| Topic Name: |
Big 4 Consulting Vs. Mckinsey, Bain, BCG, etc |
| Message Name: |
four questions to ask |
| Date Posted: |
01/31/2004 |
| In Reply To: |
Understanding that the majority of consultants at some of the firms you listed (CGEY, BP) are IT consultants, my comments are directed toward the strategy consultants from these firms only.
In my experience, it is possible to find outstanding people at most firms. However, as a sweeping (and possibly unfair) generalization, the talent and experience level at big 4 firms are more variable. You will also find more bureaucracy and "big company" nonsense at these firms. [Take the old PWC, where performance reviews were often conducted through email]. The pay scale is sometimes lower than MBB. Lastly, at the big 4 shops the IT practice can be dominant, and there is pressure for the strat side to sell IT services as part of their recommendations.
Still, I think exit opportunities are there. For big 4 firms, it will depend more on your specific experiences and your abiility to sell yourself. MBB alumni have a better placement network and the name is a selling point as well.
From the big 4, exit opportunities include b-school, other consulting firms, industry (especially if you have specific consulting experience) and financial services if you have the relevant background. |
| Message: |
If you really want to understand the differences between Big 4 strat and M/B/B, consider four things.
1) Why is the firm hired by clients and what is the firm's perception in the marketplace? The Big 4, in my experience pitching against them, will try to convince the client that their problem is anything EXCEPT strategic--it's a matter of operations, process, or IT, they will argue. The reason is that they know that clients chose M/B/B for strategy and Big 4 for things like process redesign. I cannot ever remember losing a strategy pitch to a Big 4, although I do recall losing the occasional process case to a Big 4, usually on price. This is true even in cases where M/B/B come in 2-3 times as expensive as the Big 4.
2) Why does the firm win work? The Big 4 will try to undercut M/B/B on price to win work. This is especially true in IT strat projects where a SI (systems integrator, e.g. Accenture) will do the work for almost free in hopes of winning a $25M SI contract. The strategy is just a loss leader. In professional services, be wary of working for firms that compete on price. Also be very wary of working in a loss-leading division. In the IT strategy arena, the Big 4 and the SIs have major credibility problems.
3) What is the staffing level? M/B/B not only charge more for a given project, they sell the client *fewer* FTEs for the same project. Think about the implications of that model for a moment. As SparkyTheClown points out, this should tell you something about the type of people. It also speaks to the opportunities you will have, what level of performance will be expected from you, and how much client exposure you will have.
4) What is the ownership structure of the firm? Accenture, Bearing Point, EDS (i.e. ATK) and the others made a big and mostly-unsuccessful push towards strategy in the late 1990s and have since pulled back after going public. Strategy revenues are extremely volatile, and no publicly-held company has ever succeeded in strategy consulting b/c the Street cannot stomach th e volatility. (M/B/B generally do not consider the Big 4 a threat.) The Big 4 have refocused away from strategy and towards the giant and steady revenue streams from systems integrations, BPO, outsourcing, and other projects that are distinctly un-strategy.
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