The Boston Consulting Group

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The Boston Consulting Group


Abstract

This research paper looks at the evaluation and analysis of The Boston Consulting Group’s human resources department. It shows the relationship between its consultants and organizational behaviors. Organizational performance at BCG has proven to be a significant factor in the health of the company. The report also illustrates the practices used by the company for its effectiveness and success. Also, the company developed the BCG Matrix which is used to introduce the growth-share matrix that is relative to competitors. The main role of The Boston Consulting Group is to hire the most skilled employees to effectively and efficiently fulfill the company’s objectives without constant supervision. Ranked as the 3rd most prestigious consultant firm across the nation and being the leading advisor on business strategy, BCG has a strong work ethic and a strategy to transform their business to meet every clients needs for a successful outcome.

The Boston Consulting Group

Human Resource Management (HRM) is the function within an organization that focuses on employee benefits, compensation, diversity, employee training and relations, safety and security, and corporate social responsibility. HRM is transforming to adapt to today’s business world and expected to add value to the strategic operation of employees (HR Disciplines, n.d.). Any organization, without a strategic system for HRM is clear to experience some serious problems. That's why many companies are putting more effort and energy into setting up a strong and effective HRM.

Founded in 1963 by Bruce Henderson, a Harvard Business School graduate, The Boston Consulting Group (BCG) is the world’s leading advisor on business strategy. BCG provides management consultancy services to private, public, and not-for-profit sectors worldwide. The company is rated #3 on Forbes list of “Best Companies to Work for in 2014” (Best companies to work for 2014, n.d.). The Boston Consulting Group (BCG) is an organization with exceptional HR planning. Their HR department relies on its core responsibilities of personnel recruitment and hiring, application management, training and development programs, benefits administration and compliance with legal and federal regulation. The HR department BCG also plays as a strategic and comprehensive approach to managing employees, the workplace culture and the environment. It enables employees to contribute effectively and productively to the overall company direction and the accomplishments of the organization's goals and objectives (Boston Consulting Group, 2013). Last year, the company celebrated its 50th anniversary, and today has more than 9,000 employees working in 81 offices in 45 countries.

Human capital management (HCM) is related to the strategy of developing the company’s biggest asset, its people, whose current value can be measured and whose future value can be enhanced through investment in order to make an organization succeed (What is human capital in management, 2013). BCG is one of the best overall providers of human capital management with its strategy consulting.

The BCG has a strong sense of the word “team”. It is not an individual company. The Boston Consulting Group’s mission is to:

  • Create competitive advantage through unique solutions
  • Build capabilities and mobilizing organizations
  • Drive sustainable impact
  • Provide unparalleled opportunities for personal growth
  • Succeed together with passion and trust (BCG: Mission, 2007)

Also, the company has a high focus on diversity and flexibility in the workplace. And, BCG has a variety of benefit options that stand out. Such as, it pays 100% of employee health care premiums, offer paid sabbaticals and grants new consultants to delay their start date by six months and receive $10,000 to volunteer at a nonprofit. The firm values its employee’s eagerness and motivation to keep up with the extensive travel demands as a consultant, the long hours, and give 100% every time. But, the company does not want its employees to burn out and have implemented a work-life balance approach (Breslin, 2013).

Human resource policies and compliances are the official guidelines that organizations put in place. These policies are for hiring, training, and assessing current and future associates of their workforce. These policies need to be instilled in every employee’s minds and written down on paper so it can be clearly understood.

Employees like to know exactly what their role is in the company and how their work affects the company. Having a clear structure is essential to a company’s success. At, BCG every consultant knows exactly what their role is and how it corresponds back to the company’s overall strategy and goals. The consulting industry is a very demanding and rigorous profession. That is why, BCG consultants carry bachelor degrees and higher.

The duties and responsibilities of a consultant at BCG are quite extensive and clearly stated before hired. Some of them are:

  • International travel
  • More than 8 hour work days
  • A lot of liaising and multitasking different clients and projects
  • Writing action plans and daily reports
  • Conduct interviews with key market players
  • Create strategies for change
  • Must have confidentiality and great interpersonal skills (Career path, 2008)

This is just a summation of the duties and responsibilities of a consultant at BCG. Other job titles are project leader, principal, and partner. Once the consultant becomes well-learned and have enough experience and success as a consultant, they are able to move up the ladder to these positions at the BCG.

Shaping the Future. Together. That is the vision of The Boston Consulting Group, who has won countless awards for Worlds Most Attractive Employer or Top Companies to Work for, etc. BCG is known for being the world’s leading advisor on business strategy. This organizations focus, attention to detail, and going “above and beyond” for the client has made this company what it is today. Organizations face an extremely difficult set of challenges with such a fluctuating economic climate. Their strategic capabilities are grounded in the same basic philosophies. Boston Consulting Group and their Human Resources Department stay on top of things because of various strategies to combat the ever-changing market.

