Role of a Strategic Consultant

Role of a Strategic Consultant

As enterprises face an increasingly diverse set of constraints and uncertainty, the need for insight and guidance from a strategic perspective becomes critical. The larger and more diverse an enterprise becomes, the more complex its business model becomes while often agility and speed to respond suffers. Strategic consultants assist enterprises and their leaders determine how best to confront uncertainty, risks and challenge sin their core markets while staying profitable for the long-term. This is accomplished based primarily on the strategic consultant's insights and experience in addition to their ability to clearly and convincingly communicate what strategic options an enterprise needs to consider.

Of the many frameworks strategic consultants rely on, the Determinants of Competitive Advantage, Five Forces Model and the value chain are all used extensively to provide insightful analysis that is clearly communicated to senior management. The value chain, created by Dr. Michael Porter of Harvard University, is considered essential for discussions of how an enterprise needs to be re-architected to be more focus on its customers and profitability (Porter, 1980). Inherent in the use of these frameworks are assumptions of how the financial performance of a firm will be strengthened by following the recommended strategies (Fernandez-Huerga, 2008). Strategic consultants who deliver the most value concentrate on redefining their clients; enterprises to make them more agile, resilient to market conditions and uncertainty while finding them avenues for profitable growth (Bryan, 2010). Combining the diverse series of businesses an enterprise may be in to a common vision is how strategic consultants deliver value.

Assisting Clients In Achieving Sustainable Competitive Advantage

The greatest contribution a strategic consultant can make to a client organization is to provide them with insight, intelligence and expertise in defining potentially new ventures while also helping them to streamline existing businesses. By being able to quantify the financial terms of each possible strategy, strategic consultants can quickly and clearly communicate options to the senior management teams that are accustomed to thinking in financial terms including Return on Investment (ROI) (Berman, Knight, 2008). Sustainable competitive advantage is provides to clients by providing them with insights and in many cases, financial analysis of their existing businesses they had not known before. In working with Mckinsey & Company on a recent project to evaluate the profitability of several product lines, it became apparent that the mid-range of products were not differentiated either in pricing or costing to be profitable, and the low-end of the product line, while selling well, would eventually lead the entire company into a price war. The decision was made to stop investing the technologies of these products and heavily invest in research & development (R&D) to surpass competitors by a product generation. Within nine months of this decision the low-end of the market for these products was embattled in a major price war with margins plummeting., Pulling back to invest in new technologies turned out to be the right decision.

Question for the Class

If you were given 6 months to turn around Yahoo by Marissa Meyer where would you start and how would you approach it from a strategic standpoint?

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