At its core, consulting is simply the art of helping clients achieve their goals. Management consulting is a branch of consulting that focuses on providing advice to a client’s leadership, typically for its most strategic and impactful problems.
As a smaller branch of the consulting industry – which is sometimes sized at over a trillion dollars – management consulting is typically sized at less than $100 billion in annual revenue. Management consulting attracts the highest value of any other kind of consulting; clients pay premium fees for the advice of management consultants at top firms.
This value trickles down to employees, resulting in high salaries for consultants, even those who are straight out of university. In the US, fresh graduate hires at top consulting firms can expect to be offered more than a $110,000 base salary, while MBA hires can expect an offer of more than a $175,000 base salary. At senior levels (e.g. Partner), compensation falls within the millions of dollars.
Combined with rapid career growth and other benefits, this makes management consulting a top career choice for graduates of the best universities and business schools the world over. The firms, however, are some of the most selective employers in the world. The top management consulting firm, McKinsey, reportedly receives over a million applications annually and hires fewer than 1% of candidates.
In this article, we’ll explore the management consulting industry in detail. Starting with a brief history of the industry, we’ll go on to summarize the types of management consulting firms in operation today and examine what management consultants do on a day-to-day basis. We’ll then outline the management consulting career path and consider the pros and cons of a career in management consulting. Finally, we’ll provide some advice on how to break into the industry.
Key takeaways
- Management consulting is a $100bn industry focused on advising the leaders of the world’s top organizations on how to approach their biggest challenges and opportunities.
- There are four main categories of management consulting firms: the top-3 (McKinsey, BCG and Bain), tier-2 strategy firms, specialist or boutique firms, and the strategy practices of ‘big-4’ accounting firms.
- The role of a management consultant is varied and no two days are the same. Typical activities might include analyzing data, creating presentations or dashboards for clients, participating in problem-solving sessions and conducting interviews.
- Management consulting careers offer fast progression, with promotions every two to three years for top performers, supported by a fact-based performance review process.
- The typical career path at management consulting firms begins with the pre-MBA level and progresses to the post-MBA level, followed by the manager level, junior partnership and, finally, election to Partner.
- The typical length of time a consultant works at a top firm is two to four years. Consultants typically leave for sought-after roles in investment, corporates, entrepreneurship and government.
- There are a number of pros and cons to a career in management consulting. It’s a great fit for highly-driven candidates who have strong problem-solving and communication skills.
- To break into management consulting, it’s vital to build a strong application and then prepare extensively for your interviews, making good use of the resources available.
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 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, believed that management consultants should adhere to the same high professional standards as lawyers and doctors. He is credited with developing McKinsey into the first management consulting firm in the modern sense.
In the 1960s, a number of new management consulting firms formed, most notably Roland Berger and the Boston Consulting Group (BCG). These firms were responsible for bringing a rigorous analytical approach to the study of management and strategy. They pioneered many of the analytical tools and approaches that now define the field of strategic management.
In the late 1990s, the management consulting industry blossomed. This was down to a broad range of factors, including a strong economy, increased computing power, penetration of emerging markets, privatization and globalization. Many established firms grew rapidly, and new firms were created left and right. As a result, there was huge demand for undergraduates and MBAs alike, and firms recruited extremely aggressively on campus.
After this boom period, the industry’s growth stalled for a couple of years in the early 2000s. The dot-com bubble burst and there was a painful recession, causing many corporate clients to reduce their consulting budgets for the first time in decades. As a result, many young and small firms had to either downsize or withdraw from the market entirely, while larger firms sharply reduced their recruiting efforts.
The remainder of the 2000s saw the industry recover, with an increased need for support on IT-related topics. Today’s world is changing more rapidly than ever – a state sometimes referred to as ‘VUCA’ (volatility, uncertainty, complexity and ambiguity). Companies have more questions about how they can stay ahead of the curve on the challenges and opportunities presented by themes such as digital, AI, climate change and sustainability.
The effects of this shift are multifaceted. There is an increase in demand for the services of management consulting firms, leading to strong growth across the board that’s fueled by an increased requirement for specialized verticals. Top consulting firms have therefore invested significantly to build expertise in these areas. Increasingly, consulting firms act as implementation partners for their clients, rather than advisors.
Types of management consulting firms
Today, a wide range of management consulting firms exists. These firms differ in a number of ways: their size, the types of projects they take on and the sectors they specialize in. However, they all offer opportunities for consultants to solve high-impact problems. Here’s an overview of the main types of management consulting firms in operation.
