Development of Consulting Firms in Light of Organizational Life Cycle from Eastern European Perspective

Transcription

1 Competitiveness,innovation,business excellence and consulting in CSE Europe Dubrovnik, Croatia, October 2008 Development of Consulting Firms in Light of Organizational Life Cycle from Eastern European Perspective George Plesoianu (Romania) - Jozsef Poor (Hungary) - Ian Zavril (Czech Republic)

2 Life cycle models Life cycle (or stage) models were developed to study organizational growth The primary objective of applying such models is to determine - based on contributing factors - the relevant outcomes (e.g. management, HR, etc.) for the different stages of organizational growth Important literature sources: o Greiner's five stage model (1972) o Kimberly and Miles (1980) o Miller and Friesen (1982) longitudinal analyses o Adizes (1988) o Rutherford et al (2003) Types of model country sector organization E stablishm ent G row th R ene w al D ecline/c onsolidation 1

3 Research and its objectives To gain a better understanding of the driving forces and contributing factors on the basis of which enterprises/sectors in various stages of their life cycles develop their short-, medium- and long-term management, employment and HR policies Research was to find out how consulting companies and MC sector in Czech Republic, Romania and MNCs in EE region had adapted to the accelerating changes 2

4 Findings Romanian Case (1) Overview Pre-mature Stage ( ) Growth stage 2 ( ) Growth Stage 1 ( ) Early Stage ( ) 3

5 Findings Romanian Case (2) Early Stage ( ) - Premises Entrance of MNCs (accounting firms) Foundation of AMCOR Association 1990 Romanian Management Consulting Seminars, conferences and training courses for officials and state managers First European and World Bank assistance programs on privatizations for Romania Start-up cooperation between the international consultants and local consultants The first international PHARE projects for Train the Trainers In this stage no relevant consulting assignments within HR consulting 4

6 Findings Romanian Case (3) Growth Stage 1 ( ) HR professional approaches in firm restructuring and privatization projects Western HR assessment methods and tools Modern approach of HR management and benchmarking studies New MNCs in HR and start-up of annual HR surveys and consultancy missions in Romania Other JVs and local HR small firms for HR training activities, recruitment head-hunting and remuneration surveys Local HR consulting firms, certified by AMCOR MC and HR consulting companies start-up professional consulting in Romania in cooperation with international HR companies 5

7 Findings Romanian Case (4) Growth stage 2 ( ) Increasing number of specialists in HR Local subsidiaries of foreign consulting firms promote remuneration methods and other approach of HR Management Conferences, workshops and courses for the Romanian market, with international guest speakers More EU Projects, oriented to HR management in public and business sectors Master degree courses in HR Management and Consulting Master degrees for civil service managers and continues learning courses Romanian students in European universities and stages at Western institutions or companies Increasing number of local HR management consulting firms and relevant education and knowledge 6

8 Findings Romanian Case (5) Pre-mature Stage ( ) Pre-adhesion EU Projects dedicated to HR development and the HRD Accumulated experiences by MC and HR companies supporting upgrading professional development of human resources in companies Many new projects, developed by local consultants in collaboration with experts and advisors from developed countries Romanian consulting companies have acquired enough HR experience to contribute to productivity and profitability of different firms and public institutions have profitated from high demand for talanted and motivated workforce Promoting and introducing concept of PM and Total reward system in Romanian companies will be a major challenge of better utilization of HR 7

9 Findings MNC Cases in EE region (1) Overview Management regionalization Changing patterns of knowledge-transfer Life cycle at subsidiaries Staffing Early stage Company information 8

10 Findings MNC Cases in EE region (2) Company information It goes back to US in 1940s Firm 2006 (US$ mil) Market Share Key services: HR consultancy, labor market studies, PwC $770 13% outsourcing, change management Mercer Accenture $767 $571 13% 9% Step by step involved to the region since 1980s Watson Wyatt $495 8% Newly established start-up subsidiaries Deloitte $434 7% Hungary: 1990 Towers Perrin $200 3% Czech Rep. : 1992 Hay Group $198 3% Slovakia: 1996 Aon Consulting $148 2% Poland: 1998 IBM $141 2% Almost all countries in EE region: 2005 Ernst & Young $132 2% Hewitt $126 2% Buck Consultants $64 1% Source: Kenndey Institue Other $1,994 33% Total Market $6,040 98% 9

11 Findings European MNC (3) Staffing Early stage Start up driven by regional key partners from Western offices Locals for first level management positions Selection through personal connection for first level jobs adverting for all other jobs Orientation program for newly selected managers Induction programs for all other job holders Corporate Principles Personnel Policy Service descriptions 10

12 Findings European MNC (4) Life cycle at subsidiaries Stage I: Early changes Privatisation - Firm establisment: Transform HR infrastructure and competencies Stage II: Near past Restructuring&Development Set up new HR capacities and develop new HR roles Stage III: Steady state Consolidation &Renewal Support continuous renewal and knowledge generation 11

13 Findings MNC Cases in EE region (5) Changing patterns of knowledge-transfer HQ Expats Consultants Partner, experts Local inpatriate managers Joint teams, intranet Clients Joint teams, intranets Local managers, Local inpatriate selected professionals Regional Expats. partner, consultants experts Firm establishment --- Restructuring&Development Consolidation&Renewal 12

14 Findings MNC Cases in EE region (6) Management - regionalization Third stage: Pan-EE mgmt. team Second stage: Division driven Have a flat organization structure Have a mix management team Local country managers become ambassador First stage: Locally driven 13

15 Findings Czech Case (1) Overview Management consultancy conferences Program of subventions National register (NRP) Present development 14

16 Findings Czech Case (2) Present development National register of management consultancy companies Czech Chamber of Commerce together with Czech Association for Management Consulting Main goal is to support quality and ethics of management consultants CMC certification of management consultants Program of subventions management consultancy services provided for SMEs, funded by EU Structural Funds This subvention program is managed by Ministry for Industry and Trade Regular conferences focused on management consultancy and its quality, professionalism and ethics 15

17 Findings Czech Case (3) National register of management consultancy (NRP) Open for all management consultancy companies Based on independency and self funding The membership in the NRP is matter of prestige It could be used as marketing tool Public open register of companies and consultants is focused on management consultancy Its goal to navigate the SMEs in the process of correct choice of consultants HR is a part of activities of management consultants, registered in the NRP NRP is based on confidence to published data and on supervision of consultancy services 16

18 Findings Czech Case (4) Program of subventions management consultancy services Financial support of management consultancy services for SMEs, focused on innovative processes in company management Main goals financial support to SMEs providing innovative changes in their processes by using the independent consultancy services SMEs are prepared in cooperation with consultants for innovative changes in their processes, focused to increasing their competitiveness Innovations in HR are the part of supported project 17

19 Findings Czech Case (5) Management consultancy conferences Conferences, organized by APP (Czech Chamber of Commerce) support exchange of opinions among consultants, entrepreneurs and state authorities help to consultants better understanding the needs of entrepreneurs and helping entrepreneurs cooperate with consultants are considered as a platform to discuss with state authorities how to optimize entrepreneurs surroundings provide an opportunity to present the latest consultancy know how and methods 18

20 Summary Organisations (MC-companies, MC associations) strive to meet challenges presented by life and outlined in literature Organisations try to pay attention to changes that are rooted in the actual life cycle stage These processes are faster and thus more noticeable in small and medium-sized enterprises The phenomenon becomes more traceable MC business has been reaching maturate or pre-maturate phase in analyzed cases ? 19

21 Information Dr. József Poór Professor of Management Certified Management Consultant (CMC) mobil: telefon/fax: