<PAGE>   1
               UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                          Washington, DC 20549-1004
                                      
                                      
                                  FORM 10-Q



 x   QUARTERLY REPORT PURSUANT TO SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 
---  1934
   
                  For the quarterly period ended March 31, 1998


                                       OR


     TRANSITION REPORT PURSUANT TO SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 
---
                   1934 For the transition period from        to
                                                       -------   -------

                       Commission file number 0-21485



                  SUPERIOR CONSULTANT HOLDINGS CORPORATION
             (exact name of registrant as specified in its charter)



              STATE OF DELAWARE                                 38-3306717
       (State or other jurisdiction of                       (I.R.S. Employer
       incorporation or organization)                       Identification No.)


4000 Town Center, Suite 1100 Southfield, Michigan                 48075
  (Address of principal executive offices)                     (Zip Code)


        Registrant's telephone number, including area code (248) 386-8300


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes  X  No 
                                       ---    ---

As of May 8, 1998, 10,273,030 shares of the registrant's common stock (par value
$.01) were outstanding.
        



<PAGE>   2
                    SUPERIOR CONSULTANT HOLDINGS CORPORATION
                          QUARTER ENDED MARCH 31, 1998
                                      INDEX
<TABLE>
<CAPTION>

PART I - FINANCIAL INFORMATION                                                                               PAGE NO.
                                                                                                            ---------
<S>                                                                                                          <C> 
     Item 1.       Financial Statements

                   Condensed Consolidated Balance Sheets as of March 31, 1998 and December 31,                   3
                   1997 (unaudited)

                   Condensed Consolidated Statements of Earnings for the three months ended March                4
                   31, 1998 and 1997 (unaudited)

                   Condensed Consolidated Statements of Cash Flows for the three months ended                    5
                   March 31, 1998 and 1997 (unaudited)

                   Notes to Condensed Consolidated Financial Statements                                          6

     Item 2.       Management's Discussion and Analysis of Financial Condition and Results of                    8
                   Operations

     Item 3.       Quantitative and Qualitative Disclosure About Market Risk Sensitive Instruments              11

PART II - OTHER INFORMATION

     Item 2.       Changes in Securities and Use of Proceeds

     Item 5.       Other Information                                                                            12 

     Item 6.       Exhibits and Reports on Form 8-K                                                             12
                                                                                                                   
SIGNATURES                                                                                                      13 

</TABLE>

                                     Page 2

<PAGE>   3


PART I.  FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS

            SUPERIOR CONSULTANT HOLDINGS CORPORATION AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)
                                  (UNAUDITED)


<TABLE>
<CAPTION>
    
                                                                                 MARCH 31,          DECEMBER 31,
                                                                                   1998                 1997
                                                                              ---------------     -----------------
                                                                              
                            ASSETS
<S>                                                                           <C>                 <C>
  Current assets
       Cash                                                                   $         1,655     $           2,795
       Short-term investments                                                          76,172                84,458
       Accounts receivable, net                                                        23,596                18,464
       Accrued interest receivable and prepaid expenses                                 1,365                 1,589
       Deferred income taxes                                                              350                   352
                                                                              ---------------     ----------------- 
          Total current assets                                                        103,138               107,658
  Property and equipment, net                                                           9,266                 6,915
  Goodwill, net                                                                         8,689                 4,711
  Other long-term assets                                                                  102                   117  
                                                                              ---------------     ----------------- 
          Total Assets                                                        $       121,195     $         119,401
                                                                              ===============     ================= 

             LIABILITIES AND STOCKHOLDERS' EQUITY

  Current liabilities
       Current portion of long-term debt                                      $             -     $              91
       Accounts payable                                                                 3,935                 3,061
       Accrued liabilities                                                              3,273                 5,016
       Deferred revenue                                                                 1,104                 1,597
       Income taxes payable                                                               974                   261
                                                                              ---------------     -----------------   
       Total current liabilities                                                        9,286                10,026
  Long-term debt                                                                           93                    98
  Deferred income taxes                                                                   487                   350
  Deferred performance bonuses                                                            564                   564
  Stockholders' equity
       Preferred stock; authorized, 1,000,000 shares of
       $.01 par value; no shares issued or outstanding                                      -                     -

       Common stock; authorized, 30,000,000 shares of
       $.01 par value; issued and outstanding, 10,224,509 as of
       March 31, 1998 and 10,208,024 as of December 31, 1997                              102                   102
       Additional paid-in capital                                                     105,934               105,632
       Retained earnings                                                                5,408                 3,308
       Stockholders' notes receivable                                                    (679)                 (679)
                                                                              ----------------    -----------------  
          Total stockholders' equity                                                  110,765               108,363
                                                                              ---------------     -----------------  
          Total Liabilities and Stockholders' Equity                          $       121,195     $         119,401
                                                                              ===============     =================  


       See notes to condensed consolidated financial statements.

