The management consulting industry: the free CaseCoach guide for candidates

A brief history of the management consulting industry

The birth of the management consulting industry dates back to the industrial revolution in the late 19th Century. The earliest management consulting firms included Arthur D. Little – founded by the MIT professor of the same name in the late 1890s – and Booz Allen Hamilton, founded by Edwin G. Booz, a graduate of the Kellogg School of Management at Northwestern University, in 1914.

The birth of the world’s top-3 management consulting firms

The world’s top consulting firm today, McKinsey & Company, was founded by James O. McKinsey, an accounting professor from the University of Chicago. Marvin Bower, who ran McKinsey & Company from the late 1930s for about 30 years, has been described by Harvard Business Review as “the father of modern management consulting”. Today, McKinsey is unparalleled in its reach and prestige, with over 45,000 employees and over 130 offices globally.

Boston Consulting Group (BCG) was founded in 1963 by Bruce D. Henderson, one of the ‘Great American Business Leaders of the 20th Century’, according to Harvard Business Review. With 30,000 employees today, BCG has a presence in 100 cities around the world.

Bain & Company was founded by Bill Bain – a former BCG Partner – in Boston in 1973. With 15,000 employees and 65 offices globally, Bain is smaller than both McKinsey and BCG. However, it is no less prestigious and, as a result of its smaller size, it’s the fastest-growing of the three.

As the world’s top management consulting firms, McKinsey, BCG and Bain (collectively known as ‘MBB’) have all developed new ways of serving their clients beyond the provision of traditional strategy consulting services. They have achieved this by developing deep expertise in areas such as Digital, Data Science, Operations, Sustainability and Marketing.

Today, there are a few smaller, international challengers to MBB in the management consulting industry. These include firms such as Kearney, Oliver Wyman, Roland Berger and L.E.K.

The entry of ‘the Big 4’ into the strategy consulting space

‘The Big 4’ refers to the global professional services firms EY (Ernst & Young), PwC, Deloitte and KPMG. All four offer strategy consulting services to their clients through small, dedicated units, the majority of which originated through the acquisition of smaller consulting firms in the 2010s:

• EY Parthenon: the result of EY’s acquisition of The Parthenon Group
• Monitor Deloitte: the result of Deloitte’s acquisition of Monitor
• Strategy&: the result of PwC’s acquisition of Booz & Company
• KPMG’s Global Strategy Group (GSG)

Although now well established in the field of strategy consulting, there are a number of ways in which the Big-4 differ from McKinsey, BCG and Bain, who collectively remain unchallenged as the industry leaders.

The emergence of a myriad of smaller, boutique firms

In addition to the top management consulting firms, a myriad of smaller, boutique management consulting firms is in operation. Typically they specialize in a particular industry or function, often in a single geographic area.

What does a management consultant do?

Ultimately, the job of a management consultant is to help solve their clients’ most critical and complex problems. Organizations hire management consulting firms to help them tackle their highest-impact challenges and opportunities, where hundreds of millions – or even billions – of dollars are on the line.

These challenges are usually rooted in classical areas such as:

• business strategy
• profit improvements (e.g. revenue growth, cost reduction, turnarounds, operations)
• opportunity assessments (e.g. due diligence for an acquisition, market entry, product launch)
• re-organizations

However, a large share of strategic consulting today is in addressing other items at the top of a CEO’s agenda. These priorities are often heavily influenced by the economic, geopolitical and technological landscape. These more contemporary objectives might include achieving net zero, transforming a business through digitization, harnessing data science or responding to a crisis.

The day-to-day responsibilities of a management consultant

Serving one client at a time, consultants tackle these challenges in the form of projects, undertaking a wide variety of tasks that help to build a final recommendation and, ultimately, solve the client’s problem. These tasks include:

• collecting and analyzing data
• interviewing experts and clients
• performing desk research
• identifying insights and proposing recommendations
• conducting problem-solving discussions
• creating and delivering presentations

Although a common myth about the management consulting industry is that consultants only work with CEOs, they in fact work with many people at different levels of the client’s organization to craft recommendations collaboratively. To enable this close degree of collaboration, consultants spend a great deal of time on site at the client’s office, which usually requires weekly travel and time away from home.

The work of a management consultant is likely to be attractive to those who favor strategic decision making over execution. You can learn more in our article about what management consultants at McKinsey, BCG and Bain actually do.

What does a career in management consulting look like?

Career progression in top consulting firms

The majority of consultants at McKinsey, BCG and Bain are generalists. This means that they work on a variety of projects in a wide range of industries and functions. The firms’ generalist career track has three phases, all of which evolve over the course of a consultant’s tenure:

Consultant roles

This phase is all about doing the ‘leg work’ of a project in order to support the project team with solving the client’s problem. As consultants progress through each role in this phase, they are expected to work increasingly independently. They’re also required to handle more complex or important pieces of the project, and spend more time managing client relationships.

Project management roles

This phase is all about taking the reins on a project. This involves managing day-to-day client relationships and coordinating with senior stakeholders within the firm, including Partners. Responsibilities in this phase also include managing the consultants who work on the project, and generally ensuring a successful result.

