low High
Focus on creating
capabilities and
capturing niche
markets in accord with
capabilities
Focus on using capabilities
and capturing large
markets
Lambda International Consultants
41. Core capabilities can also be examined as
they impact across business units
41Jones Graduate
School of
Business
Prahalad, C.K. and Hamel, G. (1990) The core competence of the corporation,
Harvard Business Review (v. 68, no. 3) pp. 79–91. Analysis by Lambda
International Consultants
Strength of Capability / Impact on Business
++ Very Strong
+ Strong
= Average
-Weak
0 None
42. Lambda Framework
42Jones Graduate
School of
Business
Corporate
Structure and
Governance
Sound
Business
Strategy
Key
Processes
Lean
Organization
Adequate
Resources
Culture,
Communications
and Control
Market
Consumers
Competitors
Suppliers
Marketing and Sales
Strategy
Key processes to
make the business
work
The people and
structure needed to
make the processes
work
Human resources
Financial resources
Technical resources
Knowledge
resources
Company culture
and communications
Control of the
business
Legal and
shareholder
structure and control
Start here!
Lambda International Consultants
43. Small Company Improvement Framework
Capability Based Strategies
43Jones Graduate
School of
Business
SALES /
MARKETING /
BRANDING
DISTRIBUTION/
CUSTOMER
SERVICE
FINANCE
MANAGE
MENT
AND
HUMAN
RESOUR
CES
R&D
INFORMATION
TECHNOLOGY
CORPORATE
CULTURE AND
COMMUNICATIONS
SUPPLIERS
MANUFACTURING
CAPABILITIES
• Macro environment
• Economics
• Market situation
• Micro environment
• Vision of the
business
•
Competitiveness
• Revenues,
costs, profitability
• New Business
Opportunities
• Management
Depth
Capability Evaluation
Implementation Plan and Closing of Gaps
2
Current Situation
1
Development of
Strategic Options
4
3
• Identify Opportunities
• Market
Attractiveness
• Gap analysis
• Grow vs Strengthen
• Key Markets
• Key Internal Areas
• Filter vs. External Factors
• Select Key Strategy
• Develop Resource
Priorities
• Strategy Implementation
• Closing Gaps in Processes, Organization, Resources
• Implementation Plan and Responsibilities
Lambda International Consultants
44. Concepts on Consulting
Part II
Support Material for the ALP Course
Jones Graduate School of Business, Rice University
45. Agenda for this presentation
45
Part I
Introduction
The presenter
Architecture and
Accounting
Conceptual Framework
Why do companies hire
consultants?
Consulting styles and
models
Hypothesis based
Consulting
Key Frameworks
Part II
The Consulting Process
Part III
Presenting your
Recommendations
Conclusions and closing
thoughts
Jones Graduate
School of
Business
47. Phases in Consulting Projects (1)
47Jones Graduate
School of
Business
1
• Initial Contact
2
• Discussion and Development of Hypotheses
3
• Proposal Preparation and Contract Negotiation
4
• Project Execution*
5
• Post conclusion Evaluation
* Will be explored in a detailed section
48. The Initial Contact sets the tone for the rest
of the relationship
48Jones Graduate
School of
Business
• Initial contact may
come through
• a social or
business
acquaintance
• a cold call
• a referral
• a marketing
initiative
• It is important to
present the firm in a
professional manner
• Sell, but don’t oversell
your services
• Trust is the basis of
the relationship and it
must be created from
the beginning by
understanding client
needs and budget
49. Generally a preliminary discussion with the client
includes their hypotheses as to the problem
49Jones Graduate
School of
Business
•Clients know their
businesses and orient
the Consultant as to
problem areas and
where they need advice
and support
• It is safer to interview
various people in a
client organization to
obtain divergent
viewpoints on the
problem and not
straitjacket the
proposal; ie that it is a
sales problem and not
a cost problem or
viceversa
• The Team should
discuss this internally
after initial client
meetings
50. With an initial although incomplete understanding of
potential problems a Proposal may be prepared
50Jones Graduate
School of
Business