</TABLE>

                                     Page 3
<PAGE>   4
           SUPERIOR CONSULTANT HOLDINGS CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
                                       


<TABLE>
<CAPTION>


                                                                    THREE MONTHS ENDED
                                                                        MARCH 31,
                                                                 ------------------------ 
                                                                     1998        1997
                                                                               (RESTATED)
                                                                 -----------  ----------- 

<S>                                                              <C>          <C>
  Revenues                                                       $    23,830  $    16,544

  Operating costs and expenses
    Cost of services                                                  12,067        8,462
    Selling, general and administrative expenses                       9,406        6,767
                                                                 -----------  ----------- 

       Total operating costs and expenses                             21,473       15,229
                                                                 -----------  ----------- 
       Earnings from operations                                        2,357        1,315
  Other income, principally interest income                            1,247          508
                                                                 -----------  ----------- 
       Earnings before income taxes                                    3,604        1,823

  Income taxes                                                         1,504          702
                                                                 -----------  ----------- 
       Net earnings                                              $     2,100  $     1,121
                                                                 ===========  =========== 


  Net earnings per share - basic                                 $      0.21  $      0.14
                                                                 ===========  =========== 
  Net earnings per share - diluted                               $      0.20  $      0.14
                                                                 ===========  =========== 


    Weighted average number of common and
      common equivalent shares outstanding - basic                    10,212        8,170
                                                                 ===========  =========== 

    Weighted average number of common and
      common equivalent shares outstanding - diluted                  10,442        8,241
                                                                 ===========  =========== 

    See notes to condensed consolidated financial statements.
</TABLE>

                                     Page 4

<PAGE>   5


            SUPERIOR CONSULTANT HOLDINGS CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)
                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                                                   THREE MONTHS ENDED MARCH 31,
                                                                              --------------------------------------
                                                                                 1998                    1997
                                                                                                      (RESTATED)
                                                                              ---------------       ----------------
<S>                                                                             <C>                         <C>
    Cash flows from operating activities:

       Net earnings                                                                  $ 2,100                $ 1,121
       Adjustments to reconcile net earnings
         to net cash provided by (used in) operating activities:
         Depreciation and amortization                                                   474                    272
         Bad debt expense                                                                 21                    108
         Deferred income taxes (benefit)                                                 139                   (248)
         Non-cash compensation                                                             -                     23
         Changes in operating assets and liabilities:
             Accounts receivable                                                      (3,399)                  (897)
             Accrued interest receivable and prepaid expenses                            224                     38
             Other long-term assets                                                       15                     (1)
             Accounts payable                                                            874                    714
             Accrued liabilities, deferred bonuses and compensation                   (1,743)                  (296)
             Deferred revenue                                                           (493)                  (260)
             Income taxes payable                                                        713                    254
                                                                              ---------------       ----------------

                  Net cash provided by (used in) operating activities                 (1,075)                   828

    Cash flows from investing activities:
       Purchase of NSD                                                                (5,138)                     -
       Purchase of Novum, Inc.                                                          (312)                     -
       Purchase of The Kaufman Group                                                    (462)                (3,375)
       Purchases of property and equipment                                            (2,507)                (1,183)
                                                                              ---------------       ----------------

                 Net cash used in investing activities                                (8,419)                (4,558)

    Cash flows from financing activities:
       (Repayment of) proceeds from lines of credit, net                                 (91)                     4
       Exercise of stock options                                                         181                      -
       Costs of follow on offering                                                       (17)                     -
       Repayment of long-term debt                                                        (5)                   (24)
                                                                              ---------------       ----------------
                 Net cash provided by (used in) financing activities                      68                    (20)
                                                                              ---------------       ----------------

