XLRI Crest August 2010
description
Transcript of XLRI Crest August 2010
Aug-Sept‘10
The E-Magazine of CRESCENT, XLRI
Issue 10
CREST
Consulting Research
Entrepreneurship Strategy
ALL ABOUT CONSULTING!!
ENGAGING A CONSULTANT
HR CONSULTING-THE GOOD, THE BAD AND THE UGLY
MNC’S ENTERING THE
RURAL MARKETS
PUBLIC POLICY CONSULTING
From the Editor’s Desk...
Crescent The Committee for Research,
Strategy, Consulting and En-
trepreneurship (CRESCENT)
is the result of the endeavor
of the student community of
XLRI to promote an environ-
ment of creative solution
building amongst the stu-
dents of the institute, while
reaffirming high ethical
standards and values, and
fostering personal develop-
ment in the pursuit of excel-
lence. It works with the two
fold agenda of creating a
brand presence of XLRI
among the corporate and to
help nurture ideas of budding
entrepreneurs by providing a
platform to them to showcase
their Ideas.
CREST Jul-Aug 2010
Editorial Team
Miti Vaidya
Neeti Kumar
Siddhartha Saran
Urshila Ghag
T H I S I S S U E . . .
Cover Story Page 3
Engaging a Consultant.
Features
HR Consulting | Page 2 The truth about HR consulting from as an HR professional relates his experiences for CREST Public Policy Consulting | Page 6 The need for public policy consulting in India MNC’s Penetration Strategy in Low-Income and rural Markets | Page 8 Creating Livelihood Partnership to reach customers at the lower end What’s New in the world of Consulting | Page 10 Campus Reporter | Page 11
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The advent of a new term brings a new CREST into your inbox we try to de-
code some more mysteries and explore new dimensions of Consulting.
Our cover story ‘Engaging a Consultant’ focuses on the different phases of en-
gagement between a consultant and a client. The article singularly captures
the essence of the expectations of a client and the role of a consultant. While a
lot is talked about what consulting is, there is hardly an focus on what the
process involves. This CREST article reveals the story right from what hap-
pens in the pitching phase till the final presentation is made.
We also have the truth from the horse’s mouth about HR consulting. An HR
professional speaks to CREST about his the trials and tribulations of HR con-
sulting. Other stories cover Public Policy Consulting and MNC’s penetration
Strategies in the low income market.
The Editorial Team would love to get feedback from you on
[email protected]. Happy Reading!
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C O N S U L T I N G
HR Consulting– the Good, the Bad, and the Ugly
Roy Eddington-Charles recounts his experiences as an HR consultant and
tells us in this article about the various stigmas and stereotypes associated
with HR consulting and the trials and tribulations an HR professional un-
dergoes everyday in his professional capacity. When we talk about HR Consulting, most people think we trawl the net for re-
cruits, or headhunt, or walk surreptitiously into companies and yank their em-
ployees for competitors. Once, I was visiting a friend at his office. The manager
heard that I run an HR firm and got rather nervous. He told the friend to get me
to leave as soon as possible!
Older professionals remember HR people from the Rajesh Khanna and Amitabh
movies: the chaps who deceive workers into working for less, who pretend to be
the workers‘ best friend while actually helping the company‘s bottom-line.
The worst moments are when you are testing, training or guiding an executive
much older than you – and he thinks he knows himself and his management style
better than you do, better than your tests can show. It is so frustrating; a col-
league once ran out of the room, closed the bathroom door and screamed. But
finally she did get the executive to come around.
The reality of HR consulting is not usually so sinister. I still get mail from senior
executives I trained long ago – sometimes thanking me, sometimes telling me
about a daughter‘s job or son‘s marriage, but usually asking me for advice. An
HR trainer is often seen as a counsellor you can turn to at professional cross-
roads. That‘s very satisfying.
Remember, also, the value of HR expertise in an age of mergers and acquisi-
tions. Who can forget the tension in a company recently been gobbled up whole-
sale by another group: ―Will my profile change? Will I lose status among new
colleagues? Will I be out on the streets with a pink slip?‖ Finding best-fits,
soothing ruffled feathers, being tough when necessary… The HR professional
seems a cross between a surgeon, a top executive and a hand-holding clinical
psychologist!
And, of course, when you walk into that training hall, and a few hundred voices
roar a greeting, and a few hundred eyes focus entirely on you, and you feel the
professional trust of a bunch of people who know what they are doing – well, it
is a high no drug can deliver.
