So You Want
To Be A Management Consultant?
The Anderson School at UCLA
October 1999
Our agenda for today’s presentation
What a
consultant does
Overview of the
management
consulting
industry
The client
engagement
Interviewing with
a consulting firm
2
First, some ground rules for today
 This is NOT a Towers Perrin recruiting presentation
 We may provide examples from our experiences at Towers, but this is
meant as an introduction to the industry in general
 Please ask questions throughout the day
 We’re helping only if we’re answering the questions you want
answered
 There are NO stupid questions
 It’s better to ask the “silly” questions now, rather than at a firm’s
reception
3
What a
consultant does
Overview of the
management
consulting
industry
The client
engagement
Interviewing with
a consulting firm
4
What is a management consultant?
 Management consultants are business advisors to companies and other
organizations
 Client contacts typically are senior- and executive-level managers
 Services may be provided in several areas, including:
 Functional areas
 Specific industries
 Strategy
 Financial services
 Information technology
 Oil and gas
 Human resources
 Chemicals
 Operations
 Health care
 Logistics
 High technology
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This is what you hear
a management consultant does . . .
EXTERNAL
ANALYTIC FOCUS
INTERNAL
Competitive assessment
Customer satisfaction measurement
Benchmarking
Corporate/business unit strategy
Product positioning
Marketing/distribution strategy
Value chain analysis
Customer retention
Mass customization
Portfolio analysis
Shareholder value analysis
All types of analyses must
be performed in light of the
client’s strategies
Business process improvement/reengineering
Cycle time reduction
Total quality management
Activity-based costing
Organization design
Change management
6
. . . but what does it mean to you?
You will:
 Be staffed on a project (as opposed to originating work)
 Gather project data
 Research the client, industry, and market
 Conduct client interviews, secondary research
 Work with/lead/facilitate client project teams
 Analyze data
 Tap into company resources and tools
 Perform quantitative analysis (“crunch” numbers business-school
style)
 Perform qualitative analysis (e.g., use disparate data to develop
findings)
Continued . . .
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. . . but what does it mean to you?
You will:
 Develop recommendations for discussion by project team members
 Produce reports/presentations in conjunction with project team members
 Participate in firm/internal development projects
 Marketing/new business
 Intellectual capital
 Recruiting
8
So why would anyone
in their right mind want to be a consultant?
 Learn about lots of different industries
 Work with bright, dynamic, hard-working people (like those you know in
school)
 Gain exposure to client senior management
 Make a virtually “no-lose” career choice
 Believe in the work you do: consultants make business and the world a
better place
 Travel
 Find a highly legitimate way to make a transition from one industry to
another
 Develop a strong contact network to help you throughout your career
 Enjoy the thrill and fast pace, especially as project and report deadlines
near
 Avoid having to figure out what you want to do when you grow up
Source: Adapted from Wet Feet Press (www.wetfeet.com).
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Why should you choose
not to go into consulting?
 You don’t have complete control over your schedule
 Travel can wear you out
 You don’t like the unstructured, ambiguous nature of the work
 There is too much variety; you would prefer to develop depth with one
organization
 You don’t really believe that consultants add much value; you question
the profession
 The hours can be extreme and unpredictable
 Your recommendations might not be implemented; final decisions are out
of your hands
 You prefer to work for or with small companies
 You prefer being on the line and having profit-and-loss accountability
 Your clients can fear and perhaps dislike you
Source: Adapted from Wet Feet Press.
10
What reasons should not matter?
 The money is too good to pass up; you’ve got student loans to pay
 Travel is “glamorous”
 Fancy restaurants, cell phones, and expense accounts
 You want to impress your friends
 “I can do it for a year, then move on to something else”
 The Wall Street Journal says everyone’s doing it
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What positions/careers/opportunities can
result from your experience as a consultant?
 A career in consulting
 Consultant
 Managing Consultant
 Principal (Partner)
 Practice Leader
 Office/Geographic Manager
 Skills for a different or enhanced career
 Preparation for middle and upper management in industry
 Preparation for entrepreneurial ventures
 You name it
Consulting allows you flexibility and opportunities for continuous
learning, which can prepare you for a wide variety of careers
12
What personal attributes are
required for success in consulting?
 Intellectual and analytical ability
 Ability to understand and work well with people
 Ability to communicate, persuade, and motivate
 Sense of humor
 Intellectual and emotional maturity
 Tolerance for ambiguity
 Personal drive and initiative
 Integrity
 Physical and mental stamina
Source: Adopted from Management Consulting: A Guide to the Profession.
13
What a
consultant does
Overview of the
management
consulting
industry
The client
engagement
Interviewing with
a consulting firm
14
The management consulting
industry continues to grow . . .
Total Worldwide and U.S.
