ConsultingCareerPrimer.2014–2015

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Plain and simple, MBAs love consulting.

This is no doubt in part because the average median salary and signing bonus at the leading 15 MBA

programs are higher for consulting positions than for roles with other functions.

Note: All compensation figures are based on placement reports from the classes of 2013 and 2014 at the top 15 MBA programs;

some variations exist within these reports, so attempts were made to harmonize data.

What do the data say about consulting recruiting?

Percentage of graduates entering jobs with a consulting function at the top 15 MBA programs in 2013

$18,700

$116,200

Average MBA Graduate

$80,000

$16,000

Pre-MBA Analyst/Associate

$25,000

$135,000

Consulting

Average base salary

Average bonus

4

The Org Chart

PartnerTotal compensation of $500K-$1M+

PrincipalTotal compensation up to $350K–$500K

depending on seniority

Consultant (Post-MBA)$125K–$135K plus $25K signing bonus

with performance bonus up to 30%

Business Analyst (Pre-MBA)$75K–$80K plus $5K signing bonus with

performance bonus up to 20%

ManagerTotal compensation up to $250K

with base around $150K–$175K

Source: Multiple interviews with those in the field.

Note: Compensation figures for business analyst and consultant reflect a first-year salary and bonus.

Business Analyst/Associate (Pre-MBA):

Business analysts are the most junior members of a case team.

Although their responsibilities vary by firm, in general, they are tasked

with “grunt work” that encompasses collecting and analyzing data.

On one day, a business analyst might interview a client’s employees;

on another, he/she might model the impact of a regulation change

on a client’s profit and loss statement. Business analysts spend a

lot of time using Excel and PowerPoint, and they are accustomed to

working late nights. As they advance to more senior analyst roles,

they tend to be given ownership of a work stream within a project,

case, or study. (Firms use different terms to describe client projects

and titles, and you would be wise to learn the unique vocabulary your

target firms use.) At the end of two years, business analysts can go to

business school, transition to another firm, take a role within a client

organization, or progress further within the firm.

5

Consultant(Post-MBA):

After working for three years as a business analyst at a firm or

completing their MBA degree, consultants own a work stream in a

project. They are responsible for structuring data analysis and for

collecting and evaluating data—all with the guidance and feedback

of their project leader or manager. Although they tend to handle tasks

similar to those of analysts, they are given more responsibility and

often have greater opportunities to interface directly with clients. In

addition, they can be tasked with supervising junior team members.

Consultants are generalists, serving multiple industries and functions

rather than specializing in one, and they usually invest two to three

years in the role before they become project leaders or seek outside

opportunities. Because consulting firms have a pyramid-shaped

structure (i.e., a lot of consultants, fewer project leaders, and even

fewer managers), they tend to embrace an “up or out” culture in which

strong and continually improving performance is required to remain at

the firm. Consequently, a number of consultants leave the industry at

this stage.

Project leaders possess significant consulting experience and are

responsible for the day-to-day management and final delivery of

projects. This position is sometimes regarded as the most difficult role

in this industry due to the simultaneous downstream and upstream

management required. For example, on the one hand, project leaders

are responsible for solving problems that arise with the project,

structuring the work stream, ensuring delivery of the final project by

the case team, and managing and developing junior team members.

They also interact with clients, which means they must take part in

potentially lengthy meetings to develop relationships. On the other

hand, project leaders must report to the partners who sold the case.

Project leaders must ensure that the case work is done according

to the firm’s quality standards and in a timely fashion. At this career

stage, specialization occurs. Project leaders tend to start focusing on

one or more practice areas, which are categorized by industry (e.g.,

consumer goods, technology, financial services) and by function (e.g.,

supply chain).

