Consulting Parlour

The Story of undergraduate and bible sales man who screwed bible theories!!
Bruce D. Hendersen started the management consulting division of the Boston Safe Deposit and Trust Company called as The Boston Consulting Group in 1963. In those days hardly anybody has courage to look straight in the eyes of Marvin Bower. Hendersen had other plans, he hired young trucks who challenged none other than the king bower.
A former Bible salesman, Henderson had earned an undergraduate degree in engineering from Vanderbilt University before attending Harvard Business School. He left HBS ninety days before graduation to work for Westinghouse Corporation, where he became one of the youngest vice presidents in the company's history. He would leave Westinghouse to head Arthur D. Little's management services unit before accepting an improbable challenge from the CEO of the Boston Safe Deposit and Trust Company to start a consulting arm for the bank. BCG Style-"A Punch between the eyes"-aggression and provocation BCG begins mailing concise, highly provocative essays designed to stimulate senior management thinking on a range of business issues. Statements that senior business managers would find believable are not supported. Only provocative material is argued. The subject matter is chosen to be deliberately provocative, significant in implication, and relevant to the policy decisions of corporate competition.The pieces would be called Perspectives and over the next four decades they would become the vehicle for thinking that consistently challenged both classic economic theory and current business practice. Bruce Henderson referred to them fondly as "a punch between the eyes." BCG Strategy-Business Process Expertise "Bruce called a staff meeting for a Saturday morning in the fall of 1965. He explained that to survive, much less grow, in a competitive landscape occupied by hundreds of larger and better-known consulting firms, we needed a distinctive identity. He had concluded that we shouldn’t fight the competitive battle as generalists, but should instead stake out a special area of expertise. "He asked what we thought that specialty should be. Many suggestions were offered, but in each case we were able to identify several other firms that already had strong credentials in that particular area. The discussion began to stall. Then Bruce asked a momentous question: ‘What about business strategy?’ I objected: ‘That’s too vague. Most executives won’t know what we’re talking about.’ Bruce replied, ‘That’s the beauty of it. We’ll define it.’" One of BCG's first breakthrough concepts grows out of work for a leading semiconductor manufacturer seeking to better understand the industry's chaotic pricing behavior. It's called the experience curve. It is analogous to the well-established learning curve first documented in war-time airplane production in World War II, but has broader implications. It stipulates that unit costs characteristically go down over time as "experience" (cumulated volume) increases. It would become a conceptual cornerstone in the understanding of both the role market share plays in establishing competitive advantage, and the importance of asset allocation in portfolio management. BCG Saga-"Brinkmanship in Business" Bruce Henderson's first article in the Harvard Business Review, "Brinkmanship in Business," is published. It articulates a game-theory view of business strategy that was often ignored by economists at the time. Thirty years later, the Journal of the Academy of Marketing Science would write, "Game theory has emerged as a dominant conceptual framework in marketing to analyze the behavior of competing firms in oligopilistic markets characterized by interdependence." BCG Punch-"Moving to Japan" The Boston Company spins off BCG as a separate subsidiary. BCG enters into a joint venture in London called Attwood-Boston Consultants Ltd BCG hires Sandy Moose as its first female consultant "Controlling for Growth in a Multidivision Business" spells out the dangers in an ROI-centered strategy for resource allocation in a company. The core arguments become the foundation of BCG's growth-share matrix BCG publishes Perspectives on Corporate Strategy and Perspectives on Experience. Each comprises essays written by BCG staff BCG publishes "What Makes Japan Grow," marking the beginning of a lengthy strategic focus on Japanese management and manufacturing practices Vital BCG office equipment includes slide rules, desk calculators, and an extremely loud telex machine that enables communication between offices worldwide BCG Strikes Back-Sorry Emperor (Marvin Bower) Under Henderson's leadership, BCG would become a hotbed of radical thinking in the world of business and finance. As his client list grew, Henderson invaded the nation's best business schools, the Harvards and Stanfords of the world. He eclipsed McKinsey as the top recruiter at Harvard, aggressively wooing its best students with high salaries and the chance to make a difference in a cutting-edge firm. He encouraged the brilliant young minds he hired to come up with innovative ideas that would dazzle hardened corporate veterans. Sometimes he seemed dazzled himself by the success of the whole business. "Consulting is the most improbable business on earth," he would say. BCG Communication Style-Telephones!! Each BCG consultant shares a phone line with another consultant To make an outside call, BCG staff have to call the operator and give a charge number before the call is placed Continuing BCG's tradition of addressing public policy issues, Bruce Henderson offers a strong rebuke of America's energy policy in a Perspective titled "To Create An Energy Crisis." The piece is so well received that several energy companies send copies of it to their shareholders and one publishes it as a full-page ad in major newspapers.Bill Bain and others leave BCG to form Bain and Company An energy crisis in Britain brought on by a nationwide coal strike puts all of the United Kingdom, including BCG London, on a three-day workweek. Client meetings are conducted by candlelight on "closed days," with both clients and consultants huddling under blankets to keep warm. BCG-Segmentation Sy Tilles initiates a decade-long focus on customer and business segmentation on behalf of BCG's clients. The result is a unique set of analytical approaches to this emerging strategic discipline. The techniques recognize that different needs among customer groups entail different costs to serve them. The approaches include deaveraging our clients' costs, identifying the needs and economics of particular segments, aligning value propositions with customer needs, and modeling