4. Competitor Analysis

Competition can be expressed in several forms:

The strongest competition - a complete lack of consulting services, companies prefer to do their own efforts in the development of businesses, organizations and improving the supply chain and market research. Managers of these companies deal with these issues themselves, as it is a part of their official duties. A key factor that gives Marktune superiority in competition with these companies is the fact that these managers do not normally have time to deal with additional responsibilities in the areas of market development and organization of a new distribution network. In addition, Marktune has the opportunity to negotiate confidentially with partners, suppliers, marketing organizations to collect information and conduct preliminary meetings.

Highly prestigious consulting firms: McKinsey, Ernst&Young, Boston Consulting Group, etc. These companies are the largest representatives. They consult management in certain areas, and their names mean a lot. However, the weakness of these companies is their organizational structure, companies attract partners for cooperation that are inexperienced assistants. Being a good expert in certain areas of the economy, Marktune can compete with these organizations. The company guarantees that the actual work for them will be performed by qualified professionals.

The third type of competitor is a company specializing in individual market segments: BDO Unicon Consulting, IBS, FBK Consulting, etc. These formidable rivals in the publishing market research and conducting all sorts of forums and seminars on the issue of market relations. But these firms are not able to provide highly professional consulting services, which provides Marktune. This group will be the major competing group for Marktune.

The fourth type of competitor represented by small specialized companies.

The number of competitors in management consulting offering services similar as Marktune is extensive and can come from a number of international companies as well as small local competitors.

The major consulting companies with international focus are⁴⁵:

Ernst & Young Group is a global management consulting firm with fully integrated capabilities in strategy, operations, people, and information management. The company had an estimated 60,000 employee.

McKinsey and Company, Inc., a generalist consulting firm, is perhaps the best known of the generalist management consulting organizations. Founded in 1926, McKinsey experienced tremendous growth in the 1980s and 1990s, expanding to more than 11,000 professionals and a total of 84 offices by 2001. Most of this growth for McKinsey came from international expansion. McKinsey provides consulting services that address top management issues for large organizations. The majority of its work is in the area of strategy and organization. The remainder is conducted in specialized practice areas such as marketing, manufacturing, and technology. The company has been working in Russia since 1992. The company operates in the field of corporate finance, marketing, operational consulting, mergers and acquisitions, strategic consulting, build and launch a new business, human resource management, financial advisory services.

The largest accountancy in the world, PricewaterhouseCoopers was created by the high-profile 1998 merger of Big Six rivals Price Waterhouse and Coopers & Lybrand. Like other international companies, PricewaterhouseCoopers has suffered from internal tension between its accounting and consulting arms; the company was considering splitting into two separate entities. In 2001 the firm brought in an estimated $20 billion in sales, and operations spanned over 150 countries. The company first appeared in Russia in 1913, and in 1989 it resumed its activities. PWC has offices in Moscow, St. Petersburg, Yuzhno-Sakhalinsk, Togliatti. The main activities are services for audits of financial and accounting, tax and legal consulting, corporate training, support large transactions. In 2002, IT wing of the consulting areas acquired by IBM and renamed the IBM Business Consulting Services (strategy, optimization of processes and structures, financial management, implementation of ERP, CRM, SCM, HR, outsourcing of business functions).

Accenture Ltd., formerly known as Andersen Consulting, is one of the world's largest management consulting firms, with more than $13.3 billion in revenues and 75,000 employees in 2001. The consulting wing had grown to match the accounting business in terms of revenues in the late 1990s, with big banks and communications companies as some of its largest clients. The company has been working in Russia since 1992. It operates in development and implementation of business solutions based on IT products (ERP production SAP, Microsoft, Oracle; CRM, CSM), mergers and acquisitions, strategic planning and business architecture, business process optimization, management financial, customer relationship management, management of value chains cycle and logistics, human resources development, the strategy of information and implementation of information technology solutions, software development, outsourcing.

Deloitte Consulting founded in 2002 as a result of the separation consulting business of Deloitte & Touch (a member of the Big Four). The company focuses on implementation of ERP-systems based on SAP and Oracle, mergers and acquisitions, financial strategies and business reorganization.

