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Almighty Andersen Andersen Consulting is the world's largest management consulting firm. With more than 50,000 consultants and over 65,000 employees, Andersen Consulting can draw from a vast array of industrial and technical expertise. Consultants in its four competencies (change management, process, strategic services, and technology) work together to design strategies for more than half of the Fortune 500 in America, as well as for many of the other top corporations worldwide. The company's deep staffing and technological savvy enable it to bring both focus and massive manpower to any consulting task. A huge firm Andersen Consulting has more than 65,000 employees and offices in 48 different countries. The consultancy works with over 5,000 client organizations worldwide, and is growing at the rapid rate of 20 percent annually (or more!). Revenues in 1999 were $8.9 billion - up 8 percent - with e-commerce revenues estimated to be $1.5 billion of the total. The latest on the soap opera In December 1997, Andersen Consulting famously petitioned to break away from Arthur Andersen, its sibling under the Andersen Worldwide umbrella. Making the divorce final could be costly. Partners who leave Andersen Worldwide, under the company contract, must pay 1.5 times annual revenue. That could mean that, to be allowed to split from Arthur Andersen, AC might have to pay up to $13.5 billion to Arthur Andersen. It is also possible that Andersen Consulting will lose access to the vaunted Andersen training facilities, and even the right to use the Andersen name. The issue of payment is under arbitration, and Andersen Consulting expects an answer by the end of July 2000. The split with Arthur Andersen is not projected to cause serious problems with Andersen Consulting's clientele - the firm estimates that "fewer than 5 percent" of Andersen Consulting clients also use Arthur Andersen's audit or tax services.
Shaheen jumps ship Andersen CEO George Shaheen retired in September 1999 to fill the chief executive position at Webvan, an online grocery delivery service. Initially Shaheen had intended to retire sometime in 2000, but Webvan required that he depart earlier. Shaheen is credited with Andersen Consulting's massive success in the late 1990s, including five straight years of at least 20 percent revenue growth.
Forehand comes to the fore In November 1999 Joe W. Forehand was named Shaheen's successor as CEO and managing partner. Forehand has been at Andersen Consulting since 1972, and has been a partner at the company since 1982. Prior to being named CEO, Forehand was Andersen's managing partner of global communications and high tech. The new chief executive's calm demeanor is expected to be a soothing force during the tumult caused by the row with Arthur Andersen. But Forehand is not in power simply to pacify agitated parties. He has a plan for Andersen's future that involves a push to make e-commerce the focus of the firm. The new CEO also wants to take a more active role in the Internet economy by investing in online ventures and using consultants' ideas to start businesses. Growth through outsourcing A major source of growth for Andersen Consulting has historically been its Business Process Management (BPM) unit. BPM works with clients over a period of years, actually taking over key departments like logistics, human resources, information technology, and finance. By outsourcing these non-core groups, clients save money. Andersen's careful cost management has made BPM quite popular. For example, the company currently staffs 400 consultants at DuPont, managing DuPont finance and order processing systems. The methodology takes hold Andersen Consulting is no Garden of Eden for nonconformists. The nickname "Andersen Android" (or even just "Android") has some basis in fact by most accounts. It's no surprise that Andersen, except perhaps for its cohort of strategic consultants, is a regimented firm, a fact highlighted by the firm's emphasis on training. Since 1997, Andersen has been promoting its Business Integration Model, a system of interconnected client services. (The BIM gospel is preached from the mount - that is, Andersen's main training facility, a former college campus in St. Charles, Illinois.) The goal is to mold Andersen consultants into team players who use a uniform process to achieve a common goal. Though perhaps lacking in flair, the system allows Andersen to offer standardized solutions and permit consultants from disparate offices and backgrounds to work well together (important for a firm with more than 65,000 employees). Former chairman George Shaheen once pointed out that this approach also means "we don't have to start from scratch each time." Pushing into the IT market In 1999, IT services revenues industry-wide leapt more than 9 percent to $288.7 billion. By 2003, that figure is expected to reach nearly $468 billion, and Andersen Consulting is poised to win a good chunk of that business. While revenue growth in 1999 was only 8 percent - paltry compared to 1998's astounding growth rate of almost 25 percent - Andersen estimated its e-business revenues at $1.5 billion in 1999, triple 1998's total. Andersen's Government unit led the firm in growth, with a 35 percent increase over 1998, with the Communications & High Tech group coming in second with a 22 percent increase. Andersen's numbers in 1999 were hurt both by what the company termed an "industry slowdown caused by buyers delaying their consulting investments until after 2000" and negative or flat growth in three of its global market units - Resources, Products, and Financial Services. All about technology In March 2000, the firm expanded its relationship with Microsoft, entering a $1 billion joint venture intended to provide large-scale enterprise solutions by creating a new organization within AC that will design Microsoft-based business solutions. The deal calls for the formation of a joint company called Avanade, which will focus exclusively on creating Internet platform services based on the Windows 2000 OS. The pact between AC and Microsoft will add an estimated 3,000 new tech jobs to the payroll. Andersen had already been boosting its e-commerce staffing, and introduced a $10 million global advertising campaign to promote its e-commerce consulting practice in early 2000. In addition, 14,000 Andersen consultants are currently taking internal classes to help improve their e-commerce expertise. New ventures for Andersen With unemployment at record lows, Andersen is aggressively combating the appeal of working at a dot-com with several new economy initatives of its own. In December 1999, Andersen announced that it was forming a venture capital subsidiary that would invest $1 billion in e-commerce businesses in the next five years. Called Andersen Consulting Ventures and based in Palo Alto, CA, the new unit will be led by Andersen's former managing partner in charge of global markets, Jack Wilson. Let's do launch Andersen got in on the incubation game in February 2000 with the creation of 17 "Dot-Com Launch Centres" worldwide to help startups get off the ground (though the company maintains that the "centres" are not actually incubators because they will work with companies that already have management and financial support in place). AC will take equity from the startups as partial compensation for its services. Like its peers, Andersen is trying to fight the exodus of its employees to Internet startups by providing a modified version of the startup experience for them. Another Andersen initiative, announced in March 2000, will invest $200 million in e-commerce-related companies on behalf of its employees. The program, which was designed to attract and retain high-performing employees, will continue to invest $100 million each year and will distribute the wealth created by the investments to employees in the form of "eUnits." At the same time, CEO Forehand announced that Andersen's partnership ranks will double in 2000, adding more than 1,000 new partners worldwide.