Manager (Project Leader/Engagement Manager):

6

Principal/Associate Principal:

Principals are the bridge between project leaders and partners;

one can think of them as “partners in training.” The big change

that happens at the principal level is a shift of focus from project

management to client management. Similar to project leaders,

principals oversee projects, which means they are responsible for

the final delivery of case work. However, they tend to work on more

complex and high-profile cases that require extensive interaction

with executives. In addition, principals often take the lead in writing

and coordinating proposals and participating in sales meetings. They

are in active contact with their set of key clients to generate new

leads. They have built significant market knowledge in one or more

areas, demonstrate thought leadership, and build the firm’s offerings.

Principals also take office leadership roles such as head of university

recruiting or head of the social committee. Although promotion

horizons vary by firm, the duration of the principal role is typically two

to five years.

Partner/Director: Partners are owners of the firm and are usually elected to their position

by the rest of the partnership. Their primary responsibility is to sell

case work, maintain client relationships, and deliver project work to

the client. They have the ultimate authority to approve work, and they

manage relationships with clients at the senior most level (e.g., they

frequently lunch with CEOs). They are typically aligned with one or

more practice areas and take leadership of them. In addition, partners

have significant responsibility for thought leadership (e.g., publishing

articles in Harvard Business Review, bcg.perspectives, or McKinsey

Quarterly) and additional activities within the firm such as training,

recruiting, and staffing (i.e., placing consultants on cases). The partner

role can encompass different levels. For example, some firms have a

senior partner role that requires several years of employment within

the partnership before advancement, and promotion depends on

performance, sales, and service to the firm. In addition, the “up or

out” culture persists even at this level; partners are still required to

continuously improve and advance to maintain their position within the

firm.

7

What is the job?Management consulting firms provide outsourced brains to assist clients with

tricky or sensitive problems. Consultants advise clients on strategic changes

and develop analytical answers to client questions. As a consultant, you might

help formulate a new corporate strategy for a B2B manufacturing company,

conduct strategic due diligence for an acquisition in the medical device industry,

strategize on a new product launch in a remote geographic region for a bank,

troubleshoot brand underperformance for a consumer goods company, or help

retool the supply chain for a food and beverage distributor. You also might help

a company with downsizing or with operationalizing a new strategy. Depending

on the firm and the types of projects to which you are assigned, you may

find yourself tackling a new challenge in a new location every three weeks or

camped out in Kalamazoo for an entire year.

8

No, really, what is the job?All this may sound pretty sexy, but what does “formulate a new corporate strategy for a B2B manufacturing

company” or “troubleshoot brand underperformance for a consumer goods company” really mean? Here

are some project experiences of actual first- and second-year consultants at McKinsey & Company, Bain &

Company, and BCG (the Boston Consulting Group):

We had to help decide which storefronts

of a car parts company should be closed or

expanded and where the company should

build more. As a first-year consultant, I

looked at sales data, population data, and

local competition.

We advised a packaged foods company on

improving its in-store placement. For two

weeks, I actually drove around to various

grocery stores and watched what customers

did when they approached the hot dog

aisle. I conducted surveys. A few times, the

storekeepers kicked me out. I turned the

pictures I took, survey data, and testimonials

into my part of our final PowerPoint

presentation to the client.

A technology products company had a new

technology, and they needed to decide what

to do with it. I helped assess the market

potential of this technology to replace

activities people were currently doing on

paper. I had to guesstimate—using real data

and modeling—the potential applications and

model out which one had the biggest payoff.

My job was to interview constructing

contractors to help decide if a major home

improvement center should enter the lumber

market. I had to help them understand

whether they could expect to get enough

business from medium- to large-scale

contractors to justify the costs associated

with entering the new market and reaching a

different customer base.

A hospital chain wanted to respond to the

threat of surgery centers taking away its

most profitable procedures—certain elective

ones that help subsidize the less sexy

but necessary units like trauma and burn

centers. As a consultant, I had to determine

the profitability of every kind of insurance

transaction and see if we could partner with

these centers to maintain profits.

A new CEO was making changes to

the organizational structure in a large

conglomerate consumer goods company. I

had to work with the top managers in HR

and finance to make difficult decisions about

which roles to keep, which to restructure,

and which to eliminate. Then I had to help

them manage the communication to staff

about these changes in a way that disrupted

headquarters function as little as possible."

