MANAGEMENT CONSULTING

 Session 1: Overview of Management Consulting Profession

 Session 2: Consulting Process – Discovery, Diagnosis, and Dialogue
 Session 3: Consulting Process – Analysis and Decision – making
 Session 4: Consulting Process – Engagement, Implementation and
Evaluation
 Session 5: Change Management
 Session 6: Creating Value
 Session 7: Final Project Presentation
Session 1
 Overview of Management Consulting Profession

Syllabus
 Course Review, purpose, and structure

 Consulting profession, considerations, and expectations

 Consulting process for entry and contracting

 Types of projects, proposal development and contracting

Cases and Readings

 FC, Ch. 2-5; www.flawlessconsulting.com; Checklist 1

 MC, Ch. 1

 Consulting assessment & case exercise

NATURE OF MANAGEMENT
CONSULTING
 Management consulting (MC) is the provision of
independent advice + assistance about the process of
management to clients with management responsibilities
(Council of Management Consulting Institute)
 MC means transferring to clients knowledge required for
managing + operating businesses + other organisations
 MC provide added value by transferring knowledge
(technical dimension or human dimension)
 Consulting is an advisory service  consultants do not
run the business nor take decisions on behalf of the
managers. They have no authority to decide on/
implement the changes
 Responsibility of consultants is for the quality + integrity
of the advice
 Independence means that a consultant must be in a
position of make an unbiased assessment of any
situation, + recommend frankly + objectively.
WHY CONSULTANTS ARE USED?
 Help achieve organisation purposes + objectives
 Help solve business + operational problems

 Help identify + seize opportunities

 Help enhance learning

 Help implement changes

HOW ARE CONSULTANTS USED?
 Providing information: on markets, customers, sector trends, raw
materials, suppliers, competitors, potential partners, government
policies/regulations, sources of engineering expertise
 Providing specialist resources: when the client looks for short-term
expertise
 Establishing business contacts + linkages
 Providing experts opinions: eg. tax consulting

 Doing diagnostic works

 Developing action proposals: eg. bidding

 Developing systems + methods: eg. QC systems + methods

 Planning + managing organisational changes: eg. new

products/process
 Training + developing management + staff
 Counselling + coaching : new accounting policies
OVERVIEW OF THE CONSULTING PROFESSION
 A professional consultant gives expert advice to businesses +
organizations.
 The U.S. Bureau of Labor Statistics expects the profession to grow by
83% b/w 2008 - 2018, much faster than the average growth for all jobs.
 With a median salary > $75,000, consultants make well above the
average pay of other workers.
 Consultants work with all types of organizations + industry sectors,
including technology, marketing + non-profits.
 Consultants may work as independent contractors + often work for
several different clients.
 Professional consulting firms may hire consultants with a master's
degree + several years of field experience
WHY SUCH DEVELOPMENT OF
CONSULTING PROFESSION?
 The globalisation process provides opportunities for
foreign trade + foreign investment  demand for
consulting about new markets’ regulations,
customers’ demand
 Competition increases  increased demand for
 internal/external consulting to improve weaknesses or
deficiencies so as to enhance competitiveness
 consulting about market trends, opportunities, dangers, etc.
PERFORMANCE MEASURES
External Internal

 Global and local sales  Budget & Cost

(revenue and profits)  Time to market
 Customer use and  Positioning and
satisfaction differentiation
 Product quality and  Quality of product or
performance service offering

Internal Pressures: Time to market, competing priorities &

responsibilities, achieving cost and revenue objectives in a
timely manner, product/service differentiation, and sales results.
GLOBAL MARKET OPPORTUNITIES…
 Developed countries
 Mature markets
 United States, Canada, Japan, EU; Britain, Germany,
France, Italy…

 Developing countries
 Emerging markets
 Brazil, Russia, India, China (BRIC) Colombia,
Indonesia, Vietnam, Egypt, Turkey, and South Africa
(CIVETS)

 Least developed countries (LDCs)

 Bangladesh, Ethiopia, Afghanistan, Cambodia
QUESTIONS?
 What are local market opportunities in your country
that you may consult a foreign investor?
 Consulting that a US investor/company needs when
making a decision to invest in Vietnam?
 Consulting that a Vietnamese company needs when
making a decision to export to US?
 In a number of countries, management consultants have
established voluntary professional associations to represent their
common interest + help solve their problems
 E.g. IMCA – Institute of Management Consultants, (Australia),
CAMC - Canadian Association of Management Consultants;
SYNTEC (France); BDU (Germany); APCO (Italy); ZEN-NOH-
REN (Japan); VTMSZ (Hungary); IMC or MCA (UK); Institute
of Management Consultants of Singapore/Malaysia; AMCF (US);
FEACO (Europe)
 These associations play a leading role in (i) promoting
professional standards of consulting + (ii) gaining the confidence
of management circles and a good reputation in society
ROLE OF CONSULTANTS
 Consultant: person who has influence over an
individual, group, or organization but has no direct
power to make changes or implement programs.
 Most people in staff/support roles in organisations are
consultants, officially or in-officially  internal
consulting
 Support people function/operate in any organisation by
recommending, assisting or advising on such matters as:
 human resource - product design,
 financial analysis, - safety,
 auditing, - organisational effectiveness
 system analysis,
 Goal of consultants: to affect change in line organization…
 createchange of a structural, policy, or procedural nature.
 Transfer new knowledge + provide learning opportunities for
people in group or organization
 The recipients of all the advice are clients. The client can be
a single individual, a work group, a department or a whole
organisation
 In organisations, clients for the services provided by support
people are line managers. Line managers have to labour
under the advice of support groups, whether they like or not
 OVERVIEW OF CONSULTING
SKILLS

Technical Skills Interpersonal Skills Consulting Skills

• Function, Discipline, and • Communication • Contracting
Industry • Negotiation • Negotiation, motivation, control +
• Engineering • Relationship-building power,
• Project Management • Team management • Discovery
• Planning • Assertiveness • Levels of analysis, data access,
• Marketing • Support +Empathy political climate, interview vs.
• Manufacturing intervention
• Finance • Feedback
• HRM • Synthesizing + presenting data,
• Organizational dealing with resistance
Development • Decision
• Systems Analysis • Running meetings, focusing on
relevant choices, professional vs.
personal
CRITICAL CONSULTING
SKILLS
Hard Skills Soft Skills

 Technical knowledge  Excellent communication +

and application presentation skills
 MS Excel  Problem-solving + creative
 MS PowerPoint
thinking
 Interpersonal; client
 Functional knowledge communication + relationship-
 Industry and discipline building
 Consulting models  Team leadership +
 Porter,BCG, Strategy management
wheel, financial models  High work ethics + standards
 Case methodologies
AUDITING VS. CONSULTING
 Auditor: person who evaluates an individual,
group, or organization through examination of
data, statements and records.
 Goal: to assess validity + reliability of
information + system’s internal control…
 Collects+ evaluates evidence and formulates a
judgment about the business.
 Expresses an opinion of person, organization, or
system.
 More control + recognition for client projects.
 Easier access to internal information and people.
 Consulting by (internal/external) auditors about:
 Internal control
 to prevent fraud + errors,
 to comply with regulations + rules,

 to achieve efficiency + effectiveness

 Accounting: accounting systems, accounting methods,

accounting process, etc.
 Finance
 Value-chain (R&D, designing, purchasing, manufacturing,
marketing activities)
 Risk management : risk identification, assessment +
responses
 Strategy
 Finance consulting: consulting on capital structure, assets
structure, pricing (including transfer pricing)
 Management + strategy consulting: consulting on new
strategies should be adopted, on existing strategies should be
ceased/amended, on planning, on performance evaluation and
compensation to staff
 Operation consulting: consulting on weaknesses/ inefficiencies
in operations and ways to improve, new operations to conduct
 HR consulting: consulting on recruitment, training, evaluation,
compensation,
PRACTICE AREAS
Practice Areas Top 3 Firms

Financial 1. McKinsey & Co.

