Consulting

Sector report on
Consulting
Presented by:
Swapnil Bhosale - 41
Jeetendra Chaudhari - 42
Nisha Deora - 43
Sonalika Dhar - 44
NIkhil Gala - 45
Vartika Gupta - 46
What is Consulting
“A process as any form of providing help on the content, process, or structure of a task or
series of tasks, where the consultant is not actually responsible for doing the task but is
helping those who are”
It is :
 Professional Service
 Advisory Service
 Independent Service
 Temporary Service
 Commercial Service
HERE ARE SOME OF THE LEADING
CONSULTING FIRMS
ource: Vault 2002 Consulting Survey

Purpose of Consulting
 Achieving organizational purposes and objectives
 Solving management and business problems
 Identifying and seizing new opportunities
 Enhancing learning
 Implementing changes
Why are external consultants used?
 Providing special knowledge and skill

 Supplying intensive professional help.
 Giving an impartial outside viewpoint.
 Providing management with arguments which justify predetermined measures
THERE ARE THREE BROAD LEVELS OF CONSULTING FIRMS (I)
Nature of Business
What They To whom

Sell
Strategic CEOs
Counsel
Functional
Functional
Expertise heads
Operationa
Operating
l
Product heads
THERE ARE THREE BROAD LEVELS OF CONSULTING FIRMS (II)
Nature of Work
What business portfolio should I have?
What companies should I acquire / sell?
How should I globalise?

Strategic
How do I grow my business?
How do I reduce my costs?
Functional What IT architecture should I have?
What incentive structure will help me?
Will you set up my new plant?

Operationa
Can you help improve my processes?
l
How do I implement SAP?
THERE ARE THREE BROAD LEVELS OF CONSULTING FIRMS (III)
Examples of Firms
Strategic
Functional
Operationa
l
TYPES OF CONSULTING
 Financial Consulting
 Strategic Consulting
 Marketing Consulting
 Human Resource Consulting
 IT Consulting
Financial Consulting
 Enterprise Development
 Capital management
 Least Cost operational Alternatives
 Accounting Systems:
– Management Information
– Financial accounting
– Credit control
– Inventory control
– Cost accounting
– Information processing
Major Players in Different Types of
consulting
Startegy BCG, Mckinsey , Accenture, Roland Berger
Operations E & Y, Delloite and Touche, At Kearney
Techno Management At Kearney, Cider, Infosys, TCS, KSA Technopark, Delloite and
touche
Hr Consulting Mercer
Financial Consulting Auditing firms, Karvey (portfolio management)

HSBC, Kotak mahindra, Morgan stanley (Investment banks)
Full Service Accenture, Mckinsey , PWC
Specialised
Airline and Banking Kale Consultants
The Big Five World wide
 PricewaterhouseCoopers $22.3 billion
 Deloitte Touche Tohmatsu $12.4 billion
 KPMG International $11.3 billion
 Ernst & Young International $10.0 billion
 Andersen $9.3 billion
 (As at the end of 2001)

 *Source: company press releases for all but Ernst & Young, which is an estimate from the Forbes
Fortune 500)
BC Markets - By Country
in 2005 (%)
 U.S.A. 54
 Western Europe 32
 Canada 4
 Japan 4
 Latin America 1
 Asia Pacific 2
 RoW 3
*Source (IDC)
Market Drivers and inhibitors
 The consulting services market will grow and evolve
because of various market forces that keep generating
demand and initiating new developments on the
market.
 World wide Consulting market will grow at 15.2%
(CAGR)
– Absolute terms - $138 billion by 2005
 US consulting market will grow at 14.8% (CAGR)
– Absolute Terms - $70.8 billion by 2005
*Source IDC
Positive market drivers in the consulting market include:
– Mergers and acquisitions

– Deregulation and privatization
– Restructuring
– Adoption of new technologies
– Globalization
– Market liberalization
– Economic prosperity
– Favorable conditions of capital markets
Market Inhibitors
– Global economic slowdown and recession

