They say that hindsight is 2020. Since we are well into 2021, we now have the benefit of hindsight when we look back at the year that will forever be associated with COVID. Some companies fell apart. Others flourished. Enough time has passed that we can start drawing initial conclusions about how the business world has changed since the onset of the COVID crisis. This analysis covers Mentors & Partners Group, a consulting firm that flourished in a time when their competitors faltered.
Who is Mentors & Partners Group?
Mentors & Partners Group (MPG) is a consulting firm with its headquarters in Budapest, Hungary, and offices in multiple countries. The firm was officially formed in 2015 as the consolidation of pre-existing independent consultancies. As of 2021, MPG is the leading domestic Hungarian consulting firm in terms of revenue and profit. The reason for this ascent has to do with the firm’s focus: the premium sector. They maintain this focus across their primary practice areas: Organisational Development, International Expansion, and Brand & Image Management.
Importantly, MPG is the only firm within Hungary that offers the international standard of vertical integration. When a client comes to MPG, they do not only receive a business strategy, but all the necessary support to implement that strategy. That means that MPG offers product concept creation (sales support materials, marketing, product design), creative support (corporate image elements, logo, design, slogan, and web design), recruitment and development (headhunting, developing current employees, workshops). If there are areas of expertise that they do not offer, such as legal and accounting advice, they have trusted partners ready to provide that support.
How did COVID affect the company?
THE STAGE articles typically focus on public companies for one main reason: in many countries, privately held companies do not have to publish financial data. In Hungary, however, even privately held companies must publish such data, so we were able to examine the performance of MPG’s Hungarian entity. Based on publicly available financial data, 2020 was the best year ever for MPG.
|Sales Revenue||1 028 738 €||1 783 906 €||+73%|
|Profit After Tax||238 297 €||458 757 €||+93%|
|Total Assets||688 441 €||991 197 €||+44%|
|Total Liabilities||135 176 €||230 496 €||+71%|
|Assets-Liabilities||553 265 €||760 701 €||+37%|
The firm’s performance across every major category is remarkable for one main reason: the consulting industry at large suffered during this same period. Some companies we have examined in STAGE articles, such as Netflix, experienced considerable growth because their industries benefited from the pandemic, so an impressive performance was almost a given. But consulting, in general, suffered greatly: most companies suspended or cancelled their development projects. So, in order to find out how MPG pulled off this feat, we reached out to Miklós Palencsár, the firm’s CEO, for comment.
How did their strategy change during COVID?
According to Mr Palencsár, the firm’s success during COVID is based upon an approach implemented years before: strict client filtering. The firm instituted a more stringent filtering process when it comes to choosing their partnerships. Because MPG’s focus is the market’s premium segment, each of their partners must have unique expertise that makes them stand out from the crowd. This unique expertise is the foundation on which great businesses can be built. The firm’s international expansion team screens each company and performs in-depth research about the partner’s market to see whether the company has the potential to be a unique player in their market, thus producing stable, long-term growth.
This process guarantees that all of MPG’s partners are incomparable in their field, with such knowledge and solutions that make them capable of a robust and worldwide presence. This creates partnerships that are long-term in nature, as their partners must have the potential for long-term growth and continuous expansion; unique expertise is the one thing that guarantees this. Mr Palencsár also spent time and energy training the MPG team on optimising the client experience by providing pandemic-time services. In a time in which everybody felt so insecure, the firm was a rock for its clients. They advised their clients to help them navigate the murky waters ahead. Thus, their partners performed relatively well during the pandemic-driven crisis. Mr Palencsár attributes this crisis-time performance to the fact that MPG and its partners had a rare thing: confidence to sail forward when everybody else scrambled to stay afloat.
Was this change successful?
Because most consulting firms experienced considerable downtime during the pandemic, MPG will receive another competitive advantage: crisis-time development experience. Instead of sitting at home, the entire firm was working, and according to Mr Palencsár, MPG even had to hire more consultants to keep up with increased demand. Thus, MPG already had a stellar market position before the pandemic. Now that much of the fat has been trimmed from the entire market, MPG is primed for even more success.