2015 Strategy Consulting Compensation Study

January 30, 2015

Charles Aris, Inc. | Wells Fargo Tower | 300 N. Greene Street | Suite 1800 | Greensboro, NC 27401 | 336-378-1818
 Compensation Data Key Facts
Charles Aris, Inc. is pleased to present our 2015 Strategy Consulting Compensation
Study. Key facts about the data compiled for the study are as follows:

 All compensation data points for this study were collected between January 1, 2014 and
December 31, 2014. It’s important to note that most firms raise base salaries for their
consultants in the December/January timeframe, and the most recent set of raises (i.e.
those that took place approximately one month ago) will not be reflected in this study. In
addition, one Big 3 firm provided an additional one-time special raise in October of 2014,
which effectively resulted in two raises during the calendar year. Given that we collect data
points throughout the year, only a small percentage of data points that reflect this special
increase will be incorporated in this study.

 Most firms pay year-end bonuses in the December-January timeframe as well. The target
bonus percentages indicated at the top of each bar in slide four reflect what consultants
expected to receive at year-end and are not verified after the fact.

 Compensation data points are self-reported by consultants and are not verified through any
other means. While this implies that consultants have the opportunity to be less than
honest about their compensation, we feel extremely confident that the data are accurate
given the consistency in responses we received across consultants and firms.

 We eliminated a small percentage (less than 5%) of outlier data points that would have
adversely skewed the data. We also excluded Partner compensation data points from this
study. During the course of 2014 we spoke with many Partners with MBA graduation dates
in the range of our study, but their higher compensation dramatically skewed the data to a
point where it would no longer be useful for our clients.

2
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Input Data by Consulting Firm
 During the course of 2014, Charles Aris
recruiters spoke with over 3,500 strategy
621 Total Data Points candidates, of which over 99% were actively
100% Parthenon-EY^
employed with industry leading consulting
L.E.K. Consulting
firms, corporations and private equity firms.
Oliver Wyman
A.T. Kearney
 Detailed discussions around compensation
Strategy&* happen only on an as needed basis (once a
75% candidate expresses interest in moving
Monitor Deloitte forward with an opportunity). For the
purpose of this study we have distilled only
those compensation data points from
Bain & Company candidates that were actively employed by
50% leading consulting firms.

The Boston Consulting Group  Our 2015 Strategy Consulting Compensation

Study is driven by 621 data points from
consultants across nine firms.
25%
 63.3% of the data points come from “The
McKinsey & Company Big Three” firms: McKinsey & Company, The
Boston Consulting Group and Bain &
Company.
0%
Input Data By Consulting Firm  Of the 621 total data points, 379 come from
post-MBA consultants and 242 come from
pre-MBA/undergraduate consultants.
*Formerly Booz & Co., now owned by PwC
^Formerly The Parthenon Group, now owned by EY

3
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Average Compensation by Graduation Year
Average 2014 Compensation* for Strategy Consultants by Graduation Year
$305,287
$300,000 $98,245
$270,443 Bonus
$259,606
$250,000
$80,192
$233,755 $75,456 Bonus
Bonus
$214,640 $64,599

$200,000 $193,791 Bonus

$51,616
Bonus $207,042
$173,974 $43,133 $190,252 Salary
Bonus $184,150
$35,456 Salary
$150,000 $140,960 Bonus $163,024
$169,157
Salary
Salary

$28,778 $150,658 Salary

$117,147 $138,518 Salary
Bonus
Salary
$100,000 $85,670
$95,500
$12,840
$19,450
$112,182
$11,488 $97,697 Salary
$82,660 Salary
$74,182
$50,000 Salary
Salary