– Political instability
– Legislative constraints
– Other shocks (9/11)
Key Competitive Success Factors
(World Wide)
 Focus on total solutions and integration of services

 Enhancement of depth and breadth of services provided
 Multiple pricing strategies
 Relationship building on the end-user side
 Synergistic partnerships and cooperation
Current scenario In India
 No of Consultancy Organizations : 4000
 Annual Turnover : 1000 Crores
 No Of Specialists : 1,00,000
 No of Management Consultants : 10,000
 The Market is Oligoplistic
 The market is highly concentrated
* (Source ESCAP Report)

The consulting industry in India can be called as an oligopoly on the basis of
the following factors:
1. Few consolidated companies exist in the market. The market is dominated

by a few multinational entities which control over 90% of the total
consulting market
2. The firms are not price taker nor are they price givers. There is intense
competition firms and they frequently resort to understating their fee but the
fee is still determined by themand not the market
3. The competition exists in the upper strata of the market where the bigger
names jockey for space.
4. The action of each firm is not independent of each other rather the decisions
taken by an organization are taken after a detailed analysis of the reaction
that the decision will attract
Concentration
 Largest concentration of consultancy
organizations is in the four
metropolitan cities. 25.7
27.6
Break up:
 Delhi (25.7%)
 Mumbai (25.5%) 9.1
12.1 25.5
 Chennai (12.1%)
 Calcutta (9.1%)
 Others (27%) delhi
Mumbai
Chennai
Calcutta
Others
Reasons for competitive advantage of major
players
 Absolute Size
 Global Operations
 Wide Scope of operations
 Experience
 Reputation and Clientele
Firm No.of employees Revenues Remarks
/ No. of (in Rs. Crores)
Employees in
IT
Mckinsey Over 135 / NA 90-100 The firm is growing its India
practice but competitors claims
it is in red
BCG 60/NA 25-30 Strategy is cautious & mild
KPMG 60/NA 45 The Indian arm is yet to separate

Consulting from Audit Business
PWC 850-900 / NA 125 Strong presence in IT consulting

Consulting
Cap 400 / 600 NA Focus is on Technology
Gemini
E&Y
Firm No.of employees/ Revenues Remarks
No. of Employees (In Rs. Crores)
in IT
Deloitte Touche NA NA Doesn’t have much

Tohmatsu presence in India
A.T.Kearney 40 / NA 25-30 Strong presence in

Infrastructure &
Retail Sector
Accenture 700 / 500 105 It is original IT

consultant.
GROWTH OPPORTUNITIES
Presently opportunities exists in the following fields :
1. Infrastructure and Resource Development

2. Technology up gradation
3. Energy Management/ Conservation/ Non-conventional sources
4. Power, Telecommunication, Road Construction
5. Environment protection & planning

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Sector report on

ource: Vault 2002 Consulting Survey

 Providing special knowledge and skill

What They To whom

What business portfolio should I have?

What companies should I acquire / sell?

How should I globalise?

How do I reduce my costs?

Functional What IT architecture should I have?

What incentive structure will help me?

Will you set up my new plant?

Operations E & Y, Delloite and Touche, At Kearney

Financial Consulting Auditing firms, Karvey (portfolio management)

Full Service Accenture, Mckinsey , PWC

 (As at the end of 2001)

– Mergers and acquisitions

– Global economic slowdown and recession

 Focus on total solutions and integration of services

 Annual Turnover : 1000 Crores

 No of Management Consultants : 10,000

 The Market is Oligoplistic

 The market is highly concentrated

* (Source ESCAP Report)

1. Few consolidated companies exist in the market. The market is dominated

BCG 60/NA 25-30 Strategy is cautious & mild

KPMG 60/NA 45 The Indian arm is yet to separate

PWC 850-900 / NA 125 Strong presence in IT consulting

Deloitte Touche NA NA Doesn’t have much

A.T.Kearney 40 / NA 25-30 Strong presence in

Accenture 700 / 500 105 It is original IT

1. Infrastructure and Resource Development

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