Competetive Analysis PDF

COMPETITIVE ANALYSIS IDC MarketScape: U.S.
Business Consulting Services for Smart Cities 2013 Vendor Analysis

Cushing Anderson Kerry Smith Ruthbea Yesner Clarke
IDC OPINION
This IDC study represents the vendor assessment model called IDC MarketScape. This research is a quantitative and qualitative assessment of the characteristics that explain a vendor's success in the marketplace and help anticipate its ascendancy. This study assesses the capability and business strategy of many of the leading business consulting firms. This evaluation is based on a comprehensive framework and set of parameters expected to be most conducive to success in providing business consulting services during both the short term and the long term. A significant and unique component of this evaluation is the inclusion of the perception of business consulting buyers of both the key characteristics and the capabilities of these consulting providers. As one would expect of market leaders, overall, these firms performed very well on this assessment. Key findings include: Surprisingly, this evaluation discovered that generally buyers are disappointed with the consulting provider's ability to maximize the project's value. While all vendors state a focus on maximizing the value of their projects, buyers believe this area is one of the weakest performance areas for consultants overall. Firms are generally quite good at demonstrating their ability to apply proven methodologies/tools and to provide a full spectrum of business consulting services. As Smart Cities projects become more common, repeatable approaches to similar issues will create higher value. The firms assessed for Smart Cities are challenged with serving the midtier cities and are heavily focused on large cities. While finding opportunities in midsize cities is more labor intensive, there is a lot of opportunity that could be lost to emerging high-tech urban consultancies. Repeatable processes catered to smaller projects will not only create higher value in larger cities but also expand market potential to midsize cities.
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Filing Information: August 2013, IDC #242453, Volume: 1 Business Consulting Services: Competitive Analysis
IN THIS STUDY
This IDC study uses the vendor assessment model called IDC MarketScape. This research is a quantitative and qualitative assessment of the characteristics that explain a firm's success in the marketplace and help anticipate its ascendancy. This study assesses the capability and business strategy of many of the leading business consulting firms. This evaluation is based on a comprehensive framework and set of parameters expected to be most conducive to success in providing business consulting services during both the short term and the long term. A significant and unique component of this evaluation is the inclusion of the perception of business consulting buyers of both the key characteristics and the capabilities of these consulting providers. As one would expect of market leaders, overall, these firms performed very well on this assessment. This study is composed of two key sections. The first part is a definition or description of the characteristics that IDC analysts believe make a successful business consulting firm. These characteristics are based on buyer and vendor surveys and key analysts' observations of industry best practices. The second part is a visual aggregation of multiple firms into a single bubble-chart format. This display concisely exhibits the observed and quantified scores of the consulting providers. The document concludes with IDC's essential guidance to support continued growth and improvement of these firms' offerings.
Methodology
IDC MarketScape criteria selection, weightings, and vendor scores represent wellresearched IDC judgment about the market and specific firms. IDC analysts tailor the range of standard characteristics by which firms are measured through structured discussions, surveys, and interviews with market leaders, participants, and end buyers. Market weightings are based on user interviews, buyer surveys, and the input of a review board of IDC experts in each market. IDC analysts base individual firm scores and, ultimately, firm positions on the IDC MarketScape, surveys and interviews with the firms, publicly available information, and buyer experiences in an effort to provide an accurate and consistent assessment of each firm's characteristics, behavior, and capability.
SITUATION OVERVIEW
Introduction
The concept of Smart Cities is in many ways a construct in which to frame local government transformation. This transformation is enabled by emerging technologies, such as the Internet of Things and machine to machine (M2M), social media, mobility,
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and Big Data and analytics, but it is also focused on specific goals. In IDC's definition, Smart City pilots, projects, or initiatives are focused on one or more of the following: Sustainability Economic development and/or revitalization Open data and transparency Citizen and stakeholder engagement A key ingredient in this transformation is also the ability for government leaders, including CIOs and the IT department, to embrace and test new ideas and to promote innovation and change. All of these factors together typically require new strategic directions, organizational and process changes, and selecting and implementing new systems to support a Smart City strategy. IDC forecasts spending on business consulting services by U.S. local governments to be $1.1 billion in 2014, with a growth rate slightly above 4% through 2017. Spending for consulting specific to Smart City solutions will be a small but fast-growing segment of this market as cities look to road map their technology investments and organizational and process changes necessary for city transformation. In a 2012 U.S. survey, 21% of local government respondents and 33% of state respondents said they would use business consulting services to help research, implement, and/or deploy smart technology solutions for their organization. These projects will be driven by the following: Meeting the Smart City goals listed previously, with economic development (i.e., job creation) being a top priority Transforming business systems and processes to help cities provide improved citizen services and meet rising citizen expectations Strategic direction on the use of emerging technologies like Big Data and analytics, cloud, social business, machine-to-machine automation, visualization tools, and mobile apps As described in IDC's Smart City Maturity Model, most cities are currently in the Ad Hoc stage with traditional government modus operandi, with discrete, one-off Smart City pilots or projects that are department based. While these projects serve to develop the business case for further investment, many cities will start to require services to help move to the Opportunistic stage in which project deployments need collaboration within and between departments and where key stakeholders are aligned around developing a long-term strategy. To move forward, city leaders will need to: Begin to assess its Smart City current competency and maturity Define short- and long-term goals and plan for improvements Prioritize technology, partnership, staffing, and other related investment decisions Uncover maturity gaps among departments, business units, or between functional and IT groups
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There are many challenges and obstacles to Smart City adoption that also drive the need for external consulting services. Examples of the challenges include: Fragmented decision making. Cities traditionally operate in a highly fragmented state with budgets, governance, decision making, IT platforms, and information handled by individual departments. The result is that IT strategy, investment, and the processes that support services delivery are inefficient when viewed in a systemic citywide operational context: multiple data sets and applications exist in different departments, relevant information is not shared, and operations are not coordinated beyond emergency protocols or when required for special events. Rigid processes and the lack of needed skill sets. Despite city leadership that may be pushing a Smart City agenda, and the desire by many city workers to improve and change, it is difficult for cities to overcome risk-averse cultures and procurement processes that make experimentation and innovation a challenge especially if staff lack the skill sets necessary to set the strategic and technical direction. A time of austerity. These barriers to adoption are further complicated by the long economic recovery in which many cities are operating in very austere environments, and there is limited federal funding for pilot projects. Cities are very much still in "do more with less" or even "do less with less" mode and as such Smart City initiatives must provide ROI, cost reductions, efficiency improvements, and improved citizen services. Many cities are wondering how to find investment dollars for these new projects and also how to sustain them over time. Leveraging consultants with the right experience at bridging stakeholder requirements and aligning project objectives, consultants who have the process, technical, and even local government experience, and consultants with expertise in funding models, public/private partnerships, performance contracting, and/or capital raising initiatives is essential.
IDC MarketScape Vendor Inclusion Criteria

This research includes analysis of the five largest business consulting firms and firms with broad portfolios spanning IDC's research coverage and with global scale. This assessment is designed to evaluate the characteristics of each firm as opposed to its size or the breadth of its services. It is conceivable, and in fact the case, that specialty firms can compete with multidisciplinary firms on an equal footing. As such, this evaluation should not be considered a "final judgment" on the firms to consider for a particular project. An enterprise's specific objectives and requirements will play a significant role in determining which firms should be considered as potential candidates for an engagement.
Weighting Evaluation Criteria

