management consulting b2b marketing

8/4/2019 Management Consulting B2B Marketing

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Management Consulting

B2B MarketingPresented by :- RaMaN Effect MihirKatyayan : 10IT-017Madhur Kishor Oza : 10DM-082Rachit Mathur : 10HR-027Manish Mohanty : 10DM-083Navin Singh : 10DM-090 KumarRakesh : 10FN-055


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Table of Contents

Management Consulting Globalization ................................................................................ .................................. 3

Knowledge Sharing in Consulting .............................................................................................................. ............ 3

Approaches .......................................................... ................................................................. .................................. 4

Specialisations ..................................................... ................................................................. .................................. 5

ConsultingGood or Bad? .................................................................................................................................... 7

Advantages .......................................................... ................................................................. .................................. 7

Disadvantages ...................................................... ................................................................. .................................. 7

Current State of Industry ........................................................................................................................................ 7

Future Trends and Opportunities: ......................................................... ................................................................. . 8

Consulting Pricing .......................................................... ................................................................. ....................... 9

Marketing strategy .......................................................... ................................................................. ..................... 11

The 7ps of consultancy Services ........................................................... ................................................................ 11

Consultancy Service differing from others: ................................................................ .......................................... 11

ABC of Consultancy Service marketing: ......................................................... ..................................................... 11

How can consultants attract more clients? ................................................................. ........................................... 13

Communicating Value: .............................................................. ................................................................. .......... 13

How can consulting firms learn more about effective marketing? ............................................................. .......... 13

What are the most important skills/aptitudes required for today's consultants? ................................................... 14

Appendix .............................................................................................................................................................. 15


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Management Consulting Globalization

Manufacturing firms are well down the path of globalization. Beginning about thirty years

ago, global forces, such as the emergence of low-cost competitors and rapid economic

development in emerging markets, began to have profound effects on the structure and

performance of manufacturers. Many firms responded by moving production to low-cost

countries and attempting to penetrate new markets. Today, most manufacturers grapple not

with the issue of whether to move outside their home countries, but the consequences of

doing so, such as managing an international workforce and catering to diverse customer

tastes.

The worlds service firms have been slower to globalize. For some service firms, off shoring

requires a highly skilled workforce, which can significantly limit options. Other service firms

2 may find it difficult to sell overseas, as demand for their services may be weak in certain

parts of the world. For example, services such as consulting and commercial banking are sold

mostly to large corporations and are virtually non-existent outside the developed economies.

Firms may also find it difficult or impossible to deliver highly skilled services remotely,

necessitating global operations. This ushers in a host of issues related to finding and training

local talent. All of these obstacles have conspired to limit the responses of many service firms

to global forces.

Revenue drivers of globalization:

Client expansion Indigenous demand Concentration of industry expertise

Cost is not a key driver. Most globalization has been reactive, not proactive.

Knowledge Sharing in Consulting

To be successful at the present time, it is imperative for global consulting companies to be

knowledge intensive, apply reuse economics, create knowledge and deliver quality to keep

pace with constant change. They need to harness knowledge and learn faster than

competition. In order to achieve that, they need to effectively and efficiently organise and

manage the processes of knowledge sharing internally in the organisation.

Whether practised as a full time occupation or an ad-hoc service, Management consulting can

be described as transferring to clients knowledge required for managing and operating

businesses and other organizations. To provide added value to clients, this knowledge must

help clients to be more effective in running and developing their business. Thus the


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quintessential nature of consulting is to create, transfer, share and apply management and

business knowledge. Knowledge transfer is concerned not only with knowledge and

understating of facts and realities, but also with approaches, methods and capabilities

required for the effective application of knowledge in particular economics, business,

cultural, administrative and organizational environments.

Management consultants can assume their roles in knowledge transfer because they have

accumulated, through study and practical experience, considerable knowledge of effective

ways of acting in various management solutions.

Approaches

In general, various approaches to consulting can be thought of as lying somewhere along a

continuum, with an 'expert' or prescriptive approach at one end, and a facilitative approach at

the other. In the expert approach, the consultant takes the role of expert, and provides expert

advice or assistance to the client, with, compared to the facilitative approach, less input from,

and less collaboration with, the client(s). With a facilitative approach, the consultant focuses

less on specific or technical expert knowledge, and more on theprocess of consultation itself.

