ESCP - Consultant behaviour Session 1 2021 - The Consulting industry, actors and hot topics

Spring 2021
1
Consulting
Behaviour
Dr. Benjamin Lehiany
& Stéphane Lesage
Session 1:
Course introduction &
the consulting industry

2
INTRODUCTION TO CONSULTING BEHAVIOUR
Academic year 2019/2020

COURSE CONTENT
3
Learning objectives
Learning outcomes
• Providing, through a transversal approach which
includes the different aspects of the Consulting
work, a deep knowledge of the Consulting
practice.
• Operational and behavioral aspects linked to
the Consulting practice. It will also include
“hard” aspects related to the methods and
tools used by Consultants.
• Knowing the Consulting sector with the historical context and an overview of the current
state of the sector.
• Acquiring the methods and tools used by Consulting firms such as presentation skills and the
knowledge of models to make a diagnosis.
• Understanding the Consultant profession, including behavioral aspects (posture, ethics, time
management).

1. The consulting industry,
actors & hot topics
2. Consulting jobs &
careers
4
3. The mission lifecycle &
consultant toolbox
4. The commercial
proposal
5. The Consultant posture,
ethics & time management
COURSE STRUCTURE & CONTENT

THE CONSULTING INDUSTRY & ACTORS
DEFINITION
5
What is consulting ?
5

6
“An advisory service contracted for and provided to organizations by
specially trained and qualified persons who assist, in an objective and
independent manner, the client organization to identify management
problems, recommend solutions to these problems, and help, when
requested, in the implementation of solutions.”
(Greiner and Mettzger, 1983, Consulting to Management)
DEFINITION
6

7
Consulting follows (or causes?)
business cycles
• 1886: AD Little – engineering & science
• 1890: Taylor – organization/management
• 1908: Harvard Business School – training
• 1913/14: Arthur Andersen
• 1926: James O. McKinsey
• 1929: The Great Depression
• 1937: A. "Tom" Kearney leaves McKinsey
• 1946: Price Waterhouse – creation of the
consulting department
• 1950’s: mass marketing
• 1963: BCG – “pure” strategy
• 1973: William W. Bain Jr. leaves BCG
• 1978: Harvard Business School MBA
1979: Chrysler is « saved » par Booz
• 1980: Michael Porter’s models
• 1996: Bossard is acquired by Cap
Gemini – IT management is born.
• 2000: Internet bubble explosion
• 2001: Accenture (ex. Andersen)
2002: Enron…
And what about the 2 last decades….
HISTORY
7

• Andersen Consulting cut all ties with Andersen (to become Accenture, from 2001) and Andersen Business
Consulting is now BearingPoint;
• Ernst & Young Consulting sold to Cap Gemini;
• PricewaterhouseCoopers Consulting joined IBM;
• Deloitte Consulting was acquired, under the name Ineum Consulting, by the MCG group and renamed Kurt
Salmon, for finally join Solucom and become Wavestone.
8
RESTRUCTURING FOLLOWING ENRON CRISIS FROM 2002
8
+

9
McKinsey : the CEO factory
• A few years ago more than 70 past and present CEOs of fortune
500 companies were McKinsey alumni.
• In 2011 more than 150 McKinsey alumni were running companies
with more than $1 billion in annual sales
• A 2008 study by USA today calculated that the odds of McKinsey
consultant becoming CEO of public company were the best in the
world, with 1 out of 690.
HISTORY
9
Source: https://observer.com/2013/09/the-ceo-factory-ex-mckinsey-consultants-get-hired-to-run-the-biggest-companies/#ixzz2maRUWow6

DEFINITION
CONSULTING IS THE ACT OF GIVING PROFESSIONAL ADVICE
WHAT KIND OF ADVICE WE ARE TALKING ABOUT?
10
10

DO WE (REALLY) NEED CONSULTANTS?
11
COMPANY
CONSULTING SERVICE REQUEST
Adjust value chain
Optimize performance
REGULATORS
COMPETITORS SUPPLIERS
SHAREHOLDERS
CUSTOMERS
STRATEGY ORGANISATION MANAGEMENT TECHNOLOGY
HR, R&D, ETC
Internal & external pressure on the company
Comply to regulation
Reach market expectation Align with standards
11

TYPES OF CONSULTING
12
STRATEGY
• What market segment to be targeted?
• Which scope to expend to?
• Which company to acquire?
ORGANISATION, MANAGEMENT, HR
• How to make this product / service more profitable?
• How to expand on this market?
• How to cope with increasing expenses?
• how to assert a corporate culture?
TECHNOLOGY
• Which technology to support our growth?
• How to integrate new techno in existing systems?
• How to conduct efficient implementation?
STRATEGY
CORPORATE
DEVELOPMENT
INNOVATION
PRODUCT
DEVELOPMENT
PEOPLE &
ORGANISATIONS
CORPORATE
FINANCE
DUE DILIGENCE
DIGITALISATION BIG DATA
OPERATION
SUSTAINABILITY
CHANGE
MANAGEMENT
GROWTH
M&A
TRANSFORMATION
ANALYTICS … what next
12

13
13
DO WE (REALLY) NEED
CONSULTANTS?