Go ahead: the consulting field is vast, sometimes threatening, sometimes horrifi-
cally competitive, but always rewarding. Yes, and recall the freakishly big bucks
too. :-)
Roy Eddington-Charles is the President of an independently launched Consultan-cy which operate in the areas of IT, HR and Education. Previously he has con-ducted corporate training programmes by invitation and specializes in leader-ship training.
“Once, I was visiting a friend at his office. The manager heard that I run an HR firm and got rather nerv-ous. He told the friend to get me to leave as soon as possible!”
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C O N S U L T I N G
Engaging a Consultant...
In this article, Neeti Kumar unveils the less talked about perspectives of
consulting; the expectations of a client and what goes into that final pana-
cea of a presentation
Many of us want to be consultants. This article will help tell you what it is like to
be in the shoes of a consultant as well as the shoes of a client.
A consultant is an individual with specialized skill and knowledge who is con-
tracted to accomplish (or assist in accomplishing) an assignment in an unpreju-
diced manner and independent of other responsibilities. Clients need consultants
when they require an expert‘s advice or some specialized skill. Consultants need
clients to work on new projects. There exists a symbiotic relationship between
the two. Let us analyze the different phases of the engagement between the two.
Pitching Phase
Client‘s Perspective:
Several factors have to be considerer when choosing a consultant include a thor-
ough risk and cost analysis and the consultant's availability, track record, experi-
ence, and qualifications.
Consultant‘s Perspective:
Partners carry out the main pitch process. Associates might get involved in some
non-chargeable work to support partner‘s conversation with client. Letter of Pro-
posal (LOP) or Letter of Intent (LOI) is the product of this discussion.
LOP forms a guideline to the focus of the efforts of the consulting team. It also
mentions expectations about results, what client resources will be required, and
how long the engagement is expected to take. It may or may not touch upon the
topic of remuneration.
Brainstorming/hypothesis generation
Client‘s Perspective:
For Clients, it is important to be a part of the project since the planning phase.
They should ensure that the consultants have understood the requirement clearly.
After making the right choice of the consultant they should see that the progress
is in the right direction.
Consultant‘s Perspective:
The focus is on brainstorming involving the whole consulting team, and some-
times client members. The idea is to understand the problem, discuss different
options and form hypothesis. This brainstorming stage is at once the most excit-
ing and the most frustrating stage of the project. On the one hand, it gives a new
consultant a firsthand opportunity to see how more senior members of the team
tackle the problem set before them. On the other hand, the team may not seem to
be making much headway.
The final part of the brainstorming stage is to take each of the emerging hypothe-
ses and determine how they can be proved or disproved in the analysis stage.
What data is required? How can it be gathered? Which team member will take
responsibility for each part of the analysis?
Data gathering and analysis
Client‘s Perspective:
This is just the beginning of establishing a good working relationship. Since cli-
ents are nearest to the problem they are nearest to the solution also. They must
ensure that they communicate to the consultant their problems and experience
well. Communicate! Communicate! Communicate! is the way out. They should
The Different Phases: 1) Pitching Phase 2) Brainstorming or Hypothesis Generation 3) Data Gathering and Analysis 4) Conclusions and Story Building 5) Final Presentation
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also see that consultant respects their personal data and values long term rela-
tionship with them.
Consultant‘s Perspective: The hypothesis which is formed at the brainstorming
stage is approved or disapproved at this stage. The Consulting in-house library is
considered, closely followed by that of the client. This usually results in large
stacks of text-lines, brokers' and annual reports, and other reference materials.
The big advantage which consultants have is the intellectual capital of their con-
sulting firm. They can approach firm experts or consultants who have worked on
similar but non-conflicting projects.
More interviews with client personnel may be required. Some studies may re-
quire consultation with industry experts; others may necessitate more hands-on
measures. The main task of a consultant is to find a way of re-cutting the data,
combining different data sources, and making judicious assumptions in order to
end up with data that definitively supports or negates the hypothesis you are try-
ing to test.
Pulling out conclusions and building the story
Client‘s Perspective:
Clients must demand knowledge transfer from consultants. A good consultant is
one who not just provides a solution but also creates a structure which leaves the
clients more independent.
Consultant‘s Perspective:
Developing a story is an evolving process throughout the project – it starts at hy-
pothesis generation. As more and more hypothesis is approved / disapproved a
clearer picture emerges. One might require to prepare more hypotheses and to do
some more analysis to solve the jigsaw puzzle. By developing the storyboard up
front, the team is forced to helicopter back up to the top level on a regular basis
and check that their analysis directly answers the client's key questions.
Presentation to client
Client‘s Perspective:
Clients should see that their key questions are directly being answered.