Because of this focus on process, a facilitative approach is also often referred to as 'process

consulting,' with Edgar Schein being considered the most well-known practitioner.

Many consulting firms are organized in a matrix structure, where one 'axis' describes a

business function or type of consulting: for example, strategy, operations, technology,

executive leadership, process improvement, talent management, sales, etc. The second axis is

an industry focus: for example, oil and gas, retail, automotive. Together, these form a matrix,

with consultants occupying one or more 'cells' in the matrix. For example, one consultant

may specialize in operations for the retail industry, and another may focus on process

improvement in the downstream oil and gas industry.


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SpecialisationsManagement consulting refers generally to the provision of business consulting services, but

there are numerous specializations, such as information technology consulting, human

resource consulting, virtual management consulting and others, many of which overlap, and

most of which are offered by the large diversified consultancies listed below. So-called

"boutique" consultancies, however, are smaller organizations specializing in one or a few of

such specializations.

There is a relatively unclear line between management consulting and IT consulting. There

are sometimes overlaps between the two fields, but IT consultants often have degrees

in computer science, electronics, technology, or management information systems while

management consultants often have degrees in accounting, economics, Industrial

Engineering, finance, or a generalized MBA (Masters in Business Administration).According

to the Institute for Partner Education & Development, IT consultants' revenues come

predominantly from design and planning based consulting with a mixture of IT and Business

Consulting. This is different from a Systems Integrator in that you do not normally take title

to product. Their value comes from their ability to integrate and support technologies as wellas determining product and brands.


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Human resource consulting is a $18.4 billion industrythat has emerged from management

consulting, as clients' needs have become more complex and specialized, widening the gap

between HR needs and work force capabilities, and thus accentuating the ability of HR

management consulting firms to fill this gap. While the multi-faceted nature of business

sometimes causes overlap in consulting industries (i.e., with regards to human resources,

general management and information consulting), the following are core fields around which

most HR consultancies are based:

Human capital, including remuneration (also called total rewards), employee rewardsand incentive programs, and talent acquisition and management

Health & Benefits; i.e., orchestrating optimal employee health plans with the carriersthemselves

Mergers and acquisitions, examining fit across culture, job-type, transaction costs, etc. Communication, including surveying employee attitudes, satisfaction, engagement, and

other employee behaviours

Retirement OutsourcingServices may also include legal counselling, global initiatives, investments consulting, and

the implementation of HR technologies to facilitate human capital management. The HR

consulting industry also employs more actuaries than any other in order to assist in their

services.

Virtual management, brought about by the rise of the internet, globalisation, outsourcing,

telecommuting, and virtual teams, is management of frequently widely dispersed groups and

individuals with rarely, if ever, meeting them face to face.

Following below is a sociological critique of certain forms of virtual management:

Its major advantage, according to supporters, is to focus on the customer and the value

chain from which the customer derives value. Its major drawback, according to detractors, is

that commodity and product relations "outsourced" to developing nations do tremendousharm. Others see benefits, but note that it tends to specialize these nations, as

under colonialism, when they fed "natural resources" and "human resources" to developed

nations, into narrow and limited supply roles.

While seeking organisational effectiveness in the current capitalist mode of production,

especially profit-making organisations are increasingly recognising the competitive

advantage of concentrating on their core competences and outsourcing all or most of other

operations. Another economical driving force is the shift from traditional consumerism

to relationship marketing and Customer relationship management (CRM). Companies try tointroduce products to potential customers earlier in their life and then try to keep them as


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customers as long as possible. In addition, companies may consult users for research and

development purposes to increase customer satisfaction.

These operations may also be more project-based, involving organisations that may or may

not formally belong to any of the units involved. All this creates new kinds of interlinkednetworks of suppliers, buyers, producers and customers, where the factors of production are

being acquired as conveniently as possible to make deliverables that can be seamlessly

supplied to the people who need them, to where and when they need them.

Consulting Good or Bad?