Consulting 2. Ernst & Young
3. Deloitte Consulting

Management + 1. McKinsey & Co.

Strategy 2. Bain & Co.
Consulting 3. The Boston Consulting
Group

Operations 1. Accenture
Consulting 2. Deloitte Consulting
3. McKinsey & Co.

HR Consulting 1. Mercer LLC

2. Towers Watson
3. Aon Hewitt

Sources: consultingfact.com , Vault annual survey with

consultants from prestigious firms, 2013.
 BEST ACCOUNTING FIRMS FOR
WORK

Top 4 Audit Firms 2012

1. PwC, UK
– 180,000 employees
2. Ernst & Young, UK
– 167,000 employees
3. Deloitte, US
– 193,000 employees
4. KPMG, Netherlands
– 152,000 employees
BEST CONSULTING FIRMS FOR
WORK
Top Firms 2014
1. McKinsey & Co.

2. Bain & Co.

3. The Boston Consulting Group

Inc.
4. Booz & Co.

5. PricewaterhouseCoopers

6. Oliver Wyman

7. Deloitte Consulting

8. Parthenon Group

9. A.T. Kearney

10. Accenture
Sources: consultingfact.com , Vault annual survey with
consultants from prestigious firms, 2013.
TOP CONSULTING AND ACCOUNTING FIRMS
IN VIETNAM
 McKinsey
 Deloitte Consulting
 Ernst & Young
 PwC
 KPMG Consulting
 Towers Watson
 Grant Thornton
 Aon Hewitt Consulting
 SAP Consulting
Sources: www.consultingcase101.com, 2010-11; www.mckinsey.com, .
GLOBAL MANAGEMENT VS.
BOUTIQUE CONSULTING
Big Consulting Firm Boutique Consulting Firm

Recognizable, reputable  Highly specialized and/or small

brand consulting firm
Global network of peers +  Local awareness + reputation
clients  More client interactions with
Wider exposure to industries higher responsibilities
+ functions  Focused practices + industries for
Longer career ladder, specialization opportunities
hierarchical with narrow  Faster advancement
responsibilities.  Less resources, smaller network of
peers + clients, less brand
http://managementconsulted.com/con awareness
sulting-firm-profiles/recruiting-decisi
ons-what-is-the-difference-between-g
lobal-management-consulting-firms-a
MANAGEMENT IN A CONSULTING FIRM
 Strategic management: strategies based on opportunities + the
firm’s strengths + weaknesses
 Managing marketing of consulting services

 Cost + fee management: to earn profit

 Assignment management: assignments are different from each

other  need to be managed appropriately
 Quality management: to sustain, compete + develop

 Operational + financial control

 Knowledge management: knowledge is the main assets 

should be developed, protected and used efficiently (eg.
knowledge should remain in the consulting firm even after
consultants leave the firm)
CONSULTANT ROLES
Expert Role Pair-of-Hands Role Collaborative Role

• Client/manager • Client/manager has • Consultant +

plays inactive role full control. manager work to
• Consultant • Manager be interdependent
responsible for responsible for • Bi-lateral decision-
methods, decisions methods, decisions, making.
+ results + results. • Data collection +
• Solve immediate • Apply specialized analysis joint
problem knowledge to efforts.
• Issues: Limited achieve client • Open
communication, goals. communication +
assessment, + • Issues: Overly collaboration.
actions. reliant on client • Goal to solve
ability for analysis problems so stay
+ action. solved.
CHARACTERISTICS OF CONSULTANTS
 “Dilemma analysis” ability: b/c the organisation may well be facing
situations that appear insoluble. Consultants must recognize the
dilemma, discover the nature + real causediagnostic skills needed
 Sense of organisational climate: consultants should recognize +
understand the dynamics of the internal power + political
relationships to pursuit whatever change objectives of the client 
implementation skills needed
 Integrity: consultant should be sincerely interested in helping the
client  patient + strong tolerance for ambiguity is important
(curing a client’s ills is a long + difficult process)
 Sense of timing and interpersonal skills: the best plans for change
may be destroyed if introduced at the wrong time. Interpersonal
skills b/c consulting involves dealing with people rather than with
machines/mathematical formulas
INTERNAL VS. EXTERNAL
Internal Consultant External Consultant