Management Consulting Revenues
Size
$80
$70
Total Worldwide
United States
Revenue
(in billions)
$60
$50
$40.0
$89.0
$73.0
$45.0
$40
$30
$20
$34.0
$10
$0
$17.4
$21.0
$23.9
1994
1995
1996
$39.0
1997
$47.1
1998
 Over 60% of this revenue is generated by the top 50 firms
Growth
 Projected at 13% per year through 2000
 Growth varies by consulting service line
 ‘92-96: IT 16%, Operations Mgmt. 14%, HR 10%,
Strategy 18%
 ‘97:
IT 29%, Operations Mgmt. 16%, HR 15%,
Source: Adapted from Consultants News.
Strategy 11%
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. . . is still one of the most
popular choice for Anderson graduates . . .
40%
Percentage of Anderson Graduating Class
Entering Consulting
32.0% 31.6% 32.6%
30.6%
30%
21.8%
20.3%
18.4%
20%
14.0%
10%
0%
1992
1993
1994
Source: 1993-1999 MBA Program Placement Reports
1995
1996
1997
1998
1999
16
. . . and is an
increasingly lucrative choice as well
In Thousands
$180
Starting Salaries (mean and range)
of Anderson Graduates Entering Consulting
180.0
$150
145.0
130.0
130.0
$120
112.5
100.0
$90
85.0
75.0
$60
63.5
63.0
45.0
45.0
$30
1992
1993
Source: 1993-1999 MBA Program Placement Reports
80.0
82.5
85.7
100.0
87.2
68.0
60.0
38.0
1994
45.0
1995
45.0
1996
95.5
45.0
1997
1998
1999
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Many major consulting firms
trace their roots to other firms
Arthur D.
Little
1886
1910
BoozAllen
1914
1920
1930
One major parent
Parented by two
firms or more
Acquisition
McKinsey
1926
Towers
Perrin
1934
1940
Cresap
1946
1950
Boston
Consulting
Group
1963
1960
Strategic Planning
Associates
1972
1970
1980
Monitor
1983
Source: Adapted from Bain & Company, Inc.
Bain
1973
Braxton
1976
LEK
1983
Quantum
1989
Alliance
1986
Towers Perrin
General Management
Services
1983
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The major management consulting firms
often are grouped into categories on the
basis of their origin, but this can be misleading
HUMAN
RESOURCES/
BENEFITS
CPA




Ernst & Young
Andersen Consulting
KPMG Peat Marwick
Price Waterhouse
Coopers
 Deloitte & Touche
 Arthur Andersen
 Grant Thornton
 Mercer Consulting
Group
 Towers Perrin
 Watson Wyatt
Worldwide
 Hewitt Associates
LLC
 Sedgwick Noble
Lowndes
 Milliman & Robertson
 Buck Consultants
 Alexander Consulting
Group
 A. Foster Higgins &
Co.
 Godwins International
 The Segal Co.
INFORMATION
TECHNOLOGY
 IBM
 CSC
 American
Management
Systems
 EDS
 Metrius
 Diamond Technology
Partners
GENERALIST/
STRATEGY
 McKinsey & Co.
 Gemini Consulting
 Booz-Allen &
Hamilton
 The Boston
Consulting Group
 A. T. Kearney
 Bain & Company
 Monitor Company
 Marakon Associates
E-COMMERCE





Agency.com
Razorfish
USWeb/CKS
Viant
Zefer
Source: Consultants News, July/August 1995.
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The ten largest consulting firms generate
over one-third of the industry’s revenues
1998 Management Consulting Revenues*
Firm
Andersen Consulting
Worldwide
$7,129
U.S.
$3,578
PricewaterhouseCoopers
$6,000
$2,700
Ernst & Young
$3,870
$2,400
Deloitte Consulting
$3,240
$1,480
CSC
$3,000
$1,900
KPMG
$3,000
$1,516
McKinsey & Co.
$2,500
$1,023
Cap Gemini Group
$2,261
$272
Mercer Consulting Group
$1,543
$926
Arthur Andersen
$1,368
$691
*Revenues in millions.
Source: Consultants News, June 1999.
20
What a
consultant
does
Overview of the
management
consulting
industry
The client
engagement
Interviewing with
a consulting firm
21
Steps in a consulting engagement
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
22
Steps in a consulting
engagement: identifying the lead
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
 Marketing
 Image/advertising
 General promotion
 “Events”
 New business development (sales)
 Market analysis
 Internal referrals (LOBs)
 Client referrals
 Previous/repeat client work
 Previous career contacts (industry and former consultants)
 Personal or family contacts
23
Steps in a consulting
engagement: selling the job
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
 Identifying the issues
 Selling = listening
 “What keeps you awake at night?”
