TABLEOFCONTENTS

CHAPTER 1: INTRODUCTION

• Popular profession

CHAPTER 2: THE SCOOP

• Industry history and trends

• Strategy consulting
• Operations consulting
• Information technology/systems
• Human resources consulting
• Finding a firm that fits

CHAPTER 3: ON THE JOB

• Analysts and associates

• Types of consulting projects
• The project life cycle
• One typical presentation
• A day in the life of an associate
• Career progression in consulting
• Up-or-out... sounds painful
• Lifestyle in the industry

CHAPTER 4: GETTING HIRED

• Get your foot in the door

• Is consulting for you?
• Resumes and interviewing
• The resume/behavioral interview
• Behavioral questions

Page 1 of 44
• The case interview
• Case tips
• Sample case #1
• Sample case #2
• Sample case #3
• More sample cases
• Guesstimates
• Sample guesstimate
• More practice guesstimates
• Brainteasers
• Practice brainteasers

CHAPTER 5: OUR SURVEY SAYS

• Cutthroat camaraderie
• Pay: Awesome
• Food, sabbaticals, and travel... too much travel
• Social life: Out on the town
• Long (and odd) hours
• Management: Flat or pyramidal
• Dress: Well-rested suits
• Diversity: The changing face of consulting?
• Offices: Looks like money
• Support staff: Uneven
• Training: Keeping up-to-date
• The few, the proud, the consultants

CHAPTER 6: APPENDIX
• Industry buzzwords
• Recommended reading
• About the author

Page 2 of 44
Page 3 of 44
Chapter 1: INTRODUCTION

Popular profession

Consulting continues to rank among the most popular professions for emerging MBAs and
college graduates, and for good reason. The consulting industry has seen revenues grow about 16
percent per year. Consulting is one of the best-paid professions for recent grads, offering new
graduates lucrative salary packages and the chance to rub shoulders with top management of
Fortune 500 companies, while working on some of the most interesting issues that these
managers face. At first glance it looks like a no-brainer.
But don't be hasty. Consulting careers have much to recommend it, but it's no walk in the park.
Pressures are high, travel is onerous, and the interview process can be painful. Before setting off
down the consulting route, you should develop a good understanding of where the industry is
going, what your role will be, and how closely it fits with your needs and personality.

CHAPTER 2: THE SCOOP

Industry history and trends

A brief history of consulting

Life before consultants, like life before computers, is a peculiarly difficult state of affairs to
imagine. In fact, the term and the business was only invented near the start of the 20th century.
The first consultants drew from their engineering background to conduct time- and motion-type
projects for their clients. When James "Mac" McKinsey, a professor at the University of
Chicago, set up his firm of "accounting and engineering advisors," he began by offering a similar
consulting proposition. However he soon developed a unique, integrated approach for his clients
which he called his General Survey. Instead of the traditional engineers, he began to recruit
experienced executives and trained them in a framework of analysis that considered goals,
strategies, policies, organization, facilities, procedures, and personnel. In the late 1950s, a
number of other consulting firms emerged with focused strategies and novel frameworks. The
most notable innovator was The Boston Consulting Group, which, following work with a
semiconductor manufacturer client, developed the experience curve – the idea that in most
industries, declines in cost are a function of cumulative experience. BCG later extended their
original concept by developing the growth share matrix, a tool used to assess the attractiveness of
a company within a particular industry.
The present day
Consultants and their clients have both changed. The typical company that decides to hire
consultants nowadays is likely to be a lot more sophisticated in its own in-house skill set and
Page 4 of 44
more demanding in its requirements from a consulting project. Clients may have their own
strategy group, and will have a fairly clear idea of what they think their business is all about.
This increased sophistication has led to a number of developments, which will affect you as you
make your decision to enter the industry.
Specialization
The big trend in consulting leads to specialization. Until fairly recently, the conventional wisdom
at McKinsey and its ilk was that more was to be gained by developing a stable of generalists who
could apply their learning across industries and geographies.
That strategy is changing. Clients increasingly demand that consultants come in with prior
knowledge of their industry. While most of the larger firms still hire at a generalist level, they are
requiring consultants to specialize sooner, and are hiring area experts as consultants who may
follow a different (and possibly accelerated) career track from the typical MBA.

