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Tag: expertise

Last thoughts on consulting

It’s not the first time I got this question, but, now that I’m done (at least for now) – what do I really think of management consulting?

  • image Great first job: I believe this is one of the best first jobs that you can get coming out of college or business school. It challenges you to think about issues which most people don’t get a chance to until they’re at the middle/senior manager level (e.g., the clients you work with). It also gives great practice in handling tough situations (e.g., hostile clients/customers, rapid deadlines, changing requirements, etc.) and forces you to learn how to work with many different types of people and thinking styles. It also introduces a mental discipline around finding and structuring solutions to tough problems, no matter the political situation or the perceived difficulties. Beyond the “boot camp” aspect, its also tends to pay a pretty decent salary and offer a very young and “work hard, play hard” culture which large companies tend to be unable to replicate.
  • Opens many doors: Consulting doesn’t end up fulfilling the 4 criteria for job satisfaction for everyone. But, not to fear – the skills I alluded to in the first point make new consultants very attractive to employers (some job openings primarily target consultants, like some private equity and corporate strategy roles) given the broad set of experiences and ability to perform in difficult situations. Furthermore, the abundance of MBAs and the networks of the more senior members of the firm provide consultants with a great network to use to help position themselves in new jobs. It’s a benefit that should not be discounted.
  • Very cyclical: There is no business which isn’t, to some extent, vulnerable to the business cycle, but as a fairly expensive client-services business with long lead-times in both hiring and getting new clients, management consulting is especially vulnerable. I can tell you that during a recession, things can get pretty tough. Clients are rarely willing to pay full price and demand much higher levels of quality. This, in turn, makes everyone’s lives harder and makes the firm reluctant to pay bonuses, hire additional workers, provide perks, or give promotions. This has no effect in the short-term, because there are no other job opportunities available in a recession, but when the economy begins to recover, it pushes more people to look elsewhere for jobs. The result of this is that during the ensuing recoveries/booms, firms can’t seem to do enough to hold on to their people. Compensation/bonuses go up and more promotions are granted as the firm becomes both forced to and more willing to do more to keep its people and hire new employees to handle the increased quantity of client work it wants to service – which itself becomes the over-capacity which leads to problems when a recession hits (and the cycle repeats). Now, this cycle is not unique to consulting, but it’s important to keep this in mind when considering consulting as a career because the very nature of the consulting business (long hiring/project lead times, expensive client-service) strongly amplifies the bad aspects of the consulting experience in recession and the good aspects during booms.
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  • Changing model making it harder for junior people: Like the previous bullet point, this is not unique to consulting, but it is a growing trend which I have observed. In the “Dark Ages” of business when the internet was not around and electronic data/contact lists were not so readily available, successful consultants did not require deep industry or operational area expertise to be effective – they could quickly come up to speed by finding the right data/experts and conducting the select set of analyses needed. But, as more data and “industry experts” became more readily available via the internet (and the market understanding there was demand for such things), clients began to demand more and more industry/operation-specific expertise from their consultants. This has forced the more senior members of a consulting firm to become industry/operational area experts. While this is a natural progression of the consulting model, an under-appreciated result of this is that junior members of the team now start new projects with a significant knowledge disadvantage from the senior members of the team. The result of which is that junior members may get less of an opportunity to work deeply with “the higher ups” and with the client (who expect junior consultants to be as well-versed as the senior members of the team). While strong teams and cultures find ways to mitigate these problems (with team norms, strong mentorship, and/or by allowing junior members to specialize, etc.), the change in the consulting model (and their adverse impacts) will likely continue. This is definitely something to think about if considering consulting.

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18 months

image My consulting experience has been pretty atypical so far. Most consultants rotate between cases and roles every couple of months. Me? Up until about a few weeks ago, I had been doing corporate strategy work for the same technology client for 18 months (which is a long time – hence the picture of the old man – I know, I’m clever).

And, although many consultants (yours truly included) entered the field to experience as many industries/functional roles as possible within a short period of time, I’ve found that spending this much time on a single client in a single functional role has benefited me greatly by letting me build:

  • Depth of expertise – Simply put, there’s no way that a consultant who’s constantly changing functional roles and clients to develop a deep expertise on the same level as a client’s employees. I can’t say I have the same level of expertise as someone who lives and breathes the stuff, but given the technical knowledge and understanding of the broader industry that I’ve picked up over the past 18 months, I’ve become knowledgeable enough to see connections/moves which people with less experience have yet to be able to see.
  • Deep relationship with management – Having worked 18 months on a case, I’ve built up a level of rapport and trust with the technology industry partners/managers at my firm. They now routinely include me on emails about tech industry developments, and don’t hesitate to put me on special projects. It is a position which grants me greater input and exposure than most people of my tenure, and it is one I am very grateful for. It is also good from a professional development standpoint, as I now have partners/managers whom I respect who will be in my corner.
  • Perspective on corporate strategy – I think very few people (even those in the technology industry) understand how corporate strategy at large companies is done. 18 months of watching a firm chew over the same issues again and again gives one a unique perspective on the pace and process of major strategic discussions, something that a consultant who’s rapidly rotated in and out of cases is unlikely to develop.

Several of my coworkers have asked if I’ve felt like I’ve missed out because of being on only one client. My answer is a no for three reasons. First, I am deeply interested in technology so being on a tech strategy case was like a dream come true. Secondly, as corporate strategy is an ongoing process which looks at a wide range of topics, I have had a wide range of topics ranging from premium branding (where I actually went to a Safeway’s to see how Procter & Gamble price their products relative to others), to emerging computing trends, to mobile convergence, to manufacturing outsourcing strategy, and even to formulating a process for the client to actively monitor and evaluate acquisition opportunities. Lastly, although I came into this job hoping for one thing (wide range of diverse case experiences), I believe that experiencing the exact opposite of what most consultants do see has given me a unique perspective on the corporate world – one that I would not trade away.

So, to all the new consultants (or even to the old ones), don’t knock the long-term client engagement path. You’ll be surprised at how valuable the experience can be.

 

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