$0
2013 2012 2011 2010 2013 2012 2011 2010 2009 2008† 2007 †
Undergrad Undergrad Undergrad Undergrad MBA MBA MBA MBA MBA MBA MBA
N= 22 137 61 22 40 107 75 63 40 28 26
Std Dev.** = $4.9k $16.5k $31.9k $46.1k $13.0k $30.5k $26.9k $40.2k $59.2k $47.2k $45.4k
Median** = $85.9k $91.8k $110.2k $137.4k $170.2k $185.6k $212.9k $229.5k $256.8k $275.3k $300.5k
% Change1yr^ = N/A 17.6% 30.5% 23.8% N/A N/A 19.0% 15.1% 14.7% 5.2% 14.0%
% Change2yr^^ = N/A N/A 58.5% 55.9% N/A N/A N/A 28.3% 28.9% 13.7% 16.7%
*Base salary plus target annual bonus only. Does not include retirement contribution, profit sharing, sign-on, car allowance or other such cash equivalents.
**Standard Deviation and Median numbers are calculated for base salary plus target annual bonus, i.e. the number at the top of each column
†Pre-Partner data points only, i.e. we excluded compensation data points from anyone at Partner level or equivalent as it skewed the data significantly.
^% Change1yr equals the percentage change in total annual compensation (base salary plus target annual bonus only), from 2013 to 2014, for that graduation year.
^^% Change2Yr equals the percentage change in total annual compensation (base salary plus target annual bonus only), from 2012 to 2014, for that graduation year.

4
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Average Increase in Annual Compensation
Post-MBA
Average Increase in Annual Compensation  The average post-MBA strategy consultant
Across All Post-MBA Graduation Years
experienced a 13.1% increase in
30% compensation in 2014, a noticeable increase
25% over the previous two years.

20% 18.0%
 The stronger percentage increase relative to
15% 13.1% previous years was driven by consulting firm
10.4% 9.2% retention efforts, which was driven by an
10%
increase in demand for strategy talent from
5% corporations, private equity firms and other
professional services firms.
0%
2011 2012 2013 2014

Pre-MBA
 Pre-MBA/Undergraduate consultant
Average Increase in Annual Compensation
compensation grew by over twenty percent for Across All Pre-MBA/Undergraduate Graduation Years
the third year in a row.
30%
 The available supply of pre-MBA consultants is 24.1% 23.9% 24.1%
25%
less than post-MBAs, as pre-MBAs have a
wider set of opportunities, including attending 20% 17.9%
MBA school. 15%
10%
 Corporations and private equity firms often
provide pre-MBA candidates with a double 5%
digit raise upon recruiting them, and therefore
0%
the consultantancies need to do the same to
retain these individuals. 2011 2012 2013 2014

5
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Trends in Compensation Expectations
During the course of 2014 Charles Aris, Inc. noticed the continuation of a trend in the marketplace:
consultants are expecting more in total compensation from Corporate America than what they are currently
making in consulting (and even more than what we saw in 2012 and 2013).

Consultant compensation expectations when joining Corporate America*

2009 2010 2011 2012 2013 2014

10-20% 10-20% 5-10% 5-10% 10-20%

BREAKEVEN
LESS MORE MORE MORE MORE
with
than than than than than
consulting
consulting consulting consulting consulting consulting

The continuation of multiple factors are behind this trend:

 Most consulting firms remain effectively “at capacity” and therefore are paying strong salaries and
bonuses to retain talent.
 Consulting firms that acquired a peer firm instituted retention bonuses, some of which will pay out
in 2015 and beyond, and consultants at those firms expect corporations to pay more to offset
those future payouts.
 One Big 3 firm provided a one-time mid-year raise in 2014, which effectively resulted in two raises
during the calendar year, and at least one other firm has announced plans to follow suit in 2015.
 Knowing that they are stepping off the steep compensation curve that consulting provides, consultants
strive to “get out ahead of the curve” so as not to lose their strong compensation position after only one
year of service in Corporate America.
 With so many Corporate America opportunities competing for their services, consultants believe that
they have the luxury of saying “no” to any one opportunity with the expectation that another, higher
paying opportunity is right around the corner.

*Source: Charles Aris, Inc. anecdotal data.

6
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 2014 Sample Industry Offers
Below you will find a subset of 2014 offers that were accepted by Charles Aris candidates from Tier 1 Strategy Firms.

