Management Consulting Essentials Workshop - Syllabus

Management Consulting Essentials Syllabus v. 1.0 2-‐day workshop

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Copyright © TBK Consult Holding ApS 2013. All rights reserved. Any distribution or copying is subject to prior written approval by TBK Consult Holding ApS, CVR: DK31935741. The copyright to the Business Model Canvas and the Business Model Generation concepts belongs to Osterwalder & Pigneur. Hans Peter Bech has written this syllabus for TBK Consult Holding ApS. This document is provided for educational purposes. TBK Consult Holding ApS does not warrant that it is suitable for any other purpose and makes no expressed or implied warranty of any kind and assumes no responsibility for errors and omissions. No liability is assumed for incidental or consequential damages in connection with or arising out of the use of the information contained herein. Terms of use: 1. Individuals and training providers may only use this syllabus as the basis for seminars, provided they have written agreements with TBK Consult Holding ApS. 2. Any individual or group of individuals may use this syllabus as the basis for articles, books or other derived publications, provided that the copyright of the authors and TBK Consult Holding ApS as the source and owners of this document is acknowledged in such publications. Any inquiries regarding this publication, request for usage rights for the material included herein, or corrections should be sent by email to Emma Crabtree: ecr@tbkconsult.com.

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Preface

The objective of TBK Consult is to assist software companies with local and global growth. The objectives of the TBK Academy® are to share approaches and experiences with various go-‐to-‐market strategies and frameworks and to give software executives an opportunity to build an international network of peers. The objective of the workshop “Management Consulting Essentials” is to help current and potential TBK Partners deliver more value to carefully selected clients against an attractive payment. The workshop will provide an opportunity to review and discuss the issues related to operating as “independent” management consultants.

Dual Value The workshop offers dual value. It is based on Osterwalder’s business model framework. After the workshop the attendees will be much better positioned to run a productive independent management consultant business AND will have achieved a Business Model master class type education.

The purpose and structure of the syllabus The syllabus is the basis for the workshop and explains the learning objectives, the structure and the content. A summary of the “Management Consulting Essentials” workshop can be found in the fact sheet TBK-‐AKA-‐006.

Market segmentation The workshop primarily addresses issues related to selling and delivering management consulting to small and medium sized software-‐driven companies, who need pragmatic assistance in growing their revenue and market share. The approached presented is applicable for big companies too. However, big companies seldom engage independent management consultants to address major change requirements.

Course participant prerequisites

The workshop and learning of the syllabus assumes intimate knowledge of and solid experience with sales and marketing of software. The workshop also assumes knowledge and preferably experience with executive management issues and challenges.

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“Management Consulting Essentials” Agenda Day 1 Time 08:00 08:30 09:35

10:30 11:00 12:00 13:00 15:00 15:30 16:30 17:00 19:00

Agenda item Arrival, coffee and registration Welcome, objectives, agenda and presentation of participants The independent management consultants’ business model § Introduction to Osterwalder's Business Model § Testing the independent management consultant’s business model Break The business model “front office” § Client Segmentation, Value Propositions, Channels, Channels and Client Relationships Lunch The AIDA Process § How to drive the Awareness -‐> Interest -‐> Desire -‐> Action process Break The AIDA Process § Converting Awareness to Interest Break The AIDA Process § Converting Interest to Desire End of day

Day 2 Time 08:30 09:00 10:30 11:00 12:30 13:30 15:00 15:30 17:00 15:30 19:30

Agenda item Arrival, coffee The AIDA Process § Securing action § The proposal and the consulting agreement Break The business model “front office” § Key resources, key activities and key relationships Lunch The business model P&L § Pricing, estimation, time management, utilization and leverage Break Delivery § The consulting wheel, facilitation account management Break The business model environment § Macro Economic forces, Key trends, Industry forces and Market forces. End of day

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Welcome, objectives, agenda and presentation of participants In this section each attendee will present himself explaining his/her experience with management consulting and his/her motivation for choosing this career. Each attendee will be asked to set certain objectives for the next 12 months.

The independent management consultant business model In this module we will make a short introduction to Osterwalder’s Business Model Framework. We will review the nature of the independent management consultant’s business model. The traditional management consultant business model has certain inherent weaknesses. We will review each of the nine business model building blocks and we will briefly discuss the four business model environment forces. The workshop will focus on how to improve the independent management consultant’s business model and make it more solid, repeatable and predictable.

The Business Model Front and Back Office

The business model framework operates with a Front Office, a Back Office, P&L and an Environment.

The Front Office: Customer segments and client value propositions The most critical part of any business model is the choice of client segments and client value propositions. A business model that doesn’t offer attractive and compelling value with reasonable operational expenses and capital investments will never work for its owners. The independent management consultant will typically be tempted to choose a very broad client segmentation strategy and very broad client value propositions.

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We will discuss the disadvantages of the traditional approach and discuss how we can increase our attractiveness as well as our rates by working together and working more niche-‐focused.