Implementation
Many clients are no longer willing to pay for mere strategic musing. That's why strategic
consulting firms are moving into implementation, making sure their advice is successfully put
into place. At the same time, systems consultants are trying to get more strategy assignments.
This means more competition for all consulting firms. There are still differences – the strategy
consultants don't yet have powerhouse computer and systems skills, and the systems players are
having a hard time convincing clients that they can really think "out of the box." But the success
of strategy/systems hybrids like Booz-Allen & Hamilton suggests convergence is only a matter
of time.
Cyclical nature
Consultants are good at estimating future revenues for present-day industries. It's no wonder
they've turned an eye toward consulting itself. In recent years, consulting revenues have been
growing 16 percent annually, and are expected to top $100 billion by 2000. Growth has been
fueled by aggressive penetration of emerging markets by corporations (who need consultants to
assess the new markets) and rapid changes in client industries (privatization, IT changes and
globalization), requiring consultants to sort things out.
Consulting, as the ultimate service industry, depends heavily on the prospects of large
corporations. Though global recessions bring many issues consultants can address, companies
tend to cut outside costs (including consultants) when budgets are lean.
Consulting companies are vulnerable to layoffs and recessionary cost-cutting. A 1990-91
downturn reduced new hiring to a trickle, and caused some consulting firms to fire consultants
and close offices. The project mix changes as well. Hard-hit areas include strategic advisory, IT,
and marketing/sales engagements, though the number of re-engineering, value-based
management and HR projects tend to rise.
However, prospective consultants should note that while the industry is cyclical, it's not as prone
to extreme boom and bust cycles as other industries, such as investment banking. In downturns,

Page 5 of 44
consulting firms frequently attract distressed clients who need advice to cope with the economic
situation.

Future trendspotting
While investment banks have gone public for some time, consulting firms have traditionally
shunned the idea of going public. This may be changing. KPMG is considering putting a 30
percent share of its U.S.-based consulting business up for an IPO or sale to a private investor.
The sale would bring in hundreds of millions of dollars in capital. Rumors persist that Andersen
Consulting is considering going public. A smaller firm, Diamond Technology, already has gone
public. Consultants at IT consulting firm Cambridge Technology Partners also profited when that
firm went public. (What's next, publicly traded law firms?)
Merging and separating
Like outsized amoebae, consulting firms continue to expand and divide. Perhaps the most
celebrated divorce has been that of Andersen Consulting and Arthur Andersen, a painful saga
more extended and convoluted than Gone With the Wind, that has been raging since January
1998. But while Andersen Consulting and Arthur Andersen have been not-so-fondly waving
goodbye, other firms have been saying hello. Price Waterhouse and Coopers & Lybrand merged
their operations, including their consulting units, under the Frankenstein-like moniker of
"PricewaterhouseCoopers."
The IT consulting boom: Thanks to Y2K?
Consulting firms with information technology competencies are seeing business boom,
especially as companies and governments around the world scurry to catch up with the looming
millennium bug (Year 2000, or "Y2K" within the industry), though Y2K consulting work is
slowing as the year 2000 approaches. The major growth area IT consultants are now banking on
is e-commerce (a field so new it hasn't quite been decided whether it has a hyphen or not). While
most might still see e-commerce as a means for consumers to buy books and knickknacks online
(just ask Amazon and eBay), savvy industry players know that the real killer app for business –
and consulting work – will be in business to business e-commerce. Venture capitalists are
rushing to fund business to business e-commerce plays – and companies are increasingly turning
to consultants to determine key e-commerce strategies.

