The Coin Flip

Flip a coin. Make a decision

The Coin Flip

HAVE you ever had two options, and found it difficult to choose between them?

You may have applied for MBA programs and received offers from Oxford and Cambridge. You may have been offered a new job from a competing firm. Or, you may have been trying to decide what to get for dinner: Italian or Mexican?

Tough choices.

Since you are well educated, your response to these situations is likely to be a consideration of the pros and cons. The Italian place offers home delivery. But at the same time, you have coupons for the Mexican place and you really like Burritos.

Dilemma. We have all been there.

The decision can be difficult because you are trying to justify action with logical reasoning. However, assuming you are across the facts, in many cases the decision will already have been made. Logic makes us think, but emotion makes us act. And so the option you will already be leaning towards is the one that you find more emotionally appealing.

Since emotions are controlled by a more primitive part of the brain than the parts responsible for reason, logic or language, it may not just be difficult to engage in logical reasoning in these situations, it may actually be impossible. However, even if this is the case, you can still hope to make sensible decisions if you follow these three simple steps:

  1. Acceptance: The first step is simply to accept that your actions are driven by emotion not logic.
  2. Understanding: The second step is to determine your emotional state. Some people are very in tune with their emotions (and all the better). However, for the rest of us, there is a nice trick that you can use. Take a coin from your pocket, and flip it. Heads you will go for Italian food, and tails you go for Mexican. After the coin lands, observe the result, and immediately observe how you feel about the outcome. If the coin lands heads and you feel happy, then Italian food it is. But if you are sad about the result, then you have made a discovery; you actually prefer Mexican.
  3. Reflection: The third step brings logic back into the picture. You now know which option you prefer, and so consider whether there are any logical reasons why your preferred option does not make sense. For example, you might prefer Mexican food but [you are allergic to Pinto beans / the store is closed / insert logical objections here].

[For more information on consulting concepts and frameworks, please download “The Little Blue Consulting Handbook“.]

Kyle Bass: The End is Nigh for Japan

“I would like to live in a world where it’s all rainbows and unicorns, and we could make Krugman the President … And then reality sets in” ~ Kyle Bass

KYLE BASS founded and runs Hayman Capital Management, a Dallas-based hedge fund. He is a successful investor who is well known for predicting and profiting from the sub-prime mortgage crisis in 2008.

In the speech and Q&A above, which is from May this year (worth watching), Bass shares his views on the beginning of the end for Japan. He believes that Japan has about 2 years before its systemic economic problems manifest themselves in full force. Once this happens, he believes that the resulting implosion will require the West to completely redefine its economic orthodoxy.

Japan’s public debt to GDP ratio currently exceeds 200%, which makes the Japanese government more heavily indebted as a percentage of GDP than any other country in the world (including Iceland, Greece, and Italy). In the past, Japan survived due to a high national savings rate which allowed the government to fund fiscal excess by selling bonds to domestic savers.

Bass argues that the Japanese government will not be able to continue as it has in the past. He gives a number of arguments but one of the big ones is changing demographics. Almost a third of the Japanese population is now at least 60 years old. Pension funds, the largest holders of JGBs, are already becoming net sellers of the bonds in order to discharge pension liabilities. And the Bank of Tokyo Mitsubishi has reported that expected personal savings rates in Japan will become negative since there will be more people leaving the workforce than entering the workforce in coming years. With fewer people having babies, the population is also expected to shrink from around 128 million today to below 100 million in 2050.

Is the Japanese “Keynesian end point” fast approaching?

Strategic Fail

Fail fast. Your success depends on it

BACK in high school, you teachers probably trained you in ‘exam technique’.

For example, your maths teacher probably gave your class exam-prep advice which sounded something like this: “do the easy questions first, skip anything you don’t understand and come back to it at the end of the test if you have time. Use your time carefully.” This is excellent advice. That is to say, it is excellent advice if you want to pass a high school maths exam.

Fast forward 15 years and imagine little Jimmy from your maths class, now a medical doctor, standing in an emergency room doing surgery on your father. Do you want him to skip the tricky bits and come back to them at the end?

Would you prefer a doctor who is good at surgery and good at golf? Or a doctor who is excellent at surgery and horrible at golf?

The advice that got us through high school exams, won’t get us through life. Trying to be good at everything is only a good strategy if you are trying to ensure that you don’t become excellent at anything.

Fail strategically, and fail fast.

Your success depends on it.