The importance of a firm's characteristics to project success and relevance of the particular issue combined with IDC's opinion about the impact those elements have on the selection of firms implies a unique weighting of these elements when
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evaluating a firm's overall strategy and capability to address market opportunity and realizing market success (see Tables 1 and 2). In addition to the criteria for success having varying weights, IDC believes the aggregate criteria (offering, go to market, and business) should also be weighted. Table 3 illustrates the relative weights used in this analysis. Consequently, based on the weightings, we believe there are several criteria that are most influential in predicting vendor effectiveness on specific engagements: Marketing strategy: Particularly important is the ability of the consultant to articulate its understanding of the key business issues of the day those specific to the engagement under consideration, but also more generally. And those descriptions should reflect the unique criteria and characteristics of the issue that make it relevant in the context of the enterprise. Portfolio strategy: The consulting firms must be adding new capabilities to their portfolio that not only reflect the large "in demand" services but also reflect the consultants' point of view about those services that will become important in the near- and midterm. To the extent its possible, it is also important that the consultants position themselves with skills and offerings that reflect the long-term direction of consulting including increased use of risk awareness, risk integration, and analytics. Other offering capabilities and go-to-market capabilities: For this analysis, significant weight was given to a review of both public and confidential-specific illustrations of capabilities delivered. Sometimes, these were case studies; other times, they were "qualifications" confidential recommendations normally used during a proposal process. The ability of consulting firms to represent their work with specific client examples is essential to their ability to attract new clients and gain additional qualifications. Particularly important was being able to demonstrate a wide breadth of Smart City examples.
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TABLE 1
Key Strategy Measures for Success: U.S. Business Consulting Services for Smart Cities
Subcriteria Weighting
Strategies Criteria Offering strategy
Criteria for Success Current development of offerings will be relevant and attractive to customers over the next three to five years. A wide variety of approaches will be employed to ensure increased functional and industry capability, including strategic hiring and training. To ensure maximum impact, organizations will need to increase their ability to construct teams that leverage those capabilities and provide precise value to clients. Methodologies and tools are increasingly leveraged from a single, universally accessible source to ensure worldwide consistency. Tools will be sifting to include more data-based research applied to solutions. Clients will demand greater degree of knowledge transfer to assure maximum ongoing value for the project. Also essential for effective delivery is the ability to transfer knowledge to the client teams. To remain relevant, consulting firms will add capabilities to both high-demand services and those services that the consultant believes will become important. Consultants will also begin to incubate offerings that reflect the long-term direction of consulting including increased use of risk awareness, risk integration, and analytics. Also important as a portfolio strategy is the ability of the consultant to challenge corporate culture. Prioritization of new opportunities must consider demand and adjacent capabilities and involve a tiered (regional) prioritization process and will often include incorporating risk awareness into engagements in a proactive manner.
Functionality or offering road map
1.0
Delivery model
3.0
Portfolio strategy
4.0
Other offering strategies
2.0
Offering strategy total Go-to-market strategy These strategies maximize the connection between offering and customers, including choosing to target customer segments that offer the greatest opportunity over the next three to five years. Not used in this evaluation. Consulting models are becoming more complex. Enterprise buyers need to consume consultative services in increasingly diverse ways. While still dominant, traditional engagement models are being supplemented by "microsourcing" of technically complex but narrow tasks such as analytic processing or ongoing benchmarking and information services provided with less intensive "consultation" to support insourced analytical or benchmark operations. Growth comes from many types of opportunities and client interactions, including temporal opportunities. Identifying areas of high demand and providing comprehensive and timely solutions require an integrated firmwide effort but will best serve the client's most important and immediate needs. Additionally, enterprises must perceive consultant competence in key issues to gain permission to address specific client problems.
10.0
Pricing model Sales/distribution strategy
NA 2.0
Marketing strategy
7.0
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TABLE 1
Key Strategy Measures for Success: U.S. Business Consulting Services for Smart Cities
Subcriteria Weighting 1.0
Strategies Criteria Customer service strategy
Criteria for Success Consistent and innovative service delivery relies on collaborative efforts throughout an organization. Firms must ensure a strong culture of collaboration, consistent and relevant training, and executive oversight and support. In the best case, firms use a combination of formal and informal peer review as a quality catalyst, sharing better practices and establishing a culture of high-quality engagements.
Go-to-market strategy total Business strategy Strategies to grow the business are aligned with market trends and future opportunities over the next three to five years. Firms poised for growth in the near term provide relevant specialized offerings that address specific needs, particularly for industries, geographic markets, or the size of the client. Additionally, a consulting provider's ability to cultivate a wide range of referenceable clients ensures the provider's capabilities will get the widest exposure to opportunities. Growth strategy is measured by both the diversity of the planned dimensions of growth and the measure of enthusiasm of client recommendation across company size and functional areas. Firms must be able to deliver innovation to their clients, in terms of both leveraging existing experience for the unique benefit of a client and developing a truly unique approach to solutions. Delivery of innovation is measured by client perception of the innovation delivered on the project. To maximize the ongoing capability of the consultant's employees, firms provide required training related to specific functional or technical areas and related to more broad-based consulting capabilities. The hours of required training demonstrate the firm's commitment to specific, continuous improvement of its individual consultants.
10.0
Growth strategy
3.0
Innovation/R&D pace and productivity
5.0
Employee strategy
2.0
Business strategy total

Source: IDC, 2013
10.0
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TABLE 2
Key Capability Measures for Success: U.S. Business Consulting Services for Smart Cities
Capabilities Criteria Offering capabilities Functionality/offering delivered
Criteria for Success The offering's capabilities align well with current market needs and demands. Offering capability is a combination of functional (domain) knowledge, industry insights, and technical capabilities. Higher capability reflects buyer perception of a firm's capability. The appropriate delivery model must include an appropriate integration with the client team and meet client-developed project timelines. Additionally, for consistent success, the consultant must drive and support a culture of change. Higher capability is reflected in higher buyer perception of a firm's capability in both the "ability to integrate with client team" and the "ability to meet project timelines" and "drive and support change across the organization." Cost competitiveness can best be measured by the ability to deliver financial benefits as a result of the project and directly improve client performance. Higher capability reflects buyer perception of a firm's capability in those two areas. Evolved consulting firms will necessarily be required to provide a full range of consulting services combined with an ability to provide specific insights related to industry, technical, or domain issues. Evolved consulting increasingly includes analytics or analytical components as a delivery tool and output of engagements. Higher capability reflects buyer perception of a firm's fullness and appropriateness of services offered and its ability to integrate analytics into an engagement. Consulting firms are continually introducing new service offerings. For high relevance, firms introduced a mix of both temporal and "foundational" offerings in the past years. Additionally, firms have a broad range of available case studies to demonstrate relevance to key issue and opportunities in this domain.
3.0
Delivery model appropriateness and execution
3.0
Cost competitiveness
1.0
Portfolio benefits delivered
1.0
Other offering capabilities
2.0
Offering capabilities total Go-to-market capabilities These capabilities maximize the connection between offerings and customers, such as delivery, partnerships, pricing, distribution, marketing, sales, and service. Not used in this evaluation.
10.0
Pricing model options and alignment Sales/distribution structure, capabilities
NA
Firms must operate by balancing both local and global requirements. Global presence indicates a firm's ability to respond and be relevant to crossgeographic issues. Higher capability reflects buyer perception of a firm's capability. The ability of a firm to connect to its clients' issues is essential to establishing a level of trust in the firm's ability to solve the problem. Issue performance is evaluated and weighted based on industry, domain, and regional priorities.
4.0
Marketing
6.0
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TABLE 2
Key Capability Measures for Success: U.S. Business Consulting Services for Smart Cities
Capabilities Criteria
Criteria for Success Higher capability reflects buyer perception of a firm's capability.
Customer service Other go-to-market capabilities Go-to-market capabilities total Business capabilities
Not used in this evaluation. Not used in this evaluation.
NA NA
10.0
Financial, employee, partner, and R&D management, among other capabilities, are in agreement with current market opportunities. Essential to a consulting firm's growth is its ability to develop industry-specific "referenceable clients." Clients that strongly believe the firm will represent their best interests are most often referred. Growth strategy execution is measured by the degree of enthusiasm of industry-related recommendations by clients. In addition to "required training," the culture of continuous improvement in an organization can be reflected by how much training consultants consume annually. A higher score indicates more annual training consumed by consultants. Also essential to a consulting firm's growth is the firm's ability to develop sizeand domain-specific "referenceable clients." Clients that strongly believe the firm will represent their best interests are most often referred. Business capabilities are measured by the degree of enthusiasm of recommendations by clients to enterprises of similar size and by executives of similar responsibility. 3.0
Growth strategy execution
Employee management
2.0
Other business capabilities
5.0
Business capabilities total