    Net decrease in cash                                                              (9,426)                (3,750)

    Cash and cash equivalents, beginning of period                                    87,253                 36,795
                                                                              ---------------       ----------------

    Cash and cash equivalents, end of period                                         $77,827                $33,045
                                                                              ===============       ================

    Supplemental disclosure of cash flow information:
       Interest payments                                                             $    14                $    52
       Income tax payments                                                           $ 1,970                $   646
       Non-cash acquisition costs (Issuance of common
         stock for Novum, Inc.)                                                      $   138                $     -
       Non-cash acquisition costs (Issuance of common
         stock for The Kaufman Group)                                                $     -                $ 1,600

       See notes to condensed consolidated financial statements.

</TABLE>


                                     Page 5

<PAGE>   6


            SUPERIOR CONSULTANT HOLDINGS CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)
                                 MARCH 31, 1998


NOTE 1 - BASIS OF PRESENTATION

     The accompanying unaudited condensed consolidated financial statements have
been prepared  pursuant to the rules of the Securities  and Exchange  Commission
for quarterly reports on Form 10-Q. Accordingly,  they do not include all of the
information and footnotes required by generally accepted  accounting  principles
for complete financial statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals and estimated  provisions for bonus and
profit-sharing  arrangements)  considered necessary for a fair presentation have
been included. Operating results for the three-month period ended March 31, 1998
are not necessarily  indicative of the results that may be expected for the year
ended December 31, 1998.

     These financial statements should be read in conjunction with the Company's
audited  consolidated financial statements and notes thereto included in the
Company's 1997 annual report on Form  10-K filed by the Company  with the
Securities and Exchange Commission on March 31, 1998.

     In July and August 1997, the Company acquired the outstanding stock of two
entities, in exchange for shares of the  Company's  common  stock.  These
transactions were accounted for as poolings of interests and, accordingly, the
Company's financial  statements for the quarter ended March 31, 1997 have been
restated to include the results of the acquired entities.


NOTE 2 -  NET EARNINGS PER SHARE

     On December 31, 1997, the Company adopted Statement of Financial Accounting
Standard  No. 128,  Earnings  Per Share.  As  required by SFAS 128, EPS for the
quarter ended March 31, 1997 have been  restated to conform to its provisions.
The Company's  basic and net earnings per share  amounts have been computed by
dividing net earnings by the weighted  average number of outstanding common
shares. The Company's diluted net earnings per share is computed by dividing net
earnings by the weighted average number of outstanding  common shares and common
share equivalents relating to stock options, when dilutive.

     The  computation  of diluted net  earnings  per share for the three  months
ended March 31, 1998 and 1997 includes approximately  230,000 and 71,000 shares
of common stock  equivalents, respectively.  Options to purchase  approximately
42,000 and 203,000 shares of common stock with a weighted average exercise price
of $36.18 and $23.63 were  outstanding at March 31, 1998 and 1997  respectively,
but were excluded from the computation of common share equivalents because to do
so would have been antidilutive for the periods presented.
 

                                     Page 6

<PAGE>   7



NOTE 3 - BUSINESS ACQUISITIONS

     On January 16,  1998, the Company  purchased the assets and business of the
Network Services Division ("NSD") of Multimedia  Medical Systems,  Inc. ("MMS").
NSD, located in Burlington, Massachusetts, which specializes in software
implementation and networking technology solutions for healthcare organizations.
The  purchase  price  was approximately  $5.2  million  in cash.  The  business
combination  was recorded using the  purchase  method  of  accounting  and,
accordingly, the operating results of NSD have been included in the Company's
consolidated financial statements since the date of acquisition.  The excess of
the  aggregate purchase  price  over the fair  market  value of the net  assets
acquired of approximately $3.6 million is being amortized over 15 years.

     On March 26, 1998, the Company  purchased the assets and business of Novum,
Inc.  ("Novum"), located in  Gainesville, Georgia, which specializes in
software  applications  relating to the healthcare industry. The purchase price
was approximately  $670,000, consisting of approximately $312,000 in cash
and approximately $138,000 in newly-issued common stock payable at closing, and 
an additional contingent payment of up to a maximum of $220,000 payable in 
cash and newly-issued common stock over a three year period contingent on the 
achievement of certain performance benchmarks by the acquired business.  The 
business combination was recorded using the purchase method of accounting.  
The entire purchase price has been allocated to goodwill and is being amortized 
over 15 years.
        