Strategy consulting

Consulting Categories
The types of consulting that firms offer can be divided into four general categories: strategy,
operations, information technology, and human resources. These categories often overlap, and
most of the time a consulting firm will offer two or three different areas of consulting. For
example, one consulting firm may formulate an overall strategy for a client, look closely at the

Page 6 of 44
efficiency of its operations, and implement the appropriate information technology solutions to
improve operations.
Strategy Consulting
Strategy consulting is aimed at helping a client's senior executives (for instance, the CEO and
board of directors) understand and face the strategic challenges of running their company or
organization. Strategy consultants typically work with the client's most senior management, since
those at the top normally set a company's strategy and long-term plans. While strategy consulting
firms have historically made their recommendations, presented a "deck" (a report detailing the
issues and recommendations), and walked away, increasingly their clients are expecting the
strategists to stick around and implement their suggestions. That's why more and more
consulting firms now tout their "implementation" capabilities.
Examples of typical strategy consulting engagements:
• Figuring out why a clothing retailer has lower sales per square foot than its competitors.
• Understanding why Broadway theaters have been losing money, and how the theaters can
reposition themselves to capitalize on new markets.
• Positioning a snack manufacturer to enter China, determining what kind of snacks the
Chinese will want, and how much they will pay for snacks.
• Helping a computer and peripherals manufacturer to divest non-core businesses,
determining the value of the businesses on a stand-alone basis, and suggesting potential
acquirers.
Leading strategy consulting firms include:
• Bain & Company
• Boston Consulting Group
• McKinsey & Company
• Monitor Company

Operations consulting

Operations consultants examine a client's internal workings, such as production processes,

distribution, order fulfillment, and customer service. While strategy consultants set the firm's
goals, operations consultants ensure that a client can reach these goals. Operations consultants
may investigate customer service response times, cut operating or inventory backlog costs,
investigate resource allocation, improve distribution, heighten product quality or restructure
entire departments and organizations (a specialty of the "re-engineering" craze in consulting in
the early 1990s). Unlike strategic consultants, which are more likely to hand-off their findings to
the client and leave, operations consultants are more likely to assist in making sure their
suggestions are "implemented." Major consulting firms now offer both strategic and operations
services.
Page 7 of 44
Examples of typical operations consulting engagements:
• Streamlining the equipment purchasing process of a major manufacturer.
• Determining how a restaurant chain can save on ingredient costs without changing its
menu.
• Working with a newly-merged commercial bank to increase its customer response
efficiency.
• Creating a new logistical database for a tire manufacturer.
Leading operations consulting firms include:
• Andersen Consulting
• Deloitte Consulting
• Gemini Consulting
• PricewaterhouseCoopers Consulting

Information technology/systems

Information Technology (or "IT") consultants tap into the world of technology to help clients
achieve their business goals. IT consultants (also called "systems consultants") work with
corporations and other clients to understand how technology can work for the organization,
design custom software or networking solutions, ensure that all systems and programs are
compatible, and see to it that the new system is properly implemented. The changeover from
mainframes to networked PCs, and the rush to upgrade computer systems before the millennium
bug hits (many computers are unable to process years that do not begin with 19) have boosted
the fortunes of IT consulting in recent years, though this work is slowly evaporating as the year
2000 approaches. Consulting companies who once courted Y2K specialists and ERP (enterprise
resource specialists) to handle problems associated with the millennium are now confidently
turning to what they believe will be the next big thing: solving problems connected with
electronic commerce and electronic retailing (or e-tailing) on a widespread basis.
Examples of typical IT consulting engagements:
• Advising a mutual fund company on how to provide its clients with access to account
information online.
• Working with a telecommunications company to avoid the "Year 2000" (aka the Y2K)
bug.
• Upgrading a major law firm from WordPerfect to Windows.
• Troubleshooting on a major SAP software installation.
• Leading information technology consulting firms include:

Page 8 of 44
 • American Management Systems
• Andersen Consulting
• Cambridge Technology Partners
• Diamond Technology Partners

