Introduction
Guidehouse, formally PricewaterhouseCoopers, provides business advisory services including strategy, management, technology, and risk management consulting (Guidehouse, 2019). In general, consulting companies aim to optimize business processes and overall performance within a specific area of expertise. For example, a company that wants to improve their technological infrastructure could contact a professional technology consulting firm to assess and determine possible technology upgrade solutions. Consulting companies do not provide a physical product, but rather provide expert advice and in some cases professional guidance based on practical experience in a related companies, fields, and industries. The consulting industry has been around in the United States for many years. Historical accounts of the very first consulting services companies can be traced back to a professor at MIT named Arthur D. Little who established the first management consulting firm in 1886 (Spencer, 2016). The notion of a need for management consulting business services implies that there must have been demand from companies seeking professional management advice. Clearly, the need for business consulting services has been in continuous demand ever since the very first management consulting firm. Since Mr. Little's consulting firm was established in 1886, the consulting industry has grown rapidly. According to Statista, the consulting Industry's market size is estimated to be valued at over one hundred and fifty-two billion dollars (2019). The consulting industry and related services have become very influential in the United States and have since caught the attention of major investors and companies seeking expert advice.
Today the rebranded Guidehouse company focuses on providing professional consulting services for the United States public sector businesses, such as the Department of Defense, Homeland Security, Department of Veterans Affairs, Health and Human Services, and the Department of State, as well as, many other types of government agencies (Veritas Capital, 2018). The services provided by Guidehouse do not necessary focus on a target customer in the traditional sense commonly thought of when thinking about a product-based consumer target. For example, a company that sells coffee might have a target audience mixture of men and women between the ages of eighteen and thirty-nine who drink coffee daily and live in Los Angeles, Chicago, New York, and Houston. In the case of Guidehouse, their target market focuses on specific industries rather than on individual customer segments and demographics. Guidehouse's target customers are companies with the industries of defense, financial, health, international development and diplomacy, science and infrastructure, national security, as well as, state and local governments (Guidehouse, 2019). The company provides consulting services to a vast array of customers and industries, which make up the company's customer targets.
There are several aspects of a company's overall strategy and core values that guides and defines a company's purpose, as well as, the way a company conducts business. Some companies perform better than others in the execution of business strategy. In general, there are five key steps that create a company's strategy, which include developing a strategic vision, creating objectives, developing a strategy, implementation of a strategy, and continuously monitoring and improving the company's strategy (Thompson, Gamble, Peteraf, Strickland, 2018). These steps provide a high-level overview of the common steps required in developing a company strategy. It is important to note that there are several sub-divisions within each of these steps that involve aspects of accounting, finance, human relations, marketing, operations, and others. The ideal goal of effectively implementing a company strategy is to yield results and achieve organizational success within all aspects of a company's operations and efforts. This overarching goal includes setting and implementing organization-wide, department level, and individual objectives. In 2014, Guidehouse, which was at the time known as PricewaterhouseCoopers, was awarded the Baldrige Performance Excellence Award by the United States Department of Commerce (National Institute of Standards and Technology, 2019a). The following case analyses will examine and evaluate the strategic decisions that lead Guidehouse to winning the Baldrige Performance Excellence Award, the company's business model, the competitive advantage of the business, how management and leadership are implemented to achieve a sustainable competitive advantage, and the perceived future strategic direction of the organization.
