Boston Consulting Group

Boston Consulting Group
Formation	1963
Interests	privatization, public-private partnerships
Interest of	Alexander De Croo
Member of	Business Roundtable, WEF/Strategic Partners
US 'market driven' strategic advisory company

The Boston Consulting Group (BCG) is a global management consulting firm and a leading advisor on business strategy founded by Bruce Henderson in 1963. BCG has 66 offices in 38 countries. It is extensively networked with big corporations and their front NGOs, and deep state operators.

BCG always grandly promises huge savings by privatization and radical restructuring of public enterprises; to what extent BCG is influenced by its owners, who might have stakes in the companies profiting from these 'reforms' only in one direction, has not been mapped. But in any case, BCG charges hefty fees for the advice.

Education reformers

BCG has been accused of being a 'driving force' behind market-driven reforms of schools in the US.

One small example: the firm was hired in 2012 to radically overhaul Philadelphia's schools. As part of this, BCG reportedly identified up to 60 Philadelphia school buildings as potential candidates for closure and helped line up private vendors willing to replace the state's unionised workforce.

In January 2014 BCG met Francis Maude, Cabinet Office minister and UK government reformer-in-chief, to discuss 'public sector reform'.

Lobbying for privatization

In 2013 BCG came together with Harvard Business School, and the Bill & Melinda Gates Foundation to research the role of business in improving the U.S. education system.

The initial wave of research led to the 'Business and Education Leaders Together' conference in November 2013, where more than 100 business and education leaders discussed how to reform the US's schools.

In early 2014, the project published the report, Lasting Impact: A Business Leader’s Playbook for Supporting America’s Schools. This examines the most effective ways for business leaders to engage in education reform, essentially away from ‘checkbook philanthropy’ to building more authentic relationships with teachers. The report highlights three kinds of actions that business “champions” can take to transform the education system in America:

• lobby for policy change, such as pushing for local decision-makers to support 'Common Core'.
• help 'scale up' charter-school models or digital learning tools.
• support community organisations, teacher groups, and parent groups to 'reinvigorate the entire education ecosystem in cities and towns'.

Education 'reform': partnerships

The Boston Consulting Group 'partners' with a number of organisations leading education reform. These include:

• Teach for All: 'BCG has partnered with Teach For All since 2012, supporting global as well as national projects. We have collaborated with the organization's senior leaders as they think through their priorities in expanding Teach For All's global footprint and broadening the network, adding more member organizations, and other critical topics for the young organization.'
• Bill & Melinda Gates Foundation: 'Since 2003, BCG has partnered with the Gates foundation supporting its work to strengthen education in the US, as well as its global on health care and reducing extreme poverty in developing countries.'
• World Economic Forum. One of only 100 companies to hold the highest membership level among a total of 1000 companies'. BCG helps set the agenda for the World Economic Forum's Davos and other meetings. BCG says it has been collaborating on several new projects with the World Economic Forum, exploring a broad spectrum of topics including education, infrastructure, and health.'

Education 'reform': people

• Jamie Martin: In early 2014 a strategy consultant at BCG, Jamie Martin, became a special adviser to the UK's reform-minded education sectretary, Michael Gove. Martin describes himself as an 'expert on UK education system and industry... with an interest in start ups, technology, public sector reform' and '8 years consulting & education industry experience'. Martin was also a policy adviser to Gove in opposition from March 2008 – July 2010, after which he worked for Deloitte before moving to BCG in 2012. Martin worked as an adviser to Gove between February and August 2014. During this period, out of 14 declared meetings with outside interests, he met with: BCG twice (in April 2014), with BCG 'partner' Save the Children to discuss their education work (April 2014); with Future Leaders, which has close ties with BCG partner Teach For All (April 2014) and Teach First, which is a founder of Teach for All.

• Ian Walsh, Partner and Managing Director at BCG in London where he leads both the Financial Institutions and Education practices. Walsh is a trustee of the Sutton Trust, where has led projects on GCSE under-performance, university entry, vocational education and access to the City. Walsh has also led projects for the Education Endowment Fund, Teach First and the New Schools Network.

• Michael Barber, co-chair of BCG's Centre for Public Impact (see below).

Centre for Public Impact

BCG funds a foundation called the Centre for Public Impact, which aims to help governments focus on impactful reforms, rather than just always announcing policies. It is overseen by a board of trustees co-chaired by leading education reformer Michael Barber and BCG chair, Hans-Paul Buerkner. It is run by Adrian Brown, former fellow at the Institute for Government, ex-Cabinet Office, and for two years in Tony Blair's Delivery Unit. He also spent a year in 10 Downing Street, reporting to Jonathan Powell, Tony Blair’s chief of staff.