Consulting has its own advantages and disadvantages which a company need to weigh before

opting for their services.

Advantages

Get service of special expertise Use the service as needed without any long term commitment Save on tax contributions Save on benefits to be given to full time employees Have flexibility in the relationship. Can terminate them easier than terminating employees.

Disadvantages

May not have the same continuity in the relationship as you would have with anemployee.

May sometimes have to pay high fees to the consultant. Have limited control over the consultant as they are not employees of the company Run the risk of tax problems if the consultant in fact operates like an employee.

Current State of Industry

Global consulting industry revenues (including HR, IT, strategy, operations management and

business advisory services) will be about $345 billion in 2010, according to Plunkett

Research estimates. This represents a rebound from about $310 billion in 2009 and $330

billion in 2008.

The consulting industry is a multifaceted, global business sector that is facing many

challenges and evolving quickly. At the highest level of the business is management

consulting the segment that advises top executives and boards of directors at Fortune 1000


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firms on strategy and organization. McKinsey & Company, Inc., Bain & Company, Inc.,

Boston Consulting Group, Inc. and a handful of other companies are the most elite. Such

firms may charge their clients anywhere from $300,000 to $1 million in monthly fees, with

top consultants billing as much as $5,000 daily plus expenses, and associates at $1,500 or so.

By early 2010, many European governments, from the UK to Spain to Greece, remained

saddled with daunting debt loads. Higher taxes and cuts in government spending loom, and

this will be hard on business in general, including consultants. In Asian nations, however, as

well as Brazil, high growth in GDP and a positive business climate are creating myriad

opportunities for consulting firms, both in government and private sector contracts.

In North America, the U.S. appeared to be in an economic recovery by the beginning of 2010,

and Canadian companies of most types remained on firm financial footing. Consultancies

should see reasonable growth in these nations.

Future Trends and Opportunities:

Over mid term in future, some of the opportunities and trends to be witnessed in theconsultancy industry are:

1) Government-funded economic stimulus funds will boost business in certainsectors that will produce new consulting projects, such as:

a) Major transportation infrastructure projects (including high-speedtrains)

b) Health care reform, particularly a new focus on digital health recordsin the U.S.

c) Renewable energy projects, including biomass and advanced solarinstallations.

d) Research and development projects in many fields, including advancedbattery technology, biotechnology and nanotechnology

2) Consultancies that focus on projects that clearly reduce business costs andenhance operating ratios in a reasonably short period of time will find a ripemarket (such as, consultants who focus on cash flow enhancement, supplychain efficiency and manufacturing efficiency).

3) Consultancies that have deep experience in debt restructuring and financialworkouts will remain in high demand, particularly in the fields of commercialreal estate and debt-financed mergers and acquisitions.

4) Vast new labyrinths of government regulation, government investment andpartial nationalization of the U.S. auto industry will create numerousopportunities for consultants who can show companies how to navigaterapidly changing relationships between government and certain industries, ordeal with government oversight.


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5) Consultants who assist firms in lowering employee benefits costs are in highdemand.

6) Consultants in environmental specialties, such as carbon emissions, andenergy efficiency will be in high demand.

Consulting Pricing

Any service that has been provided comes with a price. And Consulting is no exception to

this rule. The two common pricing models that have been popular in most outsourcing deals

have been used in consulting assignments too. They are the Fixed Price Model and the Time

& Material (T&M) Model.

In a Fixed Price Model, the two parties (client and the consultancy) agree to a fixed sum of

money to be paid as contract fee irrespective of the number of people engaged in the work.The work, as defined by the contract, needs to be performed to get the contract amount.

On the other hand, in a T&M Project, the two parties agree on the rate (in monetary terms)

which needs to be paid for the service provided. So, the amount to be paid by the client is not

fixed, or pre-defined, and depends completely on the number of people assigned to do the

work, and the total number of hours worked by each person.

One important aspect that has been driving these models is the Service Level Agreement or

SLA between the two parties. The disbursing of fees to the outsourcing service provider also

depends on meeting the expectations of these SLAs.