Mergers & Acquisitions: Strategy

MERGERS have had a ubiquitous presence in the news recently as leaders in the airline, publishing, and telecommunications industries have taken steps to consolidate. Just this week, two of the largest advertising entities, Omnicom and Publicis, announced a $35.1 billion merger. In recent months, tech giants Google and Yahoo have acquired dozens of companies, most notably Waze and Tumblr respectively.

Despite the frequency of these deals, a large number of market studies have indicated that “50% to 70% of mergers and acquisitions fail to create incremental shareholder value”. As a result, consulting firms have an opportunity to provide valuable expertise at each step in the M&A process with the goal of preventing these failures.

One of the most vital components of a successful acquisition is the financial valuation: determining the value of the target and ensuring that your client avoids paying too much. However, determining whether the acquisition would be a good strategic fit is the first step.

Clarifying why your client wishes to undertake the acquisition is a good place to begin, both in a case interview and in a real-life consulting engagement. Potential rationale’s for pursuing an M&A deal include:

  1. Performance Improvement: restoring performance of the target company through revenue growth and cost cutting,
  2. Growth Potential: picking winning early stage companies and helping them develop,
  3. Market Access: increasing market access for the products of the acquirer or the target,
  4. Market Power: removing excess capacity from the industry,
  5. Capability Acquisition: acquiring new production capabilities, skills or technologies more quickly or at lower cost than would otherwise be possible,
  6. Synergies: achieving revenue synergies or cost synergies not available to the target or acquirer if acting alone,
  7. Business Transformation: using the merger as a catalyst to change the combined entity into an entirely new company, for example, with new strategic focus, organisational structure, key processes, etc. According to McKinsey, transformational mergers are rare “because the circumstances have to be just right, and the management team needs to execute the strategy well.”
  8. Bargain Price: buying the target at a price below the target’s fundamental value. The ‘bargain price’ rationale is also rare since the acquirer typically has to pay target shareholders a takeover premium in addition to the target’s current market price.

Regardless of the reasons concocted by management to justify action, the vast majority of acquisitions should never take place. Due to the high failure rate and inherent problems arising from the attempt to consolidate distinctly different organisational cultures, the most valuable advice a consultant can give might be to persuade senior management not to become seduced by the allure of a potential acquisition. In the long-term, managerial decisions should support the creation of shareholder value.

Next week I will introduce the various methods consultants use when conducting a financial valuation.

Merger and Acquisition Strategies adapted from Management Consulting: A Guide to the Profession, edited by Milan Kubr and published through the International Labour Office.

Don’t Be Seduced

By sweet sounding lies

RISK taking is important. Entrepreneurs are in the business of taking risks in the pursuit of profit and are the engine room of the capitalist market economy. Risk taking makes sense where the likely consequences of action have been well considered and are deemed acceptable.

The quote above though states that “we only regret the chances we didn’t take”.

While missed opportunities can be regrettable, this is only one side of the story. The quote ignores the possibility of regretting the things we have actually done. For example, when asked by Businessweek about achievements of which he was most proud, the late Steve Jobs did not mention the iPod, the iPhone, or the iPad. Instead he stated, “I’m as proud of what we don’t do as I am of what we do.”

“Take a chance and live without regrets” is the mantra of charlatans, philanderers and unscrupulous financiers everywhere. However, it is not just the unscrupulous operators who are to blame. The sales pitch appeals to the people who are looking to be convinced (Dan Kahneman would call this confirmation bias). You probably have a friend who, despite any evidence to the contrary, desperately believes that they are uniquely lucky, that true love can be found in a night club, or that fast money is possible for them.

Some people want to be seduced by sweet sounding lies, and the results can sometimes be quite regrettable.

Learning From Your Mistakes

Are you?

THE scientific method is a formal way of investigating the world by testing your guess about a certain situation, correcting your mistakes, and thereby improving your understanding of the world.

If something doesn’t work out for you, do you get angry? Or do you ask yourself, “what went wrong in this experiment?”

Learn, grow stronger, and move on.

The Tortoise and the Hare

Stable growth is often more important than fast money

SINGAPORE is on the rise as a wealth management hub with funds under management growing by 22% in 2012 compared with around 5% for Western Europe as a whole.

The disparity in growth rates is large, and the FT has attempted to narrate a story that fast growing Singapore will replace Switzerland as the world’s leading wealth management hub.

Swiss assets under management may be growing more slowly, but the Swiss continue to manage significantly more assets (US$2.8 trillion compared with US$1.29 trillion for Singapore).