It runs global events, roundtables and a website to highlight to governments how they can improve the delivery of policies.

"Value-based care" - a wedge to reorganize the global health care system

Boston Consulting have been in the forefront of pushing the concept of value-based health care, developed in collaboration by professor Michael Porter, in his 2006 book "Redefining Health Care: Creating Value-based Competition on Results".

The concept is imagined as a conveyor belt, where the patient should first get a diagnosis, and then he should "float" further in the system without bottlenecks. It should be a break with the traditional ways of organizing hospitals with specialized clinics or departments where doctors had permanent jobs. Teams in surgery, orthopedics and other medical specialties were to be disbanded.

According to the Boston Consulting concept, patients must continuously follow their defined diagnostic flow: one for headaches, one for prostate cancer, a third for children born prematurely, etc. For each patient process, standardized goals for the care outcome must be developed.

The core of "value-based care" is that public and private hospitals must compete to provide the best care, measured on the basis of the "quality of treatment", partly based on the patient's own evaluations and partly based on costs.

The criticism of this concept from health professionals has been extensive. The patients who have many - or diffuse - diagnoses, fall completely outside this system. It breaks with the idea that the health care system should be based on solidarity and not least provide care to those who need it most. "Value-based care" is based on market and competitive thinking and does not put "the patient at the center", but "profit at the center".

The core of this is to access the "new gold": patient data down to the individual level.

Ruining a Swedish Hospital

In 2010, the Stockholm County council decided to build a new university hospital, the New Karolinska Solna (NKS) with a public-private partnership (PPP) and with value-based health care, despite protests from professionals, including the old hospital director Birger Jakobsson. He was forced to resign and replaced by the Dutchman Melvin Samson who could not speak a word of Swedish. Samsom hired five of his closest Dutch colleagues/friends as consultants.

Boston Consulting played a central part in the process. The plan was to make Karolinska a pioneer for "value-based care" where the example would spread around the world to create a market-driven global health care system, in full accordance with the thinking of the OECD and the World Economic Forum.

After a procurement process, the collaboration with BCG started in 2011. Three years later, Andreas Ringman Uggla is hired as 'product director' at Karolinska. He came from a job as a consultant at BCG. At the turn of the year 2017/2018, dubious invoices are discovered, where several have no basis and have Uggla as a reference. He resigned in January 2018. The average cost per consultant from BCG for Karolinska was 700,000 SEK ($120,000) a month. Since 2010, Karolinska has spent around SEK 1 billion in management consultants.

The new hospital was marred by misconstruction and technical problems/ In November 2016, the first patient arrived at NKS. Eventually it went as the health professionals predicted: it was a disaster. The staff did not have permanent wards, teams and workplaces, the doctors walked around with backpacks with medical equipment, and the nurses had do the patient records in the corridors. The staff barely had enough time to eat or go to the bathroom, while the number of bosses grew dramatically, from 689 in 2014 to 900 in 2020. Doctors and nurses fled the hospital. By 2020, the doctors who were left was mostly new graduates or older doctors who soon was going to retire.

The health queues grew catastrophically, without the management taking responsibility. Cancer patients died while waiting. In February 2019, close to 8,000 patients were in the queue for surgery at Karolinska - three times more than before the reorganization. 1700 of these were children.

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People

Hans-Paul Bürkner, chair of BCG

Notable current and former employees

Business

Indra Nooyi - CEO of Pepsi
Jeff Immelt - CEO of General Electric (MBA internship)
Gary M. Reiner - SVP and CIO of General Electric
William Browder - co-founder of Hermitage Capital Management
Gerald Corbett - CEO of Railtrack
Michael R. Eisenson - co-founder of Charlesbank Capital Partners, LLC, former managing director of the Harvard Management Company
Ahmed Fahour - CEO of the Australian operations of the National Australia Bank
Rob Ketterson - managing partner of Fidelity Ventures
Stefan Quandt - owner of Delton AG
Andreas Jacobs - Chairman of Barry Callebau AG
Jim Whitehurst - CEO of Red Hat, former COO of Delta Airlines
Neil Fiske - CEO of Eddie Bauer
Shinichiro Ishikawa - CEO of GDH K.K.
Michelle Peluso - President & CEO of Travelocity
Tom Layton - CEO of Opentable.com
Jim Koch - Founder & Brewmaster of Boston Beer Company
Dean Nelson - Chairman of Primedia & Former managing director of Capstone group at KKR
Michael Dornemann - Chairman & CEO of Bertelsman Entertainment
Andy Hornby - CEO of HBOS

