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Management Consulting: The “Analysis Before Action” Approach

There are many myths about management consulting, legends that contain some kernel of truth and some degree of falsity. But these stories neglect to answer the most basic question about this famed profession: What do management consultants actually do?

The answer to that query does not require any exaggeration, because these professionals already deal with complicated problems and situations that lack transparency; they operate in an environment worsened by a multitude of opinions, devoid of a set direction, making things even more difficult to resolve.

In this scenario, because issues are not exclusive to one department or set of executives, finding a solution is not the same as solving an equation. On the contrary, it is the responsibility of a management consultant to structure and write the equation – and to solve it, too! This process of overseeing an otherwise unsolvable issue is, at its core, what constitutes ‘analysis before action': Identifying the relevant topics, so a consultant can successfully engage a client by asking the right question for which there is, indeed, an answer.

By framing things this way, a consultant can assess the legitimacy of the question itself, and then coordinate with the client on the necessary steps to either reformulate the question or pursue the answer. For example: My team worked with a company, in an effort to better understand how a variation in price could improve sales for a premium cosmetics brand. Since the question involved pricing, and the fundamental concern was about growth, the challenge was clear: How do we accelerate sales with a premium priced product?

By reframing the question, we soon realized that the root cause of the problem was not a matter of pricing; any change upward or downward in price would have resulted in reduced distribution and consumer acceptance. The problem was, instead, one of expectations and positioning: The price was in line with the brand's perceived value, but the company's approach relegated the product line to a niche category.

The client's products were only used for special occasions, which explained the slow growth in volume, so any change in price would have further hindered expansion.

This analysis before action method eliminated the fog of confusion, a cloud of hot air, personal opinions and misguided expectations, enabling us to arrive at the right conclusion – that allowed us to address the brand's architecture and the consumption patterns of consumers. Then, we could uncover our solution and expand sales.

The Disruptive Power of Technology: Shortening the Product Life Cycle

Also, the analysis before action approach is crucial, now more than ever, because of the disruptive role of technology and the shortened life cycle of most products. In other words: Companies can no longer operate on autopilot, belatedly analyzing situations that are beyond repair. Put a different way, we should aspire to be Netflix, not Blockbuster; the former is a bold innovator, redesigning its business model and upending the status quo, while the latter is extinct and a symbol of abject failure because they could not see what was happening around them.

A change in perspective can, in short, bring about significant shifts in behavior and influence. The starting point, as always, involves writing – and refining and revising – the questions that will yield the right answer, and validate your results.

Never forget, too, that a brand's customers should be at the center of these activities. And, in an era of big data and the allure of trying to quantify everything, it is easy to find more and more numbers of less and less significance. Force yourself to look at data your competitors currently ignore; in fact, forget about the neat and orderly segmentation of product categories (soft drinks, beer, wine and spirits, for example), and look at how things overlap and blur boundaries.

And finally, involve the right people in this mission; assemble a team of varied backgrounds and expertise, so, as a team, their individual biases will dissolve into an unprejudiced viewpoint. From there, we can find the root cause of a problem and the space necessary to grow. That is the analysis before action philosophy, in action, for the enlightenment of all.

Filiberto Amati is the Founder of Amati & Associates, a group of Innovation Catalysts, Branding Architects and International Experts that works with a variety of multinational companies and top consumer products throughout the world.

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