 Probing for possible root causes
 Proposing solutions
 Alternatives/scenarios
 Methodologies/approaches to determining desired results
 Reaching agreement on how to proceed
 Discussion/agreement
 Letter of intent
 Formal RFP (request for proposal) or direct proposal
 Budget estimate (if appropriate)
24
Steps in a consulting
engagement: scoping the job
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
 Defining the scope
 Identifying the approach and resources required
 Tools/analyses to be used
— Gap analysis
— Roles and responsibilities
 Client and consulting resources available
— People for teams
— Experts
— Internal and external data/information
 Developing the project plan
 Identifying the deliverables
 Defining the budget
25
Steps in a consulting
engagement: staffing the engagement
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
 People involved
 Principal
 Managing Consultant
 Consultant
 Associate
 Other LOBs/experts
 Roles of each/rationale for involvement
 Experience
 Expertise
 Billing rate
 Availability, geographic, and development considerations
26
Steps in a consulting
engagement: performing the work
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
 Working with client teams
 Gathering data
 Client interviews
 Primary/secondary research
 Surveys
 Analyzing data
 Creating the work product
 Documentation
— Working papers
— Interim findings
— Analytics
 Recommendations
 Presentations
— Written product
— Oral presentation
Performing
the work
Identifying
next steps
27
A real-life example:
an aerospace/electronics firm
Identifying
the lead
Selling
the job
Scoping
the job
Phase I
Staffing the
engagement
Performing
the work
Phase II
Go/No-Go
Decision
Identifying
next steps
Phase III
Go/No-Go
Decision
28
The project design specifies
the consultants’ and client’s responsibilities
PHASE:
I
II
Establish the improvement
business case
DELIVERABLES  Requirements
definition
:
 Issue and problem
determination
III
Perform detailed analysis
and develop
recommendations
Go/No-Go
Decision
 Process and roles and
 Root cause analysis
 Improvement
opportunity
identification
CLIENT
COMMITMENT:  One phase at a time
 Go/no-go decision points
Implement
recommendations
Go/No-Go
Decision
 Defined processes,
responsibilities
documentation
 Detailed issue, problem, and
structures, roles,
responsibilities, and
technologies
opportunity analyses
 Trained staff
 Improvement alternative
 Pilot testing
evaluation
 Operational capability
 Recommendation
 Implementation plans
 Go/no-go decision criteria
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Steps in a consulting
engagement: identifying next steps
Identifying
the lead
Selling
the job
Scoping
the job
Staffing the
engagement
Performing
the work
Identifying
next steps
 Immediate actions or analyses (for client)
 Possible follow-on business (internal)
30
Issues in a consulting engagement:
managing the client and changing priorities
 Managing the client
 Schedules/agendas
 Access to client information
 Education/coaching of team leaders
 Unwilling client participants
 Internal politics/agendas
 Weak leadership/managers
 Changing priorities
 Vague/shifting/evolving scope of work
 Budget limits/changes
 Mid-project “discoveries” /new or different issue definition
 Change in client project management
 Loss of interest/new priorities
 Corporate changes affecting the project
(leadership/structural/ownership)
31
Issues in the consulting
engagement: communication
Client Executives
 “No surprises”
Client Workforce
 Worry/uncertainty
Project Team
Consultants
Partners
(often offsite)
Client
Team
Members
External Influences
Press/Analysts
Customers/Suppliers
32
What a
consultant does
Overview of the
management
consulting
industry
The client
engagement
Interviewing with
a consulting firm
33
Laying the foundation for
your success in the interview process
 Assess yourself
 Interests
 Skills
 Personality traits
 Values
 Formulate your career goals, narrow your focus
 Find criteria to compare various career options
 Don’t become frustrated; this step is difficult and time consuming
34
Preparing for the consulting interview
 Visit the firm’s web site
 Read the firm’s brochure cover to cover
 Identify the particular industry/functional focuses of the firm
 Become familiar with the firm’s organization structure/key
terminology
 Compare the firm’s core businesses with your interests
 Use library resources for additional information
 Lexis/Nexis, Hoover’s, Gladis, Internet, WetFeet, etc.
 Attend the firm’s on-campus presentations/workshops
 Search your school’s alumni database for company contacts
 Talk to people at the firm and previous summer interns about specific
questions you have
 Practice case interviews
35
Other issues to consider in evaluating firms
 Size of firm and clients
 Marketing of the firm (i.e., image)
 Degree of specialization (firm’s and yours)
 Culture
 Lifestyle issues
 Travel
 Overall environment/”feel”
 Entry levels and promotion cycles
 Typically staff consultants, project managers, and partners
 Training and development philosophy
 Defined core program
 On-the-job training
 Mentoring/development advisor
 Profit model
 How does the firm make money, and how does this affect you?
 “Billability” targets
36
Questions and Answers
What questions have we not yet answered?
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Thanks for your time — and good luck at Anderson!
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