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Consultants’ Corner A Bi-Monthly e-Journal from

Issue 83 | Oct-Nov 2013 | Page 1– 13

What’s Inside...

Balanced Scorecard - A Management Tool for Consultants Benchmarking - A Tool for Consulting BCG‟s Growth Share Matrix - An Introduction


Consultants’ Corner

From the Editors

In this Issue


Balanced Scorecard - A Management Tool for Consultants Meaning and benefits of using Balanced Score Card


Benchmarking - A Tool for Consulting


Precautions for Mobile Phone Users!!!


Boston Consulting Group (BCG) - Growth Share Matrix


Opinion Poll Result

Identification of steps used for benchmarking and benchmarking process adopted at Xerox.

Do‟s and Don‟ts while using a mobile phone

Introduction to the BCG‟s Growth Matrix

Best article in the Aug-Sep 2013 issue of

Consultants Corner


Michhami Dukkadam


What’s up at NCRCL?


An Exclusive Talk

A day of Forgiveness

All events and birthdays at NCRCL

Quiz Corner

Readers’ Corner The theme and articles in the Aug - Sep issue of CC were very interesting. Congrats to the editors on a good job and the authors for their valuable contributions.

The editorial team of the Consultants Corner wishes all its readers an auspicious Dusshera and Deepavali. May the Lord bless you with glory and success!! Subject matter expertise is the basic requirement for any consultant in addition to the formal professional education he receives. The consultant needs expertise in various domains of knowledge and as they say he needs to know a little of everything and everything of little. He has to be abreast of all the latest tools and methods of consulting in his area of expertise for him to stay relevant and effective. The Consultants’ Corner had in its earlier edition discussed the 3PT model developed by NCRCL. This edition introduces the reader to three consulting tools generally used in consulting viz., Balanced Score Card, Benchmarking and Boston Consulting Group‟s Growth Matrix. These tools of consulting are used extensively in financing, profitability analysis, business strategy, operations and other relevant fields. These tools were developed in the recent decades by consulting firms as well as individual consultants. They were further improved by scholars and consultants. The Balanced Score Card is a strategic tool used worldwide to align the business activities to the vision of the organisation. Benchmarking improves organisation performance by identifying and applying best demonstrated practices to operations and sales. The growth matrix model developed by the Boston Consulting Group helps corporations to analyse their business units or product lines. The readership base of Consultants’ Corner has touched a new high. It is also consistently growing by each day. The concept of polling for the best article too has met with a good response with the readers. The editorial team thanks all the readers for their continuous involvement and encouragement.

-Ashok Rao If you have any comment/suggestion for the editors, please write to us at Your views and comments on articles featured here are also welcome!

If you live for having it all, what you have is never enough. - Vicki Robin

We would like the readers to send us more views and suggestions on any aspect of Consultants’ Corner which has a direct impact on the quality of the magazine. The Editors will respond to the suggestions and views of the readers and would publish them in subsequent issues of CC. Wishing the readers once again happy and glorious festivities!!


Consultants’ Corner

Balanced Scorecard - A Management Tool for Consultants

The Balanced Scorecard is used to improve internal & external communications and monitor organization performances against strategic goals.

The Origin In 1986, Analog Devices, Inc (ADI), a mid -sized semi-conductor company, hired Art Schneiderman (a renowned independent consultant on Management processes) as vice-President of Quality and Productivity Improvement. Schneiderman introduced goals for a series of quality measures that correspond to be what he considered to be critical success factors for ADI. As part of five-year strategic plan of ADI, Schneiderman also developed a one page report, called the scorecard. The scorecard showed three categories of measures: Financial, new products and quality improvement process.

The Basic idea in creating this score card was to integrate financial and non financial metrics into a single system in which they did not compete with one another for management airtime. In 1990, Bob Kaplan (Professor in Harvard Business School) invited Schneiderman to the Nolan-Norton study group on performance measurement. Bob Kaplan and Schneiderman presented the use of the scorecard at the Analog Devices Inc. During the second Nolan-Norton study the participants implemented scorecards within their organizations. Eric Norton (Founder and Director of Palladium Group), who served as the project leader and facilitator, and Bob Kaplan wrote up the experiences of the participants with the scorecard and devised a "Balanced Scorecard" in 1992.

