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Eden McCallum A Network Based Consulting Firm A Case Solution

Solution Id Length Case Author Case Publisher
2122 560 Words (4 Pages) Heidi K. Gardner, Robert G. Eccles Harvard Business School : 410056
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Eden McCallum follows an "invest-reap" cycle, where it invests one year in growth and reaps the benefits of these in the next year. 2008 had been the year for investment, and now in 2009, it was time to reap. However, the recent economic downturn did not make this possible, as revenues were expected to decrease. The main issue for Eden McCallum was a trade-off.

Following questions are answered in this case study solution

  1. The Issue

  2. Porter’s Five Forces Analysis

  3. Business Model

Case Analysis for Eden McCallum A Network Based Consulting Firm A Case Solution

It could either invest again in 2009 in terms of business development, acquire new projects, and reap the benefits of these in the next year. This was the risky option as it could take a larger hit if it wasn't able to earn the revenues from these projects. On the other hand, it could cut costs which would involve laying off people or the Dutch office. This option would lead to a loss of talent and credibility in the marketplace.

2. Porter’s Five Forces Analysis

  • Threat of New Entrants: This was high in the market as an independent consultant, who were familiar with the company's business model, could themselves start a similar venture to Eden McCullum. This has implications for laying off people as they could start their independent businesses due to low barriers to entry.

  • Threat of Substitute Products: The substitute for consulting firms as independent consultants. The threat was low as these people preferred a network-based consultancy firm like Eden McCullum as it manages business development for them. 

  • Bargaining Power of Buyers: The bargaining power of buyers is low in the economic crisis. The client’s other options included to choose the big consultancy firms, which are too expensive for them. They could also contact individual consultants themselves, which would be difficult unless they have the network established for it.  

  • Bargaining Power of Suppliers: The suppliers are independent consultants. These have bargaining power as they are ones who would be delivering on the project. Cutting costs on projects could mean consultants not accepting these. 

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