STAGES OF

MANAGEMENT
CONSULTING
ENGAGEMENT
PART II

A. Problem Identification and Desired

Outcome
B. Identification of Suitable and Accurate
Sources of Information and DataGathering
C.
Data
Analysis
and
Diagnosis
III. Conducting a Consulting

Assignment
D. Solution Development
E. Preparation and Presentation of the
Report and Recommended Solution
F. Implementation
G. Follow-up Evaluation of the
Implemented Solution

Generation of Solution Alternatives

D. Solution Development
Evaluation of Solution Alternatives
Choice of the Preferred Solution Alternative
Detailed development
of the
G. Follow-up
Evaluation
ofselected
the solution
Implemented Solution

Pattern Recognition and Matching

Approach
Emphasizes experience

Generation of Solution Alternatives

Brainstorming Approach
SCAMPER Approach

Substitute, Combine, Adjust, Magnify, Put, Eliminate,

and Reverse
Delphi Approach
Idea-generation concept

Economic Feasibility
Break-even analysis, payback, NPV, or internal
rate of return
Operational Feasibility
Usability of each solution alternative
Technical
Feasibility
Evaluation
of Solution Alternatives
Adequacy of existing state of technology
Scheduling Feasibility
Ability to be rendered operational by a
specified time
Legal Feasibility
Ability to meet legal requirements

Choose the alternative solution that yields

the best fit or value relative to the
established criteria.
Choice of the Preferred Solution Alternative

APPROACHES IN AN
ENVIRONMENT OF CERTAINTY
Optimizing Approach it employs
one of the mathematical techniques
such as linear programming, integer
programming, and dynamic
programming.
Satisficing Approach - it consists
of a search among the alternative
solution that acceptably satisfies
desired performance criteria.

APPROACHES IN AN
ENVIRONMENT OF
UNCERTAINTY
Maximum Approach
Identifying the worst outcome
Choosing the alternative with the greatest
worst outcome.

Minimax Approach
Computing the maximum opportunity loss.
Computing the alternative solution.

 Maximax Approach
Identifying the best outcome
Choosing the solution alternative with
greatest best outcome
.

Rationality Approach
Applying these equal possibilities to the outcome.
Choosing the alternative solution having the highest
expected payoff.

APPROACHES IN A RISK
ENVIRONMENT
Expected Value Calculation
Weighting the outcomes for the states of
nature by the probabilities of occurrence.
Adding up the weighted outcomes the
expected value of the payoff.
Choosing the solution the alternative
having the maximum expected payoff.

Decision tree approach

This is suitable to problem situations in which a
series of sequential decisions must be made.

Monte Carlo Simulation

Approach
This approach is used in complex situations
where analytical method cannot be applied.

Other Risk Environment

Approaches
Probabilistic approaches based on queuing
theory and game theory.

This stage will involve the designing of:

1. Outputs
2. Inputs
3. Conversion Processes
4. Resource and Data bases
5. Organization
Detailed development of the selected solution

GUIDELINES FOR SOLUTION

DEVELOPMENT
1. The selected solution should be directly related
to the objectives that the client desires to
achieves.
2. Maintain a comprehensive view of the problem
situation and how it relates to the overall
organization.
3. Search for all the important relationships
involved in the situation.
4. Employ systematic procedures and
methodologies while maintaining an openness
to creative insights.

1. The presentation should normally be made orally and

accomplished by audio visual aids and a written report.
2. Facts and arguments should be presented in a clear,
concise, and nontechnical manner.
3. Do not overwhelm the client with numerous details
D.
Solution
Development
and
unnecessary
discussion of data analysis
techniques.
E.4. Preparation
Presentation
of the
Be ready howeverand
to describe
briefly the significance
Report
and Recommended
Solution
of any gathered
fact and the purpose of
any technique
employed.
F.5.Implementation
Volunteer information concerning the risk that a
recommended solution entails and the difficulties that
G.
Evaluation
the
areFollow-up
expected in implementing
theof
solution.
6.Interim presentations
and written reports should be
Implemented
Solution
made throughout the solution development phase.

The CPA:
Should evaluate
the clients capacity
D.1.Solution
Development
to develop and carry out plans for the
E. Preparation and Presentation of the
recommend program or system and
Report and Recommended Solution
2. May recommend that a client hire
F. additional
Implementation
qualified personnel to perform
of theEvaluation
many tasksofrequired.
G.some
Follow-up
the
Implemented Solution

Activities of Implementation
Phase
1. Development of a work plan.
2. Establishment of controls over the implementation
activities.
3. Selection and training of needed personnel.
4. Installation of needed physical facilities.
5. Development of standard and documentation.
6. Testing of the solution being implemented, and
7. Follow-up and evaluation of the implemented solution.

Qualified Personnel
Special Audit Team

D. Solution Development
E. Preparation
and
Presentation of the
Internal Audit
Team
Report and Recommended Solution
F. Implementation
External Team of Consultants
G. Follow-up Evaluation of the
Implemented Solution

Economic Review

Comparison of actual benefits and costs of new system with

expected benefits and costs that were developed during
system design phase

Operational Review

Focuses on actual use of implemented

system by intended users

Future Performance
Review
Identifies potential improvements and
estimates the effort required to implement the
improvements

IV. Evaluating the

Engagement and Postengagement Follow-up

Evaluation of the
Engagement
Benefits:
Provide direction for staff training program in MAS
division
Serve as a basis for evaluating the on-the-job
performance of staff personnel
Provide data for determining the required resources for
subsequent similar engagements
Provide tangible evidence of quality consciousness
consistent with the other areas of a CPAs practice.

Evaluation of the Engagement

Coverage:
Proposal
Engagement Program
Work Program and Schedule
Source Data and Documentation
Reports
Results

Post-engagement Follow-up
To uncover deficiencies early and to
make the necessary modifications