UNIVERSITY OF LUZON

College of Accountancy
Dagupan City

Areas
of
Management Consultancy

Org Maven Group

Ma. Geneva E. Arenas

Ma. Jenica Aira D. Sarmiento
Mikka Flor B. Dela Cruz
Dannessa C. Tadios
Sheena Rozel M. Aquino
Gloria B. Carcha
Ronna Marie M. Valerio
Grace C. Manuel
Joshua S. Aquino
Ernest Joshua D. Martinez
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City

Areas of Management Consultancy

Management Advisory vs Management Consulting
Management Advisory Services
the function of providing professional advisory (consulting) services to improve the clients
use of its capabilities and resources to achieve the objectives of the organization.
Management Consulting
is an independent and objective advisory services provided by qualified persons to clients to
help them identify and analyze management problems or opportunities.

Management consulting can relate to areas such as:

1. The management functions of analysis, planning, organizing and controlling.
2. The introduction of new ideas, concepts and methods to management.
3. The improvement of policies, procedures, systems methods and organizational
relationships.
4. The application and use of managerial accounting, control systems, data processing, and
mathematical techniques and methods.
5. The conduct of special studies, preparation of recommendation.

Most sought-after types of Audit work

1. Business planning and development or project feasibility studies.
2. Information systems consulting
3. Management/Operations Audit
4. Business process improvement/reengineering
5. Others

Project Feasibility Studies

Refers to the systematic gathering and analysis of data which aims to find out the viability of
the proposed business undertaking

Steps in the Preparation of a Project Study

1. Gathering and collection of relevant data
2. Evaluation and analysis of the data obtained
3. Formulation of conclusions and recommendations

Major Aspects of a Project Study

1. Management
2. Marketing
3. Technical
4. Taxatiom
5. Legal
6. Financial
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City
7. Sources of Financing
8. Profitability
9. Economic Benefits

Financial study
- this study is done to determine and evaluate the project's capital requirements, possible
sources of financing including terms and conditions, forecast of operating revenues, costs and
expenses, effect of inflation on the financial situation and results of operation

Major parts of the financing study

1. Statement of assumptions
2. Projected financial statements
3. Possible sources outside financing
4. Details of various amounts contained in the projected financial statements
5. Analysis of financial statements.

Statement of Assumption
-statement about the possible future behavior of certain factors affecting a project.

Projected financial statements

-are used to evaluate the results of the financial projection as to project's profitability, liquidity,
and solvency as well as its ability to withstand difficulties.
Possible sources of financing:
Internal source- funds obtained w/in the firm
External source- funds furnished by owners and creditors

Classifications of funds
1. Short term funds- will be needed for one year or less.
Possible source :
*Trade credit
*Advances from customers
2. Intermediate funds- will be needed between 1 to 5 years.
3. Long-term funds- will be needed for five years or more.
Possible sources:
*Issuance of capital stocks
*Depreciation
* Long-term loan from banks and other financial institutions

Attributes Of Good Feasibility Study

A good feasibility study must be:
1. Comprehensive -areas covered must be clearly defined and well investigated
2. Objective -it must reflect both the positive and negative implications.
3. Simple -the report should be easy to understand.
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City

Information System Consulting

Information system consulting (also called IT consulting, computer consultancy, business and
technology services, computing consultancy, technology consulting, and IT advisory) as a field
of activity focuses on advising organizations on how best to use information technology (IT)
in achieving their business objectives.

The IS consulting industry can be viewed as a Four-tier system:

Professional services firms which maintain large professional workforces and
command high bill rates.
Staffing firms, which place technologists with businesses on a temporary basis,
typically in response to employee absences, temporary skill shortages and technical projects.
Independent consultants, who are self-employed or who function as employees of
staffing firms, or as independent contractors in their own right.
Information Technology security consultants

There are different reasons why consultants are called in:

To gain external, objective advice and recommendations
To gain access to the consultants' specialized expertise
Temporary help during a one-time project where the hiring of a permanent employee(s)
is not required or necessary
To outsource all or part of the IS services from a specific company.

Prerequisites and major obstacles

Once a business owner defined the needs to take a business to the next level, a decision
maker will define a scope, cost and a time-frame of the project. The role of the IS consultancy
company is to support and nurture the company from the very beginning of the project till the
end, and deliver the project not only in the scope, time and cost but also with complete customer
satisfaction.

Project scoping and planning

The usual problem is that a business owner doesn't know the detail of what the project is going
to deliver until it starts the process. In many cases, the incremental effort in some projects can
lead to significant financial loss.

Business process and system design

The scope of a project is linked intimately to the proposed business processes and systems that
the project is going to deliver. Regardless of whether the project is to launch a new product
range or discontinue unprofitable parts of the business, the change will have some impact on
business processes and systems. The documentation of your business processes and system
requirements are as fundamental to project scoping as an architects plans would be to the
costing and scoping of the construction of a building.
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City
Project management support
The most successful business projects are always those that are driven by an employee who
has the authority, vision and influence to drive the required changes in a business. It is highly
unlikely that a business owner (decision maker or similar) will realize the changes unless one
has one of these people in the employment. However, the project leadership role typically
requires significant experience and skills which are not usually found within a company
focused on day-to-day operations. Due to this requirement within more significant business
change projects/programs, outside expertise is often sought from firms which can bring this
specific skill set to the company.