Consultant‘s Perspective:
What actually happens in a presentation depends on the frequency of meeting
between the consulting firm and the client. Formal presentations are presented as
a landscape of exhibits, held together by a storyline. The result of the final
presentation should not come as a surprise to the client. While the partner or the
director with the senior client relationship tends to run the meeting, managers
and even an associate who has taken ownership for some work, might get to pre-
sent.
Inputs from
Vault Guide to Consulting, zdnetasia.com
“Clients must demand knowledge transfer from consultants. A good consultant is one who not just provides a solution but also creates a structure which leaves the cli-ents more independ-
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Public Policy Consulting
A summary of the paper by Prema Sagar and Poonam Madan
on the lesser known phenomenon on Public Policy Consulting in
an emerging Indian Framework.
From license raj in 1950-1970‘s, to liberalization and increased influence of as-
sociations and media in 1990‘s, to setting up of independent regulators there has
been a transition from closed-door culture to consultative policy making.
The reluctance to bring about any breakthrough in many policy areas is because
the politicians speak simultaneously to two audiences. The first, which has
grown increasingly important in the last decade, is the domestic policy and fi-
nancial elite as well as international donors and investors. The second is the poli-
tician‘s own constituency, especially the large and intermediate farmers who
stand to lose the most from the reforms. The cutting edge of this interaction be-
tween mass and elite politics defines an important facet of the role for profes-
sional public affairs practitioners.
As we see today there are interactions between the mass politics (on caste, reli-
gion etc.) and elite politics (on economic policy etc.). Civil Society and media
are playing an increasingly visible role at such intersections. Labor law reforms,
inflation, impact on environment are few areas of interactions.
Actors involved in policy making today are the executive and the legislatures,
both at the central and state level. The interplay between the two levels is often
the seat of stalemate on issues such as GST.
Coalition Politics is another facet of today‘s policy making wherein every coali-
tion partner wants to push through his own agenda. Media has played a crucial
role in bringing policy into public domain. With increased awareness civil socie-
ty is also playing an active role especially in issues such as putting increased
pressure on companies to adhere to social and economic standards. Civil Society
organizations (NGOs) also seek to improve governance by increasing transpar-
ency and access to information about public policy formulation and implementa-
tion.
Think tanks can provide a brilliant medium for good policy making. However
independence of think tanks is an issue in India. With formation of industry as-
sociations such as CII in 1990‘s there has been a shift from particularistic lobby-
ing to general policy advocacy by industry interest groups.
It has been seen that the frequency of interaction between industry interest
groups and political parties is fairly high and the former helps the latter primarily
in raising party funds. The problem exists in the lack of transparency in these
interactions. The extent to which both the parties and the government officials
are lobbied is not known.
The question which arises is that how one can achieve a professional business-
government framework for policy consulting in India.
Impediments to Break-throughs in Policy –Makin include stale-mate between the ex-ecutive and legisla-ture, Coalition politics, the contradiction be-tween “mass and elite politics”... “Think tanks can pro-vide a brilliant medium for good policy mak-ing.”
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C O N S U L T I N G
In emerging India, bureaucracy is the weakest link that can, indeed, become the
strongest link in the policy consulting framework. Government officials are
largely generalists, while the groundwork requires technical expertise on par
with the rising complexity of business aided by technological /managerial/
financial innovation in a globalised economy. Likewise for regulation, since in-
dependent regulation by regulatory authorities is a relatively new ethos in India.
Professional public affairs practitioners can, by providing well researched facts
and arguments, make a strong and clear case for the issues they are mandated to
manage. Consultations using the power of domain expertise and insights on gov-
ernment policymaking processes at this level would make bureaucracy the
strongest link. This would also reduce transaction costs for industry.
Clearly, therefore, there is great potential for professional public affairs consult-
ants given the emerging complex issues impacting business; the dynamic regula-
tory framework requiring navigation and keen insights; and the government‗s
openness to collaboration on policy matters.
Source: http://www.johnehrenfeld.com/2009/10/the-consultants-relief-and-ret.html
“In emerging India, bu-reaucracy is the weakest link that can, indeed, be-come the strongest link in the policy consulting framework.”
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S T R A T E G Y
When companies figure out how to serve low-income consumers in developing
countries profitably, everyone wins: the disadvantaged gain access to products
and services that the private sector is best positioned to deliver, while companies
tap into vast new markets. On top of that, in many places the MNCs also try fill-
ing the gaps left by government by building roads that help them deliver their
goods, providing education and health care for communities whose workforces
they rely upon, and implementing environmental programs to protect precious
natural resources needed to keep supply chains running smoothly. Some com-
mentators would call these activities corporate social responsibility (CSR), while
others might cynically remark that it is just another way for Multinational Cor-
porations (MNCs) to make inroads into the lucrative rural and low-income mar-
kets.
