The Ultimate Beginner's Guide to Consulting! (Hours, Lifestyle, Compensation, Pros & Cons)

Summary

In this video, the speaker explores the world of consulting, breaking down the top consulting firms, their work, lifestyle, hierarchy, compensation, and more. Focusing on the prestigious 'MBB' firms (McKinsey, BCG, and Bain), the speaker explains consulting's varied and dynamic nature, including strategy, performance improvement, and M&A projects. The video covers the benefits like exposure to different industries, professional development, and luxurious perks, as well as the challenges such as lack of implementation, travel fatigue, and unpredictability. With insights from a personal background in consulting and banking, the speaker provides valuable information to help determine if consulting is the right career path.

Takeaways

• 😀 Consulting firms are divided into tiers: MBB (McKinsey, BCG, Bain) represent the top tier, followed by firms like Booz Allen and Oliver Wyman in tier two, and firms like Accenture and Big Four in tier three.
• 😀 MBB (McKinsey, BCG, Bain) are considered the 'holy grail' of consulting, known for their high-profile projects and top-tier clients like C-suite executives.
• 😀 Consultants work on diverse projects, including strategy, performance improvement, and M&A, which can range from a few weeks to over a year in duration.
• 😀 The consulting lifestyle often involves travel Monday to Thursday, staying at upscale hotels, and flying business class, with the firm covering expenses.
• 😀 Consultants typically work 50-75 hours a week, with busy days sometimes extending to midnight or later, but they don't work weekends, making it less demanding than some other industries like investment banking.
• 😀 There is an element of unpredictability in consulting, as each project can involve different clients, industries, and locations, making the work dynamic but sometimes challenging for those who prefer stability.
• 😀 Consultants are often promoted every 2-3 years, but it's competitive after reaching the Consultant level, with many exiting the field or pursuing an MBA for further advancement.
• 😀 Entry-level compensation for undergraduates in top firms like Bain and BCG starts around $90K, while McKinsey offers $100K, plus bonuses, totaling up to $135K in the first year.
• 😀 After an MBA, consultants can expect a salary of around $175K, with signing bonuses and performance bonuses pushing total earnings to approximately $250K.
• 😀 Perks in consulting include expensed dinners, frequent flyer status, luxury team events, and paid relocation if moving between offices, making it an attractive lifestyle for those who enjoy travel and networking.
• 😀 One of the cons of consulting is the lack of implementation—consultants often craft strategies but don’t always see them through to execution, which can be frustrating for those who want to build or create something tangible.

Q & A

What is the main role of a consultant in the consulting industry?

A consultant works on projects to improve a company's business by providing strategic recommendations. They gather and analyze data, conduct interviews, and create presentations to help businesses solve problems or improve operations.

How does the work-life balance look for consultants?

Consultants generally work from Monday to Thursday at client sites, traveling business class and staying in nice hotels. They return home on Thursday evenings, often have shorter workdays on Fridays, and typically do not work weekends.

What are the key differences between the top consulting firms (MBB) and other consulting firms?

MBB (McKinsey, BCG, Bain) are considered the most prestigious consulting firms, focusing on large-scale strategic projects for top executives. Other firms like Booz Allen, Oliver Wyman, and Accenture often specialize in specific industries or focus on implementation rather than strategy.

What types of projects do consultants typically work on?

Consultants work on various types of projects, such as strategy (e.g., market entry or business model transformation), performance improvement (e.g., cost reduction or pricing strategy), and M&A (e.g., due diligence or post-merger integration). The nature of the project depends on the consulting firm and the client.

What are the different levels of hierarchy in a consulting firm?

The typical hierarchy in consulting firms includes six levels: Business Analyst, Consultant, Senior Consultant, Manager, Associate Partner, and Partner. Promotions typically happen every 2-3 years based on performance, but many consultants pursue an MBA for advancement.

How does compensation work in consulting for new graduates and MBA graduates?

New graduates entering consulting can expect a base salary of around $90k-$100k, with signing and performance bonuses pushing their total compensation to $115k-$135k. MBA graduates typically earn $175k base, with signing and performance bonuses bringing their total compensation to around $250k.

What are the advantages of working in consulting?

Consulting offers many advantages, including exposure to diverse industries, a steep learning curve in strategic business thinking, and excellent exit opportunities. The perks are also notable, such as luxury travel, events, and the ability to take leaves of absence.

What are the potential downsides or challenges of consulting?

Consulting can be challenging due to the lack of hands-on implementation, as consultants often only provide recommendations without seeing them through. Travel can also be lonely and tiring, and the lack of predictability from project-to-project can be stressful for some.

How does travel affect the lifestyle of a consultant?

Consultants travel frequently, typically from Monday to Thursday, which can be tiring and isolating. Though travel perks include business-class flights and hotel stays, many consultants find the time away from home exhausting and sometimes prefer not to travel.

What are some of the perks that consultants receive?

Consultants enjoy several perks, such as reimbursed dinners, flight and hotel points, expensive team events like yacht cruises, and opportunities for temporary externships at other companies. Additionally, they can take leaves of absence and easily transfer between offices with paid relocation.