NOTE 4 - SUBSEQUENT EVENTS

     As of April 30, 1998, the Company  purchased substantially all of the
business assets of Lincoln Computer Corporation ("Lincoln"), a healthcare 
outsourcing business located in Wallingford, Connecticut. The purchase price
was approximately $1.7 million in newly-issued common stock payable at closing, 
plus the assumption of approximately $1.2 million in liabilities of the 
acquired business, and an additional contingent payment of up to a maximum of
approximately $1.3 million in cash and approximately $5.4 million in
newly-issued common stock payable over a three year period contingent on the
achievement of certain performance benchmarks by the acquired business.  The
acquisition will be recorded using the purchase method of accounting. 
        
     On May 4, 1998, the Company made a $4.5 million minority equity investment
in Empower Health Corporation ("Empower") of Austin, Texas.  Empower's mission
is to improve the quality of people's lives by empowering them with
personalized healthcare information and enabling electronic interactions and
online transactions with the healthcare industry.  The investment will be
recorded using the cost method of accounting.

NOTE 5 - NEW ACCOUNTING PRONOUNCEMENTS

     In June 1997,  the FASB issued Statement of Financial  Accounting Standards
No. 130,  Reporting of Comprehensive  Income  ("SFAS 130"),  which  establishes
standards for reporting and display of  comprehensive  income and its components
(revenues,  expense, gains, and losses) in a full set of financial  statements.
This  statement also requires that all items that are required to be recognized
under accounting standards as components of comprehensive income be reported in
a  financial  statement that is  displayed  with the same  prominence  as other
financial statements.  This statement will become effective with the full set of
financial statements expected to be filed as of and for the year ended December
31, 1998. Reclassification of financial statements for earlier periods provided
for comparative  purposes is  required.  The Company does not  anticipate  that
adoption of SFAS 130 will have a material effect on the  consolidated  financial
statements.

     In June 1997,  the FASB issued Statement of Financial  Accounting Standards
No. 131,  Disclosure about  Segments of an Enterprise  and Related Information
("SFAS  131"),  which establishes standards for the way that public business
enterprises  report information  about operating segments in annual financial
statements, and requires that those enterprises report selected information
about operating segments in interim financial reports issued to stockholders.
This statement also establishes standards for related disclosures about products
and services, geographic  areas, and major customers. This statement became
effective January 1, 1998 for annual financial statements. This statement will
be applied to interim financial statements in 1999, and will include comparative
information  for 1998 interim  periods. 

                                     Page 7

<PAGE>   8

 
ITEM 2          MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                      CONDITION AND RESULTS OF OPERATIONS

OVERVIEW

     Statements  included in  Management's  Discussion and Analysis of Financial
Condition and Results of  Operations  which are not  historical in nature,  are
intended to be, and are hereby  identified as, "forward looking statements" for
purposes of the safe harbor  provided by Section 21E of the Securities  Exchange
Act of 1934, as amended by Public Law 104-67.  Forward-looking statements may be
identified by words including  "anticipate,"  "believe," "intends," "estimates,"
"expect"  and  similar  expressions.   The Company   cautions readers  that
forward-looking statements, including without limitation, those relating to the
Company's future business prospects,  revenues, working capital, liquidity, and
income,  are subject to numerous risks and uncertainties that could cause actual
results  to differ  materially  from those indicated  in the forward looking
statements, due to several important factors herein  identified, among others,
and  other  risks and  factors  identified  from time to time in the Company's
reports  filed  with  the SEC, including  the risk factors identified in the
Company's  Registration   Statement  on  Form  S-1 (File  No.  333-1013)  and
Registration Statement on Form S-1 (File No. 333-37357).

     The  Company   conducts   business   through  its  two  primary  operating
subsidiaries,  Superior  Consultant  Company,  Inc.  ("Superior") and Enterprise
Consulting  Group,  Inc.  ("Enterprise").   Superior  is  a  leading  healthcare
consulting firm that provides a wide range of information technology consulting
and strategic  and  operations  management consulting services  to a broad
cross-section of healthcare  industry  participants and healthcare information
system vendors.  Enterprise assists clients in various industries in developing,
designing, implementing  and  maintaining  groupware and intranet and web based
information systems and solutions,  as well as enterprise messaging and custom
applications and legacy systems integration.

