| Topic Name: |
The Death of Strategy Consulting |
| Message Name: |
almost true |
| Date Posted: |
02/13/2002 |
| In Reply To: |
The rumors of Strategy Consulting's death have not been exaggerated. All of the so-called infallible top-tier firms that have taken turns claiming that they are doing better than the industry as a whole and that their stellar brands would help them ride out the economic downturn (unlike their unfortunate competitors) have been hush-hushing their own low utilization rates, accelerated up-or-out policies, deferred or reneging on offers to top candidates, and generally taking away the best aspects of the career path (expense accounts, plenty of interesting, high-level work). Consider the true stories from the so-called "best of the best":
McKinsey: Lays of their entire 2nd year Analyst class in San Francisco and Los Angeles. Euphemistically call it "ending their analyst program early." Nonsense -- layoffs are layoffs.
BCG: Finally caves in a proceeds to lay off between 20-50% of their workforce firm-wide, with Asia hit hardest but North America not spared. Entire classes of Associates at risk, including top performers.
Monitor: "Unprecedented conditions" results in firm-wide layoffs last summer and many new offeree deferrals.
Arthur D Litte: The founder of the strategy industry is on the verge of bankruptcy and cannot find an angel after many months of defaulting on loans.
Booz-Allen Hamilton: Lays off people at all levels of the firm, from partner on down, and rescinds offers.
Other, lesser firms, have been predictably hit as hard or worse.
So a word to the wise: Consulting is dead. Clients have finally realized what everyone in the industry knew the first time they made a Powerpoint, that the work they were doing had no tangible usefulness.
As attractive as the industry is for high-flying undergrads and MBAs, it was always better for the consultants than for their clients, a business model doomed for failure once the fad wore out.
Seek alternative employment. |
| Message: |
agreed its in a downturn, heard about all the things in your message
the firms you mentioned grew like crazy thus need to scale back, fast growing firms will always lay off quickly during a slow down, if you slam the breaks (or even slow down rapidaly) on a fast moving open cart, some stuff will fly off.
On the other hand, McKinsey SF cut the BA program like 4 months short, hardly a disaster, and McKinsey international appears to have more work.
Secondly, Mars and Co, a pure strategy boutique is rumored to be at 100% capacity worldwide, so not everyone is being killed.
The latter firm grows very slowly proving the problems in consulting is due to deceleration, and these problems not an indicator of strat retracting or shrinking.
Consulting is hardly dead. Firms will always want high end intellectual labor as a variable cost, not a fixed cost, and principle agent externalities will always provide cover for the profession
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