Boston Consulting Group

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The Boston Consulting Group

Type

Private

Industry

Management consulting

Founded

1963

Headquarters Boston, Massachusetts, U.S.

Key people

Rich Lesser, President & CEO

Revenue

$3.95 billion (2013)[1]

Employees

6,200 consultants worldwide (9,700

total staff)

Website

bcg.com

The Boston Consulting Group (BCG) is a global management consulting firm with 81 offices in
45 countries. It is one of the Big Threemanagement consulting firms. The firm advises clients in
the private, public, and not-for-profit sectors around the world, including more than two-thirds of
the Fortune 500.[2] Considered one of the most prestigious management consulting firms,[3] BCG
was ranked third in Fortune's "100 Best Companies to Work For" in 2014.[4]
Contents
[hide]
1 History
2 Clients
3 Awards and Recognitions
4 Recruitment
5 Developed Concepts
o 5.1 "Growth-share matrix"
o 5.2 Experience curve
o 5.3 Advantage matrix
6 Publications
o 6.1 Books
o 6.2 Perspectives

7 Notable current and former employees

8 References
9 External links
History[edit]
The company was founded by Bruce D. Henderson, a Vanderbilt University and Harvard
Business School alumnus. After many years in the purchasing department of Westinghouse in
Pittsburgh (where pricing behavior gave him the idea of the experience curve), he joined Arthur
D. Little in Cambridge, Massachusetts. He was then recruited by The Boston Company, where
he founded a one-man, one-telephone consulting unit he named Boston Consulting Group.
In 1975, Henderson arranged an employee stock ownership plan, and employees took the
company independent from The Boston Company. The buyout of all shares was completed in
1979.[5]
In January 2013, Rich Lesser became the sixth president and chief executive officer of BCG.
Clients[edit]
BCG serves as an adviser to many businesses, governments, and institutions. Some recent BCG
clients include Google, IBM, Aetna, Pfizer, American Airlines, Ford Motor Company, Tata
Group, Harvard
School
of
Public
Health, Japan
Pharmaceutical
Manufacturers
Association, Russian Ministry of Energy, Government of Canada, United States Agency for
International Development, and European Union Phare Programme, according to the 2009
publication by Wetfeet on the company.[6][7]
Awards and Recognitions[edit]
Fortune Magazine ranked BCG second in its 2011 and 2012 list of the "top 100 best companies
to work for".[8] The 2013 rankings by Fortune listed BCG as the fourth "best company to work
for."[9] BCG has also been listed in Consulting Magazine's "Best Firms to Work For" list every
year since 2001,[10] received a perfect score on the Corporate Equality Index[11] formulated by the
Human Rights Campaign for the past six years,[12] and been rated by Working
Mother magazine[13] as one of the "best companies" for working mothers for the past six
years.[12]
Recruitment[edit]
BCG is a top employer of recent graduates from Harvard Business School,[14] HEC
Paris,[15] INSEAD,[16] MIT Sloan School of Management,[17] Cambridge University,[18] Oxford
University,[19][20] Stanford Business School,[21] London Business School,[22] and Wharton School
of the University of Pennsylvania.[23] The firm also attracts a number of Rhodes
Scholarsand Marshall Scholars.
BCG typically hires for Associate or Consultant positions, with occasional so-called "lateral
hires" opportunities as Project Leader, Principal or Partner. In the United States, BCG recruits
undergraduates to join as Associates. Top-performing Associates receive sponsorship to pursue
an MBA, returning to BCG upon completion. Some Associates advance to Consultant and
beyond without obtaining an MBA, but the vast majority of Associates attend business school. A
few complete JDs, MD and other graduate degrees at various institutions (called ADCs for

Advanced Degree Candidates/Consultants). BCG also makes large efforts to hire advanced nonbusiness degree holders. Graduates holding J.D.s, M.D.s and Ph.D.s in disciplines like
engineering, science, and liberal arts receive training in business fundamentals and then typically
join the firm as Consultants although this varies between different geographies. There is also an
opportunity to join as a Summer Associate or Summer Consultant (internship) position for 10
weeks, which for many interns will result in an offer of a full-time position.
BCG's recruiting process is notoriously demanding, typically taking candidates through
computer-based problem solving tests followed by multiple rounds of case- and experiencebased interviews. In 2013, career review site Glassdoor ranked BCG as the 3rd most difficult
company to interview with.[24]
Like most consulting firms[citation needed], BCG uses a modified version of the Cravath System, also
known as "up or out".[citation needed]
Developed Concepts[edit]
"Growth-share matrix"[edit]

BCG matrix of example data set

In 1968, BCG created the "growth-share matrix", a simple chart to assist large corporations in
deciding how to allocate cash among their business units. The corporation would categorize its
business units as "Stars", "Cash Cows", "Question Marks", and "Dogs" (originally "Pets"), and
then allocate cash accordingly, moving money from "cash cows" toward "stars" and "question
marks" that had higher market growth rates, and hence higher upside potential.[25][26]
Experience curve[edit]
Main article: Experience curve effects

The experience curve illustrates that the more often a task is performed the lower will be the cost
of doing it. The task can be the production of any good or service. Each time cumulative volume
doubles, value-added costs (including administration, marketing, distribution, and
manufacturing) fall by a constant and predictable percentage.
BCG founder, Bruce Henderson, expounded the implications of the experience curve for
strategy.[27] BCG research concluded that because relatively low cost of operations is a very
powerful strategic advantage, firms should capitalize on these learning and experience effects.[28]
Advantage matrix[edit]
For more details on this topic, see Boston Consulting Group's Advantage Matrix.
In this matrix, the two axes are economies of scale and differentiation. The four quadrants
formed are called "Volume", "Stalemated", "Specialized", and "Fragmented".