Bearing Point Russia separated from KPMG (member of the Big Four) in 2002, as a result of the separation of audit and consulting businesses. The company operates in implementation of business applications based on mySAP Business Suite and Oracle E-Business Suite, optimization of business processes, tax consulting, development regulations in the field of cost accounting, accounting and budgeting.

The Boston Consulting Group (BCG) - an international consulting company (strategic consulting and strategy development, creation of new business processes). The company operates in the Russian market since 1990, the Moscow office was opened in 1994.

Roland Berger is international consulting company. First projects were implemented in the Soviet Union (1988). In 1994 the company opened a Moscow office with a full range of consulting services: market research, development of industry and corporate strategies, business restructuring, cost optimization, etc.

Monitor Group. International consulting company in Russia came in 1996. The company focuses on strategic consulting and programs to improve shareholder value, mergers and acquisitions, valuations, structural optimization with mergers and joint ventures, market entry strategy, the development of innovative processes and designing new products, corporate training, investment banking activities.

A. T. Kearney - international consulting company has been working in Russia since 1992. The company implements forecasting and research of national markets, information systems audit, IT development strategy.

Local companies with focus on traditional consulting services

ROEL Consulting established in 1995, specializing in the restructuring of industrial enterprises in the transition to a market economy. The company actively participates in regional development programs of regional and sectored industrial complexes. Since 2004 it works with the Ministry of Regional Development. ROEL Consulting develops strategies, marketing research, optimization of management, support of organizational changes, personnel management, financial management, optimization of business processes, implementation of ERP-systems, training.

BDO Unicon Consulting. Company UNICON / MS, from which the BDO Unicon Consulting, founded in 1989 as audit and consulting company, and in 1991 it implemented a project of incorporation and privatization of KAMAZ, initiated a mass privatization in Russia. Since 1994 the company actively promoted the IT area, which allowed since 2001 to initiate work on the implementation of management software SAP R / 3 and Oracle E-Business Suite, Microsoft Axapta. Since 2002 BDO Unicon Consulting becomes a member of the international audit networks BDO International. The company focuses on optimization of system management, development of corporate strategy and the strategy of information, optimization of business processes, financial management, HR-resources management, information technology solutions based on SAP, ORACLE and Microsoft Axapta. The company participates in the work of Advisory Board of the Ministry of Economic Development and Trade of the Russian Federation on issues of management accounting.

Audit-consulting group Business Systems Development. The company founded in 2001. Since 2004 it becomes member of the international auditing and consulting network IGAF Worldwide. The company releases IT-consulting and systems integration, integrated automation, audit of existing information systems, market research and strategic planning, mergers and acquisitions, business restructuring, comprehensive solutions for strategic, corporate, financial and investment management, accounting, taxation, business law, personnel management and public relations, audits, training, evaluation activity, complex projects of reform of natural monopolies and utilities, development and implementation of integrated systems for the management of federal and regional budgetary systems.

PRADO Banker and Consultant founded in 1997, initially specialized in the audit, the provision of IT services, legal consulting. Now the company engaged in strategy development and optimization of organizational structure, diagnosis management, marketing and sales, finance and management consulting, IT solutions (using a family of software products 1C: Enterprise; and the technology of its own design), audit, tax, law, corporate training and recruitment, banking services, corporate finance.

FBK-Consulting founded in 1990. Since 1995 it became member of the international auditing and consulting association of PKF. The company provides audit of financial statements, tax audits and tax planning, business audits, evaluation of activities, services in accounting, legal consulting, financial investigations, IT audit, IT strategy, implementation and support of business solutions based on mySAP Business Suite, Oracle E-Business Suite, MS Axapta, Galaxy, business development strategy, financial and management consulting, HR consulting. Actively cooperates with the Council for audit activities with the Ministry of Finance of Russia, particularly in the development of new auditing standards.

United Consultants FDP founded in 1992. The group provides tax consulting, audit and evaluation activity, strategy development, optimization of business processes, legal consulting, tax accounting and management, development and implementation of information systems. FDP positioned as a leader in tax consulting.