Although, all of these might be sound concepts theoretically, but lot of practical difficulties

have been observed in the area of SLA Management. Storing and tracking the required SLA

data becomes difficult at times. Also, SLA, as a concept, has not been understood in totality

at the base level, thus, rendering its adherence difficult. Similarly, certain SLAs (like

customer satisfaction) have ceased to be objective and measurable, and become subjective

and person dependent, thus, leading to its inability to serve its purpose.

In this perspective, the Value Based Pricing (VBP) Model has been conceptualized, whichhas been able to tackle all of the inefficiencies of the other two models. This model is based

on the basic premise of collaborating with the clients and providing tangible business benefits

to the client through the process of outsourcing, and then drawing the pay cheque from the

client based on the benefit provided.

So, the client doesn't have to promise any assured sum of money beforehand for the work to

be done. Payment is only made once the client starts seeing the benefits of the work. The risk

of not raising the benefits of outsourcing is shifted to the outsourcing service provider, which

gives the client a comfort feeling.

The model is based on a four-step framework, which has been depicted below: -


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Define - Define the Key Performance Indicators or KPIs for the client organization. KPIs

should be tangible and measurable, and should have the highest impact on the existence of

the organization. Some of the KPIs that are adopted are Increase in Revenue, Improve in

Profitability, Reduction in Lead Time, Reduction in Inventory Levels, Increase in Market

Share, Better ROCE, etc.

Define the benefit target, the benefit realization timeline, and the linked payment schedule.

The payments would be based on achieving the benefit targets. As a baseline for setting the

benefit targets, the latest KPIs should be measured, and the cut-off date defined for accepting

the KPI base values.

Suggest & Implement - Analyze the existing processes and systems, and prepare a blue-

print for incremental changes as well as Business Process Re-engineering. Also, an

automation roadmap for the client organization is prepared.

Once the suggestions have been accepted and validated through pilot runs or simulations,

hand-holding with the customer through the implementation phase is of utmost importance.

Often, the client organization doesn't have enough expertise and experience to implement the

solution and, thus, the beauty of the suggestion is lost.

Benefit Realization - On implementation of the solution, the biggest step is reaping the

benefits of the same. Benefit realization is important to both the client organization, as well

as the consultant. For the client organization, it marks the repose of the faith it had on the

consultant, and starting of tangible benefits to its firm. For the consultant, it marks the start of

the payment schedule and return on investment in the project.

Optimization - After incorporating the changes as a part of the new solution, the biggest

challenge that many client organizations face is to institutionalize it. Unless the changes are

institutionalized, the benefits derived from the solution are temporary at the maximum. So,

consultants continue to work with the client organizations to ensure that the benefits are not

short-term. So continue to work with the client to ensure continuous benefit realization.

The consultancy company also benefits from this model: -

Higher Professional Fee - This model ensures higher professional fees than what is

possible from any other model. Since the payment is defined as a certain percentage of the

benefit provided, so it can be much higher than any other situation.

Better Cash Flow - The payment for the consulting firm is based on the benefits derived

from their assignment. Also, the payment is spread over a certain time-span when the benefits

are still accruing to the client. During this time, it is possible that the consulting firm is not

working on the assignment, but the cash flow is still intact.


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Marketing strategy

The 7ps of consultancy Services

Product: Experience of the consultants, his knowledge and expertise on the subject. Price : Trust and believe of the clients is more important for the aspect of pricing. Value

based pricing is followed i.e. the more the value created for clients, the more profitable the

pricing is.

Place : As the service delivered is more at the place of the clients and the service isinseparable from the consultants

Promotion: Promotion can be done through personal sales, publicity, advertising, direct mailand tel-marketing.

People: The service delivery depends upon interpersonal skills, aptitude and serviceknowledge of the consultants.

Process: The efficient service delivery process is the differentiating factor. Physical evidence : The sight of service provision and the how a consultant carries himself

Consultancy Service differing from others:

Not Regulated by Statute and lack of formal institutionalization Management consultants lack an authoritative body of knowledge Quality of the services cannot be assessed prior to the assignment Consultants co-produce the outcomes, in a process of mutual learning and cooperation

This makes the case for Relationship Marketing .