WHY CLIENTS PAY SO HIGH FOR STRATEGY CONSULTANT SERVICES?
1. To benefit from specialist knowledge and experience that may not be
available within the organization
2. To gain an objective and independent opinion on a situation or
challenge; it is sometimes the case that the management team within
an organization is too close to the problem and a fresh pair of eyes can
be of benefit
3. Extra resource: external management consultant resource can provide a
flexible, high caliber solution to enable a project to be planned and
executed whilst avoiding the need to recruit permanent staff
14

THE MANAGEMENT CONSULTING MARKET WORLDWIDE: FACTS AND FIGURES
15
https://www.consultancy.uk/consulting-industry/management-consulting 15

THE MANAGEMENT CONSULTING MARKET WORLDWIDE: FACTS AND FIGURES
16
https://www.consultancy.uk/consulting-industry/management-consulting 16

CONSULTING MARKET IN FRANCE
”Winter is coming” for the French consulting market…?
17
SALES REVENUE IN 2019
7,3 BNS €
SECTOR
GROWTH
RATE
2020 Post COVID Forecast
CONSULTING FIRMS LOCATION
IN FRANCE - 11 %
A double-digit growth over the
last 6 years : +12 % in 2019
In 2020/21 consulting firms will recruit less (10 to 20% to
do so when usually they are 80 to 90%)
Staffing forecast : -2%
Source :
Consult’in France & Xerfi
A MARKET THAT DID NOT KNOW THE CRISIS WITH 48% GROWTH PAST SIX YEARS … until now
IN 2019
STAFFING INCREASE : +8%
TOTAL WORKFORCE : 50 000
HIRING : 14 000 inc. 55% YOUNG GRADUATES
17

STRATEGY
21%
ORGA, CHANGE
MANAGEMENT & HR
17%
DIGITAL & IT
39%
OPERATIONAL
PERFORMANCE
12%
CSR
2%
OTHER
9%
A TRADITIONALLY HEALTHY MARKET BOOSTED BY DIGITAL
Source : Global Research
18
CONSULTING MARKET
TURNOVER IN FRANCE
PER ACTIVITY
39% (vs. 30% in 2017)
MAIN TOPICS :
▪ CYBER SECURITY,
▪ GDPR,
▪ INNOVATION ALONG THE
CUSTOMER JOURNEY & e-
BUSINESS,
▪ PUBLIC ADMINISTRATION
MODERNIZATION,
▪ …
DIGITAL
TRANSFORMATION WILL
CONTINUE TO GROW STRONGLY
IN THE COMING YEARS
ACTIVITY SHARE

SECTORIAL CONTINUOUS REDISTRIBUTION
Source
Syntec Conseil
19
SPLIT OF
CONSULTING
ACTIVITY PER
CUSTOMER
MARKET
FINANCIAL SERVICES
> Investment banking, Retail banking
> Insurance
> Hedge funds
INDUSTRY
> Agri-food sector
> Transport (automotive, railway, airline)
> Pharmaceutical
PUBLIC SECTOR
> Public institution
> Government organization
OTHER
> Energy Oil & Gas / Electricity
> Environment
> Telecom
RETAIL
> Distribution
> Logistic
> Tourism
31%
10%
25%
23%
9%
STRONGEST GROWTH
+10,2% BOOSTED BY
CYBERSECURITY & GENERAL DATA
PROTECTION REGULATION (GDPR)
Note : Digital Dept. consume as much as Financial Dept. (13% of
market), while they were out from statistics three years ago.
STILL STRONG GROWTH
+7,9 % REVENUE IN 2018
19

FRAGMENTED MARKET WITH WELL-ESTABLISHED BRANDS & NEW PLAYERS
TOP TIER CONSULTING FIRMS SPECIALIZED IN
STRATEGY (MBB + others)
Elitism – Independence - Positioning at Top Management
IT CONSULTING FIRMS
Technology, IT, BPO services and consulting
PURE PLAYERS GENERALISTS
Wide range of services - Positioning at Middle Management
AUDIT FIRMS WITH CONSULTING BUSINESS UNITS
(BIG 4)
Finance and Risk
INDEPENDANT AND SPECIALIZED
CONSULTING FIRMS
New players with hybrid strategy specialized in CSR,
innovation, HR, ,…
20

STRATEGIC GROUPS: INCOME PER CONSULTANT / SIZE
Positioning of management consulting firms in france
(turnover per consultant / size)
21
• Source : Consultor
> 500 €/D.
> 2.500 €/D.
> 1.300 €/D.
21