The Front Office: Channel and customer relationships The independent management consultant’s channel and client relationships are normally very simple if not outright primitive. Independent management consultants are engaged through their own personal network or by recommendations from their personal network. In this module we will discuss how to build long-‐ term relationships generating a steady of flow of revenue as opposed to relying on short-‐term projects.

Building awareness, generating leads and grooming for projects In this section we will review the #1 challenge for all independent management consultants: Growing and maintaining a solid pipeline of profitable opportunities from which you can pick and choose to maintain a steady flow of attractive revenue and profit. This section will discuss how to drive the management consulting AIDA process:

Awareness (you can only be engaged by people who know who you are and what you do)

Interest (you can only be engaged by people who are interested in doing something with you)

Desire (you can only be engaged by people who can and will take a decision to engage a consultant now)

Action (you can only be engaged by people who actually take a decision to act on terms and conditions, which you can accept). In this module we will discuss some fundamental principles in business of delivering management consulting services. One of the most important principles is that there must be much more at risk than the cost of your fee. The risk of critical failure or the opportunity of massive success must form the basis for engaging you as a consultant. In this module we will review and discuss how you can test and help the client build the compelling business case for engaging you and keeping you on the project justifying the fees you ask. © TBK Consult Holding ApS July 2013

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We will carefully review how to create awareness in you key client segment and how to convert this awareness to interest in you as a solution source. We will carefully discuss how to develop interest into desire for doing something (and then with you) and how to convert the desire into consulting projects on terms and conditions which are attractive to you.

This section will also introduce how to apply SPIN principles in your pre-‐sales work with potential clients. SPIN was developed by Neil Rackham and released as a book in 1988. Although much has changed since then SPIN remains a simple yet powerful approach to selling consulting services.

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The Proposal As consulting services are “invisible” and typically customized for the individual situation the written proposal/agreement becomes an important instrument in closing the deals and governing the delivery. This module will provide guidance and templates for making powerful proposals that with very little effort can be converted to delivery agreements. We will review how to structure the proposal and which type of content to include. We will discuss invoicing and payment details, which are so important for the cash flow of the independent management consultant. Finally we will discuss what should be included in a set of Standard Terms & Conditions, which are attached to all proposals and agreements. Aligning expectations and agreeing on objectives and deliveries is critical for managing client satisfaction and building a steadily increasing base of happy and returning clients. Having a solid written agreement is also the only way the management consultant can manage scope and ensure that he/she is getting paid for delivering exactly what was agreed. The proposal is the written confirmation of what you have agreed with the client during the pre-‐project discussions including the specific terms and conditions for performing the work. The proposal is also your opportunity to demonstrate that you understand the situation, have identified and qualified the objectives, have defined the specific deliverables, have a clear process for the project and have clear terms and conditions for the payment you will receive for delivering your services. The proposal must as clearly as possible illustrate that the price to be paid for your services is highly justified compared to the business potential released by your contribution. This section also discusses pricing and payment issues including price negotiations.

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The Back Office: Key Resources, Key Activities and Key Relationships

In this module we will review the “back office” infrastructure required to drive the “front office” activities successfully.

Back Office: Key Activities

Driving the front office AIDA and delivery process requires numerous activities. As the independent management consultant is a single person business he can outsource some of these activities increasing the time available for sales and delivery.

Back Office: Key Resources In this section we will discuss which key competencies and resources the independent management consultant must master in order to perform the activities required to run the business model.

Back Office: Key Partnerships Key Partnerships include your network of suppliers and business partners required to make your business model work. Partnerships are important as they allow for division of labour, leveraging and economies of scale.

The Business Model: P&L

Also in a management consulting business there is a relationship between what you invest and what you can harvest. However, as in any other business model we need to secure attractive margins as well as healthy cash flow. Cash flow is critical as the independent management consultant seldom has big financial buffers to finance work in progress, bad debts and periods with lower project activity.

Time Management The independent management consultant has very few types of resources to play with. Time is the scarcest and most ephemeral of these resources. In this module we will review tools for managing time effectively. We will also work with tools helping clients to understand how to

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appreciate our consulting rates by educating them on the nature of time efficiency.

Delivery The most crucial issue associated with delivery is customer satisfaction. Customer satisfaction is closely related to what you have “promised” in the pre-‐sales phase. Management consulting is primarily facilitation. As deliveries become more operational (e. g. sales agent activities, recruitment etc.) expectations for certain outcomes become more tangible and difficult to warrant. In this section we will discuss how to avoid the “inflated expectations” trap and how we can keep managing expectations. We will also discuss best practice for extending the customer relationship and cross/up-‐sell services.

The Business Model Environment

“The Times They are a-‐Changing.” The changes affecting the software industry are also affecting how, when and why software-‐driven businesses engage external resources for problem solving. In this section we will review the four business model environment forces: § Macro-‐economic forces § Key trends § Industry forces § Market forces and how we as independent management consultants can benefit from these forces and trends. We cannot change the environment, but we can lean to compensate for and take advantage of the changes.

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