What is Management Consulting?
What do the leaders of a major company do when they have a problem that they can’t solve? They call on the best business problem solvers that money can buy – management consultants. These ladies and gents are the hotshots that are brought in to advise the CEOs and leadership on how to make their firms unstoppable.
Virtually every major company in today’s business world relies on bringing in outside expertise to solve problems. Even blue chips like Nike, Goldman, and Google call on consultants to help them innovate, grow, and strategize. This has created a hefty $139 capital-B Billion dollar market for the elite brains of the business world (Plunkett Research 2015).
Why do companies pay big bucks for hired guns?
Because good consultants can change the game. Imagine calling in Seal Team 6 to your friend’s paintball birthday party (or Beyonce to your acapella recital or Steph Curry to your high school basketball game). Often times, consultants will bring an outside perspective, a depth of experience with the problem, and a huge toolkit to fix it. So how much do they really move the needle? One top-tier management consulting firm has clients who outperform the market 4-to-1 on average, sales and marketing cases that deliver an average of 25% revenue growth, and merger integrations that average 20% higher excess shareholder value (Vault 2015). Like I said, they change the game.
What do Management Consultants do exactly?
Solve problems, yes. But how? MCs are trained to take any nebulous problem, find the root cause, construct a solution, and deliver results through change. Say Nike’s FitBit sales are falling flat and they need help. On the day-to-day, you would often start with data gathering, data aggregation, and analysis. For instance, you might accumulate all of Nike’s FitBit sales data for the past three years, analyze for patterns/issues, and form insights based on your findings. Then, you take your crucial insights and develop real, powerful recommendations. Finally you sharpen up your work, weave it into a compelling story, and deliver the vital results to the big boss. The best consultants don’t stop there. These guys will be hired to follow through on the recs and be responsible for implementing and driving results.
Why is Management Consulting often considered the best possible job when leaving college?
This career is desired for more than just its jaw-dropping salary progression and fat bonuses. The job comes with its own host of incentives and perks that make the whole package start sounding too good to be true. But that’s not all – one of the biggest benefits lies in the doors that the job opens beyond the consulting world.
1) Salary – what do I get paid?
2) Benefits and job perks – what else do I get?
a) Trainings – MC companies pay a pretty penny training their consultants. You are a prize pony that the company has an interest in keeping as frisky as possible.
b) Travel – Management consultants will often travel to be at their client sites, which includes free plane tickets to cities across the U.S. and even the world.
c) Flexibility – Although the job is high-intensity, there is a large degree in flexibility regarding work environment, type of work, industry, function, and more.
d) Network – You are working alongside some of the brightest business minds on the planet.
e) Business School – Some companies will sponsor their analysts to go to the top business school. Did someone say Harvard and Stanford… for free?
3) Exit Opportunities – What do I walk away with?
a) Prestige – Consulting firms offer an immediate level of credibility to your resume as viewers can assume you’ve operated in difficulty, real business situations.
b) Preparation – This job makes you an “overall business athlete”. You can high jump a financial model, hurdle through miles of data, and knockout a presentation to the CEO of a Fortune 500 company.
c) Unmatched experience – As a consultant you are put in the toughest business positions helping making the toughest business decisions. This spans across industry and function with unbelievable exposure to top management.
Who are the big dogs in the consulting industry?
BIG THREE: Mckinsey, BCG, Bain (MBB)
These are your prototypical strategy houses that dominate the management direction-setting work in the industry. They are also commonly regarded as the most competitive and prestigious firms.
BIG FOUR: Deloitte, PricewaterhouseCoopers, KPMG, and Ernst&Young
These four companies are the largest global professional service companies that specialize in audit, tax, and legal work. With massive resources and capabilities, these companies traditionally move a lot of ground in the industry.
OTHER NOTABLES: Accenture, The Brattle Group, A.T. Kearney, Booz Allen Hamilton, IBM, Mercer, L.E.K. Consulting, Parthenon, Oliver Wyman, Kurt Salmon, Roland Berger
So, how do I break into the consulting game?
First of all it is not easy. There are virtually no published statistics on consulting recruitment, but here are some anecdotal numbers:
McKinsey – 2012 received a global total of 225,000 applications and gave 2,200 offers, or about 1% across undergraduate, MBA, and PhD candidates. (Ladders 2013)
Deloitte – 2012 reportedly only hires 3.5% of applicants (Fastenburg, AOL Jobs, 2012)
Bain – 2015 recruiter said that they received over 6,000 undergraduate applications for a single office and gave ~40 offers. In other words, less than 1% (Brendan hearsay)
But keep reading. Breaking in is far from impossible.
Let’s start at the basics. The bare minimum to get a job in the consulting field is a bachelor’s degree. There are two major ways from here: 1) you can get hired straight out of college, 2) you earn an MBA and get hired from there. We are going to focus on the first scenario.
The on-campus recruitment process essentially resembles this:
Resume drop: Before passing off your resume, there are usually information sessions and other opportunities for applicants to learn more about the firm and to network. Once you drop the resume, all you can do is wait. There are two things that promote success here: a magnificent resume and a killer network. You get a magnificent resume by getting real experience and skills. You get a killer network by investing time and effort into relationships.
First round interview: Here, you have your foot in the door and your network can’t help you now. It’s show time. Although first rounds take many forms, you will usually see a behavioral component and the notorious case interview here. Keys to success: storytelling skills and case interview wizardry.
Second round interview: You’re in the big leagues. They know you can play the game, now they want to see if you can play with their team. Two or more back-to-back interviews with behavioral and case components. How to get the offer? Know the firm like your family, show them you think like a top-tier consultant, and crush the cases.
The bottom line.
Management Consulting is the ultimate job for the best and brightest business minds that are interested in cultivating a multifarious future. This job will teach you tons, kick open doors, and pay you wads of cash all the while. That’s also why it’s one of the most competitive job markets in the world.