Case Analysis: Guidehouse Baldrige Performance Excellence Award
According to American Society for Quality, in 1987, the United States Congress developed the Malcolm Baldrige National Quality Award, also referred to as MBNQA, to recognize national companies for achieving a high level of excellence. Baldrige is the highest presidential award that can be given for organizational performance and is based on seven criteria, including leadership, strategy, customers, data management, empowerment of the workforce, operational management, and the overall results (2019). The focus of each of these criteria pertain to a company's overall strategy and application of quality management systems. This award is only given to companies who have achieved the highest levels of performance and organizational standards. The National Institute of Standards in Technology have developed a Baldrige framework to provide operational guidance, increase levels of performance, and achieve business results that are sustainable for companies of all sizes and industries. The Baldrige Excellence Framework is a systematic approach that follows the seven criteria required to apply for the Baldrige award. The Baldrige approach aims to help businesses achieve the highest levels of performance in an ever-changing business environment, a steadfast focus on performance-driven strategies, encouraging overall engagement of customers and workforce, increase standards of governance and ethical codes of conduct, cooperate social responsibility, maintaining competitiveness, and achieving long-term success (National Institute of Standards in Technology, 2019b).
All award recipients of the Baldrige Performance Excellence Award must first fill-in a comprehensive application that covers a wide range of a company's strategy and operations. There were several strategic decisions that lead Guidehouse to winning the Baldrige Performance Excellence Award. In general, a company strategy involves all actions taken by a company's leadership team to make a company profitable and more competitive (Thompson, et al., 2018). Guidehouse's award application extensively covers a wide range of the company's overall strategy and implementation, which highlights the seven criteria required for winning the award. The Guidehouse strategic planning mechanisms mentioned in their application include the OODA loop, improving agility and flexibility, formal processes for innovation planning, SWOT Analysis, quality management systems, and more (PricewaterhouseCoopers, 2014).
Managing quality requires a focus on the reduction of production defects, increasing revenues, and continuously improving efficiency in operations. For example, quality management systems such as Six Sigma aims to achieve virtually zero defects in a company's production and processes (Russel & Taylor, 2017). Six Sigma is a statistical methodology that is designed to improve the efficiency of business processes and increase overall customer satisfaction. With the assistance of quality management system consultants, the Guidehouse company developed their own internal quality management system with the aim to achieve similar results like Six Sigma. The company referred to their internal quality management system as OODA, which represents a four-step process for strategic planning. Guidehouse defines the OODA process as observe, orient, decide, and act, as well as, elements of continuous improvement (PricewaterhouseCoopers, 2014). The tail of the OODA process involves elements of continuous improvement, which refers to a type of lean system methodology. A lean system is a methodology that places an emphasis on achieving business efficiency. The term continuous improvement in the Guidehouse strategic planning process, refers specifically to a lean systems practice called Kaizen. Kaizen means continuous improvement in Japanese and is a lean system that focuses on making gradual changes to improve business processes while eliminating waste (Lean Production, 2019). The company was awarded the Baldrige award for enacting and espousing best practices in strategical planning, execution, monitoring, and controlling.
Case Analysis: Guidehouse Competitive Advantage
Most companies will likely face competition when selling any type of product or service in the marketplace. Having a competitive advantage can make a difference in the overall success and profitability of an organization. A competitive advantage can be defined as the factors that make a company's offerings unique and attracts buyers to choose their goods and services over another company's offer (Thompson, et al., 2018). Guidehouse currently competes against other governmental consulting agencies to win contracts and clients. The company's main competitive advantage is a combination of a broad differentiation and focused differentiation strategies. The company provides services for a broad audience of customers by appealing to entire industries, which gives the company's service a wide appeal to a variety of potential customers. On the other hand, the company provides a focused differentiation strategy through the segmentation of their business into different industry sectors. Guidehouse offers a comprehensive service offering by combining both strategies that appeals to both broad and specific customer segments and groups to give the company a competitive advantage.
The ability of any firm to sell goods and services in a long-term competitive market is commonly referred to as a sustainable advantage (Chen & Wang, 2012). One competitive advantage of Guidehouse is their strategic planning process, or SPP, that they have refined over the course of many years. Additionally, Guidehouse currently has a sustainable competitive advantage as being the only consulting company in the United States who has ever been awarded the Baldrige award (Guidehouse, 2019). The Guidehouse strategy is considered proactive because they have deliberately created a strategy to meet the current and future needs of the organization and customer.