Source: IDC, 2013
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TABLE 3
Aggregate Criteria Weighting for U.S. Business Consulting Services for Smart Cities
Weighting Strategy Criteria Offering Go to market Business Total
Source: IDC, 2013
Capabilities Criteria 5.0 3.0 2.0 10.0
5.0 3.0 2.0 10.0
FUTURE OUTLOOK
IDC MarketScape U.S. Business Consulting Services for Smart Cities Market Vendor Assessment
The IDC vendor assessment for the business consulting services for Smart Cities market represents IDC's opinion on which providers are well positioned today through current capabilities and which providers are best positioned to gain market share over the next few years. Positioning in the upper right of the grid indicates that providers are well positioned to gain market share. For the purposes of analysis, IDC divided potential key strategy measures for success into two primary categories: capabilities and strategies. Positioning on the y-axis reflects the provider's current capabilities and menu of services and how well aligned it is to customer needs. The capabilities category focuses on the capabilities of the company and services today, here and now. Under this category, IDC looks at how well a provider is building/delivering capabilities that enable it to execute its chosen strategy in the market. Positioning on the x-axis, or strategies axis, indicates how well the provider's future strategy aligns with what customers will require in three to five years. The strategies category focuses on high-level strategic decisions and underlying assumptions about offerings, customer segments, business, and go-to-market plans for the future, in this case defined as the next three to five years. Under this category, analysts look at whether or not a provider's strategies in various areas are aligned with customer requirements (and spending) over a defined future time period.
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Figure 1 shows each provider's position in the vendor assessment chart. A provider's market share is indicated by the size of the bubble.
FIGURE 1
IDC MarketScape U.S. Business Consulting Services for Smart Cities Vendor Assessment
Source: IDC, 2013
Provider Profiles
Accenture
According to IDC analysis and buyer perception, Accenture is an IDC MarketScape Leader for business consulting for U.S. Smart Cities projects. Accenture offers a broad array of management consulting services to both the public and the private sectors in the context of cities and local government. Its approach is to explore the opportunities for clients and increasingly for public/private partnerships and to
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define an outcome in economic and stakeholder terms that helps drive their business forward and deliver results. Accenture sees itself as a strategic and operational management consultant willing to pursue a number of innovative value-based approaches with its clients tied to realizing results. As of June 2013, Accenture had more than 266,000 people, with growth that appears to be well distributed by geography. Accenture's management consulting growth platform is responsible for the development and delivery of the company's strategic, operational, functional, industry, process, and change consulting capabilities, working closely with the professionals in its technology and outsourcing growth platforms. Accenture Management Consulting's Strategy and Sustainability practice works closely with the company's Health & Public Service operating group to serve local government and cities. As required by local government and city-oriented clients, Accenture draws on the supporting functional expertise of its five function-based service areas: sales and customer services, finance and enterprise performance, operations, risk management, and talent and organization. Accenture Management Consulting also includes Accenture Analytics, which is increasingly involved in these sectors. Many Accenture Management Consulting professionals also help clients assess and implement strategic business solutions in areas such as cloud and mobility. These groups are backed up by Accenture's centers of excellence (COE) and innovation centers, including the recently opened Analytics Innovation Center in Singapore, established in collaboration with Singapore's Economic Development Board. Accenture has a number of analytics centers around the world supporting cities in education, health, smart grid, transportation, and procurement. Delivery of city and local government service offerings is also supported by the specialist skills in its Capability Network. This incorporates a client-facing Global Capability Network, which provides capabilities in highdemand areas, such as sourcing, procurement, and analytics. From a growing number of regional centers around the world, this satisfies client demand for consulting to be provided at speed and at scale. Accenture launched in 20122013 a number of new business services some functional and some industry specific helping to focus its offerings of end-to-end solutions for state and local smart government. These include customer-facing digital government services, intelligent processing (e.g., for human service and revenue agencies), integrated social services, enterprise (ERP) platforms and a range of productivity solutions (shared services and strategic sourcing), pension transformation, and police services. Accenture also offers a range of strategy consulting services to support business model and financing model innovation, including structures for public/private partnerships. It also provides integrated digital and physical urban master planning solutions that extend beyond real estatedriven development to full economic ecosystem development. Accenture smart grid services and smart building services are additional discrete offerings to public bodies and utility companies. Accenture has worked extensively with many of the largest cities in the United States and around the world to modernize technologies and systems for delivering citizen services. For instance, the firm worked with New York City in the launch and development of its 311 call center and online services. Integrating and consolidating technology, databases, and process streamlining for social service agencies is another area of Accenture expertise. The firm has developed technology assets, the Accenture Public Service Platform and software
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applications, that align with its public sector consulting to help address growing state and local government needs for integration and citizen access across government agency silos. Accenture has overhauled its public service marketing and, in 2012, launched a multiyear, multi-thematic umbrella marketing and thought leadership campaign, Delivering Public Service for the Future. This weaves together research on long-range challenges confronting governments and best practices to boost public sector productivity. Accenture has also undertaken extensive research with NGOs and third-party organizations for example, its work with the World Economic Forum on smart grids and its collaboration with the Carbon Disclosure Project on a joint report on European cities' emissions and carbon disclosure. It recently published a report with Arup, The Climate Group, and Horizon (the University of Nottingham) Information Marketplaces: The New Economics of Cities that addressed how technology can be used in cities to meet the growing challenges of expanding urbanization. Accenture sees dynamic convergence of technologies, industries, and social trends, creating new operating environments and opportunities for fundamental change and irrevocably altering relationships between governments and citizens and businesses and customers. The company is focused on helping organizations leverage technologies supporting overall digital strategy to transform relationships with customers and citizens. In FY12, Accenture's total net revenue grew by 11% (in local currency), from $25.5 billion to $27.9 billion. Overall consulting services (according to Accenture's definition that includes management and technology consulting as well as systems integration services) grew by 6% to $15.6 billion. Emerging geographic markets such as Brazil, China, and India continued to contribute to Accenture's recent performance. For business consulting overall, Accenture is considered to be among the most capable firms at helping clients expand into new markets or geographies, reduce costs, and drive innovation through their organizations.
Strengths/Opportunities
In the U.S. Smart Cities sector, Accenture is seen as most capable of all firms at integrating risk awareness and solutions within other consulting engagements, maximizing the value of a project, and transferring knowledge to the client. Additionally, Accenture is seen as among the most capable at helping drive innovation through an organization and integrating appropriate analytics into an engagement. Accenture is seen as better than many of its peers at directly improving clients' overall mission performance, helping enterprises create a more effective business, leveraging local and global staff appropriately, providing industry insights and competence, and offering the necessary spectrum of business consulting services.
Boston Consulting Group