• Preparing a proposal is
50% of the project
• a poor proposal
encumbers and
hinders the team
delaying
understanding the
problem and
developing solutions
• Proposals have three
key elements
• The workplan:
steps to be done,
analyses to be
performed and
deliverables for each
step
• Duration: time and
person-hours that
each step takes
• Staffing: level and
skills of the team
51. Preparing a Proposal is a multi part process
prior to writing the Proposal itself
51Jones Graduate
School of
Business
1. Understanding the problem(s)
2. Developing the methodology for
each
3. Estimating the duration of
worksteps
4. Designing the work team: skills,
levels and dedication
5. Preparing the budget
52. Preparing a Proposal is a multi part process
prior to writing the Proposal itself (2)
1
• Based on experience, the Consultant must decide what kind of problem is
faced: Strategy, Profits, Marketing, Organization or Processes
2
• For each problem, a method of analysis must be chosen to include all the
possible factors and data and what steps and substeps are needed
3
• Based on the steps and data required, the Consultant estimates and the
duration of each step in the process; there is always a Critical Path
4
• With all the steps determined, the Consultant decides the capability level
of the staff needed for each and their dedication
5
• The Consultant multiplies each staff member’s dedication in hours by the
Hourly or Daily Billing Rate for each to arrive at a budget
52Jones Graduate
School of
Business
53. Budget development: team member
dedication and projected task durations
53Jones Graduate
School of
Business
mber Task Duration Start Finish Predecessor LG JLA LEA Mkt Specialist Sr Consult
INITIAL TASKS 0 days 21-01-09 8:00 21-01-09 8:00
1 Preparatory meetings 3 days 21-01-09 8:00 23-01-09 17:00 10% 10% 5% 0% 0%
2 Develop initial proposal 3 days 26-01-09 8:00 28-01-09 17:00 2 10% 10% 5% 0% 0%
3 Discuss final proposal 0 days 28-01-09 17:00 28-01-09 17:00 3 10% 10% 5% 0% 0%
4 Develop final proposal 3 days 29-01-09 8:00 02-02-09 17:00 4 10% 10% 5% 0% 0%
5 Negotiate with Client 7 days 03-02-09 8:00 11-02-09 17:00 5 10% 10% 5% 0% 0%
6 Sign final contract 0 days 11-02-09 17:00 11-02-09 17:00 6
DEVELOP VALUE PROPOSITION 0 days 11-02-09 8:00 11-02-09 8:00
7 Prepare Market Research Protocol 7 days 12-02-09 8:00 20-02-09 17:00 6 25% 10% 5% 25% 0%
8 Define Focus Groups 3 days 12-02-09 8:00 16-02-09 17:00 6 20% 20% 5% 25% 0%
9 Focus group development 3 days 17-02-09 8:00 19-02-09 17:00 7,10 20% 20% 5% 25% 0%
10 Hold initial Focus Groups 15 days 20-02-09 8:00 12-03-09 17:00 11 5% 5% 5% 25% 0%
11 Integrate initial Focus Group Visions 3 days 13-03-09 8:00 17-03-09 17:00 12 10% 10% 5% 25% 0%
12 Hold Final Focus Groups 7 days 18-03-09 8:00 26-03-09 17:00 13 10% 10% 5% 25% 0%
13 Integrate Focus Group Visions 3 days 27-03-09 8:00 31-03-09 17:00 14 25% 25% 5% 25% 0%
14 Develop initial store proposal 3 days 01-04-09 8:00 03-04-09 17:00 15 25% 25% 5% 25% 0%
15 Approve initial store proposal 0 days 03-04-09 17:00 03-04-09 17:00 16
16 Define Value Proposition 4 days 06-04-09 8:00 09-04-09 17:00 17 25% 25% 5% 25% 50%
17 Approve Final Value Proposition 2 days 10-04-09 8:00 13-04-09 17:00 18 25% 25% 5% 25% 50%
Project for Market Research and Concept Development of a new Retail Food Store
Note: this project was atypical in that Client accepted that we bill for Initial Tasks including
Preparation of Proposal since it required significant amount of time with Client Staff and
internal negotiations with various units of a Multinational Company
54. Budget development: team member
billing rates and estimated project cost
54Jones Graduate
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Business
Rate per hour 200.00$ 200.00$ 150.00$ 125.00$ 100.00$
Step LG JLA LEA Mkt Specialist Sr Consult TOTAL
INITIAL TASKS 2,560 2,560 960 - - 6,080
1 Preparatory meetings 480 480 180 - - 1,140
2 Develop initial proposal 480 480 180 - - 1,140
3 Discuss final proposal - - - - - -
4 Develop final proposal 480 480 180 - - 1,140
