The global market for management consulting services is valued to be more than $130 billion, and constitutes over half of the total consulting market worldwide, according to Consultancy.org.
So what does this elusive profession actually entail?
Management consulting is a fast-growing field that provides advice, solutions, and strategies to improve the overall efficacy and functioning of an organization. Management consultants have industry-specific skills and experience that allow them to provide insight into different aspects of a business.
This jet-setting, lucrative, and high-stakes profession draws in rising talent from top business schools aiming to work in the ‘Big Four’ and is a fast favorite among MBA students.
But what exactly does a day in the job look like? What are the skills needed to excel in this career? How much can you earn? And how does one get a foot into the door?
Lucky for you, this handy guide to management consulting is here to answer all your questions.
So what exactly is management consulting?
Let me paint a picture for you.
Imagine that you’ve been getting a severe toothache for almost a week. You’re unable to chew food without a constant sharp nagging pain.
You decide to see a dentist who upon inspection tells you that you have a severe cavity and suggests a root canal. He also recommends a herbal toothpaste and gives you a brochure on how to prevent cavities in the future.
Well, management consultants work exactly like this dentist but for organizations.
They diagnose problems and prescribe solutions and strategies to improve company health. They help organizations solve issues that they can’t handle themselves or need specialized advice and expertise for.
In some cases, organizations lose the objectivity needed to look at the big picture and make smart business and operational decisions. Here, management consulting comes into play by providing an outside, factual, and unbiased perspective on how to optimize company performance. The consultant will work with management to identify issues within the organization and also provide research-driven suggestions for improvement.
They offer expert analysis and recommendations across various organizational dimensions including strategic planning, organizational design, human resource development, technology strategy, financial modeling, information systems implementation, operations optimization, project management, customer relationship management, and also provide implementation support to help a company achieve its goals.
In many ways, management consultancy is similar to corporate training as both require knowledge of people, processes, and procedures which are then applied towards improving the overall effectiveness of an organization.
What projects might a management consultant work on?
Management consulting is an intriguing field as consultants get to work on projects across a wide variety of sectors such as manufacturing, retail, healthcare, technology, financial services, transportation, education, energy, telecommunications, food service, hospitality, and leisure.
Some examples of the projects a consultant might work on include:
- Assisting an automobile manufacturing company in cutting costs by 5%
- Advising an international supermarket chain on whether it should enter the Indian market
- Suggesting a sustainable solution to produce 3D printing machines
- Helping a mobile phone company implement a new accounting software in three months
How much do management consultants earn?
It’s no secret that management consultants rake in the big bucks. According to Glassdoor, the national average salary for a management consultant is $103,817 annually in the United States.
That’s just the overall average, however.
Case Interview states that graduates fresh out of college in the US attract the average starting salary of $83,500 at top companies such as McKinsey, Bain, and Boston Consulting Group, excluding signing and performance bonuses. This goes up to around $149,000 for MBA joinees and consultants with some experience under their belt.
Top consultants who are partners in these high-tier firms usually earn a basic take-home pay of $570,000-$1,000,000 excluding bonuses.
These are salaries on the higher end of the scale though and may vary depending on which company you join or if you choose to work independently.
What does a day in the life of a management consultant look like?
There’s not a day that goes by the same while working as a management consultant. A typical day might involve:
- Working in-person or remotely as part of a team focused on solving challenges faced by their clients
- Analyzing industry reports, data, and other resources
- Conducting primary interviews to understand the problem being solved
- Developing insights based on these findings through secondary research
- Consulting with other teams to gain a big-picture understanding
- Providing objective feedback about current practices and processes
- Creating actionable plans and proposals to address identified gaps and weaknesses
- Writing reports and presentations outlining potential solutions
- Traveling to different places as the project demands
- Providing executive-level briefings to senior leaders and stakeholders about emerging trends and new opportunities.
- Identifying critical areas where change needs to occur to ensure long-term success
- Managing client expectations throughout the process
Is management consulting a good career?
There’s no doubt why many people aspire to become management consultants: It’s glamorous, exciting, challenging, rewarding, well-paid, and offers great opportunities for growth. But there’s also a flip side that comes with this profession.
So let’s take a look at the pros and cons of this career to help you make an informed decision.
1. It’s a Career Choice That Pays Well
Being a management consultant means having access to big money; especially if you’re working in the ‘Big Four’ (Deloitte, Ernst & Young, KPMG, and PwC) or the ‘Big Three’ (McKinsey, Bain, and BCG).
According to a Quora thread, the reason for the high pay is multi-faceted. Traditional management consulting firms usually follow the rule of ten, which means that they typically target problems that have at least ten times the value of the firm’s consultancy fees, and the solutions are usually worth many millions of dollars. Consultants also have niche industry expertise while working hours that go well beyond the standard 9 to 5.
2. Good Opportunities for Growth
Being a management consultant opens doors to new challenges and experiences every day. And with such a diverse set of responsibilities, there’s always room for advancement and professional development.
Management consulting also has very few boundaries when it comes to scope of practice. You could end up doing anything from strategy consulting to operations advisory, IT governance, financial management, data analytics, and so forth depending on the needs of the client.
Through work, you’ll gain hands-on experience in every aspect of running a successful business and also get to learn about various industries.