Initially, consultants are dedicated to one project. However, in the final role of the project management phase they start splitting their time among several projects and supporting less experienced managers.

Partner roles

The position of Partner in a top consulting firm comes with significant status and responsibility, along with an average starting compensation of close to $1,000,000. Partners function as strategic advisors to clients. They are primarily responsible for generating new business, managing and developing client relationships, and ensuring that the firm delivers positive results for clients. Partners also play a leadership role within their firm, sometimes leading an office, a function (e.g. recruiting, social events), or a practice area.

In order to achieve client impact in specific practice areas such as Digital, Data Science, Operations, Sustainability and Marketing, McKinsey, BCG and Bain also hire a smaller number of expert consultants. These individuals focus on work that aligns with their expert knowledge. In all three firms, the expert consulting career path differs from the path for generalists. You can learn more about this and the career progression that expert consultants can expect in our article on how the expert career track differs from the generalist track at McKinsey, BCG and Bain.

The performance review process

To manage consultants’ progression along the consulting career path, the firms all have a highly codified performance review process in place. From new hires to Senior Partners, every consultant is evaluated twice a year against a set of core skills, which include:

• problem solving
• analytical and numerical skills
• communication
• client relationship management
• working autonomously

The performance expectations for each skill rise in line with an individual’s role and tenure. As consultants become more senior, the firms place more emphasis on the additional skills of leading a team, developing clients from a commercial standpoint, and developing their expertise in either a section or function.

When consultants meet the performance criteria of the next level in the consulting career path they are promoted. There is a general expectation that consultants should be ready for promotion after a certain amount of time within a role.

Consultants who are not performing at the level required to be promoted on schedule, and – after being given the opportunity – have been unable to turn their performance around, may be asked to leave under the firm’s ‘up or out’ policy.

Rapid career progression is available for generalists

All three firms offer generalist consultants the prospect of rapid career progression and the opportunity to reach the level of Partner in a relatively short period of time. Top performers at McKinsey who join the firm at entry level can become a Partner after just eight years. At BCG and Bain, progression to Partner level is possible in a comparable amount of time. You can learn more about the route to Partnership in each firm in our article on the generalist consulting career path.

Why do so many people want to work in management consulting?

An attractive proposition for ambitious individuals

There are a number of factors that make a career in management consulting appealing to driven and talented candidates. It provides unparalleled learning opportunities, with exposure to a huge number of sectors, functions and locations. A management consulting career also offers plenty of intellectual stimulation, the opportunity to travel, and the chance to learn from a diverse range of colleagues in a supportive and collaborative working environment.

A significant additional attraction is the generous compensation available to consultants. An entry-level consultant can expect to earn a total of $120-125K, while an MBA graduate can expect to earn $220-225K. Consultants’ compensation continues to increase steadily in line with their progression through the ranks of the firm.

Spending time in a top consulting firm can shape the rest of your career

At McKinsey, BCG and Bain, consultants develop an abundance of transferable skills and capabilities that enable them to work in almost any other industry or function. These individuals also have an extremely prestigious brand that’s recognised and respected around the world on their resumes.

As a result, a wide range of attractive exit opportunities – many in senior executive positions – are available to those who have spent time at McKinsey, BCG or Bain. These include:

• roles in tech – our research into the exit opportunities from a consulting career indicates that Google/Alphabet, Amazon, Microsoft and Meta employ the highest number of former MBB consultants of any company
• strategy roles outside of tech (e.g. in financial services, retail or media)
• investment management (e.g., hedge funds, private equity, venture capital)
• entrepreneurship
• non-commercial roles (e.g. in academia, public service, teaching and non-profit organizations)

A challenging career for driven individuals

Although there are many advantages to a career in management consulting, there are also some downsides. At McKinsey, BCG and Bain, consultants work long hours under intense pressure and scrutiny. The extensive travel they’re required to do can compromise their work-life balance further. This is among the reasons why many people leave consulting after two to four years.

How recruitment works at top management consulting firms

Routes into management consulting

We recently conducted some research into top routes into McKinsey, BCG and Bain to learn more about the ways in which the firms leverage their four hiring channels in different locations around the world. These channels are:

Pre-experience student hiring

This is for candidates who have recently completed a bachelor’s degree or non-MBA master’s program. These candidates typically have no more than two years of experience and are hired into the firms’ entry-level consulting roles. You can learn more about joining a top firm through this channel in our article on the best degrees and majors for a career in consulting.

MBA hiring

This channel is for graduates of a one or two-year MBA program. These candidates typically have some work experience, gained before their MBAs, and are typically hired into the third level of the consultant role. You can learn more about joining a top firm through this channel in our article on the best MBAs for consulting.

Experienced professional hiring

This channel is for experienced candidates who join McKinsey, BCG and Bain from other companies. These candidates typically have two to eight years of experience and are hired into either the second or third level of the consultant role, depending on their experience. You can learn more in our articles on how to join a top management consulting firm as an experienced hire and how to move from ‘the Big 4’ or another tier-2 firm to MBB.