According to IDC analysis and buyer perception, Boston Consulting Group (BCG) is an IDC MarketScape Major Player for business consulting for U.S. Smart Cities projects. BCG is among the most globally recognized strategy consulting firms, employing 4,400 consultants. BCG organizes its capabilities into corporate development, corporate finance, operations, strategy, marketing and sales, information technology,
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and organization, with other areas of focus including innovation, turnaround, transformation, postmerger integration, globalization, sustainability, managing in a slow-growth economy, and growth. The industries served by BCG include automotive, biopharmaceuticals, consumer products, energy and environment, engineered products and project business, financial institutions, insurance, media and entertainment, medical devices and technology, healthcare payers and providers, metals and mining, private equity, process industries, public sector, retail, technology and software, telecommunications, transportation, travel and tourism, and social impact. BCG is credited with pioneering a number of strategy frameworks for the management consulting industry as BCG's focus on conceptual, strategic thinking has yielded ideas that have become classics of strategy, including the experience curve, time-based competition, sustainable growth, and total shareholder value concepts that many organizations have leveraged to improve their competitive positions. BCG has remained a large strategy firm that still mainly focuses on strategy, rather than also building a large operations practice around which it can bundle strategy services. The firm does have some operational capabilities, particularly around the supply chain management element of postmerger integration work. Research published by BCG is based on survey findings and typically delves deeply into either a specific industry's business concern or regionally specific business issues, recently with a significant focus on emerging economies. Publications in 2010 that illustrate the depth and far-reaching impact BCG addresses include What's Next for Alternative Energy?; Big Prizes in Small Places: China's Rapidly Multiplying Pockets of Growth; and Winning in Emerging-Market Cities: A Guide to the World's Largest Growth Opportunity. BCG is recognized for expanding its deep regional insights in emerging economies supported by investments and proprietary resources, including BCG's China Center for Consumer Insight. As a company culture, BCG grows organically. Geographic areas of expansion for BCG in 2011 included Morocco, Africa; Istanbul, Turkey; and Canberra, Australia (sites of three new offices for BCG). Another area of growth for BCG is focusing on public issues and financial services clients. In Mexico and Latin America, BCG has been aggressive in preparing services around IFRS compliance by training staff and reducing services costs. BCG advocates for a systemic approach to some of the major concerns facing government organizations today: the growing pressure to get more results out of decreased funding; the difficulties in balancing economic and environmental necessities when addressing climate change; the need for effective and efficient social services in light of changing populations and demographics; and the mandate for transformation within large and complex government organizations. With that in mind, BCG works with clients to leverage its capabilities in three primary areas. First, its "Lean Productive Government" approach brings private sector best practices to areas of the public sector, including justice, health, welfare, defense, transportation, and education. Second, BCG's public sector sustainability and energy practice merges energy industry knowledge with public sector capabilities and social impact/sustainability experience. Third, the company's IT capability enables governments to get more out of its tech investments delivering programs on time and on budget and optimizing sourcing strategies, for example.
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For business consulting overall, BCG is seen as better than many of its peers at helping clients expand into new markets or geographies.
To advance as a leader in the U.S. Smart Cities sector, BCG must significantly improve client perception of its ability to help enterprises create a more effective business as well as its ability to provide industry insights and competence. Additionally, BCG should improve client perception of its ability to deliver value-creating innovation, directly improve clients' overall mission performance, help drive innovation through an organization, and integrate appropriate analytics into the engagement.
CSC
According to IDC analysis and buyer perception, CSC is an IDC MarketScape Major Player for business consulting for U.S. Smart Cities projects. CSC provides technology-led consulting to support the business and mission needs of clients, with approximately 96,000 employees as of September 2012. CSC has locations in 70 countries and offers consulting, systems integration, and outsourcing services organized in two main business units Global Business Services (GBS), which includes consulting and systems integration, and Global Infrastructure Services (GIS) and three incubator offers: cyber, cloud, and Big Data. CSC serves Global 1000 companies and national and local governments through five industry verticals: financial services, health services, manufacturing/A&D, public sector, and diversified. CSC is one of the last remaining independent IT services companies with global reach. CSC reports that in 2012, its GIS service line accounted for 40% of its revenue, while consulting contributed 20%. Applications, industry software, and others contribute the remaining 40%. With a new CEO, CSC has announced a multiyear transformation plan to fix the foundation in terms of costs, expand market coverage and drive demand, move up the value chain, scale next-generation infrastructure, and rationalize and standardize offerings. While the consulting workforce is globally balanced, different regions have developed particular strengths such as banking, insurance, retail, transportation, and manufacturing in continental Europe; public sector and healthcare in the United States and the United Kingdom; utilities in Latin America; and natural resources and public sector in Australia. The group has globalized these horizontal and vertical practices to radiate solutions to all regions. Growth at CSC comes from both acquisitions and targeted moves to increase market share organically. In 2011, CSC made the following acquisitions: finalization of the acquisition of iSOFT Group Ltd., one of the world's largest providers of advanced healthcare IT solutions; VIXIA Consultoria e Tecnologia Ltda., a So Paulo, Brazilbased IT services firm focused on providing core operational software, business consulting, and systems integration services to leading insurance, reinsurance, and financial institutions in Brazil; Maricom Systems Inc., which provides business intelligence and data management solutions that support mission-critical health information technology systems within the U.S. Department of Health and Human
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Services (HHS); and AppLabs Technologies Pvt. Ltd., the world's largest pure-play software testing and quality management service provider. Through its Leading Edge Forum (LEF) and the Barometer program, CSC continues to publish research that supports its growth strategy. In 2011, the LEF published a series of reports to glean new insights from data: Big Data and Data rEvolution. Survey results include Global CIO and SRM, as well as Customer Intimacy in Europe. The Barometer program also includes surveys for other CXO functions including human resources (HR), finance, and payments. CSC believes that governments operate more effectively with the right technology and partners with clients to develop systems that will help them address some of their biggest challenges. Much of CSC's tech-driven approach is focused on government clients in the United States and leverages IT solutions such as cloud, cybersecurity, communications, virtualization, datacenter, and infrastructure. This practice offers specialized business and technology capabilities, from mission and strategy development to business and policy impact analysis. In addition, BCG offers deep strategic expertise in functional areas as well as the service-oriented architecture, enterprise transformation, and technology solutions that support them. For example, CSC has worked with state health departments in Massachusetts (designing and launching a first-of-its-kind Web site to connect the uninsured with universal coverage); New York (implementing the country's largest, most technically sophisticated Medicaid Management Information System [MMIS]); and North Carolina (replacing the state's MMIS with a new healthcare administration system to manage other state agency health services in addition to Medicaid). CSC also worked with the state of California to migrate its multiple email applications to a cloud-based solution and the Maryland Department of Transportation to implement the Coordinated Highways Action Response Team, the first U.S. statewide intelligent transportation system, to improve highway safety and operating efficiency. The system monitors data traffic cameras, road sensors, and speed detectors and then shares it with more than 30 state agencies and the public. On the municipal level, CSC partnered with the city of Knoxville, Tennessee, to manage rising costs from work-related injuries by implementing software for risk management and claims processing, which ultimately lowered workers' compensation claims by $3 million. CSC's deep industry and business process expertise provides a lens through which CSC's broad spectrum of capabilities focus on client needs. The ability to expand across all regions and across all lines of service is the foundation for CSC's future growth. For business consulting overall, CSC is seen as among the most capable at helping drive innovation through a client organization.
In the U.S. Smart Cities sector, CSC is seen as most capable of all firms at helping drive innovation through an organization and at integrating appropriate analytics into an engagement. In addition, CSC is viewed as being among the most capable firms at maximizing the value of a project and is considered to be better than many of its peers at delivering value-creating innovation, directly improving clients' overall
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mission performance, helping enterprises create a more effective business, and transferring knowledge to the client. However, CSC must significantly improve client perception of its ability to integrate risk awareness and solutions within other consulting engagements, to leverage local and global staff appropriately, and to provide the necessary spectrum of business consulting services.
Deloitte