There has been a discernible shift in how MNCs look at their entire investments
in rural markets beyond CSR. With growth drying up in developed markets and
their centre of gravity shifting to emerging markets, MNC businesses are under
pressure to prove that their rural strategies aren't just about doing well from a
CSR perspective. They also need to show head office that these strategies are
doing well from a business perspective. In short, the strategies must start deliver-
ing top- and bottom-line results.
One major challenge that stares them in the face is the complexity of these rural
markets across the world. Even within one country such as India, strategies need
to take into account the vast number of languages and cultural differences across
India's hinterland, while keeping the strategies highly flexible and adaptable.
One solution could be developing products and services tailored specifically to
the rural/low income markets. When LG entered India in the mid-1990s, numer-
ous brands were vying for shelf space with hardly anything to distinguish them
from competitors. The South Korean company developed two color television
sets for the rural market, ―Sampoorna‖ (which means "complete" in Hindi) and
Cine Plus. At US$65 and US$107 respectively, the sets were priced slightly
higher than the black-and-white televisions that other manufacturers were selling
in rural markets and that had become obsolete in urban homes. Now LG has re-
frigerators, washing machines and microwave ovens targeted at price-sensitive
consumers sold from hundreds of retail and distributor outlets across the Indian
hinterland, with rural markets contributing 40% of its Indian revenues.
Other solutions could be applying novel distribution tactics to reach out to this
segment such as selling products like shampoos and biscuits in small, inexpen-
sive packets for low-income consumers in the hinterland with little spare cash.
But it has been felt that unless the companies try to build a sustainable model
and think ‗long-term‘ with their distribution strategies, they would not be very
successful or successful only in the short run.
Generation
Therefore, here comes out the most trusted and innovative solution: creating
"livelihood partnerships"—surrounding a core product or service with additional
benefits. Rather than treating communities purely as collections of consumers,
companies that take this approach provide low-cost, productivity-enhancing as-
sistance, such as Philippines‘s Manila Water, bridge cultural gaps between com-
MNC‘s Strategy to Enter Rural and
Low-Income Markets
“There has been a dis-cernible shift in how MNCs look at their entire investments in rural mar-kets beyond CSR. With growth drying up in de-veloped markets and their centre of gravity shifting to emerging mar-kets, MNC businesses are under pressure to prove that their rural strategies aren't just about doing well from a CSR perspective.”
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S T R A T E G Y
company and community, create positive associations with the company's brand,
raise switching costs, and promote micro market activity. All this has positive
consequences for both the community and the companies doing business there.
Manila Water relies on collective billing to ensure the timely payment of bills,
employs small-scale entrepreneurs as couriers and pipeline contractors, supports
micro lending, and brings affordable water to schools and hospitals. Similarly in
India Hindustan Lever has developed Shakti, a program that trains rural women
to operate as entrepreneurial distributors of consumer products in villages of
fewer than 1,000 people. This makes it possible for it to earn revenues out of vil-
lages that would otherwise be uneconomic to serve.
Thus the key takeaway is investing in building sustainable partnerships with the
rural communities—involving the local Self Help Groups (SHGs) and coopera-
tive centres as trusted partners in the supply chain. Also, the companies should
not make the mistake of expecting quick financial results form their rural invest-
ments. They should be less focused on year-on-year success and spend more en-
ergy on building innovative solutions and business models for this segment. It's a
long haul. And many have realized it. The rest should learn this lesson quickly to
survive in the rural and the low-income segment battleground.
Inputs from:
McKinsey quarterly , India
Knowledge @Wharton
Top Ten Ways To Know You're Dating/Married To A Consultant
1. Referred to the first month of your relationship as a "diagnostic peri-
od".
2. Talks to the waiter about process flow when dinner arrives late.
3. Takes a half day at the office because, "Sunday is your day."
4. Congratulates your parents for successful value creation.
5. Tries to call room service from the bedroom.
6. Ends any argument by saying, "let's talk about this off-line."
7. Celebrates anniversary by conducting a performance review.
8. Can't be trusted with the car-too accustomed to beating up rentals.
9. Valentine's Day card has bullet points.
10. Refers to lovemaking as a "win-win".
Source: www.lachances.com/humor/jokes.htm
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C O N S U L T I N G
Who’s at the Top?
