Management Consulting Vs Strategy Consulting (Differences Explained)

Summary

This video script outlines the distinction between management consulting and strategy consulting, crucial for career paths. Strategy consultants focus on high-level planning, often working with executives, while management consultants handle both planning and execution, interacting with mid-level managers. Strategy consultants generally earn more but work longer hours. The choice between the two depends on post-consulting goals, with strategy consulting being beneficial for those aiming for C-suite roles or exploring various industries.

Takeaways

• 🔍 Management consulting and strategy consulting are distinct paths that can lead to different career outcomes.
• 💼 Strategy consultants focus on defining 'what' a company should do, while management consultants address both 'what' and 'how'.
• 👔 Strategy consultants often work with top executives like CEOs and CFOs, whereas management consultants may engage with mid-level managers.
• 🌐 Strategy consultants are management consultants but not all management consultants are strategy consultants.
• 💰 Strategy consultants typically earn 20-30% more than management consultants, but this can vary based on expertise and project risk.
• 🏥 An example given is Dwayne 'The Rock' Johnson's tequila brand considering expansion to a new country, where strategy consultants would decide the country and management consultants would execute the plan.
• 📈 The expertise and rarity of a consultant's skill set can significantly impact their earning potential.
• ⏱ Strategy consultants generally work longer hours, averaging 50-60 hours per week, compared to management consultants who may work 45-55 hours.
• 🛠 Management consultants with specialized knowledge in critical areas, like safety in the oil industry, can earn more due to the high stakes of their work.
• 🌟 If post-consulting goals are unclear, strategy consulting offers broader exposure to various industries and functions, aiding in future career decisions.
• 🚀 For those aiming for top leadership roles in large companies, strategy consulting provides valuable C-suite exposure and problem-solving experience.

Q & A

What is the main difference between management consulting and strategy consulting?

Management consulting deals with both what a company should do and how to do it, while strategy consulting focuses primarily on determining what a company should do.

Who do strategy consultants typically work with in a company?

Strategy consultants often work with the highest level of the company, such as CEOs, CFOs, and other C-suite executives.

Can strategy consultants also be considered management consultants?

Yes, all strategy consultants can be considered management consultants, but not all management consultants are strategy consultants.

What is an example of a scenario where a company might hire a strategy consultant?

An example is when Dwayne 'The Rock' Johnson, who owns a tequila brand, wants to decide which country to expand to next, and he hires a strategy consultant to analyze and recommend the next market.

How do management consultants contribute after a strategy has been set?

After a strategy is decided, management consultants come in to figure out how to implement it, such as by addressing supply chain, sales, and risk management.

On average, how much more do strategy consultants earn compared to management consultants?

Strategy consultants are typically paid about 20 to 30 percent more than management consultants.

What factors can cause a management consultant to earn more than a strategy consultant?

A management consultant can earn more if they have rare expertise that is highly valued or if the work they do could be very costly if done incorrectly.

How does the work-life balance differ between strategy consultants and management consultants?

Strategy consultants typically work more hours, averaging around 50 to 60 hours per week, compared to management consultants who work between 45 to 55 hours.

What should someone consider when deciding between becoming a strategy consultant or a management consultant?

One should consider their post-consulting career goals, whether they want exposure to C-suite executives, operational experience, or the ability to explore various industries and functions.

What advice does the speaker give for those who are unsure of their post-consulting career path?

For those unsure of their post-consulting path, the speaker recommends becoming a strategy consultant to gain exposure to a variety of projects and industries.

How can the speaker's team assist someone in becoming a consultant?

The speaker's team, composed of former McKinsey, Bain, and BCG recruiters, interviewers, and consultants, offers a program with an 89.6% success rate in helping people land consulting jobs.