The company’s business strategy drives work force needs (BCG, 2014). BCG has a few core standards that determine the company’s strategy. The main ones are integrity, respect for the individual, delivering value, and making an impact on society (BCG, 2014). Integrity involves accountability and doing the correct thing at all times. Respect for the individual entails treating everyone regardless of position with thoughtfulness and respect. That calls for a unique truthfulness and honesty that only happens when everyone is open and upfront at all times, whether good or bad. Delivering value is self-explanatory. BCG is committed to generating value that returns much more than a return on a client’s investment. That requires hard work and setting an extremely high standard for the company. Making an impact on society just means BCG wants to make an impact beyond the business. BCG donates their time and resources to community issues and institutions that are prevalent in our society (BCG, 2014).

The company’s values align up with their mission. BCG seeks to be agents of change for their clients, people, and society overall. BCG is committed to producing a viable advantage through unique solutions, building strong competencies and mobilizing organizations, driving a justifiable impact, providing unequalled opportunities for personal growth, and succeeding together with passion and trust. BCG has wide-ranging experience helping each client redesign and supplements their planning approaches. Transforming business and society is their ultimate mission that they have succeeded at.

BCG’s emphasis on investment in its people, career flexibility and mobility, extensive training, high-impact client work, a collaborative culture, progressive benefits, and a commitment to social-impact work have all contributed to the consistently strong showing. Specific benefits include 100 percent coverage of employees’ health-care premiums, internal fellowships, and tuition reimbursement. The firm also has been recognized for its LGBT-friendly benefits and policies (Top-consultant.com, 2014).

BCG’s approach to business has been unparalleled. BCG has identified what works with their superiority leadership capabilities and their extraordinary talent pool. Together with each client, they develop new visions about the business, summon each company on how to move forward, get bottom-line results, and make each company more capable going forward in the ever-changing economy and success in the twenty-first century.

The Boston Consulting Group has been recognized as a consistent top employer for the past several years as it became “one of only two firms to make the top dozen every year since 2006” in the Fortune’s 100 Best Companies to Work For List (Creating people advantage 2012, 2012). In fact, this year BCG actually ranked number 3 on the list, a step up from being number 4 in 2013 (The Boston Consulting Group, n.d.). The practices and policies executed in HR have contributed greatly to this success.

There are several HR functions that are implemented within the organization in order to strategically partner with the company. The chart below shows the top 5 HR functions or processes that have the most impact on the profit growth, profit margin, and total improvement of the company.

HR Function or Process

Profit Growth

Profit Margin

Total Improvement

1. Recruiting

3.5x

2.0x

5.5

2. On boarding and retention

2.5x

1.9x

4.4

3. Managing Talent

2.2x

2.1x

4.3

4. Employer Branding

2.4x

1.8x

4.2

5. Performance Management and rewards

2.1x

2.0x

4.1

Source: Sullivan, J. News Flash: Recruiting Has the Highest Business Impact of any HR Function

As noted in the chart above, BCG’s HR leaders contribute much of its effectiveness to several practices, but the practice that is considered to have the greatest impact on revenue growth and profit margins is recruiting (Sullivan, 2012). Of course, all of the functions are important, but recruiting has proven to have the greatest impact on the business.

The Boston Consulting Group collaborates with clients to “build a competitive, measurable, and sustainable staffing advantage through strategic focus, business connection, and excellence in execution” (BCG: Human resources competencies, 2009). The HR team has been very strategic in assisting with achieving this mission and the policies and HR functions implemented have led to the expansion of the company to enable the execution of the mission in a greater capacity. The chart below briefly shows how through the implementation of HR practices, such as recruiting, has caused the company to increase in number of employees both in the U.S. and outside of the U.S.

2013

2014

U. S. Employees

2,314

2,552

Employees Outside U.S.

6,300

6,982

100% Healthcare Coverage

yes

yes

Professional Training Salaried employees (hrs/yr)

100 hours

100 hours

Professional Training Hourly Employees (hrs/yr)

40 hours

40 hours

Source: Fortune (2014). Best Companies 2014

The chart also shows how HR invests in the employees by providing 100% paid healthcare coverage for all of the company’s full-time employees as well as provide extensive professional training each year to make sure the employees are equipped and trained with the knowledge and understand necessary to perform well. This also resembles the heart of the company, showing that the employees are viewed as “human assets,” which could be a contributing factor to its consistent appearance in Fortune’s 100 Best Companies to Work For List. Overall, HR’s policies and practices are positively impacting the organization, and assisting with the achievement of organizational goals.