As we know from Aesop’s fable about the Tortoise and the Hare, running faster does not always secure you first place, and there are three reasons to believe that Swiss wealth managers will remain in the lead:

    1. Firstly, shrewd wealth managers from Switzerland are setting up bricks-and-mortar operations in Singapore. They recognise that regional Asian investors want to deal with real people on the ground, and they’re accommodating the demand. This means that Swiss wealth managers can directly benefit from the rise of the Asian region rather than competing in a zero sum game (a race where the Swiss have to lose for the Singaporeans to win).
    2. Secondly, it is possible for both Singapore-based and Swiss-based wealth managers to thrive. For cultural and geographic reasons, Switzerland is a much better location for serving European clients (as well as many US clients); for the same reason, wealth managers based in Singapore are better placed to serve Asian clients. Both can thrive in their respective niche.
    3. Thirdly, the Swiss have a long tradition of wealth management (dating as far back as the 18th century). Swiss neutrality and national sovereignty, long recognised internationally, have ensured the stability necessary for the banking sector to survive and thrive. Can we expect the same stability from Singapore, an island state located in fast growing yet newly prosperous Asia? If the ongoing financial crisis which commenced in 2008 has taught us anything, surely the lesson was that stable growth is often more important than fast money.

Balancing the Scale

Scale improves productivity but also increases bureaucracy

Scale can help a company to produce more output at lower average costs.

However, production at scale also leads to unhelpful bureaucracy. As production rises, more employees are needed and executives implement more rules to keep things under control. Increasing production tends to lead to higher cash flows, and managers who were previously focused on production, innovation and bottom line results start to shift their focus towards turf battles and extreme careerism.

If this reminds you of a certain tech company (Microsoft) then you would be right. Ballmer announced this month plans to restructure the company with the aim of overcoming its slow moving and bureaucratic culture.

2013 List: Global Strategy Consulting Firms

List of Global Strategy Firms for 2013

BELOW is a hand-picked list of leading Global Strategy Firms.

The litmus test we used to decide whether a firm is truly “global” was whether it has an office in Sydney. A fair litmus test? Maybe not, but seeing as Sydney is at the other end of the earth you would expect a truly global strategy firm to have an office there (if you want to see a list of purely Aussie strategy firms for 2013, click here).

The below list will be of interest to you if:

  • you want to work for a leading strategy firm, or
  • your company, non-profit or government agency is looking for quality strategic advice.

The firms are:

  1. Bain
  2. BCG
  3. McKinsey
  4. Accenture
  5. Archstone Consulting
  6. A.T. Kearney
  7. Booz & Company
  8. The Birchman Group
  9. CVA
  10. Deloitte
  11. Edgar, Dunn & Company
  12. L.E.K. Consulting
  13. Millward Brown
  14. Oliver Wyman
  15. Partners in Performance
  16. Peppers & Rogers Group
  17. PwC
  18. Simon Kuch & Partners

1. Bain & Company


Founded in 1973 when Bill Bain and others left BCG to form Bain & Company. Bain has 49 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

Bain helps to transform companies into sharper, smarter, better versions of themselves. Bain’s mission is to help management teams create such high levels of economic value that together Bain and its clients can redefine their respective industries.

2. BCG


Founded in 1963 by Bruce Henderson, BCG has 79 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

BCG is a global management consulting firm and a leading advisor on business strategy. BCG partners with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises.

3. McKinsey


Founded in Chicago in 1926, McKinsey is arguably the world’s most prestigious consulting firm. McKinsey has 102 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, Johannesburg, London, Toronto, New York, and San Francisco.

McKinsey is a global management consulting firm and trusted advisors to the world’s leading businesses, governments, and institutions.

4. Accenture


Founded in 1989, Accenture has approximately 195 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

Accenture is a global management consulting, technology services and outsourcing company. Accenture has capabilities across all industries and business functions, conducts extensive research on the world’s most successful companies, and collaborates with clients to help them become high-performance businesses and governments.

5. Archstone Consulting


Archstone has 13 offices worldwide including Sydney, Hyderabad, London, New York, and San Franscisco.

Archstone offers a range of services including business strategy, technology services, outsourcing, and supply chain management.

6. A.T. Kearney


Founded in 1926, A.T. Kearney has 57 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, London, Toronto, New York, and San Francisco.

A.T. Kearney’s services include strategy, innovation, sales & marketing, operations, strategic IT, and procurement.