the costs of players serving each segment to identify potential threats and opportunities. The information revolution of the late eighties would add an entirely new dimension to both the impact and capabilities of segmentation. BCG Values-ESOP In a bet on our own future, BCG stock is sold to its employees through an employee stock ownership plan (ESOP) as a means of purchasing the company from The Boston Company. It's one of the nation's first ESOPs. In the Perspective "The Rule of Three and Four," Henderson adds to the expanding body of business and market dynamics he's enunciated with the empirical observation: "A stable competitive market never has more than three significant competitors, the largest of which has no more than four times the market share of the smallest." A competitor with less than one-quarter the share of the market leader cannot be effective. BCG Concern-Dumping In a Perspective titled "Dumping" (the predatory trade practice of selling goods or commodities below cost to gain market share), Bruce Henderson outlines the classic liberal case against trade intervention, even in the presence of "aggressive" business practices. BCG-Product Portfolio As product complexities and niche markets become more prevalent, Michael C. Goold writes "Specialization or the Full Product Line," a discussion of the natural conflicts between production scale (which reduces costs) and product proliferation, which increases costs but also (sometimes) adds value. BCG completes its buyout of stock from The Boston Company, five years ahead of schedule For the opening of the Chicago office the first employees sit on the floor to work because chairs are not delivered on time BCG Style-Labour Conflict Continuing a long series of social commentary, Bruce Henderson writes "Adversaries or Partners?," a Perspective that begins: "The Labor wars must end. Hostile confrontation between members of the same organization is a barbaric legacy of the past that we should put behind us. It is a fundamental defect in Western productivity….The Japanese are teaching the West a humiliating object lesson."1983 Highlights & InsightsBCG celebrates its 20th anniversary Bruce Henderson is awarded an honorary doctorate by Babson College Rhodes Scholar Clayton Christensen writes "'Bureaucrat' Need Not be a Dirty Word," for the Wall Street Journal, so endearing himself to The Reagan Administration that he is offered a White House Fellowship BCG- Change Management In an era of change management, Jeanie Duck, an expert in the field of organizational change, writes the Perspective "Let Middle Managers Manage." In it, she presents counterintuitive findings that make a case for the much maligned and downsized middle manager and she reminds CEO's that middle managers are still indispensable for most organizations, even in an age of employee empowerment and flat organizational structures.BCG expands its value management focus through the acquisition of Holt Planning AssociatesMark Blaxill and Tom Hout's "The Fallacy of the Overhead Quick Fix" is published in the Harvard Business Review BCG-Legend is no more George Stalk, Lawrence Shulman, and Philip Evans write "Competing on Capabilities: The New Rules of Corporate Strategy," which is published in the Harvard Business Review. The article introduces the concept of capabilities-based strategy, and extends time-based competition beyond manufacturing and operational effectiveness. The piece describes the sources of competitive advantage at highly successful companies such as Wal-Mart and Home Depot. It also anticipates emerging academic theories known collectively as the "resource-based view of the firm,"Bruce Henderson dies at age 77. "Few people have had as much impact on international business in the second half of the twentieth century as the founder of The Boston Consulting Group," eulogizes the Financial Times BCG-Reengineering As reengineering takes the business world by storm, BCG offers a counterpoint in the form of two Perspectives. In the first, "Reengineering Bumps into Strategy," Jon Isaacs points out that what may have started as a reengineering of order processing might become a "reevaluation of all customer service." At that point, fundamental questions arise that are more strategic than process-focused, and those questions are all too often left unaddressed by process engineers. BCG-Cost Reduction Against a backdrop of cost-cutting at the expense of patient care, Joshua Gray and Peter Lawyer write the Perspective "The Promise of Disease Management." Disease management is described as "an approach to patient care that coordinates resources across the entire health care delivery system and throughout the life cycle of a disease." This systematic approach to the challenge of health care delivery focuses on the patient as the "relevant unit of management." This counteintuitive approach "breaks the compromise" between cost control and quality care and becomes one of BCG's biggest ideas of the decade.Tom Hout and John Carter write "Getting It Done: New Roles For Senior Executives," which is published in the Harvard Business Review In the Perspective "From the Insight Out," Michael Silverstein shares accumulated wisdom about promoting innovative thinking in the customer discovery process. With the emergence of a more demanding breed of consumer, George Stalk, David Pecaut, and Benjamin Burnett write "Breaking Compromises, Breakaway Growth," which appears in the Harvard Business Review. The compromise in the title refers to any tradeoff forced on customers not by the nature of the good or service being delivered, but by the operating constraints faced by a business or industry. A company that finds a way to circumvent those complaints can "break the compromise" and achieve "breakaway growth." BCG-e-commerce Long before the term e-commerce is coined, Philip Evans and Thomas Wurster explore the implications of the information age for corporate strategy in their Harvard Business Review article "Strategy and the New Economics of Information." The piece wins a McKinsey Award and inaugurates a long series of BCG publications on the "deconstruction" of traditional integrated value chains.John Clarkeson becomes chairman of BCG Recognizing unseen opportunities, Larry Shulman writes the Perspective "Capitalizing on Anomalies." It advocates the systematic examination and exploration of outliers in a company's operating statistics. For example, geographic regions in which market share is especially high or low, or product ranges for which operating costs seem to vary significantly from the mean, often hide dramatic insights. The "seeds" of new businesses often lie within these seeming anomalies.