5 Negotiate with Client 1,120 1,120 420 - - 2,660
6 Sign final contract - - - - - -
DEVELOP VALUE PROPOSITION 12,320 10,640 3,000 12,500 2,400 40,860
7 Prepare Market Research Protocol 2,800 1,120 420 1,750 - 6,090
8 Define Focus Groups 960 960 180 750 - 2,850
9 Focus group development 960 960 180 750 - 2,850
10 Hold initial Focus Groups 1,200 1,200 900 3,750 - 7,050
11 Integrate initial Focus Group Visions 480 480 180 750 - 1,890
12 Hold Final Focus Groups 1,120 1,120 420 1,750 - 4,410
13 Integrate Focus Group Visions 1,200 1,200 180 750 - 3,330
14 Develop initial store proposal 1,200 1,200 180 750 - 3,330
15 Approve initial store proposal - - - - - -
16 Define Value Proposition 1,600 1,600 240 1,000 1,600 6,040
17 Approve Final Value Proposition 800 800 120 500 800 3,020
Total 14,880 13,200 3,960 12,500 2,400 46,940
Project for Market Research and Concept Development of a new Retail Food Store
55. Project Execution is the reason for being for
Consultants, so we shall devote a section to this
55Jones Graduate
School of
Business
• The Project starts
officially at the Kick Off
• May proceed through
one or two preliminary
presentations until a Final
Presentation is held
• Implementation plans
may or may not be
presented at the Final
Presentation since there
may be recommendations
that have to be approved
before implementation
plans can be finalized
56. Phases in Project Execution
1 • Kick Off
2 • Initial Interviews / Data reception
3 • Analysis of data and interviews
4 • Preliminary Presentation/Worksession
5 • Final analyses
6 • Development of Recommendations
7 • Final Presentation/Worksession
56Jones Graduate
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Business
57. The Kick Off meeting is key to align all
participants
57Jones Graduate
School of
Business
• Kick off meeting is
where the project
workplan is presented,
objectives validated
and team members
introduced
• Client team members
generally are
incorporated into the
project at this point
• Initial interviews can
be set up and data
requests delivered here
58. Being part of a consulting team
A consulting team is exactly that – a team
There has to be a Director and/or Job/Project
Manager whose responsibility is to lead the team
and who is ultimately responsible for project
deliverables
Under this person may be one, two or more
consultants whose role is to execute different parts
of the project
Interviewing
Data collection
Data analysis
Preparing charts and graphs for presentation
Preparing the presentation
Project support 58Jones Graduate
School of
Business
59. Delegation and Supervision
Within the Team
There is a tradeoff between what a Job Manager can
do him/herself and what must be delegated
Generally the Director and Job Manager will hold final
responsibility for writing and editing the final deck and
assign analyses to Consultants and Client Team Members
Consultants cannot grow unless they are given
increasingly responsible challenges within the team
Supervision and training day to day is one of the key
responsibilities for the Job Manager
With the Client
Ideally, Client Team Members would be 100% co-
participants; nevertheless, frequently they are
holding a full time job within the client organization
and cannot devote the same amount of time as a
consultant
59Jones Graduate
School of
Business
60. The Team Structure
Director or Officer in Charge
(client relations; directs
proposal, reviews intellectual
content)
Job Manager (day to day
responsibility for team; writes
document under OIC
supervision)
Consultants / Analists
(do the routine analyses; support
interviews and data collection)
60Jones Graduate
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Business
The Officer in Charge (OIC)
sees the Document one hour
before Final Presentation and
says “Oh, I see…”
61. Initial Interviews and Data Reception mark
the hands on part of the project
61Jones Graduate
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Business
• Initial interviews serve
to deepen team
understanding of the
situation and collect
initial data;