Vault.com, the source of ratings, rankings and insight for the consulting industry, has re-
leased its annual Top 50 Consulting Prestige Rankings. The Vault Consulting Prestige Rank-
ings provide a comprehensive roadmap of who's who in the consulting industry—ranging
from big consulting shops to smaller, niche firms, and spanning a vast swath of indus-
tries. From March through July, over 4,500 consultants of all levels were asked to rate con-
sulting firms on a scale of 1 to 10 based on prestige. (They were
unable to rate their own firm, and were asked to rate only firms
with which they were familiar).
The 2011 Top 10 Most Prestigious Consulting Firms are:
1. McKinsey & Company
2. The Boston Consulting Group
3. Bain & Company
4. Booz & Company
5. Deloitte Consulting
6. Mercer LLC
7. Monitor Group
8. PricewaterhouseCoopers
9. Ernst & Young
10. Oliver Wyman
Much in line with McKinsey‘s repeat at the top, this year's prestige ranking showed a re-
markably low rate of movement from last year. The Top 10 firms are entirely the same, with
some slight adjustments in positioning, as HR consulting firm Mercer LLC moved up two
spots, while Monitor Group and PricewaterhouseCoopers each moved down one notch.
PWC to acquire Diamond Management and Technology Consult-
ants
PricewaterhouseCoopers LLP (PwC) has entered into a definitive
agreement to acquire all of the outstanding common shares of Di-
amond Management & Technology Consultants, Inc., for $12.50
per share in cash. The transaction represents a premium of 31% to Diamond‘s closing stock
price of $9.54 on Monday and values Diamond at $378 million. Diamond will join the PwC
Advisory practice, which ranks among the largest providers of consulting services globally.
The transaction is expected to close in the fourth quarter of calendar year 2010.
KPMG Boosts BI with Analitica Acquisition
KPMG‘s UK Performance and Technology (P&T) Advisory division
has acquired Analitica, a leading Business Intelligence (BI) and Enter-
prise Performance Management (EPM) consultancy.
What’s New in the World of Consulting
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CREST Aug-Sep 2010
The WIZARD OF ODDZ– The Game of Strategy Wizard of Oddz was a strategy based fun game de-signed to get people off their feet and run around even with their thinking caps steadfast on their heads. There were six games based on Game Theory and Nash equilibrium such the Public Goods game, ‘Nash Bargaining’, the Ultimatum game, auctions and Pris-oner's Dilemma with an interesting XLRI flavoured twist. Needless to say, people’s interest was piqued and excitement ran high as players cooperated and de-fected in a bid to get the highest scores. The team with the highest overall score and the top player from the top two teams walked away as the winner and the sought after title of ‘the wizard of oddz’, the person whose wits reigned supreme.
ISEL (Initiative for Social and Entrepreneurial Leadership) is a joint initiative of SIGMA and CRESCENT. ISEL at XLRI provides opportunity for students for internships, final placements and live projects in the social sector and start-ups The ISEL introductory session was conducted by professor Madhukar Shukla who spoke to the students about the various learning opportunities under the various kind of companies in the social sector.
Now you can stay tuned to Crescent via its new blog at http://xlrii-crescent.blogspot.com/. We look for-ward to your contributions, articles, write-ups , ba-sically, anything that you feel you want Crescent to know and you think would make the business world a more interesting place to live.
UP NEXT... After the C3 Launch , in the second term we have more sessions lined up especially keeping in view the SIP Process to help you crack those elusive consultancy interviews and become experts at guesstimates and case analyses. There is also the Idea factory Launch on the horizon for those with raring to get set and go with their En-trepreneurial dreams. Stay tuned with CRESCENT to know about upcoming campus activities and as always, CREST will arrive faithfully in your inbox with more insights into the worlds of Consultancy, Research, Entrepreneurship and Strategy. As always, we welcome your feedback for ways to improve.
C A M P U S R E P O R T E R
ISEL LAUNCH
CRESCENT BLOG
CRESCENT e-mail id
CREST Sep 2010
CRESCENT MEMBERS
Faculty Advisor
Prof. Munish Thakur
Secretary
Mohammed Sadique Quraishi
Senior Executive Members
Aalok Sanghvi
Miti Vaidya
Nitin Agarwal
Siddhesh Ajgaonkar
Vikas Kedia
Vikram Singh Rathore
Junior Executive Members
Namrata Singh
Neeti Kumar
Rama Krishna Chava
Rohnak Shah
Shashwat Sahai
Siddhartha Saran
Urshila Ghag
Cover Photo Courtesy Karthik Srinivasan
The Editorial Team of Crest invites articles from readers for publication in forthcoming issues. If you have articles/ ex-periences/ studies to share in the areas of consulting, en-trepreneurship, research or strategy, please do send them in to [email protected] mentioning your name and insti-tute name.