Case Analysis: Guidehouse Management & Leadership
The third step of the strategy-making process involves creating a plan to achieve the vision, mission, core values, and objectives that were set in the previous steps. In general, there are four core strategies that are part of the management hierarchy, which are typically performed by different levels of management. These four core strategies within an organization include corporate strategy, business strategy, functional area strategies, and operating strategies (Thompson, et al., 2018). The Guidehouse organizational structure is a multi-level company that includes a United States advisory board, supported by a Chief Operating Officer and Risk & Quality Partner, then Operations leaders, and lastly followed by sector leaders (PricewaterhouseCoopers, 2014). This gives Guidehouse a sustainable competitive advantage by structuring knowledgeable industry experts in sectors of the business where they are most proficient and can provide the highest levels of value to their customers.
There are many types of business strategies. In general, the success of a business strategy can be tested by utilizing three common tests. These tests are referred to as the fit test, competitive advantage test, and performance test. When all three of these tests are passed successfully a company's strategy is said to be a strategy winner. In 2017, Guidehouse reported over five hundred million dollars in revenue and an anticipated growth rate above the average growth rate of around seven to ten percent (Wilkers, 2018). It appears that Guidehouse also passes the performance test, based on the information available about the company's overall performance. Guidehouse clearly is strategy winner by account of all three tests being passed successfully by the company.
Summary
Guidehouse was the 2014 winner of the Baldrige Performance Excellence Award, and the reason for this selection is clear for many reasons. Guidehouse proved through a thoughtful, comprehensive, and cohesive strategic plan that crafting a powerful vision, mission statement, core values, and objectives can benefit any organization when done properly. The company's business model realistically and obviously creates financial and strategic goals for all levels of leadership, management, and employees to achieve. The company offers several competitive advantages that are both broad and focused on achieving sustainable results to account for the highest levels of organizational success and competitive advantages. The Guidehouse company is on track to achieve higher levels of future success based on the implementation of effective planning and strong levels of efficient execution of their strategic plans. Overall, strategy plays an important role in the long-term success of any business. Deliberately creating a strategic plan that involves all aspects of a company can help generate the best ideas and eventually lead to improved organizational results. Thus, a company that takes the time to craft an effective strategic plan can potentially make a positive difference in several aspects involving their company, employees, customers, community, and the world that benefits from their services.
References
American Society of Quality (2019). What is the Malcolm Baldrige National Quality Award (MBNQA)? Retrieved from https://asq.org/quality-resources/malcolm-baldrige-national-quality-award
Chen, T. & Wang, Y. (2016). Evaluating sustainable advantages in productivity with a systematic procedure. International Journal of Advanced Manufacturing Technology.
Guidehouse (2019). Who we are. Retrieved from https://guidehouse.com/who-we-are/
Lean Production (2019). Kaizen. Retrieved from https://www.leanproduction.com/kaizen.html
National Institute of Standards and Technology (2014). Four U.S. organizations honored with 2014 Baldrige National Quality Award. Retrieved from https://www.nist.gov/news-events/news/2014/11/four-us-organizations-honored-2014-baldrige-national-quality-award
National Institute of Standards and Technology (2019a). Baldrige award recipients listing. U.S. Department of Commerce.
National Institute of Standards and Technology (2019b). How Baldrige works. U.S. Department of Commerce.
PricewaterhouseCoopers (2014). 2014 Malcolm Baldrige National Quality Award Application.
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Statista (2019). Management consulting market size by sector from 2011 to 2020.
Thompson, A., Gamble, J., Peteraf, M., Strickland, A. (2018). Crafting & executing strategy: the quest for competitive advantage, concepts and cases (21st ed.). New York: NY: McGraw-Hill Education.
Veritas Capital (2018). Veritas Capital unveils "Guidehouse" as new brand identity of its US public sector business.
Wilkers, R. (2018). PwC public sector arm rebrands to 'Guidehouse'. Washington Technology.