Boston Consulting Group
From Wikipedia, the free encyclopedia
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| Type | Partnership |
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| Founded | 1963 |
| Headquarters |  Boston, Massachusetts66 offices in 38 countries |
| Key people | Hans-Paul Bürkner, President & CEO |
| Industry | Management consulting |
| Products | Management consulting services |
| Revenue | US$ 2.3 billion (2007) |
| Employees | about 7,000 |
| Website | bcg.com |
The Boston Consulting Group (BCG) is a global management consulting firm, founded by Bruce Henderson in 1963. It has 66 offices in 38 countries, and its current CEO is Hans-Paul Bürkner. BCG is generally ranked as one of the two most "prestigious" management consulting firms in the world.[1]
The firm prides itself on its employee-focused culture, and over the last 4 years has been the only top-tier consulting firm to appear in Fortune magazine's "Best companies to work for" report. In the 2009 list, BCG is listed as the 3rd best company to work at, and is the only top-tier consulting firm to appear in the top 100.[2]
The company was formed when Henderson, a Harvard Business School alumnus, left Arthur D. Little to become head of a new management consulting division of the Boston Safe Deposit and Trust Company.
In 1975 Henderson arranged an employee stock ownership plan, so that the employees could take the company independent from The Boston Safe Deposit and Trust Company. The buyout of all shares was completed in 1979.
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[edit] Thought Leadership
[edit] BCG Growth-Share Matrix
In the 1970s, BCG created and popularized the "Growth-Share Matrix", a simple chart to assist large corporations in deciding how to allocate cash among their business units. The corporation would categorize its business units as "Stars", "Cash Cows", "Question Marks", and "Dogs", and then allocate cash accordingly, moving money from "cash cows" toward "stars" and "question marks" that had higher market growth rates, and hence higher upside potential.
The chart was popular for two decades and "continues to be used as a primer in the principles of portfolio management," as BCG says.
[edit] Experience Curve
The Experience Curve illustrates that the more often a task is performed the lower will be the cost of doing it. The task can be the production of any good or service. Each time cumulative volume doubles, value added costs (including administration, marketing, distribution, and manufacturing) fall by a constant and predictable percentage.
In the late 1960s Bruce Henderson, the founder of BCG, began to emphasize the implications of the experience curve for strategy.[3] BCG research concluded that because relatively low cost of operations is a very powerful strategic advantage, firms should capitalize on these learning and experience effects.[4] The reasoning is increased activity leads to increased learning, which leads to lower costs, which can lead to lower prices, which can lead to increased market share, which can lead to increased profitability and market dominance. According to BCG, the most effective business strategy was one of striving for market dominance in this way. This was particularly true when a firm had an early leadership in market share. It was claimed that if you cannot get enough market share to be competitive, you should get out of that business and concentrate your resources where you can take advantage of experience effects and gain dominant market share. The Growth-Share Matrix was developed (in part) to manage this strategy.
[edit] Advantage Matrix
Another "BCG Matrix", much less widely known, is the Advantage Matrix. The two axes are economies of scale and differentiation. The four quadrants formed are called "Volume", "Stalemated", "Specialized", and "Fragmented".
[edit] Publications
BCG regularly publishes articles, industry reports, and government commissioned studies relating to particular industries or business functions. For example, a recent series of articles called "Collateral Damage" discusses how the Subprime Crisis is affecting non-financial companies, and what they can do to survive.
In addition, many partners have written books on issues facing management in the modern business environment. Some recent publications include:
- Globality: Competing with Everyone from Everywhere for Everything. By Harold L. Sirkin, James W. Hemerling and Arindam K. Bhattacharya, 2008.
- The Boston Consulting Group on Strategy. By Carl W. Stern and Michael S. Deimler, 2006. Classic anthology of articles on strategy and management
- Payback - Reaping the Rewards of Innovation. By James P. Andrew and Harold L. Sirkin, 2006. Published by the Harvard Business School Press, Payback has become a staple in the MBA curriculum.
- Treasure Hunt - Inside the Mind of the New Consumer. By Michael J. Silverstein with John Butman, 2006.
- Trading Up - Why Consumers Want New Luxury Goods and How Companies Create Them. By Michael J. Silverstein and Neil Fiske, 2003. A BusinessWeek Bestseller and Berry AMA book prize winner.
- The Change Monster - The Human Forces that Fuel or Foil Corporate Transformation and Change. Jeanie Daniel Duck, 2002.
- Clausewitz on Strategy. By Tiha von Ghyczy and Bolko von Oetinger, 2001.
