Consulting Management Slides

Question 1

What’s the overall consulting process

Answer 1

1. Initial contact
2. Decision to work together
3. Preliminary analysis
4. Formal Proposal
5. Project Charter
6. In-depth analysis
7. Implementation
8. Delivery
9. Follow-up

Question 2

Core processes of a business

Answer 2

1. Strategic Analysis and corporate strategy (re-setting the scene)
2. Business planning or business development (a firm’s growth strategy)
3. Market research (environment where the firm operates in)
4. Marketing to exploit business opportunities
5. Sales to achieve the required revenues
6. New product development to enhance revenue and profits
7. Finance (adequate funding for ongoing business and expansion plans)

Question 3

Areas of consulting and firm’s processes

Answer 3

Core processes:
Corporate strategy:
- Marketing
- Market research
- Sales
- Finance
- New product development
-Business development

Operational processes:
-Operations including manufacturing and purchasing
- Logistics and customer service
- Research and development
- Information systems
- Risk management

Human processes:
- Human Resources
- Organizational development
- Outsourcing
- Interim management

Question 4

What is the strategy making process?

Answer 4

There’s an existing Business model: with vision , mission, values and goals

There needs to be strategy inputs for the strategic purpose where internal analysis is crucial analyzing strengths and weaknesses, but also the external analysis analyzing opportunities and threats

Then the strategy formulation:
Business-level strategies
Corporate-level strategies
International strategies
Entrepreneurship and innovation

Strategy implementation:
Strategic leadership
Structure and controls

Question 5

Risk management projects: how does consultant help a company with risk management

Answer 5

The consultant helps to assess the likelihood of certain events happening and puts in place plans to deal with them

Question 6

What are the drivers for key risks:

Answer 6

Externally driven

Financial risks
Strategic Risks
Hazard risks
Operational risks

Question 7

What is a manager? What are their tasks (managerial tasks) ? Inputs and outputs

Answer 7

A manager is someone whose primary responsibility is to carry out the management process.

They need to plan and make decisions, organize, lead, and control human, financial, physical and information resources to achieve efficiently and effectively the goals. Using the resources, through a number of tasks, they achieve organizations goals.

The managerial tasks are:
- Planning and decision making: setting the organizations goals and deciding how best to achieve them
- Organizing: determining how best to group activities and resources
- Leading: motivating members of the organization to work in the best interests of the organization.
- Controlling: monitoring and correcting ongoing activities to facilitate goal attainment

Question 8

What are the managerial roles?

Answer 8

Interpersonal Roles:
Figurehead, leader roles involve dealing with other people

Informational Roles:
Monitor and spokesperson roles involve the processing of information

Decisional Roles:
Entrepreneur and negotiator are managerial roles related to making decisions

Question 9

Primary types of consultant-management role interaction

Answer 9

• Supplementing
• Complementing
• Differentiating
• Integrating
• Enhancing

Question 10

The relationship between a client and consultant is determined by:

Answer 10

-Management roles in the client organization
- Objectives of consulting excercise

Question 11

What are the modes of consulting?

Answer 11

• The expert mode:
  Their expertise is used to ‘solve’ a problem presented to them by the client
• The doctor-patient mode:
  Identifies and solves the problem, the client thinks something is wrong, the consultant diagnoses and finds the solution.
• The process consulting mode:
  the consultant and client work together to solve the problem, only people who make up the business can find the best solution.

Experience has shown that the latter is the most successful in achieving a long-term results.

Question 12

Pitching the project: the formal proposal and project charter. What are the function of a formal proposal?

Answer 12

The project proposal represents the consultant’s statement of what can be achieved on behalf of the client business (goals) and what it will cost.

Key functions of a formal proposal:
• Concise and efficient means of communicating the objectives.
• Guides analysis and ensures appropriate information level
• Gives consulting team a common focus when differentiating tasks and organizing the project delivery.
• Provides a fixed point of reference to go back to.
• Used to manage client’s expectations.
provides the key document for the project and the ‘ground rules’ for the team.

• The project charter provides ‘ground rules’ for the project team.
  It is agreed by the project team at the start.

Question 13

How should the project proposal be?

Answer 13

• The proposal should be a short, straightforward document.

• Statement to the client of what the project is about and what it will do for the business, is what the client is actually buying. It presents (sells) what the consultant has to offer in a positive light.

• Aims of the project proposal
- State what the consulting exercise aims to achieve.
- Get the client’s commitment.

• A well-written proposal will get the project off to a good start.

• Manage client’s expectations.