7. Booz & Company


Founded in Chicago in 1914 by Edwin G. Booz. In 2008, Booz separated its operations from the U.S. Government consulting business. That company retained the name Booz Allen Hamilton. In 2009, Booz combined with U.S.-based management consultancy Katzenbach Partners, a leader in organisational performance. In 2012, Axon Advisory Partners joined Booz to launch Booz Digital, a full-service team of strategists, designers, and technologists who help companies turn ideas into digital businesses.

Booz has 60 offices worldwide including Sydney, Hong Kong, Bombay, New Delhi, London, New York, and San Francisco.

Booz is a leading global management consulting firm focused on serving and shaping the senior agenda of the world’s leading institutions. Booz works with its clients to identify and build the differentiating capabilities they need to outperform. Booz has experience across a broad range of industries including high technology, finance, and consumer products.

8. The Birchman Group


Birchman has 15 offices worldwide including Sydney, Johannesburg, and London.

Birchman is an international company that provides Consulting, Solution Delivery and Managed Services to many of the world’s leading organisations. Birchman provides six core services: Value Management, Business Change, Software Development, Enterprise Applications, IT Advisory, and Business Advisory.

9. CVA


Founded in 1987, CVA has 16 offices worldwide including Sydney, Singapore, Hong Kong, London, and Boston.

CVA is a global strategy boutique which has experience across a broad range of industries including Telecom Media & Technology, Financial Services, Private Equity, and Mining Metals & Materials.

10. Deloitte


Founded in 1893 in the U.S., Deloitte has a strong global presence including offices in Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

Although offering a large number of accounting services, Deloitte also has a consulting practice. Deloitte Consulting offers a broad range of services including Pricing & Profitability Management, Enterprise Cost Management, M&A, Enterprise Sustainability, Finance Transformation, Governance Risk & Regulatory, Health Care Reform, and Infrastructure Transformation.

11. Edgar, Dunn & Company


Founded in 1978 in the U.S., Edgar, Dunn & Company has 8 offices worldwide including Sydney, Singapore, London, and San Francisco.

EDC is an independent strategy consulting firm that was founded on two fundamental principles of client service:

  • Provide deep expertise that enhances clients’ perspectives, and
  • Deliver actionable advice that enables clients to create measurable, sustainable change in their organisations.

EDC is recognised among the world’s pre-eminent experts in the payments industry. Additional areas of expertise include new financial services channels, technologies and markets, retail financial services, and e-business.

12. L.E.K. Consulting


Founded in 1983 in London, L.E.K. has 22 offices worldwide including Sydney, Singapore, Bombay, New Delhi, London, New York, and San Francisco.

L.E.K. is a global strategy consulting firm that counsels clients on key strategic issues, leveraging deep industry expertise and using analytical rigor to help them make informed decisions more quickly and solve their toughest and most critical business problems. L.E.K. has expertise in a broad range of industries and has a range of capabilities including Strategy, Shareholder Value Management, Mergers & Acquisitions support, Operations & Organisation and Marketing & Sales.

13. Millward Brown


Founded in 1973, Millward Brown has 85 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

Millward Brown is passionate about helping clients grow great brands. They are experts in advertising, marketing communications, media, digital and brand equity research, and work with 90% of the world’s leading brands.

14. Oliver Wyman


Founded in New York in 1984, Oliver Wyman has 50 offices worldwide including Sydney, Singapore, Hong Kong, Bombay, New Delhi, London, Toronto, New York, and San Francisco.

Oliver Wyman is a leading global management consulting firm that combines deep industry knowledge with specialised expertise in strategy, operations, risk management, and organisation transformation. As part of Marsh & McLennan Companies, Oliver Wyman is also able to draw on experts from its sister companies in the areas of brand and identity management, microeconomics, human capital strategies, and insurance.

15. Partners in Performance


PIP has 9 offices worldwide including Sydney, Johannesburg, Toronto, and Atlanta.

PIP identifies and delivers performance improvement to industrial, resources and services companies, using a specialist team and a hands-on approach. PIP has three divisions: Resultant®, Transaction Services and Investment. The Resultant® Division works as business coaches applying practical frameworks to address issues including strategy, procurement, revenues, bottlenecking, costs, safety, environment, and organisational culture. The Transaction Services Division provides commercial due diligence for potential investment opportunities. The Investment Division looks for situations where PIP can improve the performance of an organisation through both financial and operational assistance.

16. Peppers & Rogers Group


Founded in 1993 by Don Peppers and Martha Rogers, Ph.D., PRG has 9 offices worldwide including Sydney, Singapore, Johannesburg, and Stamford Connecticut.