     The  Company  derives substantially  all of its  revenues  from  fees  for
professional  services,  the substantial  majority  of  which  are billed  at
contracted  hourly rates. The Company  establishes standard billing guidelines
based on the type and  level of service offered.  Actual  billing rates  are
established on a  project  by  project basis and may vary  from the  standard
guidelines.  Billings are typically made on a bi-weekly  basis to monitor client
satisfaction and manage outstanding  accounts  receivable  balances.  Revenue on
time and  materials  contracts is  recognized  as the services are  provided.  A
percentage  of the Company's projects are billed on a  fixed-fee  basis.  The
Company  recognizes revenue on fixed fee  projects  using the  percentage  of
completion basis. As of March 31, 1998, the Company has increased the number
and size of projects billed on a fixed-fee  basis.  Increased  use of fixed-fee
contracts subjects the Company to increased risks, including cost overruns.  As
of March 31, 1998, the Company has been awarded three significant  contracts
to provide  healthcare IT outsourcing  services.  There can be no assurance that
the Company  will be able to achieve  profit margins on outsourcing  contracts
which are consistent with its historical levels of profitability.

     The Company's historical revenue growth is attributable to various factors,
including  an increase in the number of projects for existing and new clients,  
expanded  geographic presence and acquisitions.  In addition,  the Company
seeks to increase revenues by expanding its range of specialty  services. The
Company manages its client development efforts through several  strategic
services groups,  each having specific geographic responsibility and focus.
        

                                     Page 8

<PAGE>   9

     The Company's most significant expense is cost of services,  which consists
primarily of consultant  salaries and  benefits.  In recent  years,  consultant
compensation expense has grown faster than consultant billing rates,  resulting
in an increase in the  Company's  cost of services as a percentage  of revenues.
The Company has sought to address  this issue by adding an  additional  variable
portion of compensation payable upon the achievement of measurable  performance
goals.

     The Company's cost of services as a percentage of revenues is also impacted
by its consultant  utilization.  The Company  manages  utilization by monitoring
project  requirements  and timetables.  The number of consultants  assigned to a
project will vary according to the size, complexity, duration and demands of the
project.  Project terminations,  completions and scheduling delays may result in
periods when consultants are not fully utilized. An unanticipated termination of
a significant project could cause the Company to  experience lower consultant
utilization, resulting  in  a higher  than  expected   number of  unassigned
consultants. In addition, the establishment of new practice areas and the hiring
of consultants  in peak  hiring  periods have  resulted  in  periods  of lower
consultant  utilization  (and  resulting downward  pressure on  margins)  until
project volume increases in these new areas. In the future, the establishment of
new practice areas, as well as further geographic expansion,  could from time to
time adversely affect utilization.  Variations in consultant  utilization result
in quarterly  variability  of the Company's  cost of services as a percentage of
revenues. The Company's consultants are generally employed on a full-time basis,
and therefore the Company will, in the short run, incur substantially all of its
employee-related costs even during periods of low utilization.

     Selling, general  and  administrative  expenses  include  the  costs  of
recruiting, continuing education, marketing, facilities, equipment depreciation,
and administration, including compensation and benefits.  Selling, general and
administrative expenses as a percentage of total revenues continues to decrease
as the Company leverages its infrastructure  expense across its growing revenue
base.

     Many of the Company's  engagements  involve  projects which are critical to
the operations of its clients'  business and which provide  benefits that may be
difficult to quantify.  The Company is currently engaged in assisting clients in
auditing Year 2000  compliance  and taking steps to render  information  systems
Year 2000  compliant.  The year 2000  problem  is the  result of prior  computer
programs being written using two digits,  rather than four digits, to define the
applicable year. Any of the client's programs that have time-sensitive  software
may recognize a date using "00" as the year 1900 rather than the year 2000. This
could result in major system  failure or  miscalculations.  Additionally, the
Company has  assisted and  continues  to assist its clients in  selecting and
implementing software applications for the clients' use in their business. While
the Company is not aware of any existing or potential claims,  the occurrence of
Year 2000 related systems failures in the information systems of clients of the
Company  could involve the Company in disputes  and  negatively  impact client
relationships, which in turn could  have a  material adverse  effect on the
Company's business, financial condition and results of operations, whether or
not the Company bears any responsibility, legal or otherwise, for the occurrence
of those problems.
 