• Can be inside the
Client or with outside
sources
• Data reception is key
to launching the project
• Be sure to specify
form, time span and
disaggregation of data
to the greatest degree
possible to avoid pitfalls
later
• For Interviews,
prepare interview guide
and avoid leading
questions
62. Effective Interviewing (1)
1. Prepare
1. Know your interviewee
2. Obtain background Info and define info Gaps
3. Define your objectives and key ‘takeaways’
1. General: Market tendency and evolution
2. Specific: Market size, shares, competitive strategy of X
4. Arrange order of interviews
5. Design Interview Guide
1. If possible review with other team members
6. Confirm time, meeting place and assistees
1. Who else would be there
2. Dress code?
3. Consulting team should never overwhelm interviewees
from Jan Niemens and M&W Consulting, with additions by Lambda International
Consultants
62Jones Graduate
School of
Business
63. Effective Interviewing (2)
Conduct the Interview
Introduction
Yourself/team
Time allotment
Purpose and objectives
Confidentiality; validate if OK to take notes or record the interview
Divulge potential conflicts of interest
It is safer to ask for water than coffee, less fallout if spilled….
Open Dialogue
General issues first …then specific issues
Jot down follow up questions, don’t break flow
Frequently test for your understanding and summarize what was said
Balance open and closed questions… never leading questions
Balance building rapport with obtaining information; share your insights (if
you have any, keep your mouth shut if you don’t)
Good idea is to share your graphs and synopsis charts w/ interviewee
If your team size allows it, it is an excellent idea to name one person
exclusively to transcribe the interview and/or check on the recording device
from Jan Niemens and M&W Consulting, with additions by Lambda International Consultants 63Jones Graduate
School of
Business
64. Effective Interviewing (3)
The Closing
Cover new elements introduced into interview
Review main topics covered and conclusions
Leave opportunity for open comments : “anything you
think I should have asked you, but didn’t”
Last Five Minute Jewels: frequently interviewees will give
you an invaluable insight in the last minutes, even when
walking to the door… don’t miss these, ie: “Don’t forget
your client’s sales started to go down when they changed
the comp. plan….”
Leave door open for further conversation or telephone call
Thank and offer “anything we can do to help YOU, we are
at your service”
Make sure you take all materials with you
from Jan Niemens and M&W Consulting, with additions by Lambda International Consultants 64Jones Graduate
School of
Business
65. Precise questions for effective data collection
“Garbage In/Garbage Out” is valid for data requests and
subsequent collection
If the client or data provider is not clear what is wanted, if
there are ‘grey areas’ and room for doubt or interpretation
as to EXACTLY what data is required, and for what
purpose, data collection becomes a ‘hit or miss’ affair
It is CRITICAL to eliminate any doubt and uncertainty as
to what data is required and its conditions
It is an excellent idea to prepare a template to be filled in
with the data specifying all conditions to eliminate errors
Submit data requests in writing and include due dates on
delivery, if possible get a signed copy back
Be sure to have excellent communications with your data
providers and supervise the process before receiving the
final data
65Jones Graduate
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66. Data analysis and follow up interviews start
shedding light on the issues
66Jones Graduate
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Business
• When data starts to
arrive, it is important to
review it for quality
control prior to using it
• Validity
• Exactitude
• Timeliness
• Integrity
• Follow up interviews
serve to interpret the
data received, shed
light on additional
questions and explore
in depth areas that
appear critical
• Frequently, new
issues not considered
in the proposal appear
in the interviews and
these may/may not be
incorporated into
67. Diagnosis – key elements
67Jones Graduate
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Business
Consultants are called in
when internal staff cannot
generate binding
conclusions themselves
Due to lack of time or
experience
Due to internal conflicts of
interest, ie. deciding which