PRG is a management consulting firm recognised as a leading authority and thought leader on customer-based strategies and underlying business initiatives. PRG has particular expertise in the following industries: Financial Services, Government, Telecommunications, and Airlines.

17. PwC


Founded in 1998 out of the merger of Price Waterhouse and Coopers & Lybrand, PwC has historical roots going back around 150 years. PwC operates in 158 countries worldwide including offices in Sydney, Singapore, Hong Kong, Bombay, New Delhi, Johannesburg, London, Toronto, New York, and San Francisco.

PwC helps organisations and individuals create the value they’re looking for by delivering quality assurance, tax and advisory services.

18. Simon Kuch & Partners


Founded in 1985, SKP has 26 offices worldwide including Sydney, Singapore, London, Toronto, New York, and San Francisco.

SKP is a global management consulting firm focusing on strategy, marketing, pricing and sales.

Warding Off Ghosts

Hint: this post has nothing to do with ghosts

HAVE you ever seen a ghost? Or been told a ghost story by someone who claims to have seen one?

I recently had a conversation with a friend who explained to me that his apartment is inhabited by an unfriendly ghost.

How do you ward off a ghost? A liberal dose of garlic is the usual prescription but, to suspend disbelief for a minute, what would you do if ghosts actually existed and one happened to be living in your apartment?

Not being an expert on ghosts, I suggested to my friend that his ghost, if it exists, must live in either the physical, mental or spiritual realm. It is generally accepted that ghosts are not physical creatures, and so the ghost must merely be a mental or spiritual manifestation. If it is mental, then the ghost could be defeated by thinking differently. If it is spiritual, then the ghost could be defeated by changing his beliefs.

What kind of ‘evil spirits’ inhabit your daily life? For example, do you suffer from poor health, anxiety, or fatigue? Do you lack the skills, resources, or qualifications needed to be excellent at what you do everyday? Or, do you find it difficult to save money, sell products, or perform well in interviews?

Consider for a moment whether these ‘evil spirits’ are physical, mental, or spiritual in nature:

  • Are there small changes in the way you operate that would drastically improve your performance? For example, changing the way you organise your desk.
  • Are there different ways of thinking or additional information which would help you thrive? For example, obtaining an MBA or additional on-the-job training.
  • Are your current beliefs holding you back? For example, if a salesperson believes that she is imposing a burden on every customer she calls then she may find it difficult to make sales. If she instead believes that she is offering customers an opportunity to benefit from using a wonderful product, then her sales performance is likely to improve.

Resource for Aspiring Consultants

A nice resource to help you break into the industry

IF you are interested in breaking into the management consulting industry, you might want to take a look at this super helpful resource on Quora, click here.

If you don’t have an account with Quora then you will need to sign up as a new user; well worth it imho.

Some People Will Get it

And Some Won’t

FOR those of you who missed it, we made a small typo on the previous post. Instead of writing “weigh your options” we wrote “way your options”. Kind of embarrassing … especially given the painstaking hours that we spend trying to make each post perfect.

Thankfully, many of you were good enough to point out the mistake.

Tim Jeffries, an experienced Sydney-based consultant who focuses on Process Improvement and Business Strategy, sent us the following helpful message:

Some people will get it 2

Tim’s comment was brief and to the point. Tim is a valuable member of the community.

Compare this with an email we received from Sam L.

Some people will get it 4

Sam’s point is well taken, we should have been more careful not to make msiatkes. We will also be much more careful in future to distinguish between words like “two”, “too”, and “to”, “their” and “there”, and “here” and “hear”.

Sam, we are sorry to see you go. That being said, your belief that the Consulting Blog somehow derives a large part of its value from a slavish focus on correct spelling and punctuation suggests that you probably didn’t belong here in the first place.

The Consulting Blog is built on three pillars only: a commitment to insightful ideas, appealing design, and a “life is great” philosophy. The overarching belief is that together we can change everything!

Some people will get it. And some won’t.

3 Steps to Eliminate Worry

Identify the source, weigh your options, and take action

DO you suffer from worry?

Worry is an obstacle which can prevent otherwise talented students and business people from setting and achieving goals; even ones that should be well within their reach.

Do you ever twiddle your thumbs for five minutes (or an hour) before making a sales call (or calling the girl/boy you like)? Do you ever worry that people might not like you? Do you ever worry when you feel sick that you might actually be dying?

Worry affects most people at some point in their lives, and in that sense it is perfectly natural. However, if you were completely in control you wouldn’t choose to be worried, would you? It’s uncomfortable, it’s stressful, and worrying makes it more difficult to think clearly and get things done.

