32387229 Accenture Case Study 4o733w

LB5302-Case Study

Accenture: Rebranding a Global Brand Group-5 24.04.2010

CONTENTS Page Cover page

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Contents

2

Executive Summary

3

History and Evolution of Accenture

4

Case Discussion 

Question 1

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Question 2

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Question 3

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Question 4

12

References

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Executive Summary This case study analyzes Accenture’s reincarnation by putting forth the main lessons that can be followed by other organizations going for the huge progression of rebranding, restructuring and repositioning. The case, traces the company’s history and evolution, and highlights how it managed to establish its consulting division and split it from ing activities, which was Anderson’s root. It also discusses the three pillars of Accenture’s transformation involving rebranding, restructuring and repositioning campaigns (Kaikati, 2003). Andersen Consulting, a global technology, management, and outsourcing consultancy, was forced to change its name after splitting with its parent company, the ing firm Arthur Andersen & Co, in January 2001. The company had a huge challenge of rebranding itself in a span of six months, after having already spent millions of dollars in its previous name ‘Anderson Consulting’. It finally accomplished this mammoth task and publicized its new name ‘Accenture’ in a high-profile marketing campaign in 2001 that was widely criticized but effective, at raising awareness of the Accenture brand among corporate executives which was the ultimate target of all consulting organizations (Sunset, 2008). The study deals with critically analyzing all decisions taken by the company in the process of preserving its brand equity. Issues involving rebranding and repositioning, using celebrity spokesperson along with competitive threats have been discussed and assayed.

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History and Evolution of Accenture 1913 Arthur Andersen started the ing Firm Arthur Andersen & Co. 1942 formed the istrative ing Group and created an early version of consulting unit. 1950s, Arthur Andersen began offering consulting services to companies wishing to use information systems and changed the name to istrative Service Division. 1970, the demand for information system grew and ASD Broaden the scope its business. Beyond “the design implementation of system’ to conduce the information needed by management to direct the activities of its organization” 1979 ASD became the Management Information Consulting division MICD a range of consulting services. 1980s, consulting business grew aggressively as the recession which made many company us consulting to rethink of their business strategy. In 1989, that division split from Arthur Andersen and began using the name Andersen Consulting. Both Arthur Andersen and Andersen Consulting consisted of groups of locallyowned independent partnerships and other groups around the world, in a contractual agreement with Andersen Worldwide Société Coopérative (AWSC) 1998 Andersen Consulting claimed breach of contract against AWSC and Arthur Andersen. Andersen Consulting put the 15% transfer payment for that year and future years into escrow and issued a claim for breach of contract. August 2000, as a result of a conclusion of the International Chamber of Commerce, Andersen Consulting broke all contracts with AWSC and Arthur Andersen. As part of the settlement, Andersen Consulting paid over the sum held in escrow (then $1.2 billion) to Arthur Andersen, and was required to change its name. December 31, 2000, the name Andersen Consulting was to end and they have to find a new name, resulting in the unit being renamed Accenture. On Jan. 1, 2001, the company changed its name to Accenture (from Andersen Consulting) and its website from www.ac.com to www.accenture.com and had a very big global Page | 4

marketing program designed to raise alertness in a new name. Accenture then launched one of the largest and most successful re-branding campaigns in corporate history (Accenture, n.d). In April 2001, Accenture’s partners voted awesomely to hunt an early public offering, and Accenture became a public company on July 19, 2001, when it listed on the New York Stock Exchange under the symbol ACN. Today Accenture is one of the top 50 global brands recognized by the Brand Equity Index 2008 (Swivel, 2008).

Case Discussion 1. How would you characterize Andersen Consulting’s brand equity in the late-1990s? What factors and decisions contributed to the building of this equity? Brand equity can be generally defined to represent the added value endowed to a product or service as a result of past investments in the marketing for the brand (Keller, 1998). In the early years, Anderson Consulting had accumulated extraordinary brand equity, largely embedded in the name of its founder Arthur Anderson. Anderson Consulting faced a serious challenge of positioning themselves as an IT consultant and forgoing an identity of the parent company. Anderson Consulting as a company gave a lot of importance to building its brand equity. After its successful launch as a consulting company they started marketing themselves aggressively against the traditional notions of professional services organizations. They invested a lot over the brand and created a strong name among its customers. Anderson Consulting had built strong brand equity across various consulting domains by the late 1990’s. It had gained the status of IT leader, which can be attributed as a source of its brand equity. Its customers associated the brand with creativity, innovation along with being a visionary and a leader. Over the years, Anderson Consulting’s Tag Lines played a vital role in positioning them in the minds of their customers, like the one in 1999 “Helping Achieve Value at Speed in the New Economy” which was in the time where the economy was booming at a rapid speed and companies needed the vital of the IT industry. It had made itself clear as a brand that represents technological capabilities as well as its strategic consulting expertise. Its reputation was established as one of the premier