• Balance what is being offered in the proposal and the expectations of client: the temptation to “get a sale” by offering a lot must be tempered by a care not to raise the client’s expectations so high that they cannot be met.

Question 14

What to include in the proposal?

Answer 14

A title describing the project :
- Client company’s name and a brief descriptive phrase

The client’s requirements
- Brief statement about the company, the opportunities or issues it faces and scope of the
- Aim to convey that consultant understands the key issues
- Not a complete description of the business and its situation

The overall aim of the project
- what the project aims to achieve, in broad terms
- Mission for the project from which definite objectives might be drawn

Objectives of the project
- List of detailed objectives: statements of what the project will do
- This consulting exercise aims to…

Outcomes of the project (in bullet points)
- Statement of what the business will be able to do as a result of receiving the consulting exercise and the delivery of its objectives
- “ As a result of this consulting exercise the business will be able to…”

Approach
- Description how consultants will address the issues
- Highlight the approach in broad terms, activities such as market research, analysis and guidance with implementation
- Not a detailed exposition of the methodologies!

Time plan
- Identification of when the outcomes of the project will be delivered
- Identification important milestones (key events) of the project

Key personnel
- Consulting is about paying for people’s skills and knowledge
- Brief description, what will be individual roles of the team members as well as of experience & skills (relevant, realistic and honest)

Project organisation (including clients)
- Should include clients, from steering committee to analysts
- Depending on projects size and scope.

Risk assessment
- Short description of project riks and possible mitigation
- Very brief, a detailed one should be done at the beginning of the project

Costing
-Statement of how much the project will cost the client
- Important elements: consultants’ fees, consultants’ expenses and any direct expenditure needed

Question 15

What not to include in a proposal?

Answer 15

A lot of background information on the business does not help
• Tells the client things he already knows.
• Runs the risk of losing interest before the important aspects of the proposal are reached.

The temptation to discuss the methodology that will be adopted should be avoided
• The formal business analysis techniques are the consultant’s concern not client’s.
• Consultant knows how to call upon a range of tools to deal with the hrsiness issues
• No reason to reveal those tools to the client.

Be brief. Include as much as needed, but as little as possible.

Question 16

Facets of a business problem

Answer 16

Business problem perceived by managers:

1. Rational aspect: logical evaluation of the value to the business of solving the problem.
2. Cognitive aspect: way individual managers see the problem using cognitive style and strategy
3. Political aspect: differential interest in solving problems of individuals and factional groups within the organization

Question 17

Dimensions of the problem and what is key for companies ?

Answer 17

Inhibitors: things which limit the business and stop firm achieving its goals

Assistors: things which help the business to achieve its goals

It’s key to turn external assistors into internal ones (taking control of customer demand through an effective marketing campaign

Question 18

What are some assistors and inhibitors?

Answer 18

Internal assistors:
-knowledge of products
-knowledge of markets
-business location

External assistors:
-relationship with customers
-expanding market potential
-high profit margins

Internal inhibitors:
-lack of knowledge about products
-lack of capital
-limited knowledge about the environment

External inhibitors:
-limited market potential
-competitor activity
-changes in customer demand
-high entry costs

Question 19

To work through problem, a consultant needs to go through different stages:

Answer 19

Stage 1: brainstorm causes
Exploration of possible causes of the problem in the bigger group

Stage 2: group the causes into catheories
Sort the ideas that come from brainstorming

Stage 3: construct a “cause and effect” diagram
A fish one diagram picturing the problem and likely causes

Stage 4: get to the root cause of major problems using the “5 Why’s methodology”
Determining the roots of the causes asking why until a meaningful answer to the root cause is discovered

Question 20

Objective setting: defining the desired end-state

Answer 20

Mission - reason for firm’s (thus projects) existence; a statement of what it will achieve and how, what is offered and to whom

Objectives - details how the aim will be made into a reality.

Question 21

Good objectives are:

Answer 21

• Consistent with the agreed aim of the project
• Well defined:if the objectives can be understood in different ways
• Desirable:will the achieving the objectives be good for the firm
• Feasible:are the objectives likely to be achieved given the environmental conditions ex. size of the market, competitive pressure
•Quantified: quantifin by numbers: what wil
be achieved? When it will be achieved?