According to IDC analysis and buyer perception, Deloitte is an IDC MarketScape Leader for business consulting for U.S. Smart Cities projects. Deloitte is a global professional services organization, with more than 200,000 practitioners in 150+ countries. As a multiservice consultancy, Deloitte's depth and breadth of capability is key to its business-led approach. Services include: Enterprise risk Finance services (including audit and tax advisory services) Human capital Strategy and operations Technology services (full life-cycle technology including advise, implement, and manage) As a provider of both assurance and advisory services, Deloitte does not provide consulting services to its audit clients but does benefit from the strong client relationships it has established with audit customers. Deloitte advocates its proposed value of "executable strategy" with a broad services footprint to help clients from strategy development to execution. Deloitte believes this differentiates it from both the newly rejuvenated consulting offerings of the Big Four firms and the traditional or pure-play firms as well as outsourcing-led competitors. Deloitte is the only firm among the Big Four firms not to have divested its management consulting and technology business nearly a decade ago. Deloitte credits its strong growth to its breadth and depth of services, global reach with local perspectives, industry insights, and client-centric approach. Deloitte has industry specialties in all major sectors, including consumer business and transportation, energy and resources, financial services, life sciences and healthcare, manufacturing, public sector, real estate, technology, and media and telecommunications. Deloitte continues to evolve its industry model, serving 30 microindustry sectors across capabilities and geographies. Deloitte is focused on advancing its innovation culture and is investing in this area. John Levis was appointed global chief innovation officer to lead both innovation and Deloitte's integrated market offerings (IMOs). Deloitte has released an innovation framework called Four Cornerstones Innovation Framework and has recently expanded its Global Innovation Ecosystem. A key output of its innovation process is a portfolio of global integrated market offerings in which the firm integrates skills from a variety of practices and geographies across its service lines. The firm has a mature set of global IMOs through which
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Deloitte has enjoyed good momentum in the past several years and is continuously incubating new areas of investment. Its current IMO portfolio includes such areas as analytics, finance transformation, IFRS, M&A, risk, and sustainability. Deloitte also announced the launch of Deloitte Digital. Deloitte Digital combines the strengths of a creative agency, an IT consultancy, and an industry-centric business strategy provider into a single consultancy. Deloitte expects to help clients unleash the business value of these emerging technologies and domains. Deloitte Digital includes Deloitte's online- and subscription-based services to support the company's client demand for data and advanced analytics and for alternative delivery models. Deloitte is recognized as an employer of choice, as evidenced by its recognition in many independent rankings in North America, Europe, the Middle East, and Asia. Deloitte is known for promoting flexibility and customization for each individual employee's career path via its mass career customization (MCC) program and its development and adoption of corporate lattice career model where employees no longer move up and out in the antiquated "corporate ladder" structure but move more fluidly and flexibly throughout the organization as desire and demand requires. Deloitte has also made significant investments in training and education for its employees with Deloitte University, a state-of-the-art leadership development center near Dallas, Texas, which formally opened in October 2011. Deloitte University served more than 40,000 professionals from 70 countries over the past year. Deloitte is currently assessing whether to stand up similar campuses in Europe and Asia/Pacific. Deloitte's growth is both organic and through acquisition in key areas. Deloitte announced its plans this year to invest in certain priority markets, announcing a combined $750 million investment over the next three years in 11 priority markets. The investment program aims to expand client service and industry capabilities, bolster the hiring and deployment of top talent, and cultivate innovative new services and multidisciplinary offerings. In its last reported fiscal year 2012, Deloitte successfully completed 30 strategic acquisitions in its developed markets as well as Deloitte's priority markets and capability areas. Focused on acquiring assets of strategic importance such as strategy, digital, analytics, software as a service (SaaS), financial advisory, legal services, and consulting, several of the more recent highprofile transactions were: Aggressor, merging with existing capabilities to position Deloitte as a leading Workday integrator Bersin & Associates, a provider of research-based membership programs and advisory services in the human resources, talent, and learning market CRG, in the financial advisory area, to grow its financial restructuring, turnaround management, and bankruptcy reorganization capabilities Monitor Group, a leading global pure-play strategy firm, to enhance Deloitte's broad-reaching strategy and execution presence bermind and Daemon Quest to build upon its Digital and Customer capabilities Deloitte's U.S. State Sector practice has been serving state and local governments as well as higher education institutions for over 46 years. Applying a broad range of services including consulting, enterprise risk, tax and financial advisory services,
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Deloitte has worked with its clients to address their complex challenges and take on many of their most pressing issues. Over the past 5 years, Deloitte has served 47 of the 50 states, 8 of the 10 largest cities, and more than 200 institutions of higher education. Deloitte's U.S. State Sector practice focuses on the delivery of government transformation projects with a particular emphasis in health and human services, finance and administration, higher education, transportation, and labor and employment. Deloitte creates integrated and sustainable solutions focused on helping clients address a full spectrum of concerns including fiscal, process, policy, security, and technology. The company's research and insights analyze the major strategic, organizational, and technical issues facing state and local government organizations today and help clients understand how to apply leading best practices in disruptive innovation, emerging technologies, and new business models. The development of new cutting-edge services and recent acquisitions further strengthen Deloitte's footprint in the state sector industry. The acquisition and integration of Monitor has extended Deloitte's strategy and innovation capabilities, enabling the firm to capitalize on its deep industry experience and collaborate with clients to create executable strategies seeing them through to implementation. Deloitte's "Deloitte Digital" service line provides a range of cutting-edge technical services including strategy, mobile, social, Web, and digital content development, further positioning Deloitte to help states make significant strides in advancing their technical solutions and interactions with citizens. Finally, Deloitte's Innovation Centers, particularly, the Center for Health Solutions, the Center for Cyber Innovation, and the Center for Federal Innovation have delivered research and solutions to help state government clients creatively address top-of-mind issues including health reform, security and privacy, and complex data analytics. The combination of deep sector experience, research, and resources has positioned Deloitte to be a firm that states regularly turn to work through their most complex issues. For business consulting overall, Deloitte is considered to be the strongest of all firms across a number of key metrics. Deloitte is viewed as the most capable at integrating its project team with a client, maximizing the value of a project, meeting project timelines, and providing the necessary spectrum of business consulting services. Deloitte is also considered the best in the field when it comes to helping enterprises comply with new or existing regulations and leveraging local and global staff appropriately.
In the U.S. Smart Cities sector, Deloitte is seen as among the most capable of all firms at helping enterprises create a more effective business. Deloitte is also considered to be better than many of its peers at helping drive innovation through an organization, maximizing the value of a project, providing industry insights and competence, and providing the necessary spectrum of business consulting services. Conversely, Deloitte must significantly improve client perception of its ability to integrate risk awareness and solutions within other consulting engagements and its ability to transfer knowledge to the client. In addition, Deloitte should improve the perception of its ability to directly improve clients' overall mission performance, integrate appropriate analytics into an engagement, and leverage local and global staff appropriately.
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EY
According to IDC analysis and buyer perception, EY is an IDC MarketScape Major Player for business consulting for U.S. Smart Cities projects. EY is a partnership with 167,000 professionals as of June 2012 across 140 countries globally. With the appointment of Mark Weinberger as the global chairman and CEO, the professional services organization announced the adoption of EY as its global brand name, unveiled a new logo, and adopted "Building a better working world" as its purpose. EY's core business consulting services sit within EY's advisory organization and include service lines of risk advisory and IT risk advisory, as well as performance improvement (PI). EY also offers business consulting services beyond its advisory organization, including post-transaction integration services (transactions), tax-effective process advisory (e.g., supply chain and human capital) (tax), fraud investigation and disputes management (assurance), climate change and sustainability, and financial accounting advisory services (assurance). EY is well recognized for these capabilities in assurance, tax, and transactions, which sit outside of its advisory organization. EY is focused on growth in its business performance improvement and risk practices. Analytics is an important growth area to EY in both risk and PI, as evidenced by EY's recent continued acquisitions in this space. In 2011, these acquisitions included ISA Consulting (April Americas) and Partake Consulting (May Europe, the Middle East, India, and Africa [EMEIA]). EY has a globally integrated practice that serves large global companies as well as medium-sized global, regional, and national organizations and strategic growth companies. EY relies on its extensive business network to leverage long-term relationships with CFOs and other senior CXO executives. While EY is not targeting specifically the strategy consulting or enterprisewide systems integration markets, it considers its strategy and technology expertise as key enablers for its PI and risk services. This approach is aimed at maintaining EY's objectivity in the advice the company gives to clients. EY maintains strong relationships with and expertise in leading technology vendors and their products to ensure the company's professionals have the highest levels of technical expertise. EY's global reorganization has helped the firm deliver on engagements with clients globally. From 2009 to 2011, EY integrated its organization to form single management units in its Americas, EMEIA, and Asia/Pacific regions. EY has been investing in emerging markets and has built dominant practices in a number of geographies. Within its advisory service line, in 2012, EY experienced tremendous growth in Brazil, CIS, Korea, Sub-Saharan Africa, India, Mexico, Japan, Canada, Latin America, Belgium, the Netherlands, Germany, and Nordics. EY has continued to invest heavily in building its capabilities through bringing in groups of partners and other senior professionals from other consulting firms. This has been particularly significant in EY's performance improvement business, where it has increased staff numbers by over 40% without any large acquisitions. The following organizations have been brought into EY in the past 12 months, bringing key skills to specific geographies: Axia Value Chain cross-performance improvement (Brazil, December 2012), Resolve Group HR and change management (South Africa, October 2012), Q-Core Consulting financial services and analytics (South Africa, June 2012), Arrows Consulting performance