Advanced degree hiring

This channel is for candidates who have recently completed a PhD, law school or medical school program. These candidates are typically hired into either the second or third level of the consultant role. You can learn more about joining a top firm through this channel in our article on how to go from a PhD, law degree or medical degree to management consulting.

The recruitment process at top consulting firms

Given the prestige of the world’s top-3 consulting firms – and the generous compensation and rapid career development available to consultants – it’s no surprise that McKinsey, BCG and Bain are among the top destinations for some of the best candidates in the world.

The firms compete against some of the biggest and most attractive employers in other industries for talented candidates. Those who are interested in a career in management consulting might also be considering a career in investment banking, a big tech firm or a startup.

That said, with some of the most accomplished candidates on the market submitting applications to McKinsey, BCG and Bain every year, the firms are able to select the ‘cream of the crop’. In fact, McKinsey hires fewer than 1% of the candidates who apply.

Top consulting firms use a tightly structured and highly codified recruitment process to identify exceptional individuals with outstanding problem-solving skills, interpersonal skills and drive. Here’s how the process works:

• MBB recruiters review applications and decide which candidates to progress based on an evaluation of their resumes and cover letters.
• In some cases, candidates might also be required to complete an online test, such as McKinsey’s digital assessment.
• Candidates who pass these initial screening stages are then invited to take part in several rounds of consulting interviews. These consist of a case interview followed by a fit interview or, in McKinsey’s case, a Personal Experience Interview (PEI).

The firms all use objective assessment criteria to evaluate each candidate’s interview performance and determine who should ultimately receive an offer.

The case interview: a unique interview format that candidates must learn to master

Top consulting firms use case interviews to assess whether candidates have the problem-solving and communication skills required to do the work of a management consultant. This is a notoriously challenging interview format that requires significant preparation to master.

In a case interview, the interviewer describes a business problem and the candidate then starts to propose an approach to solving it, working through the case with the interviewer and carrying out analyses to inform the answer. Finally, the candidate must synthesize their findings and share their recommendation.

Cases presented to candidates in these interviews are very similar to the problems that they would be required to solve in the role of a management consultant. They are sometimes based on real-world projects that the firm has recently completed. While these cases can cover a wide range of business topics, some of the most common case interview questions are on themes such as profit improvement, revenue growth, entering a new market and cutting costs. Candidates can expect to undertake at least four case interviews before being offered a role at a top consulting firm.

To do well in a case interview, candidates need to be able to think on their feet and perform well on a series of dimensions:

• Structuring: breaking the problem down into a small set of independent drivers
• Numeracy: solving simple math problems on paper
• Judgement and insights: drawing conclusions from the facts revealed throughout the case and the candidate’s own experience
• Creativity: generating ideas
• Synthesis: summarizing the work into an actionable recommendation
• Case leadership: driving the discussion with the interviewer towards an answer

Candidates are also assessed on the presence and communication skills they demonstrate throughout the discussion about the case.

Preparing for consulting interviews at McKinsey, BCG or Bain

To be in with a chance of landing a coveted offer from a top consulting firm, candidates must invest a significant amount of time and effort in preparing for their interviews. Most candidates who go on to receive an offer from a top consulting firm like McKinsey, BCG or Bain invest more than 50 hours in their preparation over a period of six to eight weeks.

As the leading case interview preparation platform – preparing over 50,000 candidates a year – here are our top tips for preparing for an interview with a top consulting firm:

Brush up on your math skills

To be able to solve the kind of math problems that you will face in a case interview, you need to be able to:

• compute the four operations with a pen and paper
• use key math concepts such as fractions, percentages, algebra and probability to solve simple math problems
• understand a company’s simplified income statement and balance sheet

If you’re getting ready for a case interview, it’s essential to refresh your math skills as part of your preparations. Our Case Math Course is designed to help you do this. It includes short videos covering all the topics listed above, as well as tips on how to improve your speed and reliability. This content is part of our Interview Prep Course, which also includes calculation and case math drills to help you practice running calculations on a daily basis.

Practice case interviews with other candidates

The case interview is a notoriously difficult format to master and requires a huge amount of live practice with a partner. Most successful candidates complete at least 25 live practice sessions before their interview.

To organize these sessions, head to our Practice Room, where you can connect with a diverse community of fellow candidates who are all available for case interview practice, and visit our Case Library, which includes 100+ downloadable cases that you can use for your practice sessions.

In addition to practicing live with other candidates, it’s important to become familiar with the dimensions that are assessed in consulting interviews, and to learn the techniques required to perform well in them. Our Interview Prep Course includes video lectures and sample interviews that cover every aspect of the case interview, and interactive drills for practicing them.

Meanwhile, our team of coaches – which includes former consultants and interviewers with McKinsey BCG and Bain – is available to deliver case and fit interview coaching to put your preparation to the test and provide you with personal feedback and practical advice.

Don’t neglect your preparation for the fit interview

While the format of the fit interview is likely to feel more familiar than that of the case interview, it’s still vital to prepare thoroughly for it. Our Interview Prep Course includes video lectures and sample interviews covering both the regular fit interview and McKinsey’s Personal Experience Interview (PEI).