Contd on next page


Consultants’ Corner


Benefits of Balance Scorecard

The Balanced Scorecard is a strategic planning management tool that is used extensively in business and industry, Government and non-profit organizations worldwide to align the business activities to the vision & strategy of the organization; improve internal & external communications and monitor organization performances against strategic goals.

The Balance Scorecard approach provides a clear prescription as to what companies should measure in order to “balance” the financial perspective.

Balanced Scorecard - A strategic Management System In 1996, Kaplan and Norton argued that the balanced scorecard could be used as a strategic management system which supports four management processes: 1. Translating the Vision

Among the long row of benefits of applying Balanced Scorecard, the following are more significant: 

Increased creativity and unexpected ideas;

The Balanced Scorecard helps align key performance measures with strategy at all levels of an organization;

The Balanced Scorecard provides management with a comprehensive picture of business operations;

The methodology facilitates communication and understanding of business goals and strategies at all levels of an organization;

Maximized Cooperation - team members are focused on helping one another succeed;

Usable Results - transforms strategy into action and desired behaviors;

The Balanced Scorecard concept strategic feedback and learning;

A cross organizational team - more open channels of communications & enthusiastic people;

2. Communicating & Linking 3. Business Planning 4. Feedback & Learning Seven ingredients of highly successful Balanced Scorecard programs 

A process to mobilize the organization and lead ongoing change;

Scorecards that describe the strategy;

Linking the scorecard to create an organization alignment;

Continuous workforce;

communication to empower

Initiatives are continually measured and evaluated against industry standards;

Aligning Personal Goals, Incentives, and Competencies With the Strategy;

Aligning Resources, Budgets and Initiatives with the Strategy; and

The Balanced Scorecard helps reduce the vast amount of information the company IT systems process into essentials;

A Feedback process that encourages Learning and Experience Sharing

Unique Competitive Advantage viz.,

Why Balanced Scorecard? 1. Traditional Reports looks backward- These traditional reports only reflect the past: spending incurred and revenues earned and lose to measure creation or destruction of future economic values 2. The balanced scorecard identifies factors that create long-term economic value in an organization like customer focus: satisfy, retain and acquire customers in targeted segments, Organizational learning and growth; develop skilled, motivated employees.


reduced time-frames

improved decisions and better solutions

improved processes

Ms. Madangi Anand can be reached at

Alone we can do so little; together we can do so much. - Helen Keller


Consultants’ Corner

Benchmarking – A Performance Measurement Tool Benchmarking helps in identifying methods of improving operational efficiency and analysing cost position resulting in a better output

Benchmarking is the process of comparing one‟s business processes and performance indicators to the industry‟s standards or best practices. The simple process of comparison between two or more things based on a specific set of variables is benchmarking. Benchmarking improves performance by identifying and applying best demonstrated practices to the operations of a company. The objective of benchmarking is to find examples of superior performance and to understand the reasons or driving forces behind such performance. The factors, external and internal, that contributes to better levels of performance. By understanding these factors, the companies can then improve their own performance by incorporating the best practices into their processes. How to perform benchmarking?  The first step in the benchmarking process is to identify a product, service or process to benchmark.  The second step is to identify the key performance metrics of such product, service or process. Key performance metrics is an indicator used to evaluate factors that are crucial to the success of an organization.  The third step is to select a group of companies to benchmark. As mentioned earlier, benchmarking can be performed either internally or externally.  The fourth step would be to collect data on the performance of the group of companies. The practices that the other companies will also help in understanding why the other companies are performing better than the rest.  The fifth step involves analysing the data collected in the previous step. Analysis is a crucial stage in benchmarking since at this stage various factors affecting the performance of the companies is observed.