ABC of Consultancy Service marketing:


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Assess the Situation: Examine internally your organisation and externally clientsorganisation and also the competition. All the above determines the marketing mix.

Build a Potential Client Base : To determine which client to target and with whatmarketing techniques

Contact Potential Clients : This is actually the sales part of marketing process .In thisfollowing come across opening and closing of sales , cold calls and rain making .

Consultants need to improve their brand-building ability. Consultants such as McKinsey, Booz Allen,

and others have established strong brands. But most consultants are less distinguished. The key to

branding, especially for smaller firms, is to focus on a limited number of issue areas and develop

superb expertise in those areas.

A (Assess theSituation)

B(Build a PotentialClient Base )

C(Contact PotentialClients)


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How can consultants attract more clients?

Clients are under increasing cost pressure to cut expenses. They are examining their health,

legal and consulting bills more critically. They want value for their money. This should not

be a threat to a consulting firm. A consulting firm cannot last that wants revenue withoutgenerating proportionate value. The consulting firm's challenge is to constantly figure out

how to generate more client value per dollar of cost, and to demonstrate this. Whenever

possible, the consulting firm should estimate the ROI value they hope the project will create

for the client.

Consultants need to identify the specific clients they want to acquire. It needs to distinguish

between soliciting business and positioning itself for business. The latter is much better and

consists of building a reputation for doing something so well that word of mouth acts as the

soliciting force, not sales calls. Consultants can generate buzz through giving speeches,writing articles, and joining organizations and soon word of mouth will convey their true

reputation.

Clients like to believe that their consultants, especially those on retainers, are thinking about

their businesses. Smart consultants will send occasional articles that they come across that

might interest a client. They may go further and send articles that would have more of a

personal, non-business interest for the client.

One consultant who works with a major candy company is in an enviable position. The candy

company found his ideas to be so useful that they said to him: anytime you want to think

about some issue in our business and you think we might be interested in your views, just

write them down and send us a bill for your time.

Communicating Value:

A consulting firm needs to choose defined areas of expertise and become the best in those

areas. The firm should communicate its expertise through written articles, speeches, and

exceptional performance. The firm should prepare effective brochures, ads, and other media.

They should build a network of referral sources with accountants, lawyers, and other

professionals.

How can consulting firms learn more about effective marketing?

They can attend short courses on marketing offered by many business schools. They can

contact a professor of marketing to use as an occasional consultant. They can arrange for

class projects under the professor. They can solicit marketing ideas from their advertising

agency. Ultimately they might spot an excellent professional marketer and put him or her ona retainer.


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What are the most important skills/aptitudes required for today's

consultants?

The most important skill is client relationship management.Some people have a natural

aptitude for gaining trust and respect from their clients. They are caring and sensitive people,good listeners and learners, and good problem solvers. The firm that hires more of these

people will succeed regardless of other things.

Build a good database on each client's activities, interests, opinions, and other pertinent

information. This will enable the firm to customize its services and communications to each

client.

The firm's marketers must also develop brand-building skills that go far beyond brochures

and advertising. Brand building also occurs through event management, sponsorships, and

contributions to good causes and other activities.


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Appendix

1. http://division.aomonline.org/mc/contemporary%20consultant%20toc.pdf2. http://www.managementconsultingnews.com/interviews/kotler_interview.php3. http://books.google.co.in/books?id=Wzjb55Gv5zoC&pg=PA265&lpg=PA265&dq=I

ntervention+Strategies+in+Management+Consulting&source=bl&ots=OWpi1N6BIh

&sig=IRvMYkHiOPPkSn_6RYBG8HaGeXI&hl=en&ei=KfMITenPGYfWrQe04ozV

Dg&sa=X&oi=book_result&ct=result&resnum=6&ved=0CDsQ6AEwBQ#v=onepag

e&q=Intervention%20Strategies%20in%20Management%20Consulting&f=false

4. http://en.wikipedia.org/wiki/Main_Page5. http://www.plunkettresearch.com/Industries/Consulting/ConsultingTrends/tabid/178/Default.a

spx

6. Plunkett Research, Ltd.7. http://www.liveperson.com

management consulting b2b marketing

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