9

What is good about the job?The siren song of consulting is variety. At most firms, at least in your first couple

of years, you will be forced to cross-train—joining project teams working across

functions, industries, and geographies. The broad exposure you thereby gain

to a wide diversity of business problems prepares you to face any number of

challenges throughout the rest of your career and trains you to think about them

strategically, holistically, and creatively.

But a job in consulting offers other perks as well:

• The opportunity to travel

• Generous compensation and benefits

• Exposure to C-level executives and issues early in your career

• A well-defined career path: Business Analyst � Consultant � Manager �

Principal � Partner

• A high-powered network of colleagues and clients

• Outplacement support when you are ready to transition to your next job

10

But surely the job has pain points, right?A consulting role does involve some potential drawbacks:

• The necessity of travel

• An unpredictable schedule and long hours

• A steep learning curve and an “up or out” culture

• The possibility of a new “boss” on every project

• A continual focus on “areas for development”

A job in consulting presents one of the best opportunities for growth and learning at an

early stage in your career. The downside is that you almost never have a chance to sit

still. So as soon as you have established yourself as an Excel whiz, for example, you

will then be encouraged to tackle client relationships and human dynamics on your

next project. Relying on the same skills that make you a great entry-level consultant

will make you a poor project manager; at each level, new skills are required. The job

constantly challenges and stretches you, and some consultants complain that the

unceasing focus on weaknesses can get tiring after a while. Add to that the necessity

to impress each new “boss” or project manager you encounter, and a consulting job

could definitely take a few years off your life, especially if you do not approach it with

the right mind-set and maintain a sense of humility and humor.

11

What is the secret to success?The one thing you must understand to hit the ground running in consulting is how the culture works.

Consulting culture is both entrepreneurial and hierarchical, as paradoxical as that may seem—these two

concepts truly can and do coexist. You can certainly create your own destiny, chart a course for yourself in

the direction you want, and choose the kinds of work you do. At the same time, however, you must respect,

understand, and navigate the hierarchy: you will need to cultivate relationships with people senior to you,

identify mentors and champions who will lobby to work with you come staffing and promotion time, and

establish a good reputation so that you can steadily advance your position. No one will spoon-feed you,

and if you are not looking out for your career development, no one will. You will spend a big part of your first

year learning to communicate in the style of your firm and to follow its processes, hierarchies, and norms.

Dedicate yourself to mastering the network, politics, and expectations of the job, and you will lay a foundation

for medium- and long-term success.

The burden is on you to work the political environment, get staffed, build a network, and create a long-term place for yourself in the firm.

12

Who are the big fish?When most people say, “management consulting,” they are referring to “MBB”: McKinsey & Company, Bain &

Company, and BCG (the Boston Consulting Group), also known as the Big Three. These three firms typically

claim the majority of post-MBA consulting hires. While they have much in common—they all seek to hire

the best and brightest, tackle strategic C-Suite problems, and offer broad exposure to diverse industries,

functions, and geographies (read: require some degree of travel)—culturally, they vary tremendously. If you

read between the lines, you will see that the firms’ key messaging about themselves on LinkedIn reveals these

differences (make special note of the parts we have bolded in the following descriptions):

“Our scale, scope, and

knowledge allow us to

address problems that no

one else can. We have deep

functional and industry

expertise as well as breadth

of geographical reach.”

The oldest, largest, and

best known of the Big Three,

McKinsey & Company

leverages its deep experience

to provide relevant solutions to

client problems.

Buzzwords:

Experience

Structure

Organization

“We work with top

executives to help them

make better decisions,

convert those decisions

to actions, and deliver the

sustainable success they

desire.”

The youngest and smallest of

the Big Three, Bain & Company

has the strongest firm culture—

stressing camaraderie and

teamwork—and places greater

emphasis on clients’ market

performance as a measure of

success.