one of two product lines to
prioritize
Due to a need to have
external validation of
decisions for third parties,
ie. Boards of Directors,
external entities such as
Banks and Financial
Institutions. This is
frequently true for Capital
Projects where external
validation is requested prior
to launching large capital
expenses
Diagnosing problems is
therefore one of a consultants
key tasks
Consultants must be objective
and not be unduly influenced by
client’s internal opinions and
judgments as to cause-effect
Consultants must be willing to
break from ‘groupthink’ and
diagnose the problem
independently of a client’s pre-
set opinions
Tact must be used in order not to
offend client sensibilities
The function of frameworks is to
provide the consultant with a
structure with which to work
and analyze problems
independently of current
opinions
68. Diagnosis – key elements
68Jones Graduate
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Business
Consultants are
selling their
Credibility and their
Ethics – learn to
manage client
situations accordingly
At the beginning of a project
it is perfectly fine to say “I
swear I don’t know”
Do not rush into conclusions
prematurely that you have to
retract later
This destroys your Credibility
Credibility, like Virtue, are not
easily regained
You must be honest at all
time, but do not have to say
everything you are thinking if
you have not come to
closure on ideas and
hypotheses
At the end of a project if you
say you don’t know, it is
unlikely you will be rehired
69. The first Presentation or Worksession serves to validate initial
understanding or develop first ideas as to recommendations
69Jones Graduate
School of
Business
• Between 2 to 6 weeks
after Kick Off it is
proper to hold either a
Preliminary
Presentation where the
team presents initial
findings or hold a Work
session with the client
to review implications of
data analysis and
interviews and reach
joint conclusions
• This step should
validate the team’s
focus and set the stage
for work leading to the
Final Presentation
• See “Diagnosis” in
“Elements to Consider”
70. The Final Analyses should serve to clarify areas of doubt or ‘drill
down’ in more detail into previous findings – if the team is still
discovering issues, the project is in trouble!
70Jones Graduate
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Business
• After the Preliminary
Presentation, initial
hypotheses should be
either validated or
disproved and replaced
• The Final Analyses
serve to delve deeper
into issues and start to
provide the material for
the Final
Recommendations
• Generally, these
analyses are done with
the first draft of the
final document to
ensure that all analyses
are necessary
• If in Worksession
mode, then the outline
of the Worksession is
the guide
71. Concurrent with Final Analyses, the Team should be able to
develop Recommendations or different Alternatives based on the
emerging and validated conclusions of the work
71Jones Graduate
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Business
• Once some of the
Final Analyses are
completed, a good
consulting team can
start to create
recommendations or
alternatives for the
Client
• If the project is run in
Presentation Mode,
then the team must
detail its
recommendations and
consider implications
for implementation
• If being run in
Workshop mode, then
generally different
alternatives are drawn
up to be considered in
the Worksession
72. The “Stepping Stone Method” to Consensus
Good Consultants believe “Discretion is the greater part
of Valor”
Therefore, every effort must be made to reach
consensus prior to the final presentation
Surprises are not welcome at final presentations
Pre-final presentation meetings with key executives are vital to
brief them on the evolving recommendations and ensure
feedback and acceptance of recommendations
Typically, alignment is achieved by executive level – once
executives on one level are aligned, one by one or in
small groups, then the recommendations or analyses are
presented to the level further up
Presentations become forums for discussion and deeper
insights and avoid becoming divisive and destructive
72Jones Graduate
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73. Recommendations that are worth the cost
of the project …
73Jones Graduate
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Business
Clients do not
hire consultants
to tell them what
they already
know….
