1. Prioritizing Client Needs Finding the proper balance between Internal and External Consultants Steven A. Clark Strategy, Policy & Analysis NJ TRANSIT

2. Take Care of Your Customers Managing a successful internal consulting organization means taking care of your customers. Or someone else will! AIMC 2003

3. Take Care of Your Customers Customer needs change over time. Your business offerings must adapt to meet new needs. Or your group may become obsolete! AIMC 2003

4. Competition / Cooperation It’s not about Internal versus External Consultants. It’s about blending Internal and External Consultant roles. To achieve maximum results! AIMC 2003

5. Core Business Functions Find the right balance between internal and external consulting resources in your business development strategy to be sure you are prepared to meet changing customer needs. AIMC 2003

6. NJ TRANSIT • Statewide public transit agency • $1.3 bil. operating / $2 bil. capital budget • 10,000 employees • Bus, Rail, and Light Rail transit services • More than 400,000 daily riders • Assist private carriers, county and local governments, and mobility disadvantaged clients as well AIMC 2003

7. Strategy, Policy & Analysis Management Engineering & Analysis created in 1992 within Engineering Dept. • Early projects focused on operations staffing – train crews, bridge operators, classic IE reviews • Added Energy Conservation Program in 1995 Demand Side / Supply Side AIMC 2003

8. Strategy, Policy & Analysis • Program expanded to ad hoc projects dealing with organizational design and operations analysis in 1997 • Customer satisfaction added in 1998 • Management Analysis to COO in 1999 • Led corporate wide business process improvement program in 2000 (AP, njtransit.com, maintenance systems) AIMC 2003

9. Strategy, Policy & Analysis • New ED in 2002 tasked group to staff Efficiency Task Force & McKinsey review - $30 million • Involved in Customer Service & Technology Task Forces • Reorganized in 2003 into Strategy, Policy & Analysis Department AIMC 2003

10. Survival • Our internal consulting group has survived four Executive Directors in as many years • We have contributed more than $100 million in direct budget savings • Demand for our services is at an all time high AIMC 2003

11. Strategy, Policy & Analysis Current Responsibilities: • Strategic Plan • Economic Forecasting • Rates & Ridership • Market Research • Policy • GIS • Management Analysis AIMC 2003

12. Why? • Flexible consulting capabilities • Offer internal & external resources • Ability to address company needs quickly • “On Call” service contracts • Internal staff development • Strong focus on corporate mission • Change management • Performance improvement AIMC 2003

13. Business Direction Factors to consider for specific business situations: Leading / Lagging Business Short Term / Long Term Relationship / Trust / Independence Organizational Knowledge AIMC 2003

14. Business Direction Leading / Lagging Businesses Six Sigma TQM eCommerce Legacy Systems Customer Satisfaction Downsizing AIMC 2003

15. Business Direction Short Term / Long Term Support Function Core Business Project Based Process Based Mature Market Emerging Market AIMC 2003

16. Business Direction Relationship / Trust / Independence Intimate business knowledge Reaping, not raping Fair and in the company’s interest Focused – relevant, realistic solutions AIMC 2003

17. Business Direction Industry Intelligence Outside perspective Out of the box solutions Best practices Innovations AIMC 2003

18. External Resources Understand when external consultants are the perfect fit for your business needs. • Special projects • Expertise • Peak demand • Internal staff development AIMC 2003

19. Core Business And when they’re not. • Core competencies • Long term business support • In house expertise • Anchor stores AIMC 2003

20. Selection Criteria Factors to consider in selecting internal and external consultants: • Cost • Ramp up time • Duration • Direction (emerging business) AIMC 2003

21. Partnerships Strategies for success when working with external consultants. • Knowledge transfer • Professional service management • Readiness to assist - nimble AIMC 2003

22. Consulting Engagements Governor’s Management Review Commission 18 Departmental Reviews Big 6 Firms 29 Cross Cut Issue Task Forces Government Managers Private Sector Loaned Executives AIMC 2003

23. External Energy Consulting Roles Audits Strategic Plan Commodity Trading External Energy Consulting Roles Procurement Administration Project Delivery R & D Consulting Engagements AIMC 2003

24. Consulting Engagements On Call Consulting Process Improvement (AP) Technology (Web) Business Requirements (HR) Operations Analysis (LRT) AIMC 2003

25. Consulting Engagements McKinsey Review • Short term duration / fixed price • Cost reduction, not strategic engagement • 30,000 foot perspective • Knowledge transfer = one way street • Fratricide AIMC 2003

26. Summary • Internal and External Consultants both serve important roles • Find emerging business needs and become involved • Use externals to help develop staff capabilities in new practice areas AIMC 2003

27. Summary • Don’t let past successes make you too comfortable • Take advantage of the AIMC and other professional groups to identify emerging consulting trends and develop skills • Constantly evolve your service offerings – phase out old horses, ride the strong ones, and nurture new practice areas AIMC 2003