Information System Consultants analyzed, design and develop information systems' business
solutions and provide advice on a wide range of Information systems issues.

IS consulting skills
An IS consultant needs to possess the following skills:
Advisory skills
Technical skills
Business skills
Communication skills
Management skills

Management consulting and IS consulting

There is a relatively unclear line between management consulting and IS consulting.
There are sometimes overlaps between the two fields, but IS consultants often have degrees in
computer science, electronics, technology, or management information systems while
management consultants often have degrees in accounting, economics, Industrial Engineering,
finance, or a generalized MBA (Masters in Business Administration).

According to the Institute for Partner Education & Development, IS consultants'

revenues come predominantly from design and planning based consulting with a mixture of IS
and business consulting. This is different from a systems integrator in that you do not normally
take title to product. Their value comes from their ability to integrate and support technologies
as well as determining product and brands.

Management/Operations Audit
Management/Operations Audit is a systematic review of effectiveness, efficiency and
economy of operation.

Objectives of Management/Operations Audit

*To evaluate the effectiveness and efficiency of the activities or operations of the entity in
meeting organizational goals.
*To ensure that the management is going to achieve the objectives.
*To help the management to do efficient administration of the operations.
*To identify, with management participation, opportunities for improving control.
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City

Scope of Management/Operations audit

*Economy and effeciency audit
*Program audits
*Compliance audit

Operational aspects of management/operations audit

1. Objectives and Aims of Organization
2. Productions
3. Sales and distribution
4. Operations

Benefits of management/operations audit

*it analyze and understand your company's financial records
*identify key areas for improvement in your company
*assess risks , economy, efficiency and quality
*evaluate new tecnology
*reinforce and strengthen internal control
*uncover fraudulent or other illegal activities within your company

Business Process Improvement/ Reengineering

The Business Process Improvement/ Reengineering - is the analysis and redesign of core
business processes to achieve the substantial improvement in its performance, productivity and
quality.

The business process is required to be reengineered or improved because of the following

reasons:
*the business process have might become outdated.
*the existing business process could be lengthy, time-consuming or obsolete.
*the technology keeps on updating
*sub-divisions in the organization aims at improving their respective division performance and
overlook the resultant effects on the other departments

The Business process reengineering comprises of following steps:

BPR Process
1.) Define Objectives and Framework: First of all, the objective of re-engineering must be
defined in the quantitative and qualitative terms. The objectives are the end results that the
management desires after the reengineering. Once the objectives are defined, the need for
change should be well communicated to the employees because, the success of BPR depends
on the readiness of the employees to accept the change.

2.) Identify Customer Needs: While, redesigning the business process the needs of the
customers must be taken into prior consideration. The process shall be redesigned in such a
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City
way that it clearly provides the added value to the customer. One must take the following
parameters into the consideration:
Type of Customer and customer groups.
Customers expected utilities in product and services
Customer requirements, buying habits and consuming tendencies.
Customer problems and expectations about the product or service.

3.) Study the Existing Process: Before deciding on the changes to be made in the existing
business process, one must analyze it carefully. The existing process provides a base for the
new process and hence what and why of the new process can be well designed by studying
the right and wrongs of the existing business plan.

4.) Formulate a Redesign Business Plan: Once the existing business process is studied
thoroughly, the required changes are written down on a piece of paper and is converted into an
ideal re-design process. Here, all the changes are chalked down, and the best among all the
alternatives is selected.

5.)Implement the Redesign: Finally, the changes are implemented into the redesign plan to
achieve the dramatic improvements. It is the responsibility of both the management and the
designer to operationalise the new process and gain the support of all.
Thus, the business process reengineering is collection of interrelated tasks or activities designed
to accomplish the specified outcome.

Business Benefits:
1. Growth of Business
2. Reduces Cost
3. Reduces Time to Market Product
4. Improvement in Organizational Approach

Internal Team Benefits

1. Increase Effectiveness
2. Meaningful Job for Employees
End Customer Benefits
1. Quicker response time to customer
2. Delivering high quality to customer

Other areas of management consultancy

Marketing research
- process through which managers discover the nature of the competitive environment in
which they are operating.

Marketing strategy
- defines the approach the business will take in order to gets the customers attention.
 UNIVERSITY OF LUZON
College of Accountancy
Dagupan City
Developing Promotional Campaigns
Dedicated at informing customers
Stimulating customers interest
Encouraging purchase

Planning sales force activity

Sales team, primary promotional tool
Expenditure on sales force, an important investment activity
Detailed and thoughtful planning offers real returns
An area the consultant can offer valuable support

New product development

Understanding the customers needs through market research
Technical advice on product development
Identification and contacting suppliers of critical components
Development of marketing and PR campaigns to support launch
Developing promotion campaigns to get distributors on board
Financial planning and evaluation of the return on new product investment.

Develop proposal for financial report - "innovate"

Staff recruitment - "add"

Exploring and international market - "widen your vision"