                                     Page 9

<PAGE>   10


THREE MONTHS ENDED MARCH 31, 1998 COMPARED TO THREE MONTHS ENDED
MARCH 31, 1997

 
 
     Revenues.  Revenues  increased by $7.3 million,  or 44.0%, to $23.8 million
for the three months ended March 31, 1998,  as compared to $16.5 million for the
three  months ended March 31, 1997. The revenue increase was due  primarily to
continued  strong growth in core lines of business, the Company's first quarter
acquisitions and an increased number of new client assignments.

     Cost of Services.  Cost of services increased by $3.6 million, or 42.6%, to
$12.1  million for the three months  ended March 31,  1998,  as compared to $8.5
million for the three months  ended March 31, 1997.  The increase was due to the
additional number of consultants  required to support  the  Company's  larger
revenue  base,  as well as increases in their  compensation  levels.  Cost of
services as a  percentage of revenue decreased to 50.6% for the three  months
ended March 31, 1998, as compared to 51.1% for the three months ended March 31,
1997. This slight reduction was caused by an increase in the average  consultant
billing rate.

     Selling,  general  and  administrative   expenses.   Selling,  general  and
administrative expenses increased by $2.6 million, or 39.0%, to $9.4 million for
the three months ended March 31, 1998, as compared to $6.8 million for the three
months ended March 31,  1997.  This  increase was due to  incentive  and other
compensation expenses associated with the addition of key personnel,  as well as
higher recruiting,  marketing and continuing education expenses consistent with
the Company's growth.  Selling, general  and administrative  expenses  as  a
percentage of revenues  decreased to 39.5% from 40.9% primarily due to increased
operating  efficiencies resulting from leveraging the Company's  infrastructure
expense across its growing revenue base.

     Other income and expense.  Other income was $1,247,000 for the three months
ended March 31,  1998,  as  compared  to $508,000 of other  income for the three
months ended March 31, 1997. The change was due primarily to interest  earned on
the  investment  of the  majority  of the net  proceeds of  approximately  $60.3
million from the public offering held by the Company in November, 1997.


LIQUIDITY AND CAPITAL RESOURCES

     The Company's primary capital needs have been to fund the growth in working
capital  required to support its growth in revenues.  Prior to the Company's IPO
in October,  1996, the Company's  primary source of liquidity was cash flow from
operations. The Company believes that funds generated from operations, together
with  the  proceeds  received  from  the  Company's  IPO,  the net proceeds  of
approximately  $60.3 million  from  the  follow-on  offering completed  in
November 1997, and  available  credit  under its bank credit facility  will be
sufficient to finance its working capital and capital  expenditure  requirements
for at least the next 12 months.

     At March 31,  1998,  the  Company  had cash and cash  equivalents  of $77.8
million and working capital of $94.0 million.  Working capital at March 31,     
1998 represents a decrease of $3.8 million from December 31, 1997 resulting     
primarily from purchases of property and equipment and the acquisitions of NSD
in January, 1998 and Novum, in March, 1998, respectively and an additional
payment made relating to the March, 1997 acquisition of The Kaufman Group
required by the purchase agreement.  Currently, the Company's remaining
contingency payable relating to this purchase agreement is approximately $1.0
million payable over the next two years.



                                    Page 10


<PAGE>   11



LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)


     The Company has an unsecured  line of credit  arrangement  at Comerica Bank
N.A. of $3.0  million, which bears  interest at the current  prime rate.  As of
March 31, 1998,  the Company  had no  amounts outstanding  under this line of
credit.

     Net cash used in operating  activities for the three months ended March 31,
1998 was  $1,075,000,  compared with net cash provided by operations of $828,000
for the  three  months  ended  March  31,  1997.  The  increase  in cash used in
operations is primarily due to increases in accounts receivable and decreases in
accrued liabilities; partially offset by higher earnings before depreciation and
goodwill in the current period.