- Blown to Bits - How the New Economics of Information Transforms Strategy. By Philip Evans and Thomas S. Wurster, 2000.
[edit] Recruiting
BCG typically hires for an Associate or a Consultant position. Whilst so called "lateral hires" as Project Leader, Principal or Partner are possible, they are not the norm. BCG recruits undergraduates to join as Associates from the world's top academic institutions. In the United States, this includes about a dozen top private institutions. Many Associates receive sponsorship to pursue an MBA, returning to BCG upon completion. A very small number of Associates are permitted to advance without obtaining an MBA. The vast majority of Associates attend one of the top five business schools. A few complete JDs, MD and other graduate degrees at various institutions (called ADCs for Advance Degrees Consultants)
BCG recruits MBA graduates to join as Consultants from the world's top business schools. BCG also makes large efforts to hire advanced non-business degree holders. Graduates holding JDs, MDs and PhDs in disciplines like engineering, science, and liberal arts receive training in business fundamentals and then typically join the firm as Consultants. There is also an opportunity to join as a Summer Associate or Summer Consultant (internship) position for 10 weeks, which for the majority of interns will result in an offer for full-time position.
[edit] Interview process
BCG uses the case method to conduct interviews, which is an interview technique designed to simulate the types of problems inherent in management consulting and to test the qualitative and quantitative skills deemed important for abstract thinking in a business setting.
[edit] Competitors
BCG competes most directly with McKinsey & Company and Bain & Company. BCG, McKinsey, and Bain are consistently rated as the three most "prestigious" consulting firms.[1] The three are considered to be "pure strategy" firms, and generally offer similar prices for contracts. With roughly 7,000 employees, BCG is smaller than McKinsey (17,000) and larger than Bain (4,300). BCG is the largest of the three in some countries, such as Germany and Australia.
BCG also occasionally competes with other firms such as Booz & Company, Monitor Group, Deloitte, PricewaterhouseCoopers, Accenture, and A.T. Kearney, but less directly. These firms are generally priced significantly lower, and offer a different value proposition, often focused on their ability to implement the recommendations they give. It is common for a company to employ BCG as well as some of these firms, but often for different types of work.
[edit] Offices
[edit] Offices in Asia Pacific
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[edit] Offices in Europe and the Middle East
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[edit] Offices in the Americas
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[edit] Companies founded by current and former employees
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Finance Non-profit |
Travel Other |
[edit] Notable current and former employees
[edit] Business
- Jeff Immelt - CEO of General Electric
- Indra Nooyi - CEO of Pepsi
- George David - Chairman and former CEO of United Technologies[5]
- Stefan Quandt - Owner of Delton AG
- Andy Hornby - CEO of Alliance Boots, former CEO of HBOS plc
- Neil Fiske - CEO of Eddie Bauer, co-author of Treasure Hunt: Inside the Mind of the New Consumer
- Michael Dornemann - Chairman & CEO of Bertelsmann Entertainment
- Bill Bain - Founder of Bain & Co.
- Jim Whitehurst - CEO of Red Hat, former COO of Delta Airlines
- Gerald Corbett - CEO of Railtrack
- Mauricio González Sfeir - Former President of YPFB, Former Secretary of Energy of Bolivia, owner of La Paz F.C.