Both external and internal forces can affect the performance of a company. Analysis of this data will help us in understanding why a company in a certain phase performs better than its peers. With this understanding, one can path the ways for improvement in the product, service or process.  The final step in the process is to adapt and implement the best practices. Implementation of the best practices is the most difficult step as the execution will not only require top management backing it will also need the cooperation of the lower rings of management. Once the best practices are adopted, setting reasonable goals to track the performance is vital. Whenever, a change is implemented in a process, the goal set forth should be realistic. Why perform benchmarking?  Performance improvement: Benchmarking helps in identifying methods of improving operational efficiency resulting in a better output. By understanding and implementing the best practices of the industry, one ensures performance improvement and quality in output  Cost position: Benchmarking involves studying the practices of the competitors or peers in an industry. During such a study, one can understand how the peers are setup and the cost involved in obtaining the output. With the help of this study, one can compare the costing model employed and how to improve this model. -contd on next page

The greatest use of life is to spend it for something that will outlast it - William James


Consultants’ Corner

 Gain strategic advantage: Benchmarking deals with establishing key performance indicators. By focusing on these indicators, the companies can gain strategic leverage by understanding the critical processes and how to improve these processes.  Organization learning: Benchmarking innovation in a company.


After initial denial, the management at Xerox accepted the harsh reality and implemented a five stage benchmarking model of its own involving planning, analysis, integration, action and maturity. Xerox collected essential data on key processes of best practices companies. These critical processes were then analysed to identify and define improvement. Xerox zeroed in on various other best practice companies to benchmark its other processes.

Benchmarking at XEROX


In the early 1980s, Xerox found itself increasingly vulnerable to intense competition from both US and Japanese competitors. It ignored the new entrants into the market such as Canon, Ricoh and Sevin who were consolidating their positions in the lower end market and in niche segments. Moreover, the company‟s operating cost was high and so were the prices of their products. Adding to this, the company‟s products were inferior to their competitors. As a result the market share in copiers came down sharply from 86% in 1974 to just 17% in 1984. Profits had dropped from $1.15 billion to $290 million. In 1982, David. T. Kearns took over as the CEO. He discovered that the average manufacturing cost of copiers in Japanese companies was 40% of that of Xerox which meant that the Japanese companies were able to undercut the profits of Xerox easily. He began by reducing the manufacturing cost and giving thrust to quality control. He started a program known as „Leadership through quality‟. As a part of this quality program, Xerox implemented the benchmarking process. Xerox chose to benchmark against its Japanese competitors and the results of the analysis in the key performance metrics is given below:

American Express

Best practices adopted Billing and collection

Cummins Engines and Ford Florida Power and Light

Factory floor layout


Supplier development


Quality management

Hewlett Packard

Research and product development Decentralization

Saturn Fuji Xerox DuPont

Quality improvement

Manufacturing operations Manufacturing safety

The first major payoff in this process was the increase in customer satisfaction. Customer complaints reduced by 60% and overall customer satisfaction were rated at more than 90% in 1991. Some of the other benefits reaped in implementing benchmarking are given below: 

Number of defects reduced by 78 per 100 machines.


Key performance

Analysis of competitors

 Service response time reduced by 27%.


Reduction in manufacturing cost

Xerox found out that –  It took twice as long to bring the product to the market  It used five times the number of engineers used  It had four times the number of design changes  It incurred three times the design cost  It had over 30,000 defective parts for every million produced which was 30 times more than its competitors It was revealed that Xerox would need an 18% annual productivity growth rate for five consecutive years to catch up with Japanese

 Inspection of incoming components reduced to below 5%.


Annual productivity growth rate

 Defects in incoming parts reduced to 150ppm.  Inventory costs reduced by two-thirds.  Distribution productivity increased by 8-10 %.  Notable decrease in labour costs. -contd on next page

It is the function of art to renew our perception. What we are familiar with we cease to see. - Anais Nin


Consultants’ Corner 

Errors in billing reduced from 8.3 % to 3.5%

Country units improved sales from 152% to 328%.

Xerox went on to become the only company worldwide to win all the three prestigious quality awards: the Deming Award (Japan) in 1980, the Malcolm Baldrige National Quality Award in 1989, and the European Quality Award in 1992. Analysts attributed this success to the 'Leadership through Quality' initiative, and, more significantly, to the adoption of benchmarking practices.

As a consultant, benchmarking is an important tool because if we can understand the best practices applied in the various industries, we can help our clients by tailoring and implementing these practices in their business process. This leads to growth and it also adds value to our clients. By benchmarking, companies can improve their performance by innovating and not imitating its competitors.