     Net cash used in  investing  activities  of $8.4  million  during the three
months ended March 31, 1998 consists of additions to property and equipment, the
acquisitions  of NSD and Novum,  and an additional  payment made relating to the
March, 1997 acquisition of The Kaufman Group required by the purchase agreement.
Currently, the Company's remaining contingency payable relating to this purchase
agreement is approximately $1.0 million payable over the next two years.

     Net cash  provided by  financing  activities  during the three months ended
March 31,  1998,  was  principally  the  result of  proceeds  received  from the
exercise of stock options.
 
     On January 16,  1998, the Company  purchased the assets and business of 
NSD, located in Burlington, Massachusetts, which specializes in software
implementation and networking technology solutions for healthcare
organizations.  The purchase price was  approximately $5.2 million in cash. The
business  combination  was recorded using the purchase method of accounting.
        
     On March 26, 1998, the Company purchased the assets and business of Novum,
located in Gainesville, Georgia, which specializes in software applications
relating to the healthcare industry.  The purchase price was approximately
$670,000, consisting of approximately $312,000 in cash and approximately 
$138,000 in newly-issued common stock payable at closing, and an additional
contingent payment of up to a maximum of $220,000 payable in cash and 
newly-issued common stock over a three year period contingent on the achievement
of certain performance benchmarks by the acquired business.  The business 
combination was recorded using the purchase method of accounting.

     As of April 30, 1998, the Company purchased substantially all of the
business assets of Lincoln, a healthcare outsourcing business located in 
Wallingford, Connecticut.  The purchase price was approximately $1.7 million in 
newly-issued common stock payable at closing, plus the assumption of 
approximately $1.2 million in liabilities of the acquired business, an
additional contingent payment of up to a maximum of approximately $1.3 million
in cash and approximately $5.4 million in newly-issued common stock payable 
over a three year period contingent on the achievement of certain performance 
benchmarks by the acquired business.  The acquisition will be recorded using 
the purchase method of accounting.

     On May 4, 1998, the Company made a $4.5 million minority equity investment
in Empower of Austin, Texas.  Empower's mission is to improve the quality of 
people's lives by empowering them with personalized healthcare information and
enabling electronic interactions and online transactions with the healthcare 
industry.  The investment will be recorded using the cost method of accounting.

     The Company does not believe that inflation has had a material effect on
the results of its operations in the past three years.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK SENSITIVE 
INSTRUMENTS

     The Company currently does not invest excess funds in derivative financial
instruments or other market rate sensitive instruments for the purpose of
managing its foreign currency exchange rate risk or for any other purpose.


                                    Page 11


<PAGE>   12



PART II - OTHER INFORMATION

ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS

(d)

     On October 9, 1996, the Company's Registration Statement on Form S-1 File
No. 333-10213 was declared effective by the Securities and Exchange Commission
(the "IPO Registration Statement").  The IPO Registration Statement registered
a total of 2,723,623 shares of Common Stock issued and sold by the Company and
a total of 151,377 shares of Common Stock sold by certain shareholders of the
Company (collectively, the "Offering").  All of the shares covered by the
Registration Statement were sold upon termination of the Offering on October
16, 1996 to an underwriting syndicate managed by William Blair & Company,
L.L.C., Donaldson, Lufkin & Jenrette Securities Corporation and Jefferies and
Company, Inc.  The shares sold by the Company were sold at an aggregate price of
$43,577,968, netting $40,527,510 to the Company after underwriters' discount of
$3,050,458.  The shares sold by the selling shareholders were sold at an
aggregate price of $2,422,032, netting $2,252,490 to the selling shareholders
after underwriters' discount of $169,542.  From the effective date of the
Registration Statement, the Company has incurred approximately $994,233 in
expenses in addition to the underwriters' discount described above in
connection with the registration, offering, issuance and sale of the shares in
the Offering, netting estimated proceeds from the Offering to the Company of
approximately $39.5 million.