… they hire them
to tell them what
they don’t know
Recommendations must be:
‘Actionable’ – implementable
within a reasonable amount of
time and cost and with
accesible resources
‘Insightful’- add value to the
client above what he/she
already knows
‘Game changing’ – offer the
client the opportunity to
improve his/her way of doing
business in a way that will
more than justify the
engagement
A consultant’s
job is not
complete until
the
recommendation
s are ready
74. At the Final Presentation or Worksession, the Team presents its
Conclusions or Alternatives and there should be closure-
acceptance or modification of its proposals
74Jones Graduate
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Business
• It is not unusual for
recommendations to
be modified by the
Client in the Final
Presentation. In this
case an amended
Final Report is sent to
the Client post
presentation
• If it is a Worksession
and decisions are to be
made jointly therein,
then a Post
Worksession
document is delivered
to the Client
• It may be that a
skeleton staff stays
behind to develop the
Implementation Plan
75. If the job has been done, good conclusions
and recommendations sound inevitable
Recommendation Recommendation
Conclusion
Issue
Data Data
Issue
Data Data
Recommendation
75Jones Graduate
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Business
Hypothesis Hypothesis
Synthesis
Analysis
76. Your knowledge of the client and industry will evolve through
the project … so will your insights, patience and ability to add
value
76Jones Graduate
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Business
• Blissful ignorance
• Initial insights
• Some ideas jell,
others are discarded
… resist impatience
and pressure to jump
to conclusions
• At some moment you
reach the Eureka
point, where you
finally understand what
is happening
• From this you can
start to develop
alternative
recommendations
based on insight,
creativity and your
analyses
• Grunt work to put the
final document
together
• Congratulations on a
Start
Finish
77. Managing Live TV
– the Workshop/Worksession
Doing “unscripted” workshops and worksessions offers
the opportunity to make enormous advances in
understanding the issues facing a company and to
quickly build consensus around actions to be taken… but
it can be risky
Lack of consensus marked by strong diatribe and divisions
amongst client participants
Denial or disparagement of facts being presented
Passivity among subordinates unwilling to question superior’s
opinions in public
The consultant must weigh the cultural ambience and
current environment in a company prior to deciding that
Workshops are the correct methodology – sometimes
much preliminary preparation has to be done to allow
Workshops to reach agreement
Although the Consultant has more control in Presentation
based projects, Workshops are a formidable tool
77Jones Graduate
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78. Knowing your Client Style may avoid pitfalls
Lead Client Style Impact on Consulting Team
Gambler – risk seeker, avoids routines, goes for
big wins and breaks rules, intuitive
Need to show big wins and
improvements, but create structure
Warrior- alert to threats; tolerates conflict, seeks
position of power, gives orders
Show how recommendations
improve Warrior’s status; but
needs to build a team
Athlete – skill seeker, team player, wants
participative decisions, sacrifices self, hates waste
Provide capability creation model,
but integrate risk and leadership
Farmer – seeks incremental growth, conservative,
builds on common sense consensus
Show long term growth plan, may
be too slow for fast moving industry
Craftsman – seeks well made solutions, bothered
by poor fit, likes shared consensus
Be prepared to do detailed
recommendations and risk
management evaluations
Engineer- intolerant of waste, seeks systemic
optimization, rational numbers and spec. driven
Quant driven recommendations,
but need to incorporate intuition
Copyright, Communications Patterns Iinc, Stamford Conn.; Analysis
Lambda
78Jones Graduate
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Business
79. Dealing with “Clients who say ‘NO’ ”
Sometimes, after all the effort and perseverance and
fine analysis and brilliant recommendations,
The Client says ‘NO’
79Jones Graduate
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Business
Plan B: earnestly discuss and understand why “No”
Attempt to incorporate reasons for resistance
Try to develop a compromise solution
Consider whether there are other facts to incorporate
or other third party experts to consult whose opinions
could sway the client
Plan C: “Fall back” – ‘we could be wrong ‘ - buy time to
regroup, re-evaluate and to consult other advisors and experts
and return with a new position or alternative … have a ‘cooling
off’ period.
80. In order to improve Client Service it is customary to
email the Client a Project Evaluation Form afterwards
80Jones Graduate
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Business
• Client evaluation forms
measure both Project
Content and Deliverables
and Team adherence to
Professional Standards
• Was the Client satisfied
with results?