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improvement and BI (Japan, January 2012), Life Time Partners healthcare (January 2012), Galgana performance improvement (Spain, December 2012). Through its Global Enablement Center, EY supports and leads global research and innovation initiatives. EY also develops and delivers enhancements and extensions to its core methodology and accelerator as well as enhancements in its process and risk models. Four recent enablement center offering developments are enterprise intelligence, risk transformation, cost of controls, and finance transformation. EY has also established centers of excellence in its regions around specific services. For example, in EMEIA, there are supply chain, customer, finance transformation, risk transformation, IT transformation, information security, and outsourcing advisory centers of excellence. EY has also developed strong collaborative relationships with leading research/academic institutions, including the Risk Innovation Board, Tapestry Networks, and Innovation Value Institute. EY's service lines are integrated in front of the client through the role of the client service partner (CSP), a dedicated relationship management role. CSP's relationship role helps bring together services from across the whole of EY. EY does bring together such integrated services that pull from across all of its services. An example is tax-effective supply chain management that helps transform global supply chains through a holistic approach, which spans operations, tax, and risk. EY delivers through sectors and is deeply investing into sector-specific process and risk models (which include benchmarks from external sources like APQC and EY's own metrics) to deliver sector-specific value propositions. Consulting services most in demand in the past six months have included comprehensive enterprisewide cost reduction, analytics and enterprise intelligence, and information security and services to support organizations looking to grow their emerging market presence. EY has recently launched eight regional risk centers of excellence in growth and emerging markets that will act as hubs for services addressing strategic, operational, financial, IT, and compliance risks across each region and offer insight into local laws as well as local business and industry practices against a robust backdrop of global risk methodologies and international standards. EY acknowledges that policy makers are faced with rapidly evolving dynamics, involving such long-range and systemic trends as changing demographics, urbanization, and climate change. Add to this the ongoing fallout from the economic crisis tight budgets, slow growth and high unemployment and policy leaders must now make do with less, tasked with delivering services in line with rising expectations, while somehow boosting productivity and efficiency. EY works with clients in the government and public services sectors, with the aim of creating an entrepreneurial spirit, shaping policy and strategy, delivering performance improvement and organizational change, and harnessing funding and procurements through alliances with the private sector, as well as the full range of assurance, tax, advisory, and transaction services.
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For business consulting overall, EY is seen as among the most capable of all firms at challenging corporate culture and at supporting business changes across a client organization.
In the U.S. Smart Cities sector, EY is seen as most capable of all firms at helping enterprises create a more effective business and at leveraging local and global staff appropriately. Additionally, EY is viewed as among the most capable at directly improving a client's overall mission performance, providing industry insights and competence, and offering the necessary spectrum of business consulting services. EY is seen as better than many of its peers at helping drive innovation through an organization, integrating appropriate analytics into an engagement, maximizing the value of a project, and transferring knowledge to the client. Conversely, EY is seen to need significant improvement in how clients perceive its ability to integrate risk awareness and solutions within other consulting engagements.
IBM
According to IDC analysis and buyer perception, IBM is an IDC MarketScape Leader for business consulting for U.S. Smart Cities projects. IBM is one of the largest multidisciplinary consulting firms, with more than 200,000 employees globally in its combined services business and serves clients in more than 450 locations across 170 countries. IBM provides consulting services across a wide range of topics, functions, and industries. IBM has over 4,500 dedicated public sector professionals and provides consulting services to state and local agencies and organizations. IBM provides planning and management services for smarter public safety, urban planning, and building management, along with agency administration using social collaboration and cloud computing. IBM's infrastructure services help improve local governments' transportation, water, and energy systems. IBM's human services help improve agency social programs, healthcare, and education. In November 2012, IBM debuted a perspective that the world has been fundamentally transformed by rampant availability of data. This shift has created profound changes in how enterprises engage with customers, citizens, employees, and partners. IBM calls this new agenda "Front Office Transformation" and states it has two fundamental parts: The Digital Front Office: Rethinking of everything related to how people connect, transact, and engage with institutions, governments, and companies and how they create and capture value The Globally Integrated Enterprise: Transforming operations and infrastructure to optimize resources, enabling and funding these new ways of engaging, and becoming integrated, flexible, streamlined, and agile IBM proposes that market-leading enterprises of the future will focus in both areas improving service through a digital transformation of customer interactions and improved productivity through global integration. IBM believes that clients started on this journey from one of three points some started, for example, with a predictive analytics or digital marketing project to address a specific business concern, others
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started with a modernization project to find efficiencies to fund front-office innovation, and some have boldly taken on both approaches at the same time. IBM's ability to help clients achieve this new agenda is supported by a comprehensive IT consulting services and industry-specific IT and business solutions, like business analytics and Big Data, social business, smarter commerce, IBM's Intelligent Operations Center for Smarter Cities platform, and IBM's interactive, enterprise application, and application management services. At the forefront of IBM's capabilities for Front Office Transformation is its Strategy and Transformation practice, which has dedicated consulting teams for both the "front-office digitization" and the "globally integrated enterprise." Additionally, Strategy and Transformation has five functional areas: customer value strategy, finance and risk, operations and supply chain, technology strategy, and organization and people. IBM Strategy and Transformation consultants bring IP-based assets and accelerators to client engagements to deliver tangible benefits and provide an integrated, collaborative, and systematic approach to accelerate transformations. Unifying market offerings with both a technology and a business perspective does benefit clients, particularly when clients are faced with technology-rooted operational changes. For example, IBM's offerings for the Globally Integrated Enterprise are based on a four-phased methodology integrate, standardize, optimize, and elevate through analytics each with specific assets created and harvested from client engagements. Additionally, IBM will deploy its own internal functional experts from within IBM's finance, supply chain, and other departments to work directly with clients to share best practices from IBM's own transformation journey. These capabilities are often delivered to clients through Business Value Accelerator solutions, three- to six-week engagements that align the client's business and technology priorities. Through its Front Office Transformation strategy, IBM has expanded capabilities in areas that align with IBM's Smarter Cities growth priorities. The focus on Front Office Transformation is rooted in the explosion of data and opportunity resulting from the widespread adoption of technologies, like social business and analytics, by individuals and the instrumentation of business that is reshaping the possibilities for business innovation. In 2012, IBM trained 1,000+ management consulting partners on these growth initiatives, and that program is expected to grow in 2013. IBM has also made significant investments in collaboration, knowledge management, and assets by deliberately creating a culture of knowledge sharing and collaboration that rewards consultants that contribute and reuse knowledge. IBM has been at the forefront of the rise of new mission customers as influential IT decision makers. In 2012, IBM launched a systematic effort to accelerate development of the marketing function as a core buyer of technology-enabled solutions. IBM hosted a series of CFO, CMO, and CIO Leadership Exchanges, which brought together hundreds of senior client leaders in the United States, Europe, and Asia/Pacific to better understand the challenges and opportunities presented by the digitization of front-office functions. IBM has also developed a series of priorities for
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leadership in the new connected era, underscored by IBM's own leadership who's taken a personal role in publicly shaping their profession. IBM GBS continues to engage senior business leaders through its C-suite thought leadership developed by the IBM Institute for Business Value. In 2012, GBS published the largest ever study of CEOs/government leaders, finding that the issue they believe impacts their enterprises the most is no longer macroeconomic trends or talent or regulations but technology trends and the enterprise's ability to adapt quickly enough to capture a competitive advantage. For business consulting overall, IBM is seen as the most capable of all firms across several categories. Clients consider IBM the most capable of all firms at challenging corporate culture, delivering value-creating innovation, and providing functional or technical insights and competence. IBM is also seen as the most capable in its ability to help clients expand into new markets or geographies, drive innovation through their organizations, and improve their operational efficiency.
