Must know Tools & Techniques in a Business Consulting World

Consulting (1) Insights success

Today, we are living in a world which is changing very rapidly. A revolution is taking place in almost every business sector. IT, infrastructure, healthcare, telecommunication, education, FMCG, Media & PR are going through massive transformation. With ever growing startups and existing old players, competitions in every business is going a notch higher with each passing year. To be relevant in this tough competition and earn higher profit margins, various businesses hire “Business Consultant”. Due to a tough and highly competitive environment, the role of a business consultant becomes very important for a company’s growth. A consultant’s advice can make or break an organization. Here are some of the tools and techniques which are crucial in a business consulting job.

GE McKinsey Matrix

Investment is an important aspect for the growth of any business. The fight for investments takes place at every level of a company; between teams, functional departments, R&D departments, marketing and sales departments etc. The question of where and how much to invest is an ever going headache for business leaders. GE McKinsey is a strategic tool which helps consultants to prioritize investment for its client. GE Mckinsey is a strategic tool that offers a systematic approach for a multi-business corporation to prioritize its investments among its business units. Ever increased competition, low profit margins, shortage of skilled and experienced persons etc. making business vulnerable in today’s fast moving world, GE McKinsey Matrix is a solution, which has the potential to help organization in better planning of their investments, in order to gain higher profitability.

Porter 5 forces

To be relevant in a competition, it is very necessary to have knowledge about our own and competitors strengths and weaknesses. Porter’s five forces is a simple but powerful tool for evaluating the competitiveness of your business environment and for identifying a qualitative strategy for potential profitability. Porter model is used to analyze on ground real competition among rivals of same domains. It helps a company to make policy framework and corporate strategy. Business consultants use Porter five forces to evaluate a firm’s strategic policy.

There are five parameters on which Porter’s principle is based. Understanding these parameters help consultants to derive a meaningful strategic policy for their client. These parameters are competitive rivalry, supplier power, buyer power, threat of substitution and threat of new entrants.

Balanced scoreboard

Balanced scoreboard is a tool which connects the dots between big pictures. This tool helps an organization to keep track of a company’s mission (our purpose), vision (what we aspire to do), core values, strategic focus area’s and day to day operational activities.  There are different metrics on which this tool produces necessary outcomes. These metrics are revenue, earnings, and market share, quality of product or services, employee morale, customer satisfaction.

Benchmarking

Benchmarking is the process of comparing one’s business process and performance metrics with its competitors. It helps an organization to improve its performance. Metrics on which benchmarking typically done are production costs, employee turnover, process cycle time.

Core Competencies

You can find multiple companies who are offering the same product and services at different prices across the domains. These companies may be varied in size, employee’s strength, profit, market share, growth rate etc., but still they fight and remain in competition for long. The factor which makes many small and medium size companies even big MNC’s to fight and survive in an ever increased, tough and highly competitive market is some unique characteristics. Each organization has its unique strength; we can call this unique strength as a core competency. A core competency is an expertise in an area that is not easily replicated by competitors. It allows your organization to deliver unique value to customers, thus giving the company a “leg up” on the competition.

Identifying core competencies and putting extra effort to refine and develop it further can make an organization relevant in the long run. It also helps in achieving better results in terms of marketing and profits.

As the economy and GDP are growing in many parts of the world, especially in developing countries, the demand of business consultant is also increasing across the domains. Not only private companies are utilizing the service of a business consultant but many government organizations as well. With having good knowledge of these tools and techniques, a business consultant can give much better advice to its clients and helps an organization to grow and compete in these challenging business environments.

                                                                                                         –  Ashwini Deshmukh