 Embedded in the  Act as independent consultant,

organization. outside of organization.
 Answer to superior +  Answer to client + project
deliver on objectives. objectives.
 Known status within the  Hold an advisory and/or
organization. implementation role.
 May compromise neutral  May have challenge to gain
stance and access to confidence + access to
contacts. stakeholders.
 Operate by mandate not a  Operate by choice.
choice.
WHAT KIND OF CONSULTANT WOULD
YOU LIKE TO BECOME?

 Practice areas (finance/HR/distribution/Internal

control/IT/TQM/environment) ?
 Internal or external?
 Big firm or boutique firm?
 Entry level vs. experience?
CONSULTANT’S GOALS
Establish a Collaborative Relationship
• Build trust and confidence
• Engage client stakeholders in process
• Ensure maximum use of people’s resources

Solve Problems So They Stay Solved

• Problem-solving versus delivering solutions
• Empower client to learn solving process

Ensure Attention is Given to Both Technical/Business

Problem and the Relationships
• Focus on people + process issues for increased
productivity
• Make link between technical/business problem + people
interactions
 PROFESSIONALISM + ETHICS
 Professions: MC is an emerging profession.
 A profession is characterized by 5 features:
 Knowledge + skills: a defined body of knowledge + skills proper to the
profession,
 Concept of service + social interest: professionals serve clients’ needs +
interests, to which they subordinate their own self-interests
 Ethical norms: shared + applied by professionals. Ethical norms define
what is proper + improper behavior in providing a professional service
 Community sanction + enforcement: the community in which the
profession operates + the clientele recognize the social role, status, + the
ethical +behavior norms of the profession
 Self-discipline + self-regulation: members of the profession apply self-
discipline in observing the profession’s behaviour norms. The organization
exercises self-regulation over application of the code of professional
conduct + over development of the profession.
 Ethics:
 (1) Technical competence: consultants must posses knowledge +
skills needed by a client. The consultant must assess critically his/her
knowledge + skills when considering a new assignment
Consulting associations develop a common body of knowledge (CBOK)
of professional consultants + the type and minimum duration of
experience for association membership
 (2) Avoiding conflict of interest: during an assignment, the
consultant’s competence + time are made available to the client, with
the objective of achieving the best possible results in the client’s
interest
In agreeing to serve a client, the consultant must ensure that his/her
interest does not conflict with the client’s interest. If there is a danger,
eg. due to investment, the consultant must disclose to the client.
 (3) Impartiality and objectivity: the consultant should be free of
biases, prejudices, preconceived ideas, prefabricated and prepackaged
solutions
 (4) Confidentiality: the consultant should accept neither to disclose
any confidential information of the client, nor the use this information
to obtain benefits personally or for any other
 (5) Commissions: the client should be informed of
commission/similar favours received, paid or promised by the
consultant in connection with the assignment
 (6) Value for money: consultants should charge normal + reasonable
fees, judged by the profession’s current standards + prevailing
practice
If the consultant feels that the benefit of the assignment does not justify
its costs, the consultant should warn the client before starting the job
LEGAL LIABILITY
 Management consultants are liable when their
malpractice resulting in their advices or
recommendations causing pecuniary damage/loss to their
client
 The malpractice can be in the form of non-
professionalism, negligence or fraud
 An honest error of professional judgment should not
entail the legal liability of consultants
PROFESSIONAL RESPONSIBILITY
 A set of voluntarily adopted + self-imposed values, norms +
constraints, reflecting the professional’s perception of their
role in society + their responsibility towards the client
 the relationship b/w legal liability + professional responsibility
is a relationship b/w law + ethics
 A strong sense of professional responsibility is the best
safeguard against legal liability
 In most instances, legal liability is due to breaches of
professional responsibility.
Eg. inadequate research + fact findings, appointment of
incompetent staff, hasty + superficial judgments, failure to
inform the client of risk + issues that should be considered
QUALITY MANAGEMENT
 aims at the best possible satisfaction of the clients’ needs +
satisfactions
 in consulting means self-assessment, self-control and self-
improvement
 is a system of written/unwritten standards, policies, guidelines,
controls, records, safeguards, incentives, sanctions, + other
tools + measures by which quality is assessed, maintained +
improved
 may be requested by large clients, especially in the public
sector. Eg. management consultants should hold ISO 9001
certification of quality
QUALITY MANAGEMENT (CONT.)
 must address both
 the technical side of consulting (the knowledge base, the
practical knowhow, the choice of correct data and procedures,
the analysis of all facts, the assessment of important
alternatives, …) +
 the human and behaviour side (caring for the client, listening
to their concerns, dispelling their worries, respecting their
priorities, being helpful beyond the scope of the contract…)
4 basic principles in assigning responsibilities for quality:
 (1) responsibilities must be clear + clearly stated: everybody
knows who is responsible for what
 (2) top management must be visibly involved: to give
creditability + clout to the importance of quality
 (3) continuity/succession needs to be assured: deal with
inevitable problems from absences on assignments, changes
in assignment staff, ….
 (4) quality assurance must be applied consistently: to all
works at all times
FIVE PHASES OF CONSULTING