To help you retain a calm state of mind, here are 3 steps which you can follow to help you reduce worry and stay in control of your day:

  1. Identify the source: what are you worrying about? Be specific and write it down. At the same time, also write down a description of what is the worst that could happen. If everything that could go wrong does go wrong, what would that look like? Would it be so bad?  Prepare yourself to accept the worst.
  2. Weigh your options: what can you do about it? Write down possible options that you could use to remove the source of your worries. For example, the source of your worries might be that “the prospective customer will reject me if I try to sell them the product”. This worry provides you with a number of options: for example, you could do nothing and achieve an outcome as good as rejection. You could play it safe and send the prospect a text message or email. Alternatively, you could think carefully, develop a clever pitch, anticipate responses to the prospect’s most likely objections, and then make a call or speak to the prospect in person. Weighing your options can help you understand which ones are most likely to succeed.
  3. Take action:decide what you should do, and start immediately to carry out your decision.

Just three simple steps, but if you follow them then you will be well on your way to eliminating worry.

If you are serious about reducing worry, you might also want to take a look at an excellent book on the topic written by Dale Carnegie entitled How to Stop Worrying and Start Living.

Keep calm and carry on.

Salutation to the Dawn

Today well lived makes every yesterday a dream of happiness

Look to this day!
For it is life, the very life of life.
In its brief course
Lie all the verities and realities or your existence:

The bliss of growth
The glory of action
The splendor of achievement.

For yesterday is but a dream
And tomorrow is only a vision,
But today well lived makes every yesterday a dream of happiness
And every tomorrow a vision of hope.
Look well, therefore, to this day!
Such is the salutation to the dawn.

~ Kalidasa

2013 List: Australian Strategy Consulting Firms

List of Australian Strategy Firms for 2013

BELOW is a hand-picked list of leading Australian strategy firms. This list will be of interest to you if:

  • you’re a student who wants to work for a leading strategy firm, or
  • your company, non-profit or government agency is looking for quality strategy advice.

The firms are:

  1. Nous Group
  2. Pacific Strategy Partners
  3. Port Jackson Partners
  4. Crescendo Partners
  5. Momentum Partners
  6. Oyster Consulting
  7. Second Road

1. Nous Group


Founded in 1999 by Tim Orton (ex-McKinsey), Nous Group has grown to be one of Australia’s most influential strategy firms. Nous has offices in Sydney, Melbourne, Brisbane, Canberra, Adelaide, Perth and Manila and a workforce of 150 people that includes ex-senior bureaucrats and business people.

In 2012, the BRW Client Choice Awards named Nous “best management consulting firm in Australia” including most innovative firm and best client outcomes from across the professional services sector.

Nous is best known for its ethos to create positive influence and use bold thinking to solve complex societal and business challenges. Nous service lines include business strategy, public policy, leadership & people development, organisational capability, and information management & technology.

2. Pacific Strategy Partners


Founded in 2003, Pacific Strategy Partners has offices in Sydney and Melbourne.

Pacific Strategy Partners develops practical solutions by deploying low leveraged teams guided by deep Director expertise. Services include Strategy Development, Operational Improvement, and Transaction Support.

3. Port Jackson Partners


Founded in 1991 by Terrey Arcus and Fred Hilmer, two former Directors of McKinsey. Port Jackson Partners is a boutique consultancy firm based in Sydney.

PJP is a consulting firm providing advice to CEOs, Boards and senior managers to help them set corporate direction, define business strategies and develop their organisations. PJP’s Australian clients come from a diverse range of industries and are typically top 100 listed companies, but a few are large government owned corporations. PJP focuses on helping companies with strategy and organisation.

4. Crescendo Partners


Crescendo Partners is based in Sydney and has extensive experience providing value to clients across the globe.

Crescendo Partners is an elite high value consulting, advisory and private equity firm. Services include strategy consulting, M&A support, capital raising, and private equity investment.

5. Momentum Partners


Founded in 2003, Momentum Partners has offices in Sydney, Melbourne, Brisbane, Adelaide and Perth.

Momentum’s vision is to become the leading independent consultancy in Australia providing the highest quality consulting services which integrate three key elements of organisational change: strategy, operations and people. Clients include public and governmental organisations, private companies ranging from large global corporations to small, fast growing start-ups.

6. Oyster Consulting


Oyster Consulting is based in Perth.

Oyster is a leading management consultancy focussed on helping businesses in the resources sector and associated industries. Oyster are experienced in delivering a wide array of services covering all aspects of both strategy and execution.