Mr. Vinod Murali can be reached at

Conclusion The case of Xerox shows evidence that benchmarking can be a powerful tool in improving performance and gaining strategic leverage.

Precautions for Mobile Phone Users!!! The following points throw light on crucial aspects about the mobile phone usage. 1. Keep distance – Hold the cell phone away from body to the extent possible. 2. Use a headset (wired or Bluetooth) to keep the handset away from your head. 3. Do not press the phone handset against your head. Radio Frequency (RF) energy is inversely proportional to the square of the distance from the source -- being very close increases energy absorption much more. 4. Limit the length of mobile calls. 5. Use text (SMS) as compared to voice wherever possible. 6. Put the cell phone on speaker mode. 7. Use your phone where reception is good. If the radio signal is weak, a mobile phone will increase its transmission power. Find a strong signal and avoid movement. 8. Metal & water are good conductors of radio waves so avoid using a mobile phone while wearing metal-framed glasses or having wet hair. 9. Let the call connect before putting the handset on your ear or start speaking and listening – A mobile phone first makes the communication at higher

power and then reduces power to an adequate level. More power is radiated during call connecting time. 10. If you have a choice, use a landline (wired) phone, not a mobile phone. 11. When your phone is ON, don't carry it in chest/ breast or pants pocket. When a mobile phone is ON, it automatically transmits at high power every one or two minutes to check (poll) the network. 12. Reduce mobile phone use by children as a younger person will likely have a longer lifetime exposure to radiation from cell phones. 13. Peopl e hav i ng act iv e m edi cal im pl ant s sh oul d preferably keep the cell phone at least 15cms away from the medical implant. While Purchasing a Mobile Handset check the SAR value of the mobile phone. It can be searched on internet if its model number and make is known. 14. The RF radiation is increased by Mobile phones when used in a car to overcome the window shielding. 15. It severely affects the reproductive systems of both male and females; deformity of unborn babies in the womb itself. Courtesy: Department of Telecommunications, Ministry of Communications and Information Technology, Govt. of India

If great truth does not enter into our relation to money, it cannot enter our lives. - Jacob Needleman

8Boston Consulting

Consultants’ Corner

Group (BCG) - Growth Share Matrix

Boston Consulting Group (BCG) Growth Share Matrix is the most simplest way to analyze the entity’s portfolio of investments. This matrix is used for resource allocation in a diversified company.

The Boston Consulting Group Growth Share Matrix is a portfolio planning model developed by Bruce Henderson of the Boston Consulting Group in the early 1970‟s. The business portfolio is the collection of businesses and products that makes up the company. The best portfolio is the one that uses the strength, overcomes the weakness, eradicates the threats and makes use of the opportunities in the environment. Portfolio analysis are a set of techniques that helps in taking the decisions with regard to the products and business that defines the company . Every business is required to analyse the business and the current products. Depending on the analyses made the entity is required to make a decision with regard to the investment in new products or diversification from the existing projects. This matrix is drawn up based on the observation that the Strategic Business Units (SBUs)/ Products are classified into four major categories based on the market growth and the market share. Boston Consulting Group (BCG) Growth Share Matrix is the most simplest way to analyse the entity‟s portfolio of investments . This matrix is used for resource allocation in a diversified company. Assumptions Henderson has assumptions:




The BCG matrix is a two dimensional growth share matrix where the axis represents the following:  The vertical axis represents the market growth rate  The horizontal axis represents the market share. The market growth is the measurement of the market attractiveness whereas the market share represents the measure of the company‟s strength. Classification of Products/ Strategic Business Units Based on the matrix the organizations can identify four types of products or business: 

Stars: Stars have high market share and high growth rate. The products or the SBUs falling under this category consumes large amount of cash because of the high growth rate and generate large amount of cash because of strong market share. Therefore the cash position will approximately net out. They represent immense expansion opportunities.

Options available: Vertical integration, horizontal integration, market penetration, market development, product development


 Increase in the relative market share will result in increase in generation of cash  A growing market will require investment in the assets to increase the capacity resulting in consumption of cash.