Buzzwords:

Camaraderie

Teamwork

Results

“Our customized approach

combines deep insight into

the dynamics of companies

and markets with close

collaboration at all levels of

the client organization.”

Applying a “clean slate”

approach to each client

problem, BCG leverages

its consultants’ intellectual

horsepower to create

innovative solutions in

collaboration with clients.

Buzzwords:

Academic

Innovative

Collaborative

13

Who are other notable players in this space?Major changes in the landscape of professional service firms over the past few decades have made the rest

of the management consulting field a little confusing to follow, but here are some other significant players:

Strategy& merges the management consulting arm

of assurance giant PwC (PricewaterhouseCoopers)

with the recently acquired (April 2014) Booz &

Company. If the MBB set had a fourth member that

practices fairly pure strategy consulting to top firm

management, it would be Strategy&.

Deloitte, another huge recruiter of MBA talent, is

the management consulting division of Deloitte

Touche Tohmatsu Limited, one of the Big Four

accounting firms. It acquired BearingPoint,

KPMG’s management consulting division, in 2009

and Monitor Group, the firm founded by Michael E.

Porter of “five forces” fame, in 2012.

Formerly the business and technology division of

defunct Big Five accounting firm Arthur Anderson,

Accenture offers technology and outsourcing

services in addition to management consulting,

making it the most technology-focused firm on this

list.

“A.T. Kearney is a global team of forward-thinking,

collaborative partners that delivers immediate,

meaningful results and long-term transformative

advantage to clients.” Similar to the firms we have

already discussed, A.T. Kearney consults on the

CEO agenda—often with a more operational focus

than its purely strategic peers.

Booz Allen Hamilton provides provides

management consulting, technology, engineering,

and security services to civilian government

entities, including defense and intelligence

agencies. The commercial strategy division of

Booz was spun off in 2008 to become Booz &

Company, which was later acquired by PwC (see

the Strategy& description).

The current Oliver Wyman is the product of a

merger between Mercer Oliver Wyman, Mercer

Management Consulting, and Mercer Delta in

2007. Originally founded in 1984 by two former

Booz Allen Hamilton partners, Oliver Wyman is the

subsidiary of public company, Marsh & McLennan

Companies.

14

How do I get the job?Each firm has its own nuanced approach to recruiting, but the broad strokes are the same. You will need to

demonstrate the following:

1. Strong intellectual horsepower and a track record of success in a

challenging field

2. An ability to structure and analyze ambiguous problems in an

improvisational manner, to work adeptly with numbers and calculations,

and to clearly explain your thought processes

3. Persuasive and analytical communication skills that engender confidence

and trust in you

In addition to having strong undergraduate grades and a good GMAT score (typically 710 or higher, especially

at schools with grade nondisclosure, where the only recent data point firms can use to assess your intellect is

your GMAT score), you will need to perform well in case and behavioral interviews. Some MBA students say

that prepping for case interviews is like taking an entire extra class during recruiting season. However, most

also note that the process is worthwhile in its own right because it teaches them to think in a structured way

and communicate their ideas clearly.

You will also want to network with your target companies. This includes attending company-sponsored

events, befriending classmates who have worked at the firms, and capitalizing on every opportunity to meet

firm representatives through informal and club offerings. Taking these steps to connect with the companies

for which you want to work is a necessity no matter which industry you target. Doing so helps you and the

firm(s) assess mutual fit and paves the way for your success in interviews.

If consulting is your chosen industry for a summer internship or post-MBA position, get started now building

your network, conducting informational interviews with classmates and friends at target firms, creating a

consulting-targeted resume, and preparing for case interviews. To learn more about how an MBA Career

Coach can assist you in securing your desired position through elite training, targeted skill development,

and expert guidance as you navigate the recruitment process, schedule a free consultation with us at www.

mbacareercoaches.com/consult/.

15

Do you know that your career won’t just advance on its own?If you want to get ahead, you need

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