Andersen has a very high profile on campuses as it aggressively recruits top candidates. "Andersen is desperately trying to get top-tier people into the company," says one candidate. "They even flew over people from the London office just to take people to a baseball game. It was ridiculous. Because of the time difference it was about 3 in the morning for them by the time they arrived. The partner I was talking to was falling asleep." Candidates have two interviews on campus. The first is with one person, the second with two people (normally partners or experienced managers, though usually also a peer). After making it through these screening rounds, there is a day at the nearest office. There are apparently minor differences between offices and campuses; some candidates have had a second round with three managers or partners at an Andersen office. While candidates do have the option to fly out to visit the office of their interest, "it isn't necessary to interview where you want to work, except in the case of San Francisco [a very popular office location]. Contacts say Andersen makes its big push "at sell weekend, which is very structured." Reports one insider: "The first day is in the office and features a series of meetings with the various industry groups. They provide much more specific information than you get in the recruitment brochures. There is also the opportunity to speak one-on-one with peers, and you go out to wining and dining things and to a show." Apparently, no one ever mentions Arthur Andersen. The statistics behind getting a job at Andersen are truly daunting. Andersen received 3 million resumes in 1998, and gave 900 recruiters the job of plowing through them. Of those resumes, 1.8 million were from recent college grads, the other 1.2 million from other candidates. Of these numbers, 200,000 get an initial interview. Half of those are called back for two hour-long interviews. Ultimately, Andersen makes 20,000 job offers. About 75 percent of candidates accept their job offers every year. Andersen has identified eight characteristics that it believes makes a successful Andersen consultant. Partner in charge of human resources Carol Meyer told Forbes, "We took a step back and asked 'What makes [former managing partner and CEO] George Shaheen and other top partners successful?'" The answer? A minimum 3.2 GPA, critical thinking, the ability to be a self-starter, and to juggle multiple activities. Teamwork is also vital, as is a taste for extensive and frequent travel. Andersen recruits at more than 300 United States universities and colleges. These include big names like Harvard, Midwestern powers like Northwestern and the University of Illinois, and Bradley University - George Shaheen's alma mater. (With Auburn University alum Joe Forehand on board, that school will likely see an increased recruiting effort.) Andersen also heavily targets MBAs. In 1998, according to Forbes, Andersen sent 30 recruiters to the Kellogg Graduate School of Management, coming up with 13 recruits.
The place to be Many consultants opine that "Andersen Consulting is the place for exciting opportunities and highly visible clients." One employee explains that the firm "is entrepreneurial in the sense that employees can control their own career paths." Consultants travel so frequently that their "home lives often fall into shambles," but they are "rewarded with good salaries." Andersen Consulting also offers a plethora of perks - "free flights, great social events, relaxed expense policies, and expensed dinners at great restaurants." One outstanding perk - a "concierge service that runs errands for a subsidized rate of $5 an hour. They'll feed your cat, take your car in for service, whatever you need." See you in the office on Friday? Andersen has a "Friday in the office policy" under which the firm makes an effort to fly back its consultants to their home offices on Thursday night. Says one former consultant about Fridays: "I was usually back in the office. Fridays are mostly for administrative stuff - internal development, evaluations, training." Weekend work is "rare but does happen." A business process management consultant agrees with that time assessment. "I work about 55 hours a week and bill 60. The policy is that your work hours are 8:30 to 5:30 and if you go over that you get overtime." Every service line except for strategy gets overtime. "Strategy will bill up to 10 hours a day, but after that they don't bother." Thanks for the comp time But while strategic consultants don't get overtime, they may get "comp time. What happens is that you work like a dog for six months and then you're done. Your manager says, 'It's Wednesday, take Thursday and Friday off.' It's separate from your vacation time, and just gets billed to some random black hole account." In times of crisis, however, the Friday in the office policy shifts. Says one insider: "Despite the Friday in the office policy, I have often stayed at the client site five days a week with no trip home. I have heard of some consultants who worked through the weekend at the client with no trip home." Tough hours While Andersen Consulting employees are reportedly "a fun-loving, hardworking, thinking group of people" and the scope of work is "global," the hours are "crazy" and the firm itself is "not as prestigious as other consulting firms yet." "The work can be great," says one employee, "but it wears you down after a while. It's tough on personal relationships because you travel so much. You can start to feel like a number sometimes." We hear that "rank is everything. Things aren't as meritocratic as you might expect." One consultant warns that "you need to be flexible and be able to handle a lot of stress." Mother Andersen On the whole, however, Andersen Consulting is said to be a "very cohesive, very friendly firm." "There is a distinctive Andersen-speak," says one consultant, "and maybe it does sound like android language to others, I don't know." "Leaving Andersen Consulting is like getting a divorce," says a former consultant. "The company has one of the strongest cultures I have ever seen. You have to be bright, and it helps to be cheerful. Most of all, you have to be driven by an extremely strong desire to succeed and be willing to buckle down and do what it takes."
Human Resources
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