In the 1970s, Boston Consulting Group (BCG) created a matrix for a portfolio strategy to help their organizations of being objective and fact-based. A well-known evaluated portfolio objective way for a strategic decision for future investment returns is outlined by the BCG Matrix. The four quadrant strategic objective of individual business units are stars, cash cows, problem-child or question mark, and dog. This framework applies two inputs, market growth and market share to a portfolio of segments, products or businesses, and then draws conclusions about how resources (e.g. talent, investment) should be allocated across the portfolio (BCG Matrix, n.d., para.1).) The BCG matrix is a useful portfolio for resource allocation decisions as a good starting point. Business units, products, or market segments are able to be used for a portfolio as a powerful communication tool. This creates an understanding and popularity of the organization of explaining difficult resource allocation decisions. It’s a harder challenge based on objective data and through touch decisions it is a useful tool to push.

The first quadrant is the future of the business which is critical and the first priority is for discretionary investments as a stance for “stars” defended at all costs. The second quadrant is a sustain leadership position is enough to ensure investment of generated funds in the higher growth parts of the portfolio called “cashcows” of not milking them dry. The third quadrant is “Problem Children” or “Questionmark” being the toughest business of taken the next step. A binary investment stance is called “Double or Quits” which is the best name of making a decision. It is a very heavy investment to grow market share by selected bets and making them the Stars of the future. It begins as a relative weakness position of a growing market resulting in the business making the best selective bets of achieving a leadership position with strong beliefs. This would be a tough decision to ignore of other high growth opportunities. The last quadrant is call a typical investment stance “Dog” or “Harvest/Exit” which should not be divest or exit business rapidly due to having low value and during the sale process it will distract management. The capacity of being “harvested” properly leaves them weak competitive position which will disappear quickly if investment is reduced. Rather they could be set up to operate with minimal resource drain on the rest of the portfolio, as the best people and all discretionary resources are diverted to more attractive businesses (BCG Matrix, n.d., para.4).

To conclude we have touched on what Human Resource Management is and the role that it plays in an organization. HRM is transforming to adapt to the changes in the world and today’s employees. Any company without an HRM will encounter some problems and so that is why a lot of organizations are putting much more effort into making their HRM strong and effective. The Boston Consulting Group (BCG) is an organization with one of the best HR planning. Their HRM enables employees to contribute effectively and productively to the overall company direction and accomplishments of the main organizations goals and the direction it’s going in. We touched on the top 5 HR functions that have the most impact on profit growth, profit margin and total improvement of the company. The practice that had the most impact on business is recruiting as it contributes to revenue growth also. The BCG main focus is investment in its people, career flexibility and mobility, extensive training, high impact client work, a collaborative culture, progressive benefits and a commitment to social impact. BCG develops new visions and is always changing with the economy to help better assist its employees and organizations.

References

BCG: Human resources competencies. (2009, September 4). Retrieved from http://www.bcg.com/expertise_impact/capabilities/people_organization/human_resources/competencies.aspx

BCG Matrix. (n.d.). Retrieved from IES Business Strategy: http://strategicthinker.wordpress.com/concept-template-5/

BCG - Mission. (2007, September 4). Retrieved from http://www.bcg.com/about_bcg/vision/mission.aspx

Best companies to work for 2014. (n.d.). Retrieved from http://fortune.com/best-companies/the-boston-consulting-group-3/

Boston Consulting Group. (2013). Retrieved from www.bcg.com

Breslin,M.M. (2013, February 20). Part of Boston Consulting Group's success comes from looking out for its workers. Retrieved from http://www.workforce.com/articles/part-of-boston-consulting-group-s-success-comes-from-looking-out-for-its-workers

Career path: Your road to success. (2008, September 4). Retrieved from http://www.bcg.com/careers/career_growth/career_path/

Creating people advantage 2012: Mastering HR challenges in a two-speed world. (2012, October). Retrieved from http://www.hragenda.net/uploads/6/7/8/0/6780997/bcg_creating_people_advantage_oct_2012_tcm80-119346.pdf

HR Disciplines. (n.d.). Retrieved from http://www.shrm.org/hrdisciplines/pages/default.aspx#

Sullivan,J. (2012, September 4). News flash: Recruiting has the highest business impact of any HR function. Retrieved from http://www.ere.net/2012/09/04/news-flash-recruiting-has-the-highest-business-impact-of-any-hr-function/

The Boston Consulting Group: Best companies to work for 2014. (n.d.). Retrieved from http://fortune.com/best-companies/the-boston-consulting-group-3/

What is human capital in management? (2013, May 24). Retrieved from http://education-portal.com/academy/lesson/what-is-human-capital-in-management-definition-value-quiz.html#lesson

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