Management consulting is one of the most sought-after fields in the business world. On the surface, the industry sounds glamorous – lots of air travel, working on complex business problems, and exposure to top level management. While all these truly are great components of management consulting, the reality is that the industry is not for everyone.
To be clear, we don’t mean that in a bad way. Instead, there are just so many candidates who say they want to join a management consulting firm only because they haven’t looked at both sides of the coin. Management consultants are amongst the hardest working professionals on the planet. They deal with the highest of expectations, constant deadlines, and lots of stress. For some, this may sound like a great and perhaps even exciting challenge. For others, it may not.
In this article, we provide some insight into what working in management consulting entails and how you can become a consultant yourself. We’ll also be sharing some unbiased commentary on the management consulting industry – the good and the bad.
What is Management Consulting?
In short, management consultants solve large, hairy, complicated problems for organizations. Management consultants are professional experts who provide solutions and strategies to improve the financial and operational health of an organization. The recommendations made by management consultants are backed by large amounts of research and data.
Clients hire management consultants primarily as objective third-party analyzers of an organization, including businesses, government institutions, nonprofits, and more. Oftentimes, organizations can become so engrossed in their own biases and perspectives that they can lose the objectivity needed to make the best strategic and operational decisions.
Other times, these organizations simply come across problems they’ve never experienced before. In these instances, management consulting firms who have worked on similar projects for other clients are able to provide their industry expertise and advice. For instance, one of the most common consulting projects involve cost cutting when a company has grown too quickly and is not operating at peak efficiency. A consulting firm that has worked on cost cutting projects for hundreds of companies across multiple industries could clearly use its expertise to help the client.
What Does a Management Consultant Do Day-to-Day?
Depending on the progress of the project, there are five main types of work a management consultant will work on.
Understand the Objective
- Understanding what the client is looking for is fundamental to the success of the consulting project. Consultants spend a significant amount of time with the client’s management team in order to align on the objective. There are also several discussions about the resources the consultants need, such as access to financial information and interviews with key employees. Consultants will usually also start with a hypothesis on potential solutions and think about the right data they need to test their theories.
Gather Data and Research
- Management consultants spend a lot of time gathering the right data to support their hypotheses. This can include going through a company’s internal financial figures, hosting focus groups with third parties, pouring through industry research reports, interviewing company employees, and more. All this work usually involves massive files with large amounts of raw data on Excel that need to be structured and made sense of.
Perform In-Depth Analysis
- With the data in hand, management consultants then focus on arriving to the insight they are getting paid to unravel. Consultants organize the data usually in Excel and extract the key pieces of information into charts and graphs on PowerPoint. These visualizations often help uncover potential solutions to the case, which could result in the case going in several unexpected directions. There are also many discussions within the consulting team regarding the correct interpretation of the data.
Meetings with Clients
- Throughout a project, there are many, many meetings between the consultants and the client. These meetings are not always with the C-suite executives, but point persons that the client appoints to coordinate with the consulting team (usually VPs, Directors, and etc.). What most non-consultants don’t know is that by the time the final deliverable is presented to the client, there should be no major surprises to the client. Consultants provide constant updates every few days or weeks to the point person, who provides ongoing feedback and guidance and updates his seniors.
- PowerPoint and Excel are a management consultant’s best friends. Consultants spend many hours making sure every detail is perfect and build presentations that are clean and easy to understand but are also insightful and powerful. A large portion of a consultant’s time goes into creating deliverables that are constantly checked by senior members of the consulting team and also by junior members of the client team. These checks result in constant revisions until the presentation is ready to be delivered to the client’s senior management team.
Management Consulting – The Good and the Bad
Firms like McKinsey, Boston Consulting Group, Bain, and Deloitte Consulting are some of the hardest to crack into in the world for good reason. With that said, there are still important drawbacks that should be considered before committing to the industry. Let’s discuss the pros and cons of management consulting.
Management Consulting Career Pros:
Fantastic Learning Opportunities
Management consulting firms offer an amazing learning opportunity for consultants at all levels. This is due to a few reasons:
Work with the largest companies in the world
- Because consulting projects are so expensive, they can only be afforded by sizable companies. Working on large scale projects provides a wealth of opportunity to learn about the problems the largest companies face and how to solve them.