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consultancies of the world. More precisely Anderson Consulting’s brand equity can be characterized as having brought high: 

Awareness in its category i.e. consulting: Awareness for the firm had increased from 26 percent in 1993 to 43 percent in 1997.

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High consideration in the category. It can be seen from the Overall Brand Equity Index (shown below) taken in 1999, that its consideration index, which was 9.1, was one of the highest among the major consulting firms.

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The brand image or reputation of technological as well as a strategic consulting expert. As mentioned in the case, by late 1990’s Anderson Consulting had earned a reputation as one of the premier consultancies of the world. This can be substantiated by the fact that by 1998 they were market leaders in 4 major categories in consumer rankings of consulting firms: Management and Technology Consulting, Operational Strategy Consulting, System Integration and Business Reengineering.

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A global network. Andersen Consulting worked with 91 of Fortune magazine’s 1999 Global 100 companies, as well as over half of the The Industry Standard’s 100 most important companies of the Internet economy (From the case).

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High mindshare and heart share. Ranked first in the mindshare and heartshare category by the study conducted by Harris Research in comparison with McKinsey, Booz Allen, BCG and A.T. Kearney (From the case).

Factors and decisions that led to building the equity:  Early movers in brand building. Over the years Anderson consulting positioned themselves separate from Arthur Anderson with its marketing and branding strategies. They dismissed the conventional professional services thought process and started advertising themselves aggressively.  Integrated market program, high profile media buys. As the firm’s business focus became more global, Anderson Consulting began developing an ment program that projected globally consistent images that merged across all media and was powerful in all local market. The firm focused on group testing in the US, Europe, Japan and Australia to determine which ad concepts would help Anderson Consulting achieve desired image, positioning and messaging. 

Anderson Consulting sought consistency in its marketing activities. The market research was critical in obtaining valuable input from its key target audience based on fine critical factors namely: market place awareness, client satisfaction, buyer value, advertising copy testing, and media monitoring.

 Implementation of brand equity management and measurement system. They employed brand equity measurement study to evaluate the value of its brand.

2. Compare the characteristics of Accenture’s brand equity to those of Andersen Consulting. Do you think the rebranding and repositioning of the company successfully transferred the equity from the old name to the new one? Andersen Consulting brand is separated from Arthur Andersen and consulting practice of the ing firm. Therefore, the company’s positioning and vision wasn’t clear, but it focused on strategic insight, vision and leadership with IT expertise to develop client solutions. Andersen consulting had strong position in both business strategy and Information Technology services that enabled it to post very strong consideration scores. In the 1980s and 1990s, Andersen Consulting had accumulated extraordinary brand equity, largely embedded in the name of its founder Arthur Andersen (Puget, 2003). It led on brand

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equity model which included image, awareness, consideration and preference. Averaging the scores and it carved out a leadership position, achieving the highest score on the brand equity scale. Furthermore, Andersen consulting possesses not only favorable qualities such as, share of people mind, value for money, uniqueness and momentum but also attributes for overall brand equity. Subsequently, it occupied a unique position in valued strategic business services and well-regarded IT solutions. It’s A to the power of C rebranding created a positive hype in the corporate world.

On the other hand, Accenture was more favorable in IT consulting and strategy. Reborn Accenture conducted outsourcing, traditional business consulting, technical capabilities, alliances and venture capital. It was the result of lengthy litigations between the consulting and ing arms that eventually pushed Andersen Consulting to abandon its name in 2001. Today, the renamed consulting firm, Accenture, enjoys a level of independence that largely shielded it from the collapse of Arthur Andersen (Puget, 2003). Furthermore, it projected a more organized approach in communications and high tech, financial services, products, resources and government. Accenture positioned itself among the target audiences and took notice of dramatic global changes in the marketplace. Accenture played on these aspects and offered to help clients take advantage of these changes and turn them into opportunities. Additionally, Accenture performed services for various government agencies which projected characteristics of high performance business strategy applied across multiple industries and business functions. It achieved new equity with the efforts of global rebranding and repositioning. Strong reputation of Anderson Consulting brand ed Accenture getting more unique position and image. The first rebranding experience in 1999 also helped the company to overcome the challenge. Taking cue from the previous experience, Accenture launched it’s “I am your Idea” Advertising campaign which was commendable.