• Did the team fulfill
expectations and
Proposed deliverables?
• Did the team maintain a
professional manner
throughout the project?
• Was the team supportive
of Client activities during
the Project?
• Would the Client hire the
team again?
81. Concepts on Consulting
Part III
Support Material for the ALP Course
Jones Graduate School of Business, Rice University
82. Agenda for this presentation
82
Part I
Introduction
The presenter
Architecture and
Accounting
Why do companies
hire consultants?
Conceptual Framework
Consulting styles and
models
Hypothesis based
Consulting
Key Frameworks
Part II
The Consulting Process
Part III
Presenting your
Recommendations
Conclusions and closing
thoughts
Jones Graduate
School of
Business
84. Ballroom vs. Conference Room Style
Presentations
BALLROOM CONFERENCE ROOM
84
Graphic, attention
grabbing, colorful
Can incorporate Sound and
Video
Emotion generating, sales
documents
Generally only titles, no
headers or storyline
Needs interpretation by a
Presenter
Great for large groups and
not meant to be printed
Tend to be
monochromatic, white
background
Text and chart driven
Analytical, rational and
data focused; explain
decision processes
Headers and storyline is
clear; horizontal and
vertical logic is strictly
respected
Needs no interpretation
Generally apt to be
printed and is for smaller
groups
Jones Graduate
School of
Business
http://extremepresentation.typepad.com/blog/2008/01/ballroom-vs-con.html
85. Ballroom vs. Conference Room Style
Presentations
BALLROOM CONFERENCE ROOM
85Jones Graduate
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http://extremepresentation.typepad.com/blog/2008/01/ballroom-vs-con.html
86. Horizontal and Vertical Logic
A well prepared document should stand alone, without
needing explanation from a presenter or other person
Each page consists of a HEADER or HEADLINE at the
top of the page and the CONTENT or BODY, below
The Horizontal Logic demands that all the headlines can
be read together as a book or story and has a story line
that flows without interruption
If you copy all the Headers into Word, it should flow as a
document
The Vertical Logic demands that each Content support
the Headline above it on the page
Similarly, each ‘dash’ must support each bullet above it
If you don’t have three bullet points per page, consider
eliminating it
See Barbara Minto, The Pyramid Principle 86Jones Graduate
School of
Business
87. Horizontal and Vertical Logic
87Jones Graduate
School of
Business
TO THE NEXT PAGE
VERTICAL LOGIC:
CONTENT
SUPPORTS
HEADLINE
Loret Ipsum veritas
xxx ….yyyy….zzzz
• Make sure most
important bullet points
go first
• Graphs and charts
should be clearly
labeled and LEGIBLE
88. Horizontal and Vertical Logic
Some consulting firms require the use of “Pyramid
Principle” (by Barbara Minto) for deductive or
inductive thinking
Others are less rigid and simply demand that the
“story makes sense”
A common element is that the presentation and
bullet points are always arranged – whenever
possible – according to priority and impact
Most important points first
Less key points later
88Jones Graduate
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Business
89. Examples of “Horizontal Logic” taken from Headers in
a Presentation defining a Company Vision
89Jones Graduate
School of
Business
Telcos, Cablers and ISP’s dominate the Connectivity
Landscape while the Support Competitive Landscape is mostly
Mom and Pop’s – No one integrates Connectivity + Support
Among the Lords of Connectivity, AT&T, Verizon and Warner
have aggressive packages …
The convenience of plug-and-play connectivity, reliable support for a
convenient fee –as well as access to a myriad of value-added IP
services - define the Vision of XXXYY Net
90. Vertical Logic requires that Header and
Content be mutually supportive
90Jones Graduate
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Business
91. International health insurance policies are a small,
but profitable and rapidly growing, niche market
International health insurance is estimated to be a USD 6-8 Bn market with
a growth rate of 10 -15% per annum
Latin America may represent around 10% - 15% of the international market
growing at nearly 20%
The industry is focused on expatriates and high executives that devote a
significant amount of their time in international travel
There is a second market targeted at high income individuals that live in third
world countries, but want the ability to have first class insurance coverage
Commission structures can reach 50% of first year premiums and have
