One of the world’s most prestigious management consultancies officially opened in Auckland last week and is perhaps more optimistic about New Zealand’s future than most New Zealanders.
A survey conducted by the Boston Consulting Group (BCG) in the first half of 2022 found that New Zealanders were more concerned about inflation than people in every country surveyed except Brazil.
Not only that, but New Zealanders were more afraid to attend a live concert, travel abroad, take a cruise or go to a bar than people in the US, UK United, France, Sweden, Brazil or China.
That negativity didn’t stop BCG’s senior brass in Australia from converging on Auckland for the official opening of the new office in Wynyard Quarter last week.
* On your marks, get set, restructure: a look at the new wave of restructuring
* Dileepa Fonseka: The advice machine needs fixing – but who will?
* The Biggest Taxpayer Scam of 2020
* Contractors paid $500 an hour to help the health board find ‘significant savings’
The BCG offices were due to open last year – the company even issued a press release about it – but Covid-19 and other issues got in the way.
BCG is known as one of the “big three” strategy consultancies – the most famous of which is McKinsey – which works with the world’s largest companies on their long-term plans and strategic direction. The consultancy had global sales of US$11 billion (NZ$17.6 billion) last year.
You might be wondering why he’s here, since New Zealand is a small economy and the Big Four accounting firms all run large business advisory divisions.
BCG’s Auckland office manager Phillip Benedetti said its client offering had grown in recent years, which is part of why the firm believed it had enough business to maintain a permanent office here for years. many years to come.
“Ten years ago we were just doing strategy, it was ‘we’ll talk to you once every five years and help you think about what’s going on’, and now we’re 25,000 people with capabilities ranging from strategists like me to user experience designers, to technology architects.
The group’s offices in Auckland have all the trappings you might expect from a global strategy consultancy in 2022: copies of the globe-trotting cultural magazine Monocle on the coffee table and cubicles full of well-dressed consultants and uncluttered working on PowerPoint slides and liking LinkedIn posts.
BCG’s president for Asia-Pacific, Neeraj Aggarwal, said four years ago that the company was looking for the most exciting places in Asia-Pacific and came up with three locations: Shenzhen, Osaka and New Zealand.
For him, the future of New Zealand is bright.
But New Zealand has heard of all this before, more than a decade ago, when BCG set up an office and then did it all again in late 2009 because Auckland-based staff traveled so often to Australia to serve customers.
Benedetti said the New Zealand economy was different now, and so was the business itself.
“I don’t think a lot of people in New Zealand recognize how much the [New Zealand] is the brand and what is the opportunity there is internationally,
“From a sustainability standpoint, from a standpoint of environmental protection and a multicultural society that actually works…people see New Zealand as a light on the hill.”
Benedetti said there have been two big economic shifts since the firm’s last presence here: Big Australian banks have seen control repatriated to New Zealand, while companies here are also more export-focused. than they have been in the past.
With the decision to locate in New Zealand made, the next big internal debate was whether Auckland or Wellington would be the right beachhead for the company.
Ultimately, it was a strategic decision about whether BCG would do more work for the private sector or the government.
But also which city, Auckland or Wellington, was most likely to produce the country’s next tech “unicorn”.
“We are in the Wynyard area and it was a very deliberate decision. The number of sites I’ve visited are too many to count, and we settled on Wynyard because it’s Auckland’s innovation district.
“That’s where the growth, the new ideas, the next unicorn will come from, and we fundamentally believe that we’re an essential part of that.
“We want to help businesses become unicorns, we want to help people think differently, we want to help them compete on the world stage, so if you want to do that, you might as well be in the capital of innovation from Auckland.”
As for government work, Benedetti doesn’t rule it out, but says the public sector’s ability to hire consultants like BCG is still limited, and that the scrutiny governments face in hiring them makes often these difficult contracts as well.
Both Benedetti and Aggarwal have backgrounds you wouldn’t normally associate with the stereotypical economics and business acumen of management consultants.
Benedetti, an American by birth, began as an academic scientist working in chemistry doing organic synthesis for drug discovery and development.
Aggarwal studied computer science in the 1990s in India, worked in Silicon Valley and even wrote a few million lines of code for the Intel Pentium chip.
For Aggarwal, the trip to New Zealand to open the BCG office here is part of a frenetic globetrotting tour that has been gathering pace since March. In recent months he has traveled to Toyko, Jakarta, Manila and various parts of India. Next month he will be in Seoul followed by Fukuoka, Nagoya and Osaka.
Aggarwal says the economic rebound that made all that air travel possible has been a talking point in Asia-Pacific boardrooms, but so has climate change.
Climate change is a major concern for BCG globally. It has been named as a partner consultancy for COP26 and is expected to be named in the same way for the COP27 conference in November.
Carbon emissions are another reason BCG is reopening an office here, with BCG committing to net zero emissions by 2030.
The company has New Zealand clients who have been with the company for decades – some are in agriculture, banking and insurance – but BCG serves them by flying consultants here .
Both Aggarwal and Benedetti recognize that to sustain a permanent base here they will need to expand their customer base beyond those customers, but how will they do that with so much fear there?
Aggarwal’s pitch is that in turbulent times, companies need strategy consultants because the volatile conditions make it easier for individual companies to leapfrog their competitors. He quotes Formula 1 driver Ayrton Senna’s classic quote about how it’s easier to overtake cars in the rain, when drivers are careful or can’t control their cars, than to do the same in good weather. terms.
And now that BCG has finally opened its office here, Benedetti insists he’s not going to pack up and leave like they did a decade ago, even with dark economic clouds looming. ‘horizon.
“BCG is back, we are here to stay in New Zealand and we want to build long term relationships.
“I’m not here to sell you something really quick and then rush off to Australia. I am here because I fundamentally believe in the potential of New Zealand.