Consulting Consulting $$ Company

Education Industry Offer* Offer Title
Firm (Base + Bonus%) Description
B.S. 2013 Top 9 $80k + 8% $90k+14% Strategy Manager Corporation
B.S. 2012 Top 9 $83k + 40% $100k+10%+$10kS Senior Analyst Corporation
B.S. 2012 Big 3 $90k + 35% $100k+100% Associate Private Equity
Pre
MBA B.S. 2011 Big 3 $97k + 29% $135k+41% Strategy Analyst Hedge Fund

Post
MBA 2012 Big 3 $145k + 30% $160k+20%+$20kE Sr. Manager Corporation
MBA
MBA 2012 Big 3 $145k + 20% $150k+20%+$20kS+$20kE Sr. Manager Corporation
MBA 2012 Big 3 $140k + 30% $155k+25%+$20kS Associate Corporation
MBA 2012 Top 9 $165k + 40% $165k+30%+$10kS+$50kE Director Corporation
MBA 2011 Top 9 $140k + 7% $155k+25%+$16kS Associate Corporation
MBA 2010 Top 9 $180k + 35% $200k+23%+$35kE Director Corporation
MBA 2009 Top 9 $160k + 45% $170k+35% AVP Corporation
MBA 2009 Big 3 $210k + 40% $200k+75% Director Hedge Fund
MBA 2008 Top 9 $150k + 17% $175k+20%+$20kS Sr. Manager Corporation
MBA 2008 Top 9 $210k+5%+$13kE $190k+25%+$30kS+$57kE Director Corporation
MBA 2007 Big 3 $180k + 60% $205k+35%+$40kS+$75kE Sr. Director Corporation

*First two numbers equal base salary plus target annual bonus (%). S=Sign-On bonus. E=Annual Equity Grant. Does not include other cash equivalents.
EXAMPLE: “$160k+25%+$15kS+$40kE “= Base Salary of $160k, Target Annual Bonus of 25%, Sign-On of $15k, Annual Equity Grant of $40k

7
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 2014 Offer Ranges by MBA Year
Below you will find 2014 corporate offer ranges*, at the 25th, 50th and 75th percentiles, for each Post-MBA
graduation year.

2012 MBA 25th 50th 75th 2009 MBA 25th 50th 75th
Title Associate Manager Sr Manager Title Director Sr Director V.P.
Base Salary $135,000 $150,000 $165,000 Base Salary $175,000 $185,000 $195,000
Annual Bonus 10% 20% 30% Annual Bonus 25% 30% 35%
Annual Equity $0 $0 $20,000 Annual Equity $30,000 $45,000 $60,000
Total Package $148,500 $180,000 $234,500 Total Package $248,750 $285,500 $323,250

2011 MBA 25th 50th 75th 2008 MBA 25th 50th 75th
Title Manager Sr Manager Director Title Director Sr Director V.P.
Base Salary $150,000 $165,000 $180,000 Base Salary $180,000 $190,000 $200,000
Annual Bonus 15% 25% 35% Annual Bonus 30% 35% 40%
Annual Equity $0 $20,000 $40,000 Annual Equity $35,000 $55,000 $75,000
Total Package $172,500 $226,250 $283,000 Total Package $269,000 $311,500 $355,000

2010 MBA 25th 50th 75th 2007 MBA 25th 50th 75th
Title Sr Manager Director Sr Director Title Sr Director V.P. V.P.
Base Salary $160,000 $175,000 $190,000 Base Salary $190,000 $205,000 $220,000
Annual Bonus 20% 30% 35% Annual Bonus 35% 45% 55%
Annual Equity $20,000 $35,000 $50,000 Annual Equity $50,000 $75,000 $100,000
Total Package $212,000 $262,500 $306,500 Total Package $306,500 $372,250 $441,000

*Source: Charles Aris, Inc. anecdotal data.

8
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 2014 Offer Ranges by Undergraduate Year
Below you will find 2014 corporate offer ranges*, at the 25th, 50th and 75th percentiles, for each Pre-MBA/
Undergraduate graduation year.

2012 Pre-MBA 25th 50th 75th

Title Analyst Analyst Sr Analyst
Base Salary $80,000 $90,000 $100,000
Annual Bonus 5% 10% 15%
Annual Equity $0 $0 $0
Total Package $84,000 $99,000 $115,000

2011 Pre-MBA 25th 50th 75th

Title Analyst Sr Analyst Associate
Base Salary $90,000 $100,000 $110,000
Annual Bonus 10% 15% 20%
Annual Equity $0 $0 $0
Total Package $99,000 $115,000 $132,000

2010 Pre-MBA 25th 50th 75th

Title Sr Analyst Associate Sr Associate
Base Salary $100,000 $110,000 $120,000
Annual Bonus 15% 20% 25%
Annual Equity $0 $0 $15,000
Total Package $115,000 $132,000 $165,000

*Source: Charles Aris, Inc. anecdotal data.

