Official Proof – McKinsey thinks highly of BCG, Bain and one surprise firm (it’s not who you think), while thumbing it’s nose at the rest.

Over the weekend we were debating how to map out a hierarchy of the management consulting market which is not based on hearsay and opinion. We wanted something more mathematical and precise: something which would be hard to dispute or was at least independently replicable.

Over the weekend an idea emerged. Watching Marissa Mayer celebrate her new promotion and Mark Zuckerberg topple Steve Jobs as a tech titan, we developed a pretty good and original way to do this. You can read about the approach at the end. It may be a good idea to start there otherwise the concept of “votes” will not make much sense to you. Download the presentation here.

Findings

• McKinsey, Bain and BCG receive the most votes. They are the top-dogs as voted by their competitors. McKinsey is the most popular. Notice how the élite firms in blue receive lots of votes but are in the stingy part of the graph for giving out the least votes.
• Notice the auditing firms PWC, Deloitte, Accenture in red (okay, former auditing firm) also cluster together. They give out an awful lot of votes but receive much less. You may ask why they would give out so many votes. Our guess is the non-consulting divisions of the auditing firms are citing reports from consulting competitors. The other explanation is that consultants in the auditing firms are referring to their competitors and do not realise the damage this causes.
• Firms which have really weak brands in green also stand out. The Oliver Wyman, Booz and Monitor brands operate in a vague and undefined space. They are not the first choice when describing strategy (that’s McKinsey), operations (that’s AT Kearney), implementation (that’s usually Deloitte) or technology (that’s invariably Accenture). So the brand and votes languish. They need to be known for something.
• Look at the strong showing by AT Kearney. It clearly occupies a niche and does quite well. AT Kearney’s focus and positioning seem to be paying dividends.

Who does McKinsey admire?

• The top-dog, McKinsey, gives 25% of its votes to BCG and an equal percentage, 17% to both Bain and PWC. Wow! That’s a surprise. Take that Deloitte, E&Y and KPMG. We did not expect PWC to get this much recognition from McKinsey. Although, Marvin Bower did once refer to PWC as the “Rolls-Royce” of accounting firms. So the admiration may make sense.

Who does BCG admire?

• If McKinsey rates BCG tops, who does BCG rate as tops? It simply returns the favour to McKinsey. BCG is stingy when voting for other firms. Of the 32 votes on its site, 30% go to McKinsey and the rest are fragmented.

• Bain, rates Accenture and McKinsey equally by giving them 27% of all votes. (Note: the Global Leader for Bain’s Technology Strategy practice is Accenture’s former Senior Partner. That could explain part of this.) It rates BCG third with 17% of the votes.

• It’s no use analyzing PWC, Deloitte and Accenture. They all liberally name their competitors. We counted over 30 votes per a competitor. We stopped counting since at some point a vote is meaningless.

Monitor is stingy with votes and the sentiment is returned

• How’s this for a shocker. Monitor is the most frugal with its votes. It voted only 12 times and evenly spread its votes. Although, as discussed in an earlier post, the Monitor website is poorly maintained and updated. So their true feelings may not be captured.

Here’s the summary:

• Every firm votes for McKinsey.
• McKinsey votes for BCG, Bain and PWC.
• BCG keeps it exclusive and votes for McKinsey.
• Bain votes McKinsey and Accenture at the top followed by BCG. The élite consulting firms are stingy with their votes but extremely popular with their peers (Reminds me of high-school)
• AT Kearney is an unexpected winner carving out a distinctive niche. So is PWC who gets a nod from McKinsey.
• The auditing firms are liberal with their votes but do not get many in return.
• There are a pack of floaters who have no distinctive identity or group. Wonder what they are known for?

Approach

• We know that management consulting forms do not like each other much and would rather not mention their competitors on their website. That’s a fact. They would rather repeat the analyses by using a neutral source like the Congressional Budget Office than reference a BCG analysis of the Congressional Budget Office’s figures.
• Therefore if a consulting firm’s website mentions their competitor by name, we can assume they had no choice, the information must be that important and good. In essence we can consider each mention as a ‘vote’. A ‘vote’ of confidence in that competitor if you like.
• By counting the ‘votes’ between the top 10 management consulting firms websites we can work out who is the top consulting firm. More importantly, we can work out who they think is the top firm.
• That’s similar to Google’s back-link analyses. Except here we are counting a mere mention on the website. We do not care if it is hyperlinked or not. Management consulting firms rarely hyperlink their references so counting hyperlinks is flawed.
• Now for part two.
• Taking a lesson from Facebook we can see which competitor a consulting firm chooses to link to, to determine its pseudo-social network. For example, if everyone votes for BCG, but BCG only votes for 4 firms, then we can see BCG is the king-pin.
• So we can ignore all the “diplomatic” things firms say about each other and have a look at how to they actually feel about their competitors.
• We conducted this analyses using Google site search and catered for changes in names (Mercer Management Consulting to Oliver Wyman), variations of name (BCG or Boston Consulting Group) and false-positives (Monitor appears everywhere and not as the name of the firm).
• We manually deleted duplicates of the same vote. A duplicate means the article was popular, not the reference material so there was no reason top count it twice.
• We also ignore non-English sites. We applied the 80/20 principle.
• We did not include every firm in this analyses. No matter which list we came up with someone would be unhappy. Nonetheless, we think the sample is representative of the total management consulting market and the broad results are valid.

You saw this first on Firmconsulting.com.