The top-3 firms (‘MBB’)
The top three management consulting firms are McKinsey, Boston Consulting Group (BCG) and Bain. Collectively known as ‘MBB’, they are big management consulting firms that do all sorts of work and run the gamut across every sector and function. They are the most selective, prestigious and expensive of all the management consulting firms.
Tier-2 strategy firms
Strategy firms like Kearney, L.E.K and Oliver Wyman are known as ‘tier-2’ firms. They do the same type of broad-based strategy work as MBB firms, using the same type of model. However, they are not as big as MBB firms and tend to feel more entrepreneurial. Each tier-2 strategy firm has its own strengths in certain geographies, sectors and functions.
Specialist or boutique firms
These firms specialize in a particular sector, function or geography. There are thousands of such firms, and few have a global footprint. Some of the biggest include IQVia in life sciences, Newton in operations, Gartner in technology, and Delta Partners in TMT (technology, media and telecom).
Strategy practices of ‘big-4’ accounting firms
The ‘big-4’ accounting firms are Deloitte, PwC, EY and KPMG. They are all many times bigger than MBB firms, with huge teams focused on accounting and implementation consulting work.
In recent years, they have all invested in building strategy practices that now rival the top-3 in terms of impact and diversity. Most of the firms have now acquired independent strategy firms such as Monitor (Deloitte), Booz Allen (PwC) and Parthenon (EY).
You can learn more about these firms in our article on the top-10 management consulting firms.
What do management consultants do?
Solving clients’ most important problems
At its heart, the job of a management consultant is to solve clients’ most critical and complex problems. Organizations hire management consulting firms to help them tackle their highest-impact challenges, where hundreds of millions – or even billions – of dollars are on the line.
Given the high-stakes nature of these problems – and the correspondingly high fees that firms charge – the organizations that typically seek the support of management consulting firms are large corporations, governments and some of the world’s largest non-profits. Some firms also carry out pro-bono work for smaller charities or government initiatives.
The problems that clients need to solve can be varied and far-reaching. They’re often rooted in classical areas like 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) and re-organizations. However, a large share of work for top consulting firms today is in addressing other items at the top of a CEO’s agenda, which 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
- responding to a crisis (e.g. disruptions to the supply chain, the continuing fallout of the COVID-19 pandemic)
Working on projects in teams
Working with one client at a time, consultants tackle these problems as projects. While each project can last anywhere from two weeks to six months, the average duration is eight to 12 weeks. During this time, consultants work on the project in a dedicated consulting team that typically consists of two to six people, including a Project Manager and a number of Associates or Analysts.
Several Partners are usually involved in each project, and consulting teams are often supported by expert consultants who are specialists in the relevant industry or function. Consulting is a client-facing job and consulting teams spend a good deal of time on-site to solve the problem in close collaboration with the client.
Throughout their careers, management consultants move from project to project, gaining a huge amount of experience and exposure along the way. Someone who spends three years in management consulting will typically work on 10-15 different problems with clients in a wide variety of industries and sectors.
You can find out more in our article on what consultants at McKinsey, BCG and Bain do.
A day in the life of a management consultant
A day in the life of a management consultant is anything but typical. It often involves a wide variety of activities such as analyzing data, creating presentations or dashboards for clients, participating in problem-solving sessions and conducting interviews.
For in-person projects, the working week usually begins with travel to a client site. Once you’ve arrived, you might start the day by interviewing a member of the client’s organization to collect insights to verify or disprove a hypothesis. This could be followed by a quick meeting with the client sponsor – who hired your firm for the project – to review the key goals and objectives for the week ahead.
The rest of the day could be spent learning about the client’s industry or the specific issue at hand to get a clearer picture of the client’s problem and what might be causing it. Next, you might be back at your desk crunching numbers, generating insights and then synthesizing your preliminary findings and recommendations on a few slides that you might share with your client. Finally, you might have a session with the team to share everyone’s findings and, with the guidance of the Partners on your team, agree how to move the project forward.
While no two days in management consulting are the same, the graphic below illustrates what a ‘typical’ day might look like for a management consultant.