- Bruce Buchanan - CEO of Jetstar Airways
- Martin Halusa - CEO of Apax Partners
- Steve Hafner - Co-founder and CEO of Kayak.com, co-founder and former CEO of Orbitz[6]
- Ahmed Fahour - CEO of the Australian operations of the National Australia Bank
- Andreas Jacobs - Chairman of Barry Callebaut
- Jean-Christophe Babin - CEO of TAG Heuer[7]
- Alan Tripp - Founder of SCORE! Educational Centers and InsideTrack
- Michael Carpenter - Chairman of Southgate Alternative Investments, former CEO of Salomon Smith Barney[8]
- Michael R. Eisenson - co-founder of Charlesbank Capital Partners, former managing director of the Harvard Management Company
- William Browder - Co-founder of Hermitage Capital Management
- John Paulson - Founder of Paulson & Co, a New York-based hedge fund
- Gary M. Reiner - SVP and CIO of General Electric
- Harold L. Sirkin - Author of several business books, including Payback: Reaping the Rewards of Innovation and GLOBALITY: Competing with Everyone from Everywhere for Everything
- Michael J. Silverstein - Author of several bestselling business books, including Trading Up: The New American Luxury and Treasure Hunt: Inside the Mind of the New Consumer
- John Ho - Former Asia chief of The Children's Investment Fund
- Jan Koeppen - COO of News Corporation Europe and Asia[9]
- Daniel Gulati - Young entrepreneur, one of Australia's "mini-moguls" under 25[10]
- Peter Balnaves - CTO of CVS Caremark
- Mehmet Subasi - Founder & CEO of Vodaco
- Ariane de Bonvoisin - Author of The First 30 Days: Your Guide to Any Change (And Loving Your Life More)
- Aamir A. Rehman - Author of Dubai & Co.: Global Strategies for Doing Business in the Gulf States
- Azwan Khan Osman Khan - Senior Vice President, Corporate Strategy & Development, Celcom
[edit] Politics and public service
- Benjamin Netanyahu - Prime Minister of Israel (1996-1999, 2009 - Present)
- Mitt Romney - Governor of Massachusetts (2003-2007), CEO of the 2002 Winter Olympics in Salt Lake City, co-founder of Bain Capital, former CEO of Bain and Company
- Jeffrey Hunker - National Security Council member under President Bill Clinton and professor at Carnegie Mellon University
- Hans Wijers - Minister of Economic Affairs of the Netherlands (1994-1998), CEO of Akzo Nobel
- Ira Magaziner - Aide and policy advisor to President Clinton, CEO of SJS Advisors and co-founder of Brown University's open curriculum
- Peter Lampl - Founder and Chairman of Sutton Trust
- Steve Poizner - California businessman and Republican politician
- Mahlon Apgar, IV - international authority on housing, infrastructure, and real estate
- Natasha Tsukanova - Advisor to the Russian government on Energy M&A[11]
- Ken Hachikian - Chairman of the Armenian National Committee of America and Cambridge Heart, Inc.
[edit] Academia
- Clayton M. Christensen - Robert and Jane Cizik Professor, Harvard Business School
- Michael Chu - Senior Lecturer, Harvard Business School, Former partner Kohlberg Kravis Roberts, and a founding senior partner of Pegasus Capital
- James Abegglen - was a university professor in management and economics, the author and co-author of ten books on Japan
- Linda Bilmes - Professor, Harvard Kennedy School of Government
- Jeffrey Hunker - Distinguished Service Professor of Technology and Public Policy, Carnegie Mellon University
- John R. Wells - Professor, President International Institute for Management Development, Switzerland
- Kaz Uchida - Professor, Waseda University, Tokyo
- Aiba Koji - Professor, Waseda University, Tokyo
[edit] Others
- John Legend - Grammy award winning musician
- Liu Yiting - Subject of the book Harvard Girl, a best-seller in China
- Alex Michel - Star of the Bachelor, Season One
- Carl Woebcken - German film producer
- Jehan Ratnatunga - Co-Founder of Ripple (charitable organisation)
- Jesse Ward - Golf pro
[edit] See also
[edit] References
- ^ a b http://www.vault.com/nr/consulting_rankings/consulting_rankings.jsp?consulting2009=2&ch_id=252
- ^ http://money.cnn.com/magazines/fortune/bestcompanies/2009/full_list/
- ^ Hax, Arnoldo C.; Majluf, Nicolas S. (October 1982). "Competitive cost dynamics: the experience curve". Interfaces 12: 50–61. doi:.
- ^ Henderson, Bruce (1974, #149). "The Experience Curve Reviewed: V. Price Stability" ([PDF] Reprint). Perspectives (The Boston Consulting Group). http://www.bcg.com/publications/files/experiencecurveV.pdf. Retrieved on 2007-03-24.
- ^ http://www.chiefexecutive.net/ME2/Audiences/dirmod.asp?sid=&nm=&type=Publishing&mod=Publications%3A%3AArticle&mid=8F3A7027421841978F18BE895F87F791&tier=4&id=2F64778E21C1413E9EF9564BF90749D9&AudID=257093CD337F495B86A6A07046702F8C
- ^ http://www.vcgate.com/Kayak-com-Leading-The-Travel-Search-Engine-Market.asp
- ^ http://www.allbusiness.com/manufacturing/miscellaneous-mfg-jewelry-silverware/6547960-1.html
- ^ http://news.prnewswire.com/DisplayReleaseContent.aspx?ACCT=104&STORY=/www/story/05-27-2009/0005033571
- ^ http://www.forbes.com/feeds/afx/2009/03/19/afx6189791.html
- ^ Kallmeyer, N. 'Mini Moguls: One good idea can lead to a career' Sydney Morning Herald, 25 June 2008, p.4
- ^ http://www.thedeal.com/corporatedealmaker/2009/05/jp_morgan_banker_exits_to_advi.php
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