7. Second Road


Second Road is based in Sydney.

Second Road is a Strategy & Innovation firm unlocking and empowering imagination and intelligence.

3 Steps for Greater Focus

Accept what you have, visualise what you want, and orient yourself in the right direction

DO you ever feel like ‘success’ eludes you? Like you should be achieving more? Like you’re not making progress with your studies, career, or business?

There are 3 steps you can use to achieve greater focus:

  1. Acceptance: understand where you are now. What are your skills, talents, tools, and resources?
  2. Vision: be crystal clear about what you want. Visualise the future and create a plan for getting there. Find people who have already achieved your goal, or who are further along the path to success. Your journey will be much easier if you can find people who are willing and able to help you navigate the path.
  3. Orientation: ensure you are making progress and heading in the right direction. Consider your lifestyle, friends, habits, and personal priorities. Orient your life so that it is aligned with your goals for the future.

Competitive Response

CanadaCo, the largest discount retailer in Canada, currently holds the dominant market share in the industry. USCo, the largest discount retailer in the United States, has decided to expand into Canada by purchasing CanadaCo’s competition. How should the CEO of CanadaCo respond?

WHEN considering a case that requires a competitive response, first take a look at the action which forced the company to respond.

In the example above, we should test the hypothesis that USCo has a cost advantage due to economies of scale. This advantage would allow USCo to provide lower prices to Canadian consumers compared with CanadaCo. As a result, USCo’s entry into the Canadian market would probably cause our client to lose market share.

Without a full understanding of the facts, a response could be determined prematurely, neglecting vital characteristics of the case. What other factors would you ask about?

If I were presented with the case above, I would ask questions specifically pertaining to the differences between the Canadian market and the US market in order to determine the magnitude of USCo’s advantage.

Once the situation has been fully fleshed out, the next step would be to recommend a course of action. CandaCo could opt to do nothing, or respond in one or more of the following ways:

  1. Change its pricing strategy,
  2. Hire top executives away from USCo,
  3. Acquire or merge with a competing company,
  4. Rouse customer loyalty through rewards programs and customer service,
  5. Mimic USCo’s new product offering,
  6. Market CanadaCo’s products and build brand awareness.

Competitive Response

Let’s assume USCo is relatively unknown in Canada and will incur costs resulting from challenges in establishing a Canadian distribution network, but not enough to cause costs to rise to CanadaCo’s level.

The solution I would propose is that CanadaCo should focus on reputation. Unfortunately, attempting a price war with USCo would appear to be futile, and so I believe the best response would be to attempt to retain existing customers by developing CanadaCo’s customer loyalty program and by focusing on customer service.

How would you respond?

Strategy and framework adapted from Case In Point, a case interview preparation book written by Marc P. Cosentino. Case scenario is a derivation from a practice case provided by The Boston Consulting Group.

[For more information on consulting concepts and frameworks, please download “The Little Blue Consulting Handbook“.]

Brick Walls

Giving you a chance to show how badly you really want it

ARE you experiencing unexpected difficulties? Has your progress stalled? Have you hit a wall?

You may feel irritated, angry and frustrated, but be thankful. Brick walls are there for a reason.

They are there to stop your competition, to challenge and test you, and to give you an opportunity to show how badly you really want it.

Retrace your steps a few paces, consider your approach, and have another go.

You might spot a gap you hadn’t noticed before. Or, you might just fly higher than you’d thought possible.

Your perseverance will be rewarded.

How to Use Envy to Build Success

There will always be greener pastures. Accept what you have, and build from there

YOU may have found yourself envying the position of others.

In a former life, I worked as a finance lawyer and often dealt with investment bankers. They worked about the same hours as I did, their job seemed much less challenging than mine was, and they enjoyed doing deals while I often had deals foisted upon me at the 11th hour. Despite their job being more appealing, and to add insult to injury, they were also paid 4 times as much money.  It seemed a great injustice.

You may have shared a similar experience. You might be a management consultant looking at a corporate director who is about your age but earns more money for less work.  You might be a manager for a bricks-and-mortar company looking at a more-highly-paid manager at a tech firm that didn’t exist 10 years ago.

Envy is a powerful emotion.  The sobering reality though is that there will always be someone with more money, more prestige, more power, or who is younger and smarter than you are.

Recognise envy when it appears. But instead of giving in to feelings of resentment, consider directing your energy towards a re-examination or your strengths and how you might use them to create more value for others.

