Charles-Edouard Bouée, the newly elected CEO of Roland Berger Strategy Consultants, is currently together with the Global Executive Committee working on the firm’s new strategy. Although the strategy has not yet been unveiled in detail, Consultancy.uk has gotten hold of the outline, and the plans are big. The blueprint centres around an ambitious growth target – in the coming years the international management consultancy aims at tripling its size, to be realised through further expansion of its footprint and the introduction of several ‘sub-brands’ and ‘hotspots’ that will complement its service portfolio.
Following Roland Berger’s decision to continue operating as an independent consulting firm end of last year, the global partner team agreed that the firm would work towards a new strategy, aimed at among others boosting its global presence, overall size, financial profitability and reputation. Key responsible for the task is the Frenchman Charles-Edouard Bouée, who was named CEO in the summer, accompanied by Stefan Schaible and Tijo Collot d'Escury, who were appointed Deputy CEOs early September. Together with the four other members of Roland Berger’s Global Executive Committee (GEC) they have over the past period intensively led the development of a new strategy.
Although the strategy still is work in progress, and has not yet been shared internally past the management ranks, the outline reveals that size and market share stand at the heart of the master plan. Consulting firms, in particular those active in the top of the market, are under increasing pressure to stay on par with the increasing globalisation of their clients. In addition, driven by increasing external and internal complexity, clients are upping their expectations from external advisors. This implies that size and global reach have become paramount for consultants, combined with a differentiated positioning in the marketplace, for instance through deep industry and/or functional knowledge, a multi-disciplinary approach or a niche offering.
In the case of Roland Berger size is a focus area – the firm is smaller than the three large market leaders in the strategy consulting space – McKinsey, BCG and Bain – yet at the same time too large and broad in terms of capabilities to position itself as a niche player. In a time where profitability is under pressure – exemplified for instance by Monitor’s bankruptcy and Booz’s decision to sell itself to PwC – it stands without a doubt that Roland Berger’s GEC will aim at bolstering its scale.
Not surprisingly, Roland Berger’s GEC has recognised the importance of size as a key competitive factor, and decided to center its new strategy around growth. In the coming years the firm aims at tripling its business, from the current 2,400 employees to more than 7,000, a transition that should would not only in Europe but also globally confirm the firm’s top-5 position in the strategy consulting segment, amidst the larger American players. At the same time, the firm consciously chooses to hold on to its ‘high-end’ consulting model, refusing to expand into the more lower value added segment (e.g. implementation, digital execution, etc), hence only leaving room for horizontal expansion across the advisory value chain. To realise the ambitious objective, the firm will execute three key pillars.
The first pillar focuses on rolling out a series of new sub-brands, in order to better position itself towards customers whilst at the same time not eroding its traditional high-end strategy consultancy offering. The multi-brand approach follows similar moves from other players in the market, with the Digital space presenting the most notable examples: McKinsey works with McKinsey Digital, BCG operates with BCG Digital Solutions and dozens of other consulting firms have recently launched separate Digital labels. Roland Berger is working on plans for labels such as 'Roland Berger Digital’, ‘Roland Berger Real Estate’ and 'Roland Berger Executive Communications’. To build the sub-brands, it is foreseen that alliances and partnerships will be struck with specialist firms.
Further building its global presence is another pillar, to be done through a combination of ‘hotspots’ in markets, that are relevant to the respective industries, and a more ‘open’ delivery approach with counterparts in the industry, mainly in disciplines which are not covered by its service portfolio.
Lastly, the GEC is aware that the global expansion can only be successful if the firm returns to the high profitability levels it enjoyed prior to the crisis. Over the past months several initiatives have already been rolled out to boost profitability, which have according to analysts resulted in an annual saving of approximately €50 million to date, and also for the coming period the firm’s internal efficiency will be bolstered through the deployment of a number of new projects. Partners are expected to quickly reap the benefits – the firm’s profits are rising, and for the first time in a number of years the firm’s shareholders will receive dividend.
Roll-out in 2015
Roland Berger has confirmed to Consultancy.uk that the new strategy will be launched at the beginning of 2015. To minimise the disruption on the business the firm will follow a phased implementation strategy, as opposed to a ‘big-bang’ approach, and take between 6 to 12 months to complete the roll-out.