Strategy Consulting

Part
01
of two
Part
01

Strategy Consulting: Competitive Landscape

The 4 top strategy consulting companies are: IBM Global Services, Bain & Company, McKinsey & Company, and the Boston Consulting Group (BCG). Each of the aforementioned strategy companies have competitive advantages that include technology, a focus on social impact, security, and attracting top talent. You will find a deep dive of my findings in the attached spreadsheet.

Revenue


~ IBM Global Services revenue is 4.2 billion dollars annually
~ Bain and Company revenue is 2.3 billion dollars annually
~ McKinsey and Company is 8.8 billion dollars annually
~ Boston Consulting Group is 5.6 billion dollar annually

Sub-Services


Below, please find a general list of each of the four large consulting companies sub-services per request. Each of the companies sub categories are pretty extensive so there are just a few listed below. For a full list of the remaining list of sub-categories, please click the citation links.

~ IBM Global Services include business design, business resiliency services, cloud services, digital workplace services, enterprise applications, network services just to name a few.

~ Bain and Company sub-segments include marketing, organization, operations ,technology, transformation ,digital, advanced analytics and more.

~ McKinsey and Company sub-segments include design, digital, learning programs for clients, marketing & sales, analytics, operations and more.

~ Boston Consulting Group sub-segments include big data, advanced analytics, change management, client enablement, corporate development & Finance, globalization, growth and more.

Industries each company works with:

~ IBM Global Services work with aerospace and defense, automotive, banking and financial markets, chemicals, consumer products, construction, education, electronics, energy and utilities and much more.

~ Bain and Company works with agribusiness, airlines and transportation, automotive, chemicals, consumer products, energy, financial services and much more.

~ McKinsey and Company works with advanced electronics, aerospace and defense, agriculture, automotive and assembly, capital projects and infrastructure, chemicals, consumer packaged goods, electric power and Natural Gas, financial services and much more.

~ Boston Consulting works with automotive and mobility, biopharmaceuticals, consumer products, education, energy and environment, engineered products and infrastructure, financial institutions, health care payers and providers and much more.

competitive advantages


~ IBM Global Services strongest competitive advantage is the services market and it's market share in terms of technology. By having such a large percentage of the market with their software already installed and in use, IBM has an advantage when it comes to services that other agencies do not have, specifically the non-technology companies.

~ Bain and Company strongest competitive advantage is its partnership with the World Economic Forum, as it positions them as a partner with one of the largest international organizations.

~ McKinsey and Company competitive advantage is its focus on social impact to include food, mobile communications, banking services, or utilities—to the way they operate—including employment practices and supply-chain decisions.

~ Boston Consulting competitive advantage is its consistent high ranking as "Consulting’s Best Firms to Work For List". This is an indicator that they attract the top talent their consultant "bench".
Part
02
of two
Part
02

Strategy Consulting: Market Size

The market size for strategy consulting is about $30 billion dollars of the larger $470 billion general consulting market. The North American region holds about 40% of the global share and, as such, it is calculated that the American strategy consulting market size is roughly $12 billion. Additionally, of the world's largest consulting firms, Accenture has the largest income regarding strategic consulting specifically.

MARKET SIZE

As the strategy consulting industry is considered one of three subsections of the management consulting industry, which includes human resources and operations, a thorough research was performed of the larger management consulting industry and then specified strategy consulting specific information within. The global consulting industry market size was approximately $470 billion in 2016, with the management consulting industry valued at $251 billion and a compound annual growth rate (CAGR) of 4.1%. The strategy consulting market, considered "the most prestigious segment" of the management consulting industry, accounts for 12% of the total market. As of 2016, the market for strategic consulting services is estimated to be about $30 billion. The North American consulting market, regarded as the most mature region globally, holds 40% of the global share. Thus, the conclusions for market sizing of this industry are:

40% * consulting industry market size * strategy consulting market share = North American consulting market.

That is to say, 250 billion*40%*12% which equals $12 billion dollars in the North American strategic consulting industry.

With a reported CAGR of 4.1%, the estimated market sizes for 2017 and 2018 are approximately $12.49 billion and $13 billion respectively.

COMPANY RANKINGS

Based on our research, the world's largest consulting firms are ranked based on strategic consulting revenue for 2017. The list is as follows:

#1 Accenture — $2.18B
#2 PwC — $1.4B
#3 KPMG — $1.22B
#4 Deloitte — $1.08B
#5 EY — $0.39B

As stated, the rankings of this list are based on strategic consulting revenue of the top management consulting companies which was calculated by finding the consulting revenue on each company's annual report and multiplying it by 12% as strategy consulting represents approximately 12% of the total management consulting market. This implies that strategic consulting would account for about 12% of the consulting revenue earned by each company. These are the specific formulas we used to calculate each total prior to organizing from the highest to the lowest revenue in billions:

PwC — 12.253 * 12% = $1.4B
Deloitte8.997 * 12% = $1.08B
EY — 3.27 * 12% = $0.39B
KPMG — 10.18 * 12% = $1.22B
Accenture — 18.17 * 12% = $2.18B

BUSINESS SEGMENTS

It bears noting that the largest revenue generators for consulting in the United States are in management, scientific, and technical consulting services. As strategy consulting is part of the larger management consulting industry, trends that affect the market size are largely based on trends affecting the consulting industry at large. For the last five years, the annualized growth within the management sector has been at 3.6%. Within the management sector in the U.S., there are over 600,000 consultants working and strategic management accounts for "over $30 billion in total revenue."

CONCLUSION

The global market size for strategy consulting is about $30 billion and has a CAGR of 4.1%. In the United States, most of the revenue within consulting is generated by management, scientific, and technical consulting services. However, the management sector in general can be expected to continue to grow at a rate of 3.6% annually, affecting the strategic consulting growth rate as well.
Sources
Sources