Success is attained by building on strength, not by wishing you are something you are not.  By understanding your talents and skills, you can find ways to use them.  By giving in to envy, however, you lose control of your own story and may wind up following a path that leads you nowhere. Such was the unfortunate fate which befell a certain Stone Cutter in the Eastern folk story recounted below.

There was once a stone cutter who was dissatisfied with himself and with his position in life. One day he passed a wealthy merchant’s house. Through the open gateway, he saw many fine possessions and important visitors. “How powerful that merchant must be!” thought the stone cutter. He became very envious and wished that he could be like the merchant.

To his great surprise, he suddenly became the merchant, enjoying more luxuries and power than he had ever imagined, but envied and detested by those less wealthy than himself. Soon a high official passed by, carried in a sedan chair, accompanied by attendants and escorted by soldiers beating gongs. Everyone, no matter how wealthy, had to bow low before the procession. “How powerful that official is!” he thought. “I wish that I could be a high official!”

Then he became the high official, carried everywhere in his embroidered sedan chair, feared and hated by the people all around. It was a hot summer day, so the official felt very uncomfortable in the sticky sedan chair. He looked up at the sun. It shone proudly in the sky, unaffected by his presence. “How powerful the sun is!” he thought. “I wish that I could be the sun!”

Then he became the sun, shining fiercely down on everyone, scorching the fields, cursed by the farmers and laborers. But a huge black cloud moved between him and the earth, so that his light could no longer shine on everything below. “How powerful that storm cloud is!” he thought. “I wish that I could be a cloud!”

Then he became the cloud, flooding the fields and villages, shouted at by everyone. But soon he found that he was being pushed away by some great force, and realized that it was the wind. “How powerful it is!” he thought. “I wish that I could be the wind!”

Then he became the wind, blowing tiles off the roofs of houses, uprooting trees, feared and hated by all below him. But after a while, he ran up against something that would not move, no matter how forcefully he blew against it – a huge, towering rock. “How powerful that rock is!” he thought. “I wish that I could be a rock!”

Then he became the rock, more powerful than anything else on earth. But as he stood there, he heard the sound of a hammer pounding a chisel into his hard surface, and felt himself being chipped away piece by piece. “What could be more powerful than I, the rock?” he thought.

He looked down and saw far below him the figure of a stone cutter.

Entering a New Market

Your client is a low-cost airline headquartered in Philadelphia with frequent service to cities along the East Coast of the United States. The CEO is interested in expanding service into a small town in the Midwest; let’s call it Greenville. What is your recommendation?

THE first step in approaching a question such as this one is simply to summarise the information provided. Considering the brevity of the question above, this process may seem unnecessary; however, by repeating the question in your own words you will be able to differentiate between relevant and irrelevant information. Furthermore, this engages you in a conversation with the interviewer as opposed to enduring an uncomfortable silence.

Once the important information has been identified, it is valuable to verify the client’s objectives. Consultants often begin their working relationship with a client by asking about objectives and determining the feasibility of those goals. In this scenario, it is vital to understand why the client wants to expand service to this area. Is it strictly profit related? Or is there a desire for diversification?

Grasping the objective will enable you to ask the right questions. This part of the interview allows you to understand the case, provide a suitable recommendation, and demonstrate your thought process when dealing with new information. What is the size of the market? What is the current growth rate? Who are the potential customers in Greenville? Who is the competition? This is also a good time to explore details about the product and pricing.

Finally, you determine whether to advise the client to enter the market and, if so, what is the best way to do so?

By organising your thoughts in a simple diagram such as the one below, you can ensure that you are providing a truly comprehensive answer.

Entering a New Market - Diagram 4

Strategy and framework adapted from Case in Point, a case interview preparation book written by Marc P. Cosentino.

Mastering the Case Interview

Demonstrating that you have the business acumen required for the job

AFTER impressing interviewers with tales of leadership ability and applicable work experience, the hard part commences: demonstrating that you have the business acumen required for the job.

Cases allow consulting firms to see how applicants would react in front of a client when faced with difficult situations, as well as provide insight into an individual’s thought process. While certain skills can be taught, an ability to rationalize logically, act objectively, and think creatively can often only come naturally. Consulting firms seek to discover whether you possess those necessary skills.

Over the next few weeks, I will explore the various methods used to approach these interviews as well as introduce cases used by top consulting firms.

I encourage you to collaborate together in the comment section to discover new solutions or present a different angle than the one I have chosen.

To start with, please take a look at the video below which presents an introduction to the case interview from Ernst & Young Advisory.