Contd on next page

Keep a green tree in your heart and perhaps a songbird will come. - Chinese proverb


Consultants’ Corner 

Cash cows: Cash cows have low growth rate and high market share. The products or the SBUs under this category generate cash because of the high market share but consumes less because of the low growth rate. Over a period of time when the growth rate comes down stars will become cash cows.

Options available: Product dev elopment, diversification, divestiture, retrenchment 

Question marks: Question marks are also called problem children or wild cats. The product or SBUs under this category represents low market share and high growth rate as a result of which large amounts of cash are consumed but enough cash is not generated. Hence if the question marks are left unattended, it will result in lots of cash locked up in these products or SBUs. Every organization should work towards transforming the question marks to stars and in case there is a reduction in the growth rate then the same should be turned into cash cows.

Options available: Market penetration, market development, product development, divestiture 

Dogs: Dogs have low growth rate and low market share. They generate enough cash to maintain themselves. Dogs are cash traps and should be minimized by disinvestment or liquidation.

Options available: liquidation




 Hold The objective here is to preserve the market share and maintain the strategy which the organization is currently following.  Harvest The objective is to increase the short term cash flows despite the long term consequences.  Divest The objective here is to sell off or liquidate the business so that the resources can be best used elsewhere. The performance of the products should be analysed by every organization which will guide them to a more secure and better future. The performance will be measured by the amount of cash that is generated by the products. Hence the need for BCG Share Matrix arises which uses the indicators of cash generation, market share and market growth.

The organization should classify the products or SBUs under each category mentioned above for the purpose of pursuing the following strategies:  Build The objective is to increase the market share substantially for building a strong future.

Ms. Sandya Manohar can be reached at

Opinion Poll Result Best article in the Aug-Sep 2013 issue of Consultants’ Corner The Editorial Team thanks its readers for taking part in this poll. We request our readers to actively participate in this Opinion Poll since the annual best article for CC would be selected based on your votes.

Total no. of votes polled: 12


Consultants’ Corner

One custom in Jainism after the last day of Paryushan

It is not as easy as turning off a light switch but we

Those who are born in Jain families or having Jain

would be more conducive for our social and spiritual

(Samvatsari) is that of saying "Michhami Dukkadam ". friends are familiar with the meaning and theme behind it. I am trying to expand its meaning and the scope which would make it more meaningful.

Michchhami means to be fruitless (forgiven) and

Dukkadam (Dushkrut) means bad deeds. Therefore

the meaning of Michchhami Dukkadam is my bad deeds (with you) be fruitless.

So concept behind saying or writing someone "Michchhami Dukkadam" is that if I have done any harm to you, then those bad deeds to be forgiven (be

fruitless). The Sanskrit version of the phrase is “mithya me dushkritaam� meaning "may the evil of it be in vain" or simply put "May my misdeeds be undone.

If we reflect back on ourselves we would realize that our mind is continuously busy either thinking on

something which may be near to us or could even be as far away as the other end of the world, talking or

doing physical activities. This thinking, our words or

have a choice to minimize our damage so that things

uplift which should ultimately lead to salvation or liberation from this worldly life of any kind.

So keeping in mind, I wish you all Michhami Dukkadam! I forgive (from the bottom of my heart without any reservation)all living beings (who may have caused me any pain and suffering either in this

life or previous lives), and I beg (again from the bot-

tom of my heart without any reservation) for the for-

giveness from all living beings (no matter how small or big to whom I may have caused pain and suffering

in this life or previous lives, knowingly or unknowingly, mentally, verbally or

physically, or if I have

asked or encouraged someone else to carry out such activities). (Let all creatures know that) I have a friendship with everybody and I have no revenge (animosity or enmity) toward anybody.

Mr. Gopal Agarwal can be reached at

our physical activities would be reflection of our

happiness, sorrow, anger, greed, jealousy, and egoism, etc. and, depending upon how we react to those, we attract various types of new karmas to our souls. No prudent person would like to attract bad karma and at certain stages any karma at all.

The most important thing in this world is to learn to give out love, and let it come in. - Morrie Schwartz


Consultants’ Corner

What’s up at NCRCL?