attractive incentive plans
Principal companies in this market are
Bupa: acquired IHI Danmark and Amedex forming IHI Amedex
BMI
Generali
Axa
Prudential
Others
(Source: AIVA International) 91
93. Story Boards / The Master Deck
As soon as possible, but definitely after the mid project
presentation, the team should start working on the Final
Story Board or Master Deck
This is the first cut of the finished document and each slide
should have the horizontal and vertical logic as clear as
possible and as detailed a description as possible of the
supporting charts, graphs or bullet points
From this point on, the team works with this final document as
a reference, completing , editing or deleting pages as the
project evolves
ONE copy – paper or electronic – should be labelled the
MASTER and one person responsible for it, or each part of it …
this may be different people for different chapters there should
never be TWO MASTERS (for the same material) as this can
cause much confusion
93Jones Graduate
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Business
94. Story Boards / The Master Deck
Decks will change as the project evolves
In the analytical phase, decks will revolve around the
different issues: costs, competition, organization, market,
processes…
In the synthetic/recommendation phase, they will turn
around 90 degrees and revolve around recommendations
linking material from different issues and parts of the
analytical document to create a document that supports
the recommendations and implementation
94Jones Graduate
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Business
95. Typical Agenda Pages comparing two
presentations
Analytical Phase Synthetic Phase
95
Our understanding of
the situation
Critical Issues
Market and Industry
Evolution
Competitor Profiles and
Positioning
Our Capabilities
Corporate Governance
Initial Conclusions
Introduction
Definition of Company
Priorities
Becoming More
Competitive
A New Career Plan
Conclusions and Next
Steps
Jones Graduate
School of
Business
96. Example of Evolution of a Document
XXXYY Net
96Jones Graduate
School of
Business
Initial Presentation Agenda Final Presentation Agenda
New to Final Presentation
• Development of Products & Visions
• Client Segmentation and Market Attractiveness
• Key Process and Organization Plans
• Developed Business Plan
• Long term Vision and Exit Strategy
New
Products
that drive
the rest of
the
Presentatio
n
97. One chart is worth a thousand bullet points
97Jones Graduate
School of
Business
Manufacturers have
different alternatives
in reaching their
clients. Some can
sell directly to
Clients, for example,
Dell. Others sell to
and through a Retail
outlet. Many others
go through a network
of Distributors and
Wholesalers before
reaching the Retailer
and ultimately, the
Client. The structure
depends on the
product and the
“Cost to serve”
98. This "figurative map" by Charles Joseph Minard shows
information about the advance of Napoleon's army into Russia
and its retreat; it is considered a masterpiece of presentation
98Jones Graduate
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Business
https://qed.princeton.edu/index.php/User:Student/Minard_carte_figurative
99. Some tips on using Excel Graphs
Chart type Functionality
Column or Bar Compare magnitude of different elements, sales, units, etc.
Time series to track evolution of data
Line Time series
Scatter gram Relationship between two variables, ie. correlation,
regression analysis
Pie Charts Snapshot of composition and market shares
Area Mix of line and pie chart; can show composition over time
or in two axes
Can be in 100% terms or unit terms
Bubble charts Similar to scatter grams, but with a third value in size
Surface Similar to area, but with third value in height
Hi Lo Close Evolution of prices (or other values ) over time
Polar
Coordinates
Comparing different subjects across multiple rating criteria
or one subject across multiple criteria over time
99Jones Graduate
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Business
100. Some resources for improving your
graphical capabilities
Say It With Charts, Gene Zelazny
Information Graphics, Robert Harris
The Visual Display of Quantitative Information,
Edward R. Tufte
some websites
http://extremepresentation.typepad.com/blog/2006/09/sim
plicity_of_d.html
http://paulecoyote.com/2009/09/02/book-the-visual-
display-of-quantitative-information-edward-r-tufte/
100Jones Graduate
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