2019 Vault Rankings
The name may sound local, but The Boston Consulting Group's reach—and expertise—is anything but. With 5,000 consultants in 78 offices in 43 countries, the firm ranks as one of America's Largest Private Companies, according to Forbes magazine. Clients typically include many of the world's 500 largest companies, but BCG also counts midsized businesses, nonprofit organizations and government agencies in North and South America, Asia, Europe, the Middle East and Australia among its clients. The firm's consultants—who have included notables such as Indra Nooyi, CEO of Pepsi; Jeff Immelt, CEO of General Electric; Jim Koch, founder, CEO and Brewmaster of Boston Beer Company; Sally Blount, dean of the Kellogg School of Management; Israeli Prime Minister Benjamin Netanyahu; and Grammy Award winner John Legend—are experts in a number of industries, including consumer goods, retail, financial services, industrial goods, social impact and nonprofit, energy, health care, insurance, technology, media, and telecom.
The firm helps clients with a number of specific management needs within its broad functional practice areas, such as growth strategy development and execution; business portfolio management; mergers and acquisitions; postmerger integration; productivity and efficiency improvement; marketing and pricing; supply chain management; IT infrastructure; customer and supplier relationship management; sustainability; turnaround; and private equity, among other services.
The Henderson legacy
BCG was founded in 1963 by Bruce D. Henderson, a former Bible salesman and Harvard B-school dropout. Challenged by the CEO of The Boston Safe Deposit & Trust Company to form a consulting arm for the organization, Henderson responded with an aggressive strategy. While his first month's billings amounted to $500 and his office had a staff of just two by the end of his first year in business, Henderson's subsequent success is impossible to deny—and it was driven largely by expansion. In 1966, BCG became the first Western strategy consulting outfit in Japan, and a string of offices throughout Europe soon followed. By 1976, half of the firm's revenue was being generated outside the U.S.—a year after Henderson laid out a plan for employee stock ownership that saw the firm fully owned by BCGers in 1979. Such was Henderson's reputation within the business world that, following his death in 1992, no less a publication than the Financial Times wrote that "few people have had as much impact on international business in the second half of the twentieth century as the founder of The Boston Consulting Group."
In 1998, BCG established the Strategy Institute, a sort of consulting think tank set up to apply insights from a variety of disciplines to the strategic challenges facing both business and society. Among the concepts developed by the firm over the years are the experience curve (which charts improvements in efficiency as experience is amassed), time-based competition (an approach that recognizes speed as an essential component of success), disease management (an approach to patient care that takes a more systemic view of quality and costs than traditional approaches), richness versus reach (the trade-off inherent in the economics of information), trading up and trading down (consumer spending phenomena) and globality (the post-globalization era in which everyone from everywhere competes for everything).
Not the stuff of fairytales
Perhaps the innovation that the firm is best known for, however, is its growth-share matrix. While a tool that utilizes images such as cows, stars and dogs might sound fanciful, the matrix is one serious piece of business methodology—and one that has become a core tool used by businesses the world over. A graphic representation of a firm's money flow, the growth-share matrix divides a company's assets into four categories—the three mentioned previously, plus question marks. While a full description of the methodology is available on BCG's website, the basic meaning of each category is as follows: a cow represents a "cash cow," a low-growth, high-market share pursuit (generally the bread and butter of any business); a star is an enterprise that both uses and generates a lot of money, usually on the way to achieving cow status; a dog tends to be labor-intensive but provides little return on investment; and question marks are to be avoided at all costs—basically representing money pits that absorb resources but produce little revenue.
Falling in line
While many of BCG's consultants come from some of the best business schools in the world—including the University of Chicago, Harvard, INSEAD, Kellogg, Stanford and Wharton—not everyone working at the firm has a business background. A number of consultants have degrees that range from economics, biochemistry and engineering, to psychology, classics and law.
Whatever their background, the firm organizes its brainpower into formal practice areas, which include the functional and industry areas listed above, as well as timely issues such as managing through the downturn, cloud computing, megatrends, operational transformation and turnaround, sustainability and talent management.
Paying it forward
BCG is big on being good. Its social impact practice network, which functions like one of the firm's formal practice areas, works with clients on socially conscious issues, including public health, education, community and economic development, environmental preservation, hunger, and arts and culture. The network chose its focus areas based on the UN Millennium Development Goals, which set targets for combating poverty, illiteracy and disease for the world's poor by 2015.
Building the business canon
As might be expected of a company with so many experts and a dedication to research, BCGers put out their fair share of publications—so many, in fact, that in 2006, the firm collected some of its biggest thoughts over the past 40 years into one volume, entitled The Boston Consulting Group on Strategy. Aimed at executives across all industries, the anthology offers both the now-established wisdom as the company conceived it years ago, as well as more recent thoughts on the state of business. The themes, in many cases, have remained consistent over the decades: Retain competitive advantage, break compromises, realize the value of time, and remain aware of second- and third-order causes.
IN THE NEWS
Rich Lesser Named BCG's New President and CEO
On January 1 2013, Richard I. Lesser took the helm as BCG embarks on its 50th year of operations. Lesser has been on the firm's Executive Committee since 2006 and served as BCG's Chairman of North and South America since 2009. Before that, he was head of the New York office beginning in 2000. In 2009, Consulting magazine named him one of the industry's most influential consultants.
Fortune Best Companies Award
At Number Four, BCG extended its run near the top of Fortune's 100 Best Companies to Work For list. BCG is one of only two firms to make it to the top dozen every year since 2006; the firm has stayed in the top five for three years straight and continues to enjoy the highest ranking among consultancies by a wide margin.
Expanding its footprint
The Boston Consulting Group recently opened three new offices—Montreal, Seattle, and Bogota—enlarging the firm's global footprint to 78 offices in 43 countries.
"Game Changing" at 50 years
As part of its celebration of its 50th anniversary, BCG instituted the "Game Changing" program to help business leaders navigate shifts in business and the global economy. As part of this program BCG published Own the Future: 50 Ways to Win from The Boston Consulting Group and partnered with some of the world's premier content organizers—including the Financial Times, TED, Magnum Photos, and Kram/Weisshaar.
Iván Martén, global leader of The Boston Consulting Group's Energy practice, was named one of the "Top 25" most influential consultants of 2013 by Consulting magazine, the industry's leading trade publication. Martén won in the "Excellence in Energy" category.
BCG Earns Perfect Score on Corporate Equality Index for Sixth Consecutive Year
The Boston Consulting Group earned a perfect score of 100 percent on the Human Rights Campaign Foundation's Corporate Equality Index, making BCG one of HRC's "Best Places to Work for LGBT Equality."
Exchange Place, 31st Floor
Boston, MA 02109
Phone: (617) 973-1200
Employer Type: Private
President & CEO: Rich Lesser
2016 Employees (All Locations): 12,000
85 offices in 48 countries
Functional Practice Areas and Capabilities
Managing in a Two-Speed Economy
Marketing & Sales
People and Organization
Transformation and Large Scale Change
Industry Practice Areas and Expertise
Energy & Environment
Engineered Products & Infrastructure
Health Care Payers & Providers
Media & Entertainment
Medical Devices & Technology
Metals & Mining
Transportation, Travel & Tourism