The 14th Annual General Meeting of NCRCL was held on 14th Sep 2013 at Hotel Deccan Plaza, Chennai

Institute of Management Consultants of India held a Training Workshop on “Developing Consultancy Skills” on 28th Sep 2013 at Chennai

Participants of the Training Workshop

Dr. R S Murali, speaker, interacting with the participants during the Training Workshop

Study Circle Presentation at NCRCL 1. Dr. R.S. Murali conducted a session on „My Experiences in Botswana‟ on 02nd Aug 2013.

Birthday wishes

2. U S Mohanty conducted a session on ‘Fraud Detection and Forensic Accounting’ on 14th & 29th Aug 2013. 3. Ashok Rao conducted a session on ‘Equator Principles’ on 05th Sep 2013. 4. Bhavana R. conducted a session on ‘Secretarial Standards’ on 20th Sep 2013.

Manjunath -19th Oct

Jeevan Rao - 9th Nov

5. Dr. R.S. Murali conducted a session on ‘Publications and Research’ on 27th Sep 2013.

NCRCL mourns the death of Mr R. Ramachandran, Ex-employee of our Chennai office who passed away on 15th September, 2013. Our heartfelt condolences to his family.

Subba Rao - 25th Nov


Consultants’ Corner

An Exclusive Talk with Vinod Murali Vinod Murali B.Com, CISA

Working as Consultant Support Born on 17th February Email: Phone No: +91 98406 98672

CC. The meaning of your name. Vinod: Different

CC. What do you most like about a person? Vinod: Sense of humour

CC. Nickname. Vinod: Vinu

CC. What do you most hate in a person? Vinod: Playing the blame game

CC. Your dream job. Vinod: Forensic Accountant

CC. Team work vs Individual work – your comments. Vinod: Individuals work to their specific strengths and their synergy form a team.

CC Your first impression of NCRCL. Vinod: Place to grow on a professional and personal front CC. What personal/emotional characteristic of yours do you want to change? Vinod: Impatient and impulsive CC. Money or job satisfaction? Vinod: Job satisfaction CC. Your Stress buster. Vinod: Listening to ARR music CC. Do you have a small circle of close friends, rather than a large number of friends? Vinod: Small circle of close friends

CC. Do you make efforts to get others to laugh and smile? Vinod: Yes CC. Your heart rules your head or your head rules your heart? Vinod: My heart rules my head CC. What kind of special talent do you have? Vinod: Out of the box thinking CC. What are your hobbies? Vinod: Playing football, reading books, writing my blog

1. Name the businessman of Indian origin behind Fairfax, the company that has acquired Blackberry? 2. Grand brand ____‟ by Balasubramanian and Ramakrishnan is a book about what or whom? Fill in the blank. 3. As per the new Companies Act, what is the minimum number of women directors mandatory in a Company Board of Directors? 4. Which Indian businessman‟s IT account was hacked by a Hyderabad based CA student and has been caught? 5. Expand VCES, the service tax amnesty scheme launched by Government of India . Send in your answers to the editor at Participants with the correct entry will be awarded with a Recognition Certificate by NCRCL. Last issue answers. 1 Mahesh Bhupati ; 2. It is not a company registered under the Companies Act; 3. % discounts involve calculations that cause anxiety. Hence some customers prefer absolute discounts; 4. 40 hours in 4 days and taking 3 day weekend; 5.

The right answer was given by Bhavana R !!! Congratulations !!!

Our Mission is to apply our professional capabilities with a holistic approach for the happiness of clients, through values and social commitment.

Editorial Board


Mr. C S Suresh, Executive Director Mr. Ashok Rao, Executive Director

Editors Ms. Sandya M, Consultant Mr. Karthik M V, Consultant

Published by NCR Consultants Limited, Chennai & Bangalore

Email to

NCR Consultants Limited Registered Office: 2nd Floor, New No. 4, Old No. 23, C P Ramasamy Road, Alwarpet, Chennai - 600 018 Ph:+91 44 2466 0955/ 24986850 Email: Branch Office: #107, 1st Floor, Railway Parallel Road, Kumarapark West, Bangalore - 560 020 Ph/Fax: +91 80 23560265 Email:


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Consultants Corner Oct-Nov 2013  
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A Bi-Monthly e-Journal from NCRCL