The management consultant career path
While each firm uses slightly different names for the roles available at each level of seniority, the typical management consulting career path is as follows:
- Pre-MBA consultant
- Post-MBA consultant
- Manager
- Junior partner
- Partner
Pre-MBA consultant
This is typically an entry-level role for consultants who are fresh out of undergraduate studies or a non-business master’s degree, and have less than two years of experience. Competition for this position is fierce, and invitations to interview are only extended to applicants with exceptional academic backgrounds, strong extracurricular and leadership experience, and selective internships.
Consultants in this position are responsible for data collection and analysis, creating client presentations, and supporting managers and executives to produce relevant client deliverables.
Consultants who join firms in this position typically go to business school after two to three years, in line with the firm’s offer of paying for further education. Those who do not attend business school might either continue with the firm in a post-MBA role, head out for a secondment, or exit the firm and transition to another industry.
At McKinsey, pre-MBA consultants are called ‘Business Analysts’, while at BCG they’re called ‘Associates’ and at Bain they’re called ‘Associate Consultants’.
Post-MBA consultant
This is a position either for candidates who have completed an MBA or PhD, or professionals with three to eight years of experience. Firms also promote top performers to this position directly from pre-MBA roles.
Post-MBA consultants are responsible for identifying issues, forming hypotheses and formulating recommendations. They manage larger aspects of the problem-solving process and are responsible for presenting findings to clients.
In this position, consultants also develop managerial experience. They help to structure the client project and occasionally manage the pre-MBA consultants who work on it.
At McKinsey, post-MBA consultants are called ‘Associates’, while at BCG and Bain they’re called ‘Consultants’.
Manager
After two to three years at the post-MBA level, top-performing consultants progress to the level of manager. In this position, they are responsible for overseeing junior team members, while supporting senior colleagues to ensure the project is aligned with the client’s expectations.
The manager position is often considered to be a make-or-break role in a management consulting career. It’s a consultant’s first time managing the day-to-day client relationship, co-ordinating the Partners involved in the project and managing a team of consultants. Managers are also expected to begin developing expertise in specific domains in order to become the go-to person on those topics for clients in the future.
In addition to this, managers have a role to play in their firm’s development efforts. Activities in this area might include writing articles, conducting research, recruiting and developing new approaches to solving client problems.
Finally, managers contribute to employee development and training. They teach relevant skills to junior consultants to help them develop and advance within the firm.
At McKinsey, managers are called ‘Engagement Managers’, while at BCG they’re called ‘Project Leaders’ and at Bain they’re called ‘Managers’.
Junior partner
From the manager level, consultants are expected to decide whether to continue their management consulting careers and remain on the path to partnership.
Those who stay progress to the junior partnership level. This is even more demanding than the manager level; consultants can have oversight of and involvement in up to three or four projects at any given time.
At McKinsey, junior partners are called ‘Associate Partners’, while at BCG and Bain they’re called ‘Principals’.
Partner
Consultants who have spent two to four years at the junior partnership level can be elected as Partners. This typically takes seven to 10 years from an entry-level position, and around six years from a post-MBA position. In the case of exceptionally senior staff who have several years of experience, Partners can also be hired directly from another organization.
A Partner functions as a senior expert and strategic advisor to clients and is involved in both client and firm leadership. Partners are responsible for generating new business and developing client relationships. They are accountable for defining innovative strategies for their clients and helping them achieve results.
Partners also oversee the growth and direction of the firm. They often have ownership of functional or industry topics, and lead the development of an office or region.
After five to 10 years, some Partners are promoted to Senior Partner. From there, the most ambitious Senior Partners may attempt to become the firm’s Managing Director and lead its efforts worldwide.
Leaving a career in management consulting
A management consulting career has two natural exit points: after two to three years at the pre-MBA consultant level and after spending time at the manager level. The typical length of time a consultant works at a top firm is two to four years, and some statistics show that 2.7 years is the average point at which a consultant leaves a top firm like McKinsey, BCG or Bain.
Consultants exit the world of management consulting for a variety of reasons. These can include the need for a more sustainable lifestyle and the draw of new opportunities in industries such as technology, startups, private equity and government. Meanwhile, some consultants are more interested in creating and implementing ideas than they are in advising others. Read more in our article about why people leave management consulting after two to four years.
Management consulting is a strong springboard to a number of other careers because of the many transferable skills that consultants learn. These include problem-solving, communication and leadership, along with exposure to multiple industries and functions. These skills are widely respected and recognised, and will prepare you well for a leadership role in any sector or industry. Read more in our article about exit opportunities for consultants who leave McKinsey, BCG and Bain.