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When the brand was renamed, there was a lot of cost involved on innovative print and billboard advertising in addition to television. Despite the short period of changing the name, the company had got a victory in transferring brand equity. The company also used innovative ads, sponsoring in global sports, direct mailing to clients, hosting tournaments, etc to create brand recognition, brand association and brand recall. After raising internal awareness, external launching was done through two-phased marketing strategy. Through the repeated exposure of the rebranding process to the clients and customers through global advertising, the company had achieved desired consumer awareness and interest. The new name not only provided a clear picture of their direction and position, with a unique new word that could be trademarked worldwide, but it also provided some continuity from the old world. Careful observation shows that Andersen Consulting Corp. was surely often abbreviated to ACC, especially on internal documents, and that it is the first 3 letters of the new name (BrighterNaming, n.d). Focusing longer term on broader business areas made Accenture brand equity higher than Anderson Consulting. In essence, the company not only transferred brand equity successfully from Anderson Consulting to Accenture, but also got much higher awareness and trust among clients, customers, businesses and the public. In fact the whole process was considered as one of the most successful rebranding operations in the history.

3. How much of a competitive threat is IBM? How should Accenture best compete with them? Accenture is a global company which provides services that include management consulting, technology services, and outsourcing. Accenture is also reported as a Fortune Global 500 company with 110 offices in 48 countries. In 2008, the company generated revenue of US$ 23.39 billion, with approximately 50 percent of its revenue generated from

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United States, 38 percent from Europe, the Middle East, Africa and India, and other 8 percent from Asia/Pacific region. Although Accenture has achieved success, it still faces significant competition. The biggest challenge comes from International Business Machines (IBM). In 1990, IBM had been changed from a hardware company into an IT service company. IBM is reported to be one of the largest computer companies in the world selling both hardware and software. Furthermore, a study conducted in 1997 by industry analyst IDC found out that IBM and Andersen Consulting enjoyed the greatest popularity among technology buyers. It is reported that in 2008, the company (IBM) generated a revenue of US$ 103.6 billion. Moreover, the company has scientists, engineers, sales professionals and consultants in over 170 countries. However, both the companies have their own strengths and weaknesses. In this paper, our group also discusses about the SWOT analysis of the two companies. Accenture owns professional consulting expertises that help the company in strategic transformational projects (Krauss, 2009). While IBM has global capacity to give global ends solution for its clients. The following is the details of SWOT analysis of both companies. The SWOT analysis gives us a bird’s eye view of both the companies and gives us a platform to compare and contrast to play on Accenture’s strengths and opportunities while keeping an eye on its weakness and threats as compared to its competitor’s.

Accenture Strengths

Weaknesses

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The company is well-known for its consulting driven approach and endto-end service delivery competency

 The heavy partner approach to sales does not easily penetrate to the midmarket.

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Company history as a consulting organization has become the key strengths for development of business relationships.

 The company needs to strengthen the strategy part as it is not yet the same as the traditional strategy consulting firm.

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It has brand equity and strong visibility for its clients.

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The company has more than 2,000 professionals all over the world.

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Opportunities

Threats

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The company has strong technology and outsourcing capability, which many of the competitors lack of.

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The company competes against IBM, as IBM has diversity geographic scale.

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The company has a global reach and good integration capabilities.

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Many competitors will also globally expand services capabilities.

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The company conducts the highresearch for new opportunities in technology, like SOA, SaaS, and cloud computing.

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The company has leadership position, particularly in North America market.

IBM Global Business Services Strengths

Weaknesses

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The company is known for its global scale and strong implementation competency.

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The company marketing strategies make it difficult to identify the market approach.

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The company has strong mind share with business and IT buyers.

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The company has talented work force with advance research and development.

The global scale gives a challenge for the company, as the global integration will be a never ending process.

