When hiring a strategy consulting firm, it is important that a company understand what constitutes a quality firm. An inability to do this may result in hiring the wrong firm. This can reek all types of havoc on a company. It may even hurt its chances of being a success.
There are a few things that a company will need to consider before hiring a strategy consulting firm. If a company does not, they are in danger of choosing the wrong one. This can have all sorts of repercussions, amongst them, financial disaster. The wrong strategy can throw a company off course because they will be adopting the wrong approach. This could result in loss of revenues and possibly even the entire business.
The points that mark of a good strategy consulting firm
While there is no way to know for sure whether or not a strategy consulting firm will do a good job, there are certainly things a person can learn about a company that will help him or her make a decision about whether or not they can potentially do a good job. Below, we will list and explain some of these things are.
A. Reputation: The reputation of a company says a lot about it. While there is a chance that some complaints are made as a result of pettiness, if the same complaint(s) keeps being reported, there may be some truth with it. A company should keep their ears and eyes open before deciding on a strategy consulting firm so that they learn as much as possible before settling on one.
One way to do the aforementioned is to ask for references. However, it is important to note that any customer a company offers as a reference will likely be one that they have a positive relationship with otherwise the company wouldn’t release their name and contact info. If, however, the reference is a respected and trusted member of the industry, it may be worth listening to.
B. History: Companies that have been around for some time may or may not be the best thing going. However, they are probably at least decent to have been around for as long as they have. Companies that have a lengthy and positive history, combined with well trained employees, are definitely worth considering.
When seeking out strategy consulting firms, companies should look for ones with a history of strong performance, experience and a good reputation. These types of firms should be able to come up with an effective strategy.
When you engage with a strategic consulting firm the first step they need to perform is a solid competitive analysis. In order to build a proper strategy.
Why is a Competitive Analysis so Important?
When a strategy consulting firm works with a company, they will always perform a competitive analysis. This will help them understand the competition and subsequently, come up with a viable strategy. Without this information, it would be impossible to do so. This process will be fairly in-depth because it is so important.
One of the first things strategy consulting firm will do is perform an analysis of the competition. Understanding who a business’ competitors are is very important. It will have an impact on what type of strategy a consulting firm recommends a company implement. For instance, a firm may suggest that a company in the middle of the pack be more aggressive in their marketing and advertising efforts. Conversely, they may suggest that an industry leader continue its current efforts.
Factors involving competitive analysis
A consulting firm will ask a number of questions when performing a competition analysis. They include but are not necessarily limited to the following.
a. Identification of the competition:This will be one of the first things that a strategy consulting firm will do. They will want to know who the competition is. This will help them determine the company’s place in the market. A failure to do so will cause their efforts to be ineffective.
This part of the process is generally easy enough. The company receiving the consultation will have a good idea of who their competition is. The consulting firm will use this information along with their own investigation to not only determine who’s in the industry but to learn all about them, for instance, their standing in the industry, their history, revenues, marketing efforts, etc.
b. The company’s standing in the industry: Before a proper strategy can be determined, it is necessary to figure out the company’s current standing in the industry. This will have an impact on what strategy is best. A company playing catch up may need to be much more aggressive than one that is firmly in the middle of the pack. After determining a company’s standing, it will be necessary to determine it goals.
c. The ability to compete within the industry: There will some companies that are difficult to beat. For instance, those companies which have been around for a while and subsequently have managed to develop strong brand recognition and a loyal following. There will be others, however, that can be surpassed. Understanding which is which and then making appropriate decisions about who to go after and who not to, will be an important part of the decision making process following the consulting firm’s competition analysis.
Building and growing a successful business is hard. Strategy consulting firms can assist with building a vision and approach for success. Picking the right firm and then understanding your position relative to the competition are crucial for success.