Question 22

What’s the starting point and outcome of a project and explain the parts:

Answer 22

It’s the project charter
There are many ways to document the outcome of the definition of project scope and objectives. It should include:

1. Project information
-Leaders (client and consultant)
-Project start
-Project end
-Brief description

2. Project organisation
-Sponsor
-Steering committee
-Leader
-Core team

3. Case for the project
(Why are we doing this?

4. Scope of the project
-What should ard should not be included)

5. Project time frame
(Key milestones and issues)

6. Problem to be solved
(What will be the benefit?)

7. Project goals and business case
(What are your objectives?)

8. Project measurements/change
(How to know whether you are successful?
How to change anything in the project?)

Question 23

Development of a Strategy for the journey

Answer 23

One good option is DMAIC process

1. Define the problem.
2. Measurements (decide in measurements)
3. Analyse what is going wrong.
4. Improve the processes identified.
5. Control (hand control) back to the client.

Question 24

What are the core competences?

Answer 24

Core competences are the activities, processes and skills that allows competitive advantage by applying it to the business model.

It’s what do we do well

1. Understanding customers needs and behaviors
2. Basic offer
3. Entrepreneurial invention
4. Source of competitive advantage

Question 25

What’s the value chain? What does it shows?

Answer 25

The value chain shows the activities (and/or departments) that deliver competitive advantage. Which they all lead to have a desired margin

Support activities:
- Infrastructure
- Human Resources Management
- Technology development
- Procurement

Primary activities:
- Inbound logistics
- Operations
- Outbound logistics
- Marketing and sales
- Service

Question 26

Why do businesses fail? Areas consultant needs to know to understand a clients issues.

Answer 26

A consultant not only needs to understand what businesses do and do well, but also why they fail.

7 key areas for business failure:
1. Their business model
2. Not understanding markets and customers
3. Poor cash management
4. Ineffective financial management
5. No (or poor) business planning and performance
6. Inefficient processes
7. Poor management

Consultants need to look at these areas first when understanding a client’s issues.

Question 27

What are the eight stages of successful change within organizations? Which role do quick wins play?

Answer 27

1. Establish a sense of urgency
2. Create a powerful coalition
3. Develop a vision
4. Communicate the change vision
5. Empower employees to act on the vision
6. Generate short-term wins (Quick Wins)
7. Consolidate improvements and produce more change
8. Anchor new approaches to culture

The Change process can take a long time - so it is important to have some short-term wins that are visible, unambiguous and related to the change effort.

Targeting short-term wins does increase the pressure on people, useful way of keeping up the urgency, especially when the end is a long way off in a major program.

Question 28

Risk assessments

Answer 28

• Consultants are called in to address a ‘problem’.
• The problem or issue might be an opportunity the business could potentially exploit.
• Problems do not present themselves.
• The firms’ managers identify them.
• A problem has rational, cognitive and political facets that determine how it will be understood.
- Rational: logical, formal manner, economic value or cost
- Cognitive: the way in which the problem appears for manager
- Political: the way in which a problem is received and processed by the individuals who make up organization

Question 29

What are the elements of a risk assessment?

Answer 29

Risk definition
1. Number:number items on a list. Makes it easy to find them and there can be no misunderstandings when numbers are used
2. Risk description:keep it as short as possile while making it as long as needed
3. Risk causes - if known - will lie at the basis of risk mitigation: be comprehensive

Risk analysis
1. **Consequences must be clearly stated, also consequences of consequences
2. ** Likelihood: this is where risk assessments often lack clarity. Adding a column explaining this is helpful
3. With impact the same holds true as for likelihood. For both, do never have more than 4-5 options
4. Risk rating: is the result of likelihood and impact. Using red , yellow and green is helpful for readers of the project report.

Question 30

What are the ways to calculate projects days?

Answer 30

There are two ways:

Top down:
•Based on earlier projects and/or personal experience, the planner(s) evaluate how many days will probably be needed for a given project (if small) or task groups (if large)
• Depending on expertise, such evaluations can be surprisingly accurate.

Bottom up:
• All parts of the project are divided up into the smallest tasks or activities possible
•The amount of time of any task is either estimated or tested.

The results of both are then compared

Question 31

What contains the project log and what includes the status report?

Answer 31

Building on the project charter, a project will now design its project log which contains all plans and activities, dates and goals of the project, including status reports

The status report:
• aids further planning activities
• provides a summary of information collected and results achieved, thus a status overview
•contains meeting results, decisions taken and important notes also contains next steps, deadlines, upcoming milestones etc
•states how the project performs against budget and which steps will be taken in the case of slippage
•contains the updated risk report including risk mitigating steps
•And whatever else the client or the project management wishes to include.

A well executed project log, recording all relevant aspect of a given consulting exercise, encourages reflection along the project and also serves as an excellent learning resource for future projects.