In the U.S. Smart Cities sector, IBM is seen as better than many of its peers at directly improving clients' overall mission performance, helping drive innovation through an organization, helping enterprises create a more effective business, integrating appropriate analytics into an engagement, and leveraging local and global staff appropriately. IBM is also considered to be better than many of its peers at integrating risk awareness and solutions within other consulting engagements, maximizing the value of a project, providing industry insights and competence, and offering the necessary spectrum of business consulting services. Conversely, IBM should improve the perception of its ability to transfer knowledge to the client.
KPMG
According to IDC analysis and buyer perception, KPMG is an IDC MarketScape Major Player for business consulting for U.S. Smart Cities projects. KPMG is a global network of professional firms providing audit, tax, and advisory services. The company operates in 156 countries and has more than 152,000 people working in member firms around the world. The independent member firms of the KPMG network are affiliated with KPMG International Cooperative ("KPMG International"), a Swiss entity. KPMG's Advisory service areas include management consulting, risk consulting, and transactions and restructuring. KPMG firms focus on the needs of clients, assessing what they require to achieve their objectives and then working across the globe to deploy the right skills and experience to deliver consistent, measurable value. KPMG's network of firms brings industry-specific solutions to address key client issues such as adapting to a changing world, efficiency and cost management, customer growth, embedding regulatory change, talent and human capital management, data, and insight and technology. KPMG professionals can provide value to clients with a keen ability to combine functional, operational, and technology consulting skills with deep experience in audit, risk, regulatory, tax, and M&A issues.
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KPMG's State and Local practice's 1,400 professionals (across audit, tax, and advisory) serve over 50% of the states, 60% of the largest cities, and 50% of the counties in the United States, with particular expertise in the areas of finance and accounting, transportation, health and human services, justice and security, education, and public retirement systems. KPMG assesses the needs of its state and local government clients by examining three main categories, namely: Business and service strategies Information technology enablers Organizational enablers Within each of these categories, KPMG has identified 20 electronic government elements that can be rated in terms of five stages in a life cycle of maturity. This framework demonstrates where state and local governments are in need of extending their capabilities. The gaps in the "as-is" and "to-be" maturity assessment are then used to assist clients in driving execution and transformation. KPMG's Cities Global Center of Excellence is composed of a dedicated team that brings together subject matter experts and industry professionals from around the world to share leading practices, knowledge, and experience. The Cities Global COE mission is to advise and support the sustainable development of cities and the effective provision of city services. One of the key services offered to KPMG clients through the Center is Information and Communication Technology (ICT) Innovation, including support for Smart City initiatives. KPMG's Cities Global COE uses an innovative Municipal Reference Model (MRM) that was developed collaboratively by KPMG and numerous municipalities. MRM assists and guides the implementation of new municipal transformation solutions. KPMG has demonstrated the use or application of the reference model on approximately 60 engagements, ranging from initiatives looking to reorganize city departments, to establishing a stronger governance framework, to developing Smart City solutions. At the core of the MRM is the concept of a city service, such as drinking water supply or garbage collection. One of the more progressive uses of the MRM is its ability to assist in bundling services. A typical city, for example, can bundle its services by several categories, including life-cycle stage (youth, adults, seniors), target group (unemployed, property owners, homeless), life event (about to move, just married, retiring), and needs (income, food, shelter). Service bundling for Cities enables them to become more "client centric" by offering electronic services in a manner that is more intuitive than traditional techniques. For business consulting overall, KPMG is viewed as the most capable of all firms at helping clients comply with regulations and at integrating risk awareness and solutions within other consulting engagements.
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In the U.S. Smart Cities sector, KPMG is seen as among the most capable firms at directly improving a client's overall mission performance, helping enterprises create a more effective business, and providing the necessary spectrum of business consulting services. KPMG is perceived as better than many of its peers at helping drive innovation through an organization, integrating appropriate analytics into an engagement, leveraging local and global staff appropriately, and maximizing the value of a project. KPMG is also viewed as better than many of its peers at providing industry insights and competence and at transferring knowledge to the client. Conversely, KPMG should improve client perception of its ability to integrate risk awareness and solutions within other consulting engagements.
McKinsey
According to IDC analysis and buyer perception, McKinsey & Co. is an IDC MarketScape Major Player for business consulting for U.S. Smart Cities projects. McKinsey is a globally recognized strategy consulting firm that was founded in 1926. McKinsey provides a combination of strategic and operations management services and has approximately 9,000 consultants in 90 offices across 51 countries. McKinsey defines its seven core functional practices as business technology office, corporate finance, marketing and sales, operations, organization, strategy, and risk. The firm organizes by industry specializations across 19 industry areas. Recently, McKinsey launched a special initiative dedicated to sustainability. Additional offerings include solutions that cover a range of current issues that are also organized by function and industry: global banking pools, climate desk, granular growth, and 16 others. McKinsey is often recognized as a leader among strategy firms. However, it is the firm's operations management consulting work that is growing as a result of client interest in the implementation of "actionable strategy." McKinsey responded to this demand with its recently launched McKinsey Solutions. This group of services is based on the firm's most distinctive and "packageable" proprietary knowledge (i.e., services based on proprietary databases, models, tools, and insights). These packaged services typically include an online service delivery platform (software as a service), enabling clients to make informed business decisions on a variety of topics in different functions (e.g., pricing), sectors (e.g., banking), and regions (e.g., China). This globally operating group within the firm has a central hub in Europe (Brussels/Louvain-la-Neuve, Belgium) and a rapidly increasing presence in North America and India. McKinsey serves numerous clients in the banking and financial services sectors. The financial services practice provides deep functional and regional expertise and capabilities that address strategic needs for all types of financial service institutions, from small banks to large investment institutions. McKinsey's Branch Insights solution area provides retail banks with an online platform to track and manage branch performance, providing actionable change based on utilization metrics. Within its functional areas of expertise, McKinsey remains relevant with thought leadership and studies focused on cost cutting in the finance organization. For instance, McKinsey draws comparisons between cost-reduction strategies and building appropriate functional competencies in its May 2010 research titled Five Ways CFOs Can Make Cost Cuts Stick.
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Through the McKinsey Center for Government (MCG), McKinsey brings external experts together with its own practitioners to create a network for research, collaboration, and innovation in government. Fusing both new and proven knowledge and tools, MCG works with governments and agencies dealing with limited resources to overcome challenges, build capabilities, continuously improve performance, and deliver more to constituents, all in an environment of limited resources. McKinsey believes that the execution issues in IT and infrastructure can be only partly solved by employee training; what's perhaps even more essential is enabling a shift in mindsets and behaviors. Additionally, overreliance on contractors can hamper the skills agencies need to build in their organizations; therefore, McKinsey believes agencies must learn how to work effectively with contractors, not be wholly dependent on them. Governments need to excel in four areas, according to McKinsey: project management, purchasing, process and customer service, and strategic planning. By building strengths in those functions, governments can avoid the most common stumbling blocks in IT, operations, and strategy. One of McKinsey's areas of focus is regulation in the field of public protection, including both regulatory and law enforcement agencies. As these organizations come under increased scrutiny with regard to their ability to anticipate threats, balanced with concerns about costs to tax payers and potential invasion of privacy, McKinsey believes they must rethink core management functions such as strategic planning, risk management, performance management, and recruiting and hiring to make better decisions and improve cost effectiveness. In concert with these practice areas, KPMG is studying in depth two areas critical to preserving public safety. The first area is cybersecurity; securing cyberspace is of paramount importance to governments, yet they have an insufficient understanding of the scale of the challenge. McKinsey believes that attacks on government data and systems, critical national infrastructure, and private enterprises' intellectual property carry the most risk, and the company has identified the elements of a next-generation cyberdefense and is conducting ongoing research on the primary threats that governments face as well as the various levers (such as tax strategy or civil litigation) they can use to counter these threats. Second, the company is researching connectivity with food and drug regulation in a global benchmarking and knowledge-development effort that covers topics important to food and medicalproducts regulators, such as inspection programs, the root causes of product recalls, and approaches to managing drug shortages. In medical-products regulation, MCG focuses on a number of specific issues, including enhancing human-subject protection in clinical trials and improving the security of the supply chain. With governments facing significant fiscal concerns, public finance is under intense pressure to increase transparency and improve performance. McKinsey's work in public finance addresses a broad array of issues, from examining macroeconomic trends and performing expenditure analysis to assessing and quantifying risk, redesigning IT infrastructure, and exploring new methods of revenue generation. Recent projects include developing a compliance and collections improvement strategy for a national tax authority and helping a government lender streamline the loan-approval process, yielding a 70% decrease in backlogs as well as an increase in employee morale and customer satisfaction. For business consulting overall, McKinsey is seen as among the most capable of all firms at helping clients expand into new markets or geographies.