The pros and cons of a career in management consulting
Management consulting is an exciting and multifaceted career that offers exposure to challenging business problems, mentorship and transferable skills that will be highly attractive to future employers. However, the industry comes with its challenges and a career in management consulting isn’t right for everyone. Here’s an overview of the pros and cons.
The benefits of a career in management consulting
The high-impact, interesting and challenging problems that consultants get to solve make the work of a management consultant extremely satisfying for many. In addition, top consulting firms tend to offer a positive, supportive and vibrant working environment, with the opportunity to work with talented and motivated colleagues.
Together with fast-tracked learning and development, the opportunity to work internationally and career flexibility, the benefits of a career in management consulting are varied and far-reaching. You can learn more in our article about some of the great reasons to work in management consulting.
The downsides of a career in management consulting
Along with all the upsides of a career in management consulting, there are a number of downsides. For some, the ‘up and out’ policy in place in management consulting firms, where a small number of employees are terminated for not meeting promotion criteria, can be a big drawback.
In addition to this, the demanding and highly pressured environment of management consulting firms can make it difficult for consultants to achieve a satisfactory work-life balance. Some consultants also find it frustrating that they rarely see the impact of the work they have done once a client project has come to an end. You can learn more in our article about the drawbacks of a career in management consulting.
Getting into management consulting
Careers in management consulting are highly sought after, but their demanding and uniquely fast-paced nature mean that they’re not a good fit for everyone. Here, we’ll examine the qualities that make a great management consultant. We’ll also provide some advice for getting into the industry and preparing to interview at a top management consulting firm.
People who are a great fit for careers in management consulting
Whether a management consulting firm is large or small, or if it has a wide range of clients or specialises in a particular field, there are three qualities that make a candidate a great fit for a career in management consulting.
Firstly, you must enjoy solving problems. Top management consulting firms are hired by executives to solve their most important challenges, such as increasing profits or entering a new market. Solving these problems requires a large amount of analysis, research and discussion, so it’s important that you care about the problem you’re solving.
Secondly, you must have excellent interpersonal skills. It’s not enough to have a great solution to the problem; consultants also need to communicate that solution well in a synthesized format, in a way that gets people interested in moving it forward. That’s why firms are looking for good communicators.
Finally, you must be highly driven. This means having the proactivity and stamina to land a project successfully and push yourself to the next level without necessarily being asked to do so. You also need to be adaptable and resourceful when facing challenges.
You can learn more about these qualities and why they’re so important in our article about whether a career in management consulting is right for you.
Applying to join a management consulting firm
If you think a career in management consulting might be right for you, there are a number of steps you’ll need to take to break into the industry, all of which require some effort.
First, you will need to research each firm and its recruitment process before deciding where to apply. This involves connecting with consultants to learn more about the target firm and looking online to understand what the firm requires and the roles that are currently available.
To pass the initial screening stages, you will have to build an application that demonstrates that you’re a good fit for the firm. This is a critical step because management consulting firms are among the most selective employers and they reject most candidates at this stage.
If you’re looking for support with building a successful application to a management consulting firm, our Free Resume Course includes resume and cover letter templates, along with specialized advice for students, MBAs and experienced professionals.
Preparing for management consulting interviews
The consulting interview is the most important part of the process of joining a top firm. It’s an assessment of your problem-solving and communication skills, as well as your rationale for exploring a management consulting career. There are two main parts to interviews at management consulting firms: the case interview and the fit interview.
The case interview
In the case interview, you are given a problem to solve that’s similar to the remit of a management consulting project, such as improving profits, growing a business, reducing costs or entering a new market. You will start by proposing an approach to solving the problem and then work through the case with your interviewer, carrying out analyses that inform the answer. Finally, you will synthesize your findings and share your recommendation. The case interview is a unique and notoriously difficult interview format and requires extensive preparation through practice with a partner. You can learn more in our guide on how to ace consulting case interviews.
The fit interview
The fit interview is primarily focused on testing whether you are an achiever and whether you’ve demonstrated abilities that are transferable to management consulting. It typically starts with an invitation to provide a short introduction to your background, followed by a discussion about your motivation and some of your key achievements. You can learn more in our guide on how to ace consulting fit interviews.
Preparing for management consulting interviews
Building the skills to nail these types of interviews requires extensive preparation and a lot of practice. Our Interview Prep Course helps you do just that, with all the material you need to ace your case and fit interview, including video lectures, sample interviews, case material and practice tools.
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.