Exposure to top level management
- Consulting projects usually include the client’s most important members of their management teams. Being able to discuss strategy with them and learn how they think is amazing exposure, especially for junior consultants.
Learn from intelligent and driven colleagues
- The most of what you learn at a management consulting firm often will be from your colleagues. Consulting firms only hire the cream of the crop and you co-workers are the ones who you interface with for the majority of time.
Flexibility and Variety
Management consulting firms offer a unique opportunity to learn from a broad range of people, problems, and industries.
- Different locations and bosses
- Because management consultants work on a project-by-project basis, they are not fixed to one manager or location. This means that if you don’t have a great experience with a particular team or place, you won’t be stuck in that position for long. On the other hand, if you do have a good experience, you will be able to request working with that same team.
- Wide range of objectives across multiple projects
- The more junior you are, the wider range of projects you will come across. One project may include a cost cutting objective, while the next could be about entering a new market. The exposure to a variety of projects allows for great professional development.
- Projects across various different industries
- Most management consultants are generalists at the beginning stages of their career, meaning that they are industry agnostic. This means that one project can be in the healthcare industry while the next one could be in the oil industry. Each industry has its different features and unique learning lessons. There are few fields other than management consulting that provide an opportunity to learn about so many different industries in the same job.
- Different locations and bosses
Amazing Exit Opportunities
Having companies like McKinsey and Company or Deloitte Consulting on your resume will make your post-consulting recruiting life incredibly easier. Management consultants are amongst the most sought-after employees by companies across all industries. Consulting alumni especially at the top firms often also become C-Suite level executives. Though management consultants work extremely hard, they often say that it’s all worth it because of how much can be learned on the job that can be applied to other roles.
Management Consulting Career Cons:
Lack of Tangible Results
If you’re looking for a job where your work results in solid, tangible results, management consulting may not be for you. Even if your team works for months and delivers irrefutable amazing advice, it is completely up to the client to execute. Management consultants rarely get to see the results of all their hard work because as soon as a project is over, they need to move onto the next one.
Lots of Stress and Expectations
Your team and your client will both be demanding at management consulting firms. Because you’re usually working with the largest companies in the world, the stakes are usually quite high. The industry is extremely fast paced and there are constant deadlines that results in long hours. At times, you may be working similar hours as investment bankers but won’t be compensated as much (see our 2019 management consulting salaries article for reference). Consequently, many management consultants burn out from the job and move onto other industries.
Lack of a Creative Environment
Though there is a lot of critical thinking involved in management consulting, there isn’t as much creativity. Especially if you are more junior at the firm, a lot of work involves gathering research and analyzing data. These tasks don’t call for that much creativity in comparison to fields like product management and entrepreneurship. If you are a truly creative person who wants to build products, services, or businesses, management consulting may not be for you.
Top Management Consulting Firms
Now that you have a solid understanding of what the management consulting industry entails, it’s next important to know which firms you should aim to work at. See our ranking of the Top 25 Consulting Firms here.
There’s MBB and Then There’s the Rest
The most prestigious and sought-after firms are the “Big Three”. They’re also known as “MBB,” an acronym for the top three firms of the management consulting world:
The Big 4
The Big 4 accounting firms actually generate more revenue for consulting services than MBB. This is largely due to several acquisitions which have expanded each firm’s scope. In order of highest revenues from consulting services generated, here are the Big 4 firms (along with the strategy practices they acquired to compete with MBB):
- Deloitte (acquired Monitor Group)
- PwC (acquired Booz & Company and rebranded it as Strategy&)
- Ernst & Young (acquired the Parthenon Group)
Strategy Consulting Firms
A lot of people ask what the difference between strategy and management consulting. Strategy consulting is simply a subset and type of consulting that fits under the broader management consulting umbrella. The MBB and Big 4 all provide strategy consulting, and this service is the most prestigious of all types of consulting. Here are some firms that focus on different types of strategy:
- Oliver Wyman
- L.E.K. Consulting
- Accenture Strategy
- Booz Allen Hamilton
- Roland Berger
Management Consulting: Overview Video
Management consulting is a very rewarding career, but it’s not for everybody. We trust that this article gave insight into what management consulting is, and its pros and cons. If the day to day activities of a management consultant sound interesting to you, reach out to our team to find out more of what it will take to land a career in consulting!