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In the U.S. Smart Cities sector, McKinsey is seen as better than many of its peers at integrating risk awareness and solutions within consulting engagements. In terms of opportunities for advancement, McKinsey must significantly improve client perception of its ability to deliver value-creating innovation, directly improve a client's overall mission performance, help drive innovation through an organization, and help enterprises create a more effective business. With regard to the assets its teams bring to an engagement, McKinsey must significantly improve client perception of its ability to integrate appropriate analytics, leverage local and global staff appropriately, maximize the value of a project, and transfer knowledge to the client.
PricewaterhouseCoopers
According to IDC analysis and buyer perception, PricewaterhouseCoopers (PwC) is an IDC MarketScape Leader for business consulting for U.S. Smart Cities projects. PwC is a Big Four global professional services organization, established as a global network of member firms, with more than 30,000 people in 77 locations across the United States. PwC serves client organizations across all industry sectors and functional areas. PwC provides services through three divisions or "lines of service": assurance, tax, and advisory. From strategy through execution, PwC Advisory helps clients build their next competitive advantage. Its Assurance practice collaborates with clients so that the financial information they report to the investing public and other stakeholders is clear and reliable. Through its Tax practice, PwC assists businesses, individuals, and organizations with tax strategy, planning, and compliance, while also delivering a wide range of business advisory services. PwC's Center for State and Local Government is organized within the Public Sector Practice. Nearly 10,000 PwC partners and staff around the world are serving government and public services clients. PwC's vision for its State and Local Government Practice is to "help state and local governments connect citizens to government, plan and drive investments, and increase efficiency to promote long-term economic, environmental, social, and cultural prosperity." Within the execution of this strategy, PwC focuses its service offerings on the trends that impact all levels of state and local government around the nation: Economic development focuses on driving action to promote economic growth and sustainable development, generate employment opportunities, and realize sustained economic development. Sustainability focuses on promoting sustainability, integrating sustainable development concepts into broader operations, and realizing cost efficiency and short-term and long-term benefits from sustainability initiatives. Health focuses on understanding changing demographics, innovation in care and management, cost pressures, and legislative change and managing care for millions of citizens, including paying, providing, measuring, and regulating healthcare through regulatory and policy analysis, business process reengineering, health IT systems design, and strategic program management. Utilities focuses on strategy, planning, and implementation advice to utilities that receive public funds, including large power, water, and energy companies.
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Transportation focuses on working collaboratively to rethink service delivery models, plan for future investments, and deliver on the promise of technology and innovation through strategy, analytical, and program management services, as well as specific support in key areas such as transportation payments, asset management, customer engagement, capital improvements, technology management, and operational efficiency. Fiscal management focuses on wide-reaching financial implications of state and local government decision making, including expenditure analysis, revenue analysis, investment optimization, sourcing strategies, and public/private partnership structuring. Program management focuses on a strategic approach to managing projects across agencies and organizations, program management, project management, quality assurance, vendor management, procurement management, and program management competency design. Technology focuses on how to get the most of technology assets, ensure organizational and technology goals are aligned, plan for future technology investments, address enterprise architecture planning needs, develop focused technology strategies, conduct transparent technology selections, execute technology organizational improvements, deliver technology projects successfully, evaluate information security, and ensure business continuity management. Operations and organization focuses on efficient operations, aligning operations with organizational goals and executing on operational improvements through supply chain optimization, customer contact operations, maintenance, asset management, payment processing, and administrative functions. Additionally, it focuses on understanding staffing needs to design more effective organizations and to manage organizational change, as well as specialized shared services, talent management, and compensation planning services. Strategy focuses on organizational mission, vision, and high-level goals and translates these into tangible strategic plans and specific actions through executive working sessions, extensive benchmarking, organizational analysis, and performance management to build strategies, plan for execution, and evaluate progress. Through a continually evolving project created for cities, their leaders, businesses, and citizens seeking to improve their economies and quality of life, PwC developed the comprehensive study, Cities of Opportunity, which provides a framework for thought and action among the world's and the United States' most significant cities. The latest fifth edition includes analysis of 27 cities that exemplify a key capital market center, represent a broad geographic sampling, and comprise both mature and emerging economies. For business consulting overall, PricewaterhouseCoopers is seen as most capable of all firms at helping clients reduce costs and at leveraging local and global staff appropriately.
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In the U.S. Smart Cities sector, PwC is seen as most capable of all firms at integrating risk awareness and solutions within other consulting engagements and at providing the necessary spectrum of business consulting services. Additionally, PwC is considered to be among the most capable at helping drive innovation through an organization, leveraging local and global staff appropriately, maximizing the value of a project, and providing industry insights and competence. PwC is perceived to be better than many of its peers at directly improving clients' overall mission performance, helping enterprises create a more effective business, integrating appropriate analytics into an engagement, and transferring knowledge to the client.
ESSENTIAL GUIDANCE
Guidance for Buyers of Consulting Services for U.S. Smart Cities Projects
Business requirements demand solutions that work holistically within an enterprise. These solutions are often complex and require a multiple domains of expertise and stakeholders from a variety of areas to ensure success. As a result, consulting projects are often complex. To maximize value and minimize disruption enterprise leaders must: Assure project is strategically valuable to assure full organizational commitment to change. Create visible links between project strategy and "mission execution." Integrate all impacted departments/LOBs throughout the project to ensure stakeholder needs are fully satisfied. Anticipate and address the common obstacles to successful consulting projects. Avoid scope creep. Plan for sufficient organizational change. Commit sufficient internal resources to the project.
As Smart City projects often have a transformational component, it is also important that city buyers begin to explicitly state the need for innovative solutions or ideas in RFPs and throughout the procurement process. Cities often complain that consulting firms do not bring innovation into the process as they would in private sector accounts; this may be true, but part of the onus for this is on city buyers themselves. With procurement processes that are highly specific and often with rigid paperwork requirements, cities must ensure that innovation and transformation are integrated in to Smart City project requirements.
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Related Research
IDC MarketScape: EMEA Business Consulting Services 2013 Vendor Analysis (IDC #239504, February 2013) IDC MarketScape: Worldwide Business Consulting Services 2013 Vendor Analysis (IDC #239484, February 2013) IDC MarketScape: Americas Business Consulting Services 2013 Vendor Analysis (IDC #239482, February 2013) IDC MarketScape: Asia/Pacific Business Consulting Services 2013 Vendor Analysis (IDC #239483, February 2013) IDC MarketScape: Worldwide Financial Services Consulting 2012 Vendor Analysis (IDC #236018, July 2012) IDC MarketScape: Worldwide Strategy Consulting Services 2012 Vendor Analysis (IDC #236019, July 2012) IDC MarketScape: Worldwide Operations Consulting Services 2012 Vendor Analysis (IDC #236022, July 2012) IDC MarketScape: Worldwide Finance and Accounting Consulting Services 2012 Vendor Analysis (IDC #236122, July 2012)
Synopsis
This IDC study uses the IDC MarketScape model to provide an assessment of a number of providers participating in the U.S. business consulting services for Smart Cities market. The IDC MarketScape is an evaluation based on a comprehensive framework and a set of parameters that assesses providers relative to one another and to those factors expected to be most conducive to success in a given market during both the short term and the long term. "While consulting providers are generally perceived as capable, buyers of consulting services believe consulting vendors sometimes fail to meet their projected return on investment. This vendor analysis shows that some vendors are better able to produce meaningful results than others." Cushing Anderson, vice president, Business Consulting Services research
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COMPETITIVE ANALYSIS IDC MarketScape: U.S.

Business Consulting Services for Smart Cities 2013 Vendor Analysis

IDC MarketScape Vendor Inclusion Criteria

Weighting Evaluation Criteria

Strategies Criteria Offering strategy

Functionality or offering road map

Other offering strategies

Pricing model Sales/distribution strategy

Strategies Criteria Customer service strategy

Innovation/R&D pace and productivity

Business strategy total

Capabilities Criteria Offering capabilities Functionality/offering delivered

Delivery model appropriateness and execution

Portfolio benefits delivered

Other offering capabilities

Pricing model options and alignment Sales/distribution structure, capabilities

Not used in this evaluation. Not used in this evaluation.

Growth strategy execution

Other business capabilities

Business capabilities total

Capabilities Criteria 5.0 3.0 2.0 10.0

5.0 3.0 2.0 10.0

Source: IDC, 2013

Boston Consulting Group

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