Second, what challenges do the clients need help with? Who are the clients? The clients are often leading businesses e. While each consulting firm will have a different client base and sometimes different sector focus , the primary customers of many consulting firms come from the first category: leading businesses.
We'll revisit this more below. What are the client challenges? Given that leading businesses are the primary customers of consulting firms, you might immediately ask: why do leading businesses, who likely can likely hire the world's best talent, need to hire expensive consultants to help them with their problems? While there are edge cases, there are three core reasons that drive the bulk of the consulting business.
For more detail, read on below or listen to me walk through the three core reasons companies hire firms like McKinsey, BCG and Bain. The leading consulting firms have built up critical expertise in key areas.
Thus, when companies face mission-critical challenges or problems that require that expertise, an efficient way to resolve the issue can be to engage with a consulting firm.
For example, consider the scenario of a large consumer electronics manufacturer who has decided to merge with a similarly sized competitor. While both firms have done small acquisitions in the past, neither firm has ever attempted a merger of this scale.
Thus, neither will have the muscle memory or in-house expertise to confidently execute well. Note the operative word confidently here. Things changed in the s, with McKinsey leading the way. In and , the firm placed help-wanted ads in The New York Times and Time magazine, with the goal of generating applications that it could then reject, to establish its own eliteness. Daniel Markovits: How life became an endless, terrible competition.
Management-consulting firms deployed a panoply of branded processes against middle management. Management consultants thus implemented and rationalized a transformation in the American corporation. They downsized in response not to particular business problems but rather to a new managerial ethos and methods; they downsized when profitable as well as when struggling, and during booms as well as busts.
The downsizing peaked during the extraordinary economic boom of the s. The culls, moreover, were dramatic. Overall, middle managers were downsized at nearly twice the rate of nonmanagerial workers.
Downsizing was indeed wrenching. When IBM abandoned lifetime employment in the s , local officials asked gun-shop owners around its headquarters to close their stores while employees absorbed the shock. Production workers did not escape the whirlwind, as companies—again with help from consultants— stripped them of their residual management functions and the benefits that these sustained.
Corporations broke their unions, and jobs that once carried bright futures became gloomy. United Parcel Service , long famous for its full-time workers and promoting from within, began emphasizing part-time work in UPS has since hired more than half a million part-time workers, with just 13, advancing within the company. Overall, the share of private-sector workers belonging to a union fell from about one-third in to less than one-sixteenth in In some cases, downsized employees have been hired back as subcontractors, with no long-term claim on the companies and no role in running them.
When IBM laid off masses of workers in the s, for example, it hired back one in five as consultants. Other corporations were built from scratch on a subcontracting model. The clothing brand United Colors of Benetton has only 1, employees but uses 25, workers through subcontractors. The shift from permanent to precarious jobs continues apace. And the gig economy is just a high-tech generalization of the sub-contractor model. Uber is a more extreme Benetton; it deprives drivers of any role in planning and coordination, and it has literally no corporate hierarchy through which drivers can rise up to join management.
Then they make changes, and incorporate updates into a PowerPoint deck. Depending on the strength of their relationships, the consulting team may get informal input from client stakeholders, before formally presenting to Walmart. Overview: After communicating the analysis, the client may have specific questions or objections.
This step may not always be included, but it's common for consultants to go through a process of refining their data and analysis in response to client feedback. In fact, steps may be repeated several times before the final deliverables are complete.
Example: Walmart's regional head of marketing asks if customers with children under 18, is actually a more important measure than age. The consultants have an early hunch, but decide it's best to crunch the numbers before giving a firm answer. They go back to the data, and discover that customers between , who also recently bought diapers e.
They bring their updated findings to the Walmart team for feedback. Overview: Now it's time for the final work to be submitted. The exact materials to be provided should be listed in the SOW. It may include a PowerPoint deck, spreadsheet, model, etc. The final deliverable will be reviewed with the client, who will then sign-off on the completion of the project. Example: After revising their analysis and getting additional feedback from Walmart stakeholders, the consulting team now has a polished set of recommendations.
A final review is done with the full consulting team, and Walmart's decision makers. They are satisfied with the analysis, and excited about the recommendations. After the review, the final documents are delivered, and Walmart gives their final sign-off on the project. Along with the day-to-day work, consulting comes with a unique lifestyle that you won't find in a typical corporate job. Consultants travel frequently, and a typical schedule is to fly out on Monday morning, fly home on Thursday night, and work from the home office on Friday.
The exact schedule varies based on the consulting firm and the client. A benefit of the travel, is getting to see new places on the company's dime. Plus, you can really bring in the loyalty program points airlines, hotels, etc. If you find yourself in a room full of consultants, then frequent flyer status and rewards points is always an easy conversation topic.
Another benefit are the sponsored paid for by the company dinners and events, which can be pretty spectacular for some consultancies. If you're in consulting long enough, you'll eat some of the best food you've ever had, for free. As with anything, it's not all free meals, and travel bliss.
Consulting has a reputation for long-hours, and a demanding work environment. Plus, being on the road can make it difficult to manage relationships and activities at home. To thrive as a consultant, it's important to be adaptable.
You'll run into delayed flights, demanding clients, and difficult problems. But, if you respond well to the challenges, consulting can be an exciting career. Not to mention the exceptional exit opportunities and generous pay. Broadly speaking, consulting projects can be categorized into 2 different groups: advisory and implementation projects.
For most people, when they think about consulting, they're probably thinking about advisory consulting. In this type of engagement, a consulting firm would be hired to advise their client on firm strategy, give recommendations based on market conditions, provide specialized expertise in specific industries, etc. Free Resume Course Download resume templates and watch in-depth, step-by-step resume advice videos. Log in.
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