3. Opportunity to build your network
As a management consultant, you’ll likely be interacting with the top brass at the client organization. This gives you a chance to build relationships with key decision-makers and learn from them.
4. A High Level of Independence
One of the biggest benefits of being a management consultant is that there’s not much supervision or micromanagement. Unlike most corporate jobs where employees must report back their progress daily and weekly, managers expect consultants to keep track of themselves.
1. Long hours and a high-stress environment
Management consulting is a demanding profession as you are expected to work long hours and it’s not uncommon for consultants to have stressful days at the office. Managing clients isn’t easy and managing multiple projects simultaneously can make things worse.
The lack of structure sometimes leads to burnout among consultants who don’t see enough time off. Working well into the night becomes routine and even weekends can feel like weekdays.
2. Being away from home and family
Frequent travel comes with the job and when combined with the long hours means that you have to spend a good chunk of time away from home. It becomes tough to balance family life (especially for people who have children) with professional commitments.
The unpredictability of your schedule also doesn’t leave much space for planning vacations or other personal obligations.
3. You might not always see the fruits of your labor
Clients might decide not to implement the recommendations of the consulting firm once the contract has ended. In other cases, the client may choose to bring in another company to do the project instead of using what was recommended by the consulting firm.
So, you might not always see the tangible results of your effort.
This profession does come with its perks and drawbacks but if you harbor an interest in management consulting and are unsure of where to start, read on to learn how you can get started in this field.
What educational qualifications do you need to enter this profession?
The basic entry-level requirement is a bachelor’s degree in a business-aligned field such as business administration, accounting, finance, economics, marketing, organizational psychology, or human resource management.
However, with the increasingly competitive landscape, an MBA is a more typical requirement which also affords you the opportunity to enter the profession at a higher level with a larger paycheck.
If you don’t have a degree though, don’t fret.
Smaller firms do accept applicants without a university degree but who either possess analytical and quantitative reasoning skills, strong technical expertise in a field, or relevant work experience.
How can you land a job in management consulting?
The sure-fire way is to pursue an MBA at top business schools as recruiters are always on the lookout for fresh talent. In fact, the top consulting companies have a list of target schools to cherry-pick graduates from.
It’s also not uncommon for students to take internships before graduating to get a foot in the door.
A Quora response by a former partner of Booz Allen Hamilton succinctly lists three ways to land your first job in this field: enter as a business analyst if you’re fresh out of college; join as an associate consultant from a top MBA school; or if you’re further along the professional ladder, enter with specialized experience in a consulting-related field.
It’s also important to network and build relationships with alumni and people at the companies you’d like to work in as this will help you stand out when applying for jobs. Keep an eye out on LinkedIn for open positions and tailor your resume according to the organization.
Once you land an interview, a key component in the entire process is the ‘case interview’ where you’re asked to analyze a particular project and offer recommendations based on the available data. Here’s a mock interview from Bain to guide you on what to do.
What can you expect at your first job?
So you’ve cleared the interview, signed on the dotted line, and it’s your first day at the office! Congrats!
But what can you expect here?
Most companies offer training programs and orientation sessions to acclimatize fresh graduates with job requirements and company culture. You’ll also have access to mentors from experienced professionals to help you navigate any challenges along the way.
Your manager will likely give you assignments based on his/her needs or as the project demands. Some managers prefer having junior associates do all the grunt work while others want them to focus more on strategic planning. You’ll most likely spend your time doing base research, typing up notes, creating presentations, or working with Excel to collate data.
You’ll also get numerous opportunities to soak up knowledge and learn new skills. This includes attending conferences, workshops, seminars, webinars, and other events where you can network with peers and industry leaders.
What skills can help you succeed as a management consultant?
Natural leadership abilities
The ability to lead effectively and build trust amongst colleagues is vital to being successful in a team environment. It also helps if you’re good at delegating tasks and motivating others towards achieving common objectives. Being able to inspire confidence in clients and peers alike is a key quality to achieve success in this profession.
Effective Communication Skills
Good communication skills are essential in any field but especially so in management consulting where it’s crucial to establish rapport with stakeholders and gain their trust. You’ll also spend much time communicating ideas through meetings and presentations. Thus, effective verbal and written communications skills are essential as well as strong listening abilities.
The Greek philosopher Heraclitus once said, ‘The only constant in life is change’. This rings especially true in the life of a management consultant as you might find yourself working across multiple industries or even countries during a single project. Thus, you need to keep a flexible attitude and adapt quickly to challenges as they arise.
Management consultants rely heavily on numbers and statistics when making recommendations. Thus, it’s important to be data-savvy and be able to explain information clearly and succinctly using charts and graphs.
Strategic Thinking & Problem Solving
You must be able to think critically, analyze data, understand complex situations, and come up with effective solutions to overcome challenges. It’s vital to consider various possibilities and then use research and data to reach the ideal solution for the project.
It is important to have an eye for business as understanding the financials, operations, marketing, sales, human resources, and legal aspects of a client’s business are crucial to understanding their needs. It is also imperative to keep up with the latest trends, regulations, competitors, laws, and best practices of the industry you specialize in to help you make informed decisions.
Management consulting is a field that has immense scope for growth. And we hope that this guide has been a helpful reference to learning more about this profession.