Local companies specialized in IT

IBS founded in 1992. The beginning of activities was distribution of IT equipment, automation of banks, later as automation of trading enterprises and telecommunications companies. The company is the largest players in the Russian market of computer software. Since 1996, it positioned as a system integrator. The first of the Russian system integrators, have implemented R / 3 (SAP AG) without the involvement of external consultants (2000). The company focuses on implementation of ERP-systems of production SAP AG, MBS, Oracle, 1C, information-analytical systems, CRM, SCM, optimization, and outsourcing of IT infrastructure, IT services and IT auditing, financial consulting, optimization of control systems, reengineering business processes, business restructuring, the introduction of project management, HR-consulting.

IT founded in 1990, initially - the supplier of computer equipment, software development, and system integration. In 2000, the unit has been established IT consulting, since 2002 is adaptation of the ERP-system (SAP AG, MBS, Oracle), and since 2004, the company offers services for IT outsourcing. IT designed software BOSS-HR that is recognized as the best instrument in Russian HR-Management. The company releases implementation, support and maintenance of IT systems, including automation systems management, IT infrastructure, systems and information technology security training in IT and management, management consulting, business process optimization, HR-consulting.

Compulink established in 1993, a major player in the Russian computer market. In 2004, acquired a controlling stake in consulting company GMCS, engaged in management consulting and implementation of ERP (Oracle, SAP and MS Axapta). Compulink engaged in optimization of control systems and business processes, consulting the federal and regional governments and municipalities, development of IT strategies for optimization of IT services, the introduction of ERP-system MS Dynamics AX (formerly MS Axapta), Oracle E-Business Suite, Oracle CRM, mySAP Business Suite, mySAP All-in-One, SAP Business One, SSA ERP (Baan), BOSS-HR; IT infrastructure services, supply and service of IT equipment, manufacture of computer equipment.

Borlase established in 1991, a major player in the market of IT services. Since 1996, working with Oracle, is actively developing activities to introduce ERP based on Oracle EBS. In 2004 creates the Department of HR-consulting, in 2005 - the department of business consulting. Specializes in business projects with IT components, strategic management, restructuring and consulting in the field of labour, streamline business processes and organizational structures, financial management, automation systems, personnel management, developing IT strategies, performance audits of information systems, implementation of business applications based on Oracle E-Business Suite and mySAP Business Suite, means of information protection, maintenance of IT infrastructure, training in IT.

Table 6 displays the biggest consulting companies in Russia.

Table 6. The largest consulting companies in Russia in 2009⁴⁶.

Table 7 displays the major competitors of Marktune in different consulting areas.

Table 7. The major competitors of Marktune in main consulting areas

Niche competitor analysis

The primary niche competitors of Marktune will be companies that offer marketing consulting products. The competitor analysis displayed on Tables 8. Due to generally high quality of products, orientation to customer exclusivity, after sales services, maintaining high standards and company reputation, the better price/quality ratio Marktune intends to outperform the other companies. The competitors with highest integrated performance scores will be FinExpertisa and Gorislavzev & Co.

Legend 5=excellent; 1=poor

Table 8. The major niche competitors of Marktune.

Competitive strengths and weaknesses of companies that operate in niche of Marktune depicted in Table 9.

Table 9. Strengths and weaknesses of niche competitors.

Taking in consideration competitive analysis and consulting market preconditions Marktune should maintain stated standards and guarantee high quality of services. The management of the new venture has a plan to build strong consulting brand. The main targets of the company to reach competitive advantage will be:

- maintaining low level of employee turnover to guarantee better quality of services and highly qualified consulting staff;

- outstanding marketing and sales activities that supported by sufficient marketing budgets and the best sales personnel;

- establishing controlling system to monitor introduced criteria of competitiveness of the new venture;

- high position in consulting ratings and rankings;

- finding partners in other regions;

- better prices for offered services;

- superior methods of work with clients;

- high responsibility and punctuality while serving the clients;

- free client support of the project (amendments) after implementing the orders.

The basis for growing the venture is reflected in the following three strategies:

Priority 1: Market penetration due to lower prices and better quality of consulting services.

Priority 2. Launching new products and services. Initial consulting services of the new venture will be offering business planning services, marketing research and positioning services, development of clients’ strategy, marketing and sales policies. With growing of Marktune business the new venture will offer installation of CRM and ERP systems, HR services and hiring top executive personnel for specific clients’ demand, financial planning, cost and capital advisory.

Priority 3: Enter new geographic markets (Russian regions, Ukraine, Kazakhstan).