CONSULTANT BEHAVIOR
Hot topics in consulting
Hot topic #1
Blurring boundaries
22

BLURRING BOUNDARIES AND INCREASED COMPETITION
BIG FOUR STRONG COMEBACK
> Famous or renowned brand (Deloitte, PwC,
EY, KPMG)
> High investment capacity
> Purchase on the strategic segment (Deloitte
= Monitor / PwC = Booz + Strategy & / EY =
Parthenon Group )
INTERNAL CONSULTING GROUPS
> Creation of internal consulting agencies as
Renault Consulting, Orange Consulting, Vinci
Consulting, BNP Consulting…
> With ability to offer sectorial expertise
YOUNG CONSULTING AGENCIES
BREAKTHROUGH
> Low and flexible structural costs
> Adaptive agencies with significant growth
rates (ex: Weave, Colombus, SIA Partner,
Onepoint…)
> Agility to meet specific clients needs
IT CONSULTING FIRMS DEVELOPMENT
> IT Consulting firms benefit from technology
competencies to develop their activities and
provide larger scope of offer including digital
strategy (ex: IBM, CGI, Sopra, Atos, Wavestone…)
> New entrants from pure tech sectors providing IT
services (Amazon WS, google cloud, Microsoft,
Oracle).
The most resilient models in period of crisis are:
i. on the one hand, very large firms that have strong brand and investment capacity
ii. and on the other side, small cabinets with flexible cost structure
23

CONSULTANT BEHAVIOR
Hot topic #2
New busines
models
24

CONSULTING MARKET
THE NEW BUSINESS MODELS
SOURCE : XERFI 2018
• HR: diversified profiles
(data scientists, developers,
designers…).
• Culture: digital native /
Style: agile / startup
• Brand: innovative
• Business model: diversified
(consulting, incubation,
trainings, investment, digital
solutions…)
• Ex: Fabernovel, The Family,
Onepoint.
• HR: outsourced to
independents / students.
• KSF: data base of
clients/consultants,
matching algorithm,
fundraising.
• Style: network
• Business model:
commission on one or both
sides of the platform.
• Ex: Comatch, La crème de la
crème, OkayDoc...
• HR: blended human/AI.
• Culture: data
• Style: tech
• KSF: tech competences,
client base (SMEs),
fundraising.
• Brand: innovative
• Business model: automated
BI (subscription fee) +
advisory (per diem)
• Ex: IBM, AWS, Quantmetry,
BI Consulting…
Hybrid models Platform models AI models

CONSULTANT BEHAVIOR
Hot topic #3
Clients’ bargaining
power
26

CONSULTING MARKET TREND
Prices in consulting have increased 3 times slower than inflation in the last ten
years, mainly due to new customer’s behaviors Source : Precepta
! CLIENTS HAVE BECOME INCREASINGLY MORE
DEMANDING
> Aware of consulting firms’ methods
> Know what they can expect
> Accurate about their need
> Expect direct added value: standardized solutions are no longer
granted
! CONSULTING IS MORE & MORE SUBJECTED TO
PURCHASING PROCEDURES
> Consulting services are bought by Purchasing Department
according to specific requirements and through tendering
procedures
> With a continuous pressure on prices

CONSULTING MARKET TREND
THE INCUMBENTS’ RESPONSE
To face the challenge of transformation,
consulting firms will continue to adapt their
economic model and offers
BUSINESS MODEL TRANSFORMATION
> New strategic positioning towards to more specialization
> Pricing adaptation
> Enhancement of the commercial and operational performance
NEW HIRING PROFILES
> Graduated in strategic consulting
> Mathematical post-degree training (Harvard business review has
identified Data scientist “The Sexiest Job of the 21st Century”)
> Digital specialists
MARKET CONSOLIDATION
> Emergence of very large groups able to provide a large spectrum
of services from the most operational to the best strategic
DIGITAL TRANSFORMATION
> The digital revolution (cloud computing, big data, three-
dimensional printing…) may induce major impacts with :
− Emergence of new economic models
− Business transformation with new challenges and
opportunities
− New goods & services shifting to a digital knowledge-based
economy
− Traditional management businesses challenged
WITH A MARKET ABOUT 1.000 M€ IN
2025, DIGITAL IS EXPECTED TO BE THE
MAIN GROWTH OPPORTUNITY FOR
CONSULTING FIRMS

1. The consulting industry,
actors & hot topics
2. Consulting jobs &
careers
29
3. The mission lifecycle &
consultant toolbox
4. The commercial
proposal
5. The Consultant posture,
ethics & time management
COURSE STRUCTURE & CONTENT
Next session

ESCP - Consultant behaviour Session 1 2021 - The Consulting industry, actors and hot topics

ESCP - Consultant behaviour Session 1 2021 - The Consulting industry, actors and hot topics

More Related Content

What's hot

Similar to ESCP - Consultant behaviour Session 1 2021 - The Consulting industry, actors and hot topics

Recently uploaded

ESCP - Consultant behaviour Session 1 2021 - The Consulting industry, actors and hot topics