Boston Consulting Group

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The Boston Consulting Group
Type Partnership
Industry Management consulting
Founded 1963
Headquarters Boston, Massachusetts, United States
74 offices in 42 countries
Key people Hans-Paul Bürkner, President & CEO
Products Management consulting services
Revenue US$ 3.05 billion (2010) BCG.com
Employees 4,800 (consultants) BCG.com
Website bcg.com

The Boston Consulting Group (BCG) is a global management consulting firm with offices in 42 countries. It is recognized as one of the most prestigious management consulting firms in the world.[1] It is one of only three companies to appear in the top 15 of Fortune's "Best Companies to Work For" report for seven consecutive years.[2] In the 2011 list, BCG is listed as the second best company to work for, and is the only top-tier consulting firm to appear in the top 100 according to Fortune.[3] BCG is also the only firm to have been listed every year in Consulting Magazine's "Best Firms to Work For" list, since the magazine's inception in 2001.[4]

The company was formed by Bruce D. Henderson, a Vanderbilt University and Harvard Business School alumnus. After many years in the purchasing department of Westinghouse in Pittsburgh (where pricing behavior gave him the idea of the experience curve), he joined Arthur D. Little in Cambridge, Massachusetts. He was then recruited by The Boston Company, where he founded a one-man, one-telephone consulting unit he named Boston Consulting Group. In 1975, Henderson arranged an employee stock ownership plan, and employees took the company independent from The Boston Company.[5] The buyout of all shares was completed in 1979.[6]

Contents

[edit] Concepts developed

[edit] "Growth-share matrix"

Growthsharematrix.png
BCG matrix of example data set

In 1968, BCG created 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" (originally "Pets"), 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.[7][8]

[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 expounded the implications of the experience curve for strategy.[9] 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.[10]

[edit] Advantage matrix

In this matrix, the two axes are economies of scale and differentiation. The four quadrants formed are called "Volume", "Stalemated", "Specialized", and "Fragmented".

[edit] Recruiting

BCG typically hires for Associate or Consultant positions. While so-called "lateral hires" as Project Leader, Principal or Partner are possible, they are not the norm. In the United States, BCG recruits undergraduates to join as Associates from about a dozen institutions. Top-performing Associates receive sponsorship to pursue an MBA, returning to BCG upon completion. Some Associates advance to Consultant and beyond without obtaining an MBA, but the vast majority of Associates attend business school. A few complete JDs, MD and other graduate degrees at various institutions (called ADCs for Advance Degrees Consultants). BCG also makes large efforts to hire advanced non-business degree holders. Graduates holding J.D.s, M.D.s and Ph.D.s in disciplines like engineering, science, and liberal arts receive training in business fundamentals and then typically join the firm as Consultants although this varies between different geographies. There is also an opportunity to join as a Summer Associate or Summer Consultant (internship) position for 10 weeks, which for many interns will result in an offer of a full-time position.

Like most consulting firms, BCG uses a modified version of the Cravath System, also known as "up or out".

[edit] Competitors

Three firms compete in providing management consulting services to Fortune 500 and large enterprises, consistently recruiting top talent from elite colleges and professional/graduate schools globally: McKinsey & Company, Bain & Company, and The Boston Consulting Group.[11] This top tier of the consulting industry is commonly termed "the MBB" by executive recruiters and industry insiders.[12]

Although these three firms compete directly across all major sectors and geographies, each firm possesses its own unique profile that defines its sustainable competitive advantage in the marketplace.

[edit] Publications

  • Michael J. Silverstein and Kate Sayre. Women Want More: How to Capture Your Share of the World's Largest, Fast-Growing Market 2009.
  • Harold L. Sirkin, James W. Hemerling and Arindam K. Bhattacharya. Globality: Competing with Everyone from Everywhere for Everything 2008.
  • Carl W. Stern and Michael S. Deimler: The Boston Consulting Group on Strategy 2006. A collection of articles on strategy and management
  • James P. Andrew and Harold L. Sirkin: Payback – Reaping the Rewards of Innovation Harvard Business School Press 2006
  • Michael J. Silverstein with John Butman: Treasure Hunt – Inside the Mind of the New Consumer 2006.
  • Michael J. Silverstein and Neil Fiske: Trading Up – Why Consumers Want New Luxury Goods and How Companies Create Them 2003
  • Jeanie Daniel Duck: The Change Monster – The Human Forces that Fuel or Foil Corporate Transformation and Change 2002.
  • Tiha von Ghyczy and Bolko von Oetinger: Clausewitz on Strategy 2001.
  • Philip Evans and Thomas S. Wurster: Blown to Bits – How the New Economics of Information Transforms Strategy 2000.