Politics and Public Service

Ira Magaziner - Aide and policy advisor to President Clinton, CEO of SJS Advisors and co founder of Brown University's open curriculum
Benjamin Netanyahu - Prime Minister of Israel (1996-1999)
Steve Poizner - California businessman and Republican politician
Mitt Romney - Governor of Massachusetts, CEO of the 2002 Winter Olympics in Salt Lake City, co-founder of Bain Capital
Hans Wijers - Minister of Economic Affairs of the Netherlands (1994-1998), CEO of Akzo Nobel

Others

Kaz Uchida- Professor, Waseda University, Tokyo [1]
Aiba Koji- Professor, Waseda University, Tokyo
John R. Wells - Professor, President International Institute for Management Development, Switzerland
Linda Bilmes - academic, Harvard Kennedy School of Government
Clayton M. Christensen - Robert and Jane Cizik Professor, Harvard Business School
Michael Chu - senior lecturer, Harvard Business School, Former partner KKR and a founding senior partner of Pegasus Capital
John Legend - musician
Jesse Ward - golf pro
Jehan Ratnatunga - Co-Founder of Ripple (charitable organisation) and a director of ibookr.com
Alex Michel - Star of the Bachelor, season one
Michael J. Silverstein - Author of several bestselling business books, including "Trading Up" and "Treasure Hunt"
Azwan Khan Osman Khan - Senior Vice President, Corporate Strategy & Development, Celcom
Aamir A. Rehman - Author of "Dubai & Co.: Global Strategies for Doing Business in the Gulf States"

• Nick Viner Former senior partner of The Boston Consulting Group is Chief Executive of Jewish Community Centre, is Chairman of Pop-Up young people’s charity and a member of Belsize Square Synagogue.

Publications

Every year, BCG publishes articles, industry reports, government commissioned studies and books relating to particular industries or authorial practice areas. Many partners have written books on issues facing management in the modern business environment. Some recent publications:

• Trading Up - Why Consumers Want New Luxury Goods and How Companies Create Them. By Michael J. Silverstein and Neil Fiske, 2003. A Business Week Bestseller and Berry AMA book prize winner.
• Payback - Reaping the Rewards of Innovation. By James P. Andrew and Harold L. Sirkin, 2006. Published by the Harvard Business School Press, Payback has become a staple in the MBA curriculum.
• Blown to Bits - How the New Economics of Information Transforms Strategy. By Philip Evans and Thomas S. Wurster, 2000.
• Treasure Hunt - Inside the Mind of the New Consumer. By Michael J. Silverstein with John Butman, 2006.
• The Change Monster - The Human Forces that Fuel or Foil Corporate Transformation and Change. Jeanie Daniel Duck, 2002.

History

The company was formed when Henderson, a Harvard Business School alumnus, left Arthur D. Little to accept the challenge from the CEO of the Boston Safe Deposit and Trust Company to start a consulting arm for the bank.

In 1965 Henderson thought that to survive, much less grow, in a competitive landscape occupied by hundreds of larger and better-known consulting firms, a distinctive identity was needed, and pioneered "Business Strategy" as a special area of expertise for BCG.

As his client list grew, Henderson targeted the nation's best business schools. At some point he was said to have eclipsed McKinsey as the top recruiter at Harvard, aggressively wooing its best students with high salaries and the chance to make a difference in a cutting-edge firm. He encouraged the young minds he hired to come up with innovative ideas that were meant to dazzle hardened corporate veterans.

In 1973 Bill Bain and others left BCG to form Bain & Company, and two years later Henderson arranged an employee stock ownership plan (ESOP), so that the employees could take the company independent from The Boston Safe Deposit and Trust Company. The buyout of all shares was completed in 1979.

In 1998 BCG created The Strategy Institute. Its purpose is to enrich the firm's strategic thinking by applying insights from a variety of academic disciplines to the strategic challenges facing both business and society.

The Boston Consulting Group ranked 11th overall and 1st among smaller companies in Fortune Magazine's 2008 "100 Best US Companies to Work For" survey, based on strong employee development, a supportive culture, and progressive benefits.

Competitors

• McKinsey & Company
• Bain & Company
• Monitor Group

References

1.http://money.cnn.com/galleries/2007/fortune/0701/gallery.bestcos/8.html
2.http://bwnt.businessweek.com/recruiting/index.asp?c=243

3.http://www.consultingmag.com/articles/239/1/Kaz-Uchida---Boston-Consulting-Group/Kaz-Uchida---Boston-Consulting-Group.html

External links

• Official Web Site

 

Employees on Wikispooks

Employee	Job	Appointed	End	Description
Kurt Lauk	Leader of German practice	1978	1984
Ira Magaziner	Consultant	1973	1979
Hans Wijers	CEO and Chairman for Netherlands	1999	2001	Also worked from them in the 1980s

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