Question 32

Consultant-client interaction:

Answer 32

The spectrum of consultant-client relationships depends on the level of intimacy

Low:
Consultant gets instructions at the beginning, completes the work independently and shares results at the end

Medium-low:
Consultant completes most of the work but discusses with client throughout
The consultant does most of the work but checks in with the client for discussions and feedback throughout the project

Medium-high:
Consultant leads or guides a team from client’s company to complete the project. The client’s team actively participates in the process

High:
Consultant is brought into the company for a specified time to fulfill a task or job function
The consultant becomes part of the company for a set period to perform a specific task or take on a role

Question 33

Benchmarking project progression

Answer 33

People taking active part during the project: team members, outside consultants and members of the client team.

Roles, members of the client team play, represented by the responsibility assignment matrix (RAM) to list the activities.
Four main categories of the RAM, under which one or more members of the client organization are listed:

Four main categories of the RAM
• Responsible:who performs task (best: one person)
• Accountable:who ensures completion (one person)
• Consulted:who is asked for their opinions (political reasons and to ensure that the activity is done properly)
• Informed: who has to be up-to-date with what is happening (no direct impact, need to be kept in touch due to wider implications of the project)

• There is a supports category for those who provide further resources

Question 34

What does RAM means and what is it about?

Answer 34

RAM is responsibility assignment matrix (RAM): it represents the roles that members of the client team play to list the activities.

Four main categories of the RAM, under which one or more members of the client organization are listed

1. Responsible:who performs task (best: one person)
2. Accountable:who ensures completion (one person)
3. Consulted: who is asked for their opinions (political reasons and to ensure that the activity is done properly)
4. Informed: who has to be up-to-date with what is happening (no direct impact, need to be kept in touch due to wider implications of the project)

• There is also a supports category for those who provide further resources

Question 35

Why is being sensitive to clients emotions important? What can you do about it?

Answer 35

Trust is the key to building and maintaining a good relationship.

Development of the TRUST: client - consultant

• Truthful: easy to tell what other wants to hear; even if the truth may be painful, it is a pre-requisite for a sound business relationship
• Responsive: the consultant has be responsive to the client’s needs and listen to them
• Uniform:consultants have to be consistent in their ideas and attitudes towards the project; so that the client doesn’t get confused
• Safe: important that the client can feel safe while working with the consultant through agreements, NDAs
• Trained: the client has to believe that consultant is competent in the area of expertise through ex. work experience, reputation

Question 36

What is TRUST?

Answer 36

Trust is the key to building and maintaining a good relationship.

Development of the TRUST: client - consultant

• Truthful: easy to tell what other wants to hear; even if the truth may be painful, it is a pre-requisite for a sound business relationship
**• Responsive: ** the consultant has to engage totally in the client’s world and being responsive to the client’s needs
**• Uniform: **consultants have to be consistent in their ideas and attitudes towards the project; client will get confused
**• Safe: ** important that the client can feel safe while working with the consultant through ex. secrecy agreements, NDAs
**• Trained: ** the client has to believe that consultant is competent in the area of expertise through ex. work experience, reputation

Question 37

What is critical in any strategic planning?

Answer 37

As with any strategic planning it is critical to have an effective vision:

Imaginable:conveys a picture of what the future will look like
Desirable:appeals to the long-term interests of all those who have stake in the enterprise
Feasible:comprises realistic, attainable goals
Focused:is clear enough to provide guidance in decision-making
Flexible : is general enough to allow individual initiative and alternative responses in the light of changing conditions
**Communicable: ** is easy to communicate; can be successfully explained within five minutes

Question 38

Why do firms risk with change programs?

Answer 38

• Satisfaction with the current situation of the business and lack of creating a sense of urgency in employees
• Don’t create powerful guiding coalition
• Underestimate the power of a vision: plays a key role by helping to direct, align and aspire actions
• Under-communicate the vision
• Obstacles block the vision: whenever people avoid confronting obstacles they disempower employees
• Fail to create short-term wins: without employees give up
• Declare victory too soon
• Neglect to anchor changes firmly in the corporate culture

Question 39

The decision tu use a consultant

Answer 39

The decision involves sinificant cost (time, money and opportunity) and is not lightly taken.
Benefits must outweigh the costs (decision to use a consultant is like decision to buy anything else)

A management consultant should bear in mind 3 fundamental issues:
• What they offer must enhance a clients performance and help achieve its objectives
•their contribution has to be more valuable than existing managers or recruits can contribute
• The client should be aware of the added value of the consultant.

Question 40

What is consulting?