Opportunities

Threats

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The company leverage on its global strength that maintains the brand equity for the clients.

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As a largest IT company, IBM will face agility challenges as the demand for new technologies accelerate.

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The company engages in emerging technology like cloud and SOA.

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The company has more barriers for innovation in rapidly changing technologies (Bjorlin, 2010).

Client satisfaction is high.

How should Accenture best compete with them? Page | 11

The company should combine the strategic insight, vision and thought leadership with IT expertise in improving clients’ solutions. 

It should create more Points of Difference (PODs) as with more differences, it will gain more competitive advantages.

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Accenture with the knowledge and experience in management consulting and strategic company can supplement its weakness regarding to technical skills compared to IBM by partnering or entering into alliance with leading hardware, software developers.

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Continue investing in marketing campaigns in order to gain broader and deeper brand awareness, including mindshare and heart share.

This unique combination of skills can enable the company to establish points of parity with technology and strategy firm, while at the same time achieving points of difference.

4. Evaluate the effectiveness of Tiger Woods as a spokesman for the company. Is Accenture achieving its objectives with a celebrity spokesman? Accenture has always been a high reputed company but they needed someone to increase their brand value and nobody but Tiger Woods was the most suitable for this job as not only was he one of the best at his work but due to the trust and respect he brought to the table. He was also at the peak of his career at that point of time, as he was the highest paid athlete in the world last year. He has been ranked fifth in the latest Forbes top 100-celebrity list. In October 2003, Accenture started their multiyear contract with Tiger Woods to their new high performance business strategy. Undoubtedly, he is one of the best golfers in the world and business and golf go very well together. Their advertising campaign was developed with a theme line “Go on Be a Tiger” and the latest theme was “We know what it takes to be a Tiger.” Most of the ments were pictured with Tiger during a golf match in an intense competitive situation and winning it due to his high performance. The campaign explained how Accenture delivers high performance even in the most competitive situations and possesses business critical capabilities, industrial expertise and technology to help its clients receive superior economic results. These campaigns were a great success. Tiger helped them increase their perceived value by 200 million dollars as he was a role model for many and their ments were brilliant (Accenture, 2003).

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Until end of 2009 they shared an amazing ongoing relationship. But then in 2009 Tiger’s personal life was shattered as his cheating scandals became rather public. His name became a punch line, and jokes on his personal life flowed like water over the Internet. On 13 th December 2009 Accenture cut all ties with Mr. Woods. It was the first company to drop Tiger Woods, as it was the most affected by his cheating scandals and personal life. ments like "It’s what you do next that counts", "Some Watch. Some Wait. Some Pounce. Go on. Be a Tiger”, "To accomplish more, sometimes you need to see less. Go on be a Tiger”, “It’s what Tiger does next that counts”, took a bizarre new meaning suddenly after the scandal. Accenture did achieve its objectives with a celebrity spokesperson as Woods was a role model for so many that in year 1996 in a Sports Illustrated article he was referred to as the “chosen one” and predicted he would have the “power to impact nations”. However, according to us Accenture made a few mistakes in their use of Tiger Woods. Firstly, they build the brand completely around him as an equal part of the branding. Secondly, Woods is a living/young celeb with who new controversies like these can easily arise. It’s much different when people like Gandhi or Abraham Lincoln are used, as they are deceased and no new controversies can come up. Further, they failed to see how over extended Tiger’s brand was, such as Gillete, Rolex, American Express, General Mills, Gatorade etc. He makes $110 million dollars from sponsorships. Accenture overstayed its t branding with Tiger by a few years. Companies should not do that as celebs are humans too and they should know that the good relations cannot last forever. Lastly, by ending its relationship with Woods some might think of Accenture as a good corporate citizen who doesn’t such vulgar Page | 13

behavior others may think of it as a non ive company who is selfish and is not there for the people associated with them when they need them. In our opinion they should have stuck by Tiger and proved that even with such difficult situations victory can be achieved as Tiger is going rise soon. Even though some think Accenture did the right thing but we don’t agree (Sommer, 2009). Accenture should now not bounce back from one celeb to the other instead it should learn to market and promote itself without a celeb to show their high performance by using women athletes perhaps or great business leaders maybe people dealing with social causes. Their new campaign is about animals doing impossible things. It shows an elephant surfing, which can be their beginning to better innovations in advertising (Somaiya, n.d).

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