     None of such expenses were paid to any officer, director or 10% or greater
stockholder of the Company or any affiliate of any such persons.  Since the
effective date of the Registration Statement, the Net Proceeds have been
applied to the following uses in the following estimated amounts:

Construction of buildings and facilities:                $         ---------
                                                         -------------------
Purchase and installation of equipment:                  $         8,086,000
                                                         -------------------
Purchase and improvement of real estate:                 $         1,729,000
                                                         -------------------
Acquisitions of other business (es):                     $         9,287,000
                                                         -------------------
Repayment of indebtedness:                               $         2,834,000
                                                         -------------------
Working Capital:                                         $         ---------
                                                         -------------------
Temporary Investment:                                    $        13,917,000
                                                         -------------------
Payment of accrued compensation:                         $         3,680,000
                                                         -------------------

The temporary investments specified above have consisted primarily of
short-term commercial paper.  Except for payment of accrued compensation at the
time of the IPO in the amount of $3,509,000, none of the payments of proceeds
mentioned above were paid to any officer, director or 10% or greater stockholder
of the Company or any affiliate of any such person.

     On March 26, 1998, the Company issued approximately 3,805 shares of its 
common stock in connection with the acquisition of Novum (valued at 
approximately $138,000 based on a market trading average over a 20-day period 
ending immediately prior to the consummation of the transaction).  On April 30, 
1998, the Company issued approximately 48,381 shares of its common stock in
connection with the acquisition of substantially all of the business assets of
Lincoln (valued at approximately $1.7 million based on a market trading average 
over a 20-day period ending immediately prior to the consummation of the 
transaction).  The shares were issued to the shareholders of Novum and certain 
shareholders of Lincoln, respectively, as "restricted securities" pursuant to 
Section 4(2) of the Securities Act of 1933, as amended, in privately negotiated 
transactions not constituting public offerings.

ITEM 5. OTHER INFORMATION

     On January 16, 1998, the Company purchased the assets and business of NSD,
located in Burlington, Massachusetts, which specializes in software
implementation and networking technology solutions for healthcare
organizations.  The purchase price was approximately $5.2 million in cash.  The
business combination was recorded using the purchase method of accounting.

     On March 26, 1998, the Company purchased the assets and business of Novum,
located in Gainesville, Georgia, which specializes in software applications
relating to the healthcare industry.  The purchase price was approximately
$670,000, consisting of approximately $312,000 in cash and approximately 
$138,000 in newly-issued common stock payable at closing, and an additional
contingent payment of up to a maximum of $220,000 payable in cash and 
newly-issued common stock over a three year period contingent upon the 
achievement of certain performance benchmarks by the acquired business.  The 
business combination was recorded using the purchase method of accounting.

     As of April 30, 1998, the Company purchased substantially all of the 
business assets of Lincoln, a healthcare outsourcing business located in 
Wallingford, Connecticut.  The purchase price was approximately $1.7 million in 
newly-issued common stock payable at closing, plus the assumption of 
approximately $1.2 million in liabilities of the acquired business, and an 
additional contingent payment of up to a maximum of approximately $1.3 million
in cash and approximately $5.4 million in newly-issued common stock payable 
over a three year period contingent on the achievement of certain performance 
benchmarks by the acquired business.  The acquisition will be recorded using 
the purchase method of accounting.

     On May 4, 1998, the Company made a $4.5 million minority equity investment
in Empower of Austin, Texas.  Empower's mission is to improve the quality of 
people's lives by empowering them with personalized healthcare information and
enabling electronic interactions and online transactions with the healthcare 
industry.  The investment will be recorded using the cost method of accounting.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits


         27*  Financial Data Schedule for the First Quarter ended March 31, 1998


(b)      None

_______________________________


*   Filed herewith




                                    Page 12



<PAGE>   13

SIGNATURES



Pursuant  to the requirements of the  Securities Exchange Act of 1934,  the
registrant has duly caused this report to be signed on its  behalf by the
undersigned thereunto duly authorized.

                                 Superior Consultant Holdings Corporation


Date    May 15, 1998                By: /s/ Richard D. Helppie, Jr.
                                    Richard D. Helppie, Jr,
                                    President, Chief Executive Officer
                                    (Principal Executive Officer)

Date    May 15, 1998                By: /s/ James T. House
                                    James T. House
                                    Vice President and Chief Financial Officer
                                    (Principal Financial and Accounting Officer)



       

                             Page 13



<PAGE>   14




                                   Exhibit Index
                                   -------------



Exhibit No.                  Description
-----------                  -----------

    27                       Financial Data Schedule