[edit] Offices

[edit] Asia-Pacific

New Zealand Auckland founded in 1990
Thailand Bangkok founded in 1994
China Beijing founded in 2001
Australia Canberra founded in 2010
Hong Kong Hong Kong founded in 1990
Indonesia Jakarta founded in 1995
Malaysia Kuala Lumpur founded in 1992
Australia Melbourne founded in 1990
India Mumbai founded in 1996

Japan Nagoya founded in 2002
India New Delhi founded in 2002
Australia Perth founded in 2010
South Korea Seoul founded in 1995
China Shanghai founded in 1993
Singapore Singapore founded in 1995
Australia Sydney founded in 1990
Republic of China Taipei founded in 2003
Japan Tokyo founded in 1966

[edit] Europe, Middle East and Africa

United Arab Emirates Abu Dhabi founded in 2007
Netherlands Amsterdam founded in 1993
Greece Athens founded in 2001
Spain Barcelona founded in 2002
Germany Berlin founded in 1999
Belgium Brussels founded in 1993
Hungary Budapest founded in 1997
Morocco Casablanca founded in 2010
Germany Cologne founded in 2001
Denmark Copenhagen founded in 1998
United Arab Emirates Dubai founded in 2007
Germany Düsseldorf founded in 1982
Germany Frankfurt founded in 1991
Germany Hamburg founded in 1994
Finland Helsinki founded in 1995
Turkey Istanbul founded in 2003 closed in 2005, and re-opened in 2010
South Africa Johannesburg founded in 2011

Ukraine Kiev founded in 2007
Portugal Lisbon founded in 1995
United Kingdom London founded in 1970
Spain Madrid founded in 1987
Italy Milan founded in 1986
Russia Moscow founded in 1994
Germany Munich founded in 1975, European headquarters
Norway Oslo founded in 1996
France Paris founded in 1972
Czech Republic Prague founded in 2004
Italy Rome founded in 2001
Sweden Stockholm founded in 1988
Germany Stuttgart founded in 1997
Israel Tel Aviv founded in 2010
Austria Vienna founded in 1997
Poland Warsaw founded in 1997
Switzerland Zürich founded in 1989

[edit] The Americas

United States Atlanta founded in 1995
United States Boston founded in 1963, Global Headquarters
Argentina Buenos Aires founded in 1995
United States Chicago founded in 1979
United States Dallas founded in 1994
United States Detroit founded in 2005
United States Houston founded in 2003
United States Los Angeles founded in 1982
Mexico Mexico City founded in 1998
United States Miami founded in 2003

United States Minneapolis founded in 2007
Mexico Monterrey founded in 1993
United States New Jersey founded in 2006
United States New York founded in 1984
United States Philadelphia founded in 2007
United States San Francisco founded in 1974
Chile Santiago founded in 2002
Brazil São Paulo founded in 1997
Canada Toronto founded in 1993
United States Washington, D.C. founded in 1996

[edit] Notable current and former employees

[edit] Business

[edit] Politics and public service

[edit] Academia

[edit] Others

[edit] References

  1. ^ "Vault.com". Vault.com. 2012-01-05. http://www.vault.com/wps/portal/usa/companies/company-profile?companyId=322&search_type=company. Retrieved 2012-02-11. 
  2. ^ The other two are Wegmans and W. L. Gore & Associates. Company press release
  3. ^ Fortune magazine, "100 Best Companies To Work For, 2011"
  4. ^ "Consulting Magazine, "". Consultingmag.com. http://www.consultingmag.com/article/ART646235?C=vwYyWJTDVE7NlfT. Retrieved 2012-02-11. 
  5. ^ About BCG: BCG.com
  6. ^ About BCG: BCG.com
  7. ^ The Product Portfolio, BCG, January 1970
  8. ^ The Experience Curve Reviewed BCG
  9. ^ Hax, Arnoldo C.; Majluf, Nicolas S. (October 1982). "Competitive cost dynamics: the experience curve". Interfaces 12 (5): 50–61. doi:10.1287/inte.12.5.50. 
  10. ^ 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 March 24, 2007. 
  11. ^ Luefschuetz, Gary S., Selling Professional Services to the Fortune 500: How to Win in the Billion-Dollar Market of Strategy Consulting, Technology Solutions, and Outsourcing Services, (McGraw-Hill Professional, 2010) via Google Books.
  12. ^ "Consultant speak: management consulting lingo, consulting terminology and common consulting terms". Managementconsulted.com. http://managementconsulted.com/core-content/dictionary/. Retrieved 2012-02-11. 
  13. ^ Chief Executive magazine. "CEO of the Year 2005."
  14. ^ Cohan, Peter. "Will Obama serve Sam Adams at this week's White House happy hour?." DailyFinance.com. July 28, 2009
  15. ^ VCgate. "Kayak.com Leading The Travel Search Engine Market." March 14, 2009
  16. ^ Business Wire. "Appointments Within LVMH's Watch & Jewellery Business Group." July 12, 2000
  17. ^ GMAC Financial Services press release. "New GMAC Board of Directors is Established." May 27, 2009
  18. ^ Yamazaki, Tomoko and Sato, Shigeru. "TCI Loses More Than Face as Japan Says No to Foreigners Playing." Bloomberg L.P.. July 29, 2009
  19. ^ Thomson Reuters. "News Corp appoints Jan Koeppen COO Europe and Asia." March 19, 2009
  20. ^ Hiralal, Baz. "J.P. Morgan banker exits to advise Russia on M&A?." TheDeal.com. May 15, 2009.
  21. ^ Byrt, William John. "Management Education: An International Survey"
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