Tourism New Zealand enlist ZS Associates for global market analysis

12 September 2018 Consultancy.com.au

ZS Associates, a global management consultancy have been brought in by New Zealand’s tourism department to conduct a market analysis across nine global markets.

The US-based consulting firm ZS Associates has been brought across the Pacific to conduct an analysis on the impact of Tourism New Zealand’s current market campaigns and strategies. The firm specialises in growing market share and improving overall performance for its clients.

Headquartered in Evanston, Illinois the firm was born in 1983 when three peers from the Kellogg School of Management came together with a side business in sales and marketing by the names of Andris Zoltners, Frederic Esser Nemmers and Prabha Sinha. Today the firm has over 20 offices spread throughout the Americas, Europe and Asia.

Tourism New Zealand were struggling to use the data that they had managed to compile effectively. The department wanted to understand how their marketing campaigns faired and if their money was being spent effectively. They also wanted to analyse their choice of travel agents – to whom they gave trips to NZ’s most famous tourist sites – as well as their training and education.

“Tourism as an industry isn’t known for its analytics. It doesn’t typically do well with data gathering,” says Emil Petrov, strategy manager at Tourism New Zealand. “We had to put the plumbing in before building the house, and we had nothing to build on.”

Tourism New Zealand enlist ZS Associates for global market analysis

To achieve the desired impact, the firm sought out ZS Associates. Although the firm does not have an office in Australia or New Zealand, with offices in two advanced economic regions as well as New Delhi, Pune, Singapore, Shanghai and Tokyo, the firm had the target audience covered.

Together, ZS Associates and Tourism New Zealand mapped out the which travel agents made the biggest impact on sales as well as which marketing campaigns had the greatest impact. Using data from passenger records, travel agency as well as a historical analysis of campaigns and compared each with the cost of the initiative.

The results showed the power of the data analysis. To optimise the efficiency and cost-effectiveness of the campaigns, the pair had to make strategic decisions on their investments. “It helped us see where to make tradeoffs on where to invest, and showed us which markets we were already covering effectively,” Petrov says. 

Data suggested that in the US it was imperative to focus on reaching out to travel agents and that an increased interaction had a positive effect on sales. However in China for instance, this was not true, as the smaller travel agencies showed a less positive effect. This lead the duo to change their strategy in China and focus on larger travel agencies and optimise the process. Furthermore, the findings showed that targeted discovery trips increased visitor volume far beyond any non-targeted counterparts.

“ZS translated the big ideas into an approach that was the right size for our data and our models,” Petrov says. “Distilling everything down into information that we could use in team meetings was also really valuable. ZS provided great analytics and insights that weren’t cookie-cutter, which was a big contribution to our business,” Petrov concludes.

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Commonwealth Bank working with McKinsey on massive job cuts

16 April 2019 Consultancy.com.au

The Commonwealth Bank could be set to cut up to 10,000 jobs and around $2 billion in costs according to reports, with the bank working on the plan with McKinsey.

Driven by new CEO Matt Comyn, who was appointed to the helm last year, the Commonwealth Bank of Australia (CBA) is said to be mulling a plan devised in conjunction with global strategy and management firm McKinsey & Company to axe up to 10,000 local jobs – saving about $2 billion in operating costs. It continues the close relationship between the bank and the consultancy dating back for more than 15 years.

The largest employer among Australia’s Big Four banks, the potential cuts could see an almost 25 percent reduction to its approximate workforce of 44,000, the CBA’s headcount then dropping below the ~34,000-strong staff at National Bank. The plan is also reported to include the shuttering of 300 of its 1000 branches around the country, although as customers shift to online banking the closures are not unexpected.

“My understanding is that the story is good and there has been a plan underway,” said Your Money’s chief reporter Leo Shanahan of the reports which first surfaced in The Australian (Your Money was formed through a partnership between Nine and NewsCorp subsidiary Australia News Channel). With its potential ramifications for the government’s hopes in the upcoming federal election, the reporting from Murdoch’s stable provides an unexpected twist.

“Matt Comyn has been wanting to shut branches in particular for a while and cut costs at the bank. There is broadly a plan underway over the next few years for [this cost-cutting] to happen,” continued Shanahan on Comyn, who replaced former McKinsey New Zealand head and global partner Ian Narev as CEO last year following the anti-money laundering breeches which saw the bank fined a record $700 million.Commonwealth Bank working with McKinsey on massive job cutsComyn has since broadly criticised his predecessor at the recent Royal Commission into misconduct in the banking and financial services sector, which stemmed in part from a Four Corners report on the profit-at-all-costs culture within the CBA’s financial planning division, but the bank’s relationship with McKinsey apparently remains strong – having dated back to before Narev’s arrival and featuring other close links.

In 2003, the CBA brought in McKinsey for an ongoing “benchmarking” project to cut $500 million in costs – with 600 staff said to be in the retrenchment cross-hairs at the time following a significant reduction in the years prior. McKinsey has continued to serve the CBA in the years following, and had throughout the 80s and 90s advised all of the NAB, Westpac and the ANZ on various cost-cutting and re-organisational measures – including saving Westpac from potential collapse.

Meanwhile, CBA’s Group Executive for Retail Banking Angus Sullivan, who will be responsible for overseeing any strategy to close branches and let go customer facing staff, was like Narev a former partner in McKinsey’s New York office, spending nine years with the strategy firm before joining CBA in 2011. Former CFO Rob Jesudason is also among others a McKinsey alumnus, while the leadership team of the CBA’s strategy division continues to feature a number of ex-McKinsey consultants.

For the Commonwealth Bank’s part, it has described the reports of a mass redundancy – which The Australian contends were meant to be kept secret until after the election – as “unnecessarily alarming” and “misleading”, while reiterating the need to manage costs. McKinsey meanwhile traditionally refuses to comment on matters concerning its clients, although the firm recently committed to greater transparency following a series of its own public image issues.

The financial sector accounts for nearly a quarter of Australia’s $5 billion management consulting spend, with the Big Four professional services quartet Deloitte, PwC, KPMG and EY in recent years all scoring multi-million dollar contracts with the big Australian banks – particularly around the areas of digitisation. McKinsey, meanwhile, was last year brought in by Telstra on another $1 billion cost-cutting program.