Phase 5
Phase 4
Phase 1 Phase 3 Extension,
Phase 2 Engageme
Entry + Analysis + Recycle,
Discovery nt +
Contractin Decision or
+ Dialogue Implement
g to Act Terminatio
ation
n
Step 1: Entry and Contracting:
 First contacts with clients

 Preliminary problem diagnosis

 Assignment planning

 Assignment proposals to clients

 Consulting contract
CONSULTING PHASE REQUIREMENTS:
CONTRACTING

1. Negotiate demands
2. Cope with mixed motivation.
3. Surface concerns about exposure and loss of control.
4. Understand triangular and rectangular contracts
1. Triangular contract: consultant has to serve both the
needs of the client but also their own management
when implementing priorities
2. Rectangular contract: is began with a general
understanding b/w consultant’s boss + client’s boss
 consultant works with the client in situation that
neither of them has chosen consultation
Step 2: Discovery and Dialogue:
 Purpose analysis

 Problem analysis

 Fact finding

 Fact analysis and synthesis

 Feedback to client
CONSULTING PHASE REQUIREMENTS:
DISCOVERY & INQUIRY
1. Layers of inquiry.
2. Political climate.
3. Resistance to sharing information.
4. The interview as a joint learning event.
Step 3: Analysis and Decision to act:
 Developing solutions

 Evaluating alternatives

 Proposals to client

 Planning for implementation

CONSULTING PHASE REQUIREMENTS
FEEDBACK & DECISION TO ACT
1. Funneling/ synthesizing data
2. Presenting personal and organizational data.
3. Managing the meeting for action.
4. Focusing on the present feedback.
5. Don’t take it personally
Step 4: Implementation:
 Assisting with implementation

 Adjusting proposals

 Training
CONSULTING PHASE REQUIREMENTS
ENGAGEMENT + IMPLEMENTATION
1. Bet on engagement over mandate and
persuasion.
2. Design more participation than
presentation.
3. Address difficult issues early.
4. Involve people early for change efforts.
5. Change the conversation to change the
culture.
6. Pay attention to place and space.
Step 5: Termination
 Evaluation

 Final report

 Settling commitments

 Plans for follow-up

 Withdrawal
YOUR CONSULTING MISSION
 PwC Strategy Consulting
 http://www.youtube.com/watch?v=YkWdkvhUDH
 Mastering Case Methodology
 http://youtu.be/2uzMOcUVLX4
 Bain & Co. Case Challenge
 http://www.joinbain.com/apply-to-bain/interview-preparatio
n/
FLAWLESS CONSULTING

 Authenticity
 Results
 Accountability