9
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Consultant Competencies
The matrix below defines the expected competencies for consultants at each level for the 2014 recruiting year.

Title at
Consulting Analyst Associate Manager Principal Partner
Firm*

Years of 1-3 yrs 1-2 yrs 3-4 yrs 5-7 yrs 8+ yrs
Experience Pre-MBA Post-MBA Post-MBA Post-MBA Post-MBA

2011-2013
Current 2013- 2011- 2008- 2007 and
undergraduate
Education 2014 MBA 2012 MBA 2010 MBA earlier MBA
degree

Breakdown of Consultant Competencies by Position

(Consultant Competencies defined on next slide)
100%
Case Cracking Influence/Lead Influencing/
Leading Selling/
Case Cracking
75% Project Mgmt. Influencing/ Selling/
Case Cracking Leading Influencing/
Project Mgmt. Leading
50%
Analytics/
Slide Building Case Cracking
Analytics/ Project Mgmt.
25% Case Cracking
Slide Building
Project Mgmt. Project Mgmt.
Analytics/Slides
Analyst Associate Manager Principal Partner

*Note that titles differ significantly by firm. These are

meant to serve as generic titles that work across all firms.
10
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Consultant Competency Definitions

Senior  Generate revenue by selling consulting services.

Level
Selling/  Establish vision, frame key issues and set high
Competencies Influencing/ level strategy.
Leading  Influence key executives and stakeholders to
support significant change.

 Understand the problem at a more granular level

and establish a hypothesis driven approach
Case Cracking through which a solution can be derived.
 Effectively, solve the problem.
 Write the storyline.

 Understand strategic direction as set by the

hypothesis driven approach, set milestones, scope
Project analysis, assign resources, manage execution and
Management report findings.
 Serve as quality control lead.

 Conduct quantitative analyses in a defect-free

Analytics/ manner. Possess mastery of Microsoft Excel.
Junior
Slide Building  Leverage Microsoft PowerPoint to create
Level
impactful, concise, and defect-free slide loops.
Competencies

11
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent
 Charles Aris, Inc. Strategy Practice
Chad Oakley
President
 Charles Aris, Inc. is a national executive search firm 336-378-1818 ext. 9101
that was founded in 1969. The Strategy & Business chad.oakley@charlesaris.com
Development division at Charles Aris is led by Chad
Oakley, a former Bain & Company consultant and
Wharton MBA.
Jody Karavanic
Senior Practice Leader
 Since its inception in 2003 the Strategy & Business 336-378-1818 ext. 9104
Development division has placed over three-hundred jody.karavanic@charlesaris.com
candidates, at multiple levels, including Vice President,
Director, Manager and Analyst.

 The division's client base falls into three categories: Steven Stewart
the Corporate Strategy teams of industry leading Senior Practice Leader
336-378-1818 ext. 9114
Fortune 500 companies, the investment and portfolio steven.stewart@charlesaris.com
management teams of leading Private Equity firms,
and professional services firms, including consultancies
and the like.
Caroline Wilson
 The candidates that we place typically work for top tier Senior Practice Leader
336-378-1818 ext. 9120
strategy consulting firms and possess undergraduate caroline.wilson@charlesaris.com
and graduate degrees from the world's leading
educational institutions.

 For more information, please contact any of our team Jillian Jitima
members as shown on this page or visit Project Manager
336-378-1818 ext. 9115
www.charlesaris.com.
jillian.jitima@charlesaris.com

12
Copyright 2015
This information Charles Aris,
is confidential andIncorporated.
was preparedAll
byrights reserved.
Charles Aris, IncNot to be
solely forutilized
the usebyofany
ourthird party
client; it iswithout theutilized
not to be prior consent of Charles
by any third party Aris, Incorporated.
without our prior consent