Human resources consulting

It helps to have a good plan, but the best business strategies, the most up-to-date tech and the
most streamlined operations don't mean anything if the right people aren't there to put them into
place. That's why the field of human resources consulting is on the upswing. Increasingly,
companies have determined that investing in their human capital pays off. Human resources
consultants are called upon to maximize the value of employees while placing the right people
with the right competencies in roles that are value-added. This may involve so-called "change
navigation," developing or altering work cultures, "managing relationships" to ensure focus on
customers and open communication, building "competencies" through better and more efficient
training programs, and fostering employee creativity through "process innovation." Another
growing area of human resources consulting, now that downsizing is a way of life, is counseling
and processing laid-off employees.
Leading human resources consulting firms include:
• Buck Consultants
• Hewitt Associates
• Towers Perrin
• Watson Wyatt Worldwide

Finding a firm that fits

Are you more interested in working on high-level strategy issues, or rolling your sleeves up and
digging into the operational details of a company? It's well worth asking questions that yield
useful information about the working style and culture of the different consulting firms.
Do analysts/associates work on more than one project (also known as an engagement or study)
simultaneously?
Some companies, like McKinsey and Booz-Allen & Hamilton, assign their associates and
analysts to a single project at any given time, while others, like BCG, prefer to staff consultants
on up to five engagements at once. This results in a number of differences in working style.
• When on a number of studies at once, you'll have to become adept very quickly at
managing expectations and making complex prioritization and trade-offs as to what you
can get done in the time available.
Page 9 of 44
 • If you're only planning to stay in consulting for a couple of years, you may be concerned
about the trade-off in breadth versus depth of industries and study types that you'll be
working on. Would you prefer to dig into fewer areas in more detail, or use this time to
get the maximum exposure to the range of experiences possible?
• Working on multiple projects normally means that you'll spend more time in the office
versus out at the client – after all, you can't really sit at Client A's office discussing Client
B's distribution problems on the telephone.
Does the project team include both consultant and full-time client members?
While almost all consulting firms will mention "considerable client contact" as one of their
attributes, it's worth examining further – does this mean weekly update meetings with senior
client managers, or day-to-day interactions with lower-level client staff who are full-time
members of the project team? Again, the answer to your query will tell you a lot about the style
of work that you'll be doing:
• On the one hand, client team members can be a real pain, requiring you to spend time
schooling them in your consulting methodologies, pull them through the "wallow phase"
(when there's just too much information), and adjust your schedule to their other
commitments.
• On the other hand, it could be argued that working with client team members is the most
valuable thing that an associate or analyst can do. It allows you to cut your teeth in
developing management skills (something in which consultants are sadly lacking).
Moreover, it will give you a better insight into the industry and company that you're
working with (especially valuable if you are considering jumping ship to a client at some
point in the future).

Does the consulting firm have offices worldwide, or are they focused in a small number of key
sites? How does this compare with their client distribution?
This inquiry will tell you something about how much traveling consultants at a firm do, and what
proportion of their studies tend to be out of town. BCG, Bain, McKinsey and Andersen
Consulting have offices in most major locations around the world, while Gemini and Monitor are
well known for sending their consultants to faraway destinations for extended periods, due to the
smaller number of local offices. For some consultants, extensive travelling and the
accompanying airmiles are a turn-on, while for others the prospect of another airport lounge
might be enough to send them running from the profession.
The number of offices is one way of determining frequency of travel. It's also worth asking about
the firm's policy on staffing between offices. Some consultancies are taking a more pan-regional
approach to staffing projects, especially in European and Asian offices. This means that even if
you're assigned to the London office, you may be instantly shipped off to Hungary – or Chiang
Mai. Consulting firms with strong specializations are also more prone to sending consultants on
extended trips – because a specialized assignment requires the best consultants, no matter where
they may be based.

Page 10 of 44
At what level do consultants begin to specialize by industry, function, or geographic expertise?
As you enter the consulting fold, you may have a clear idea of an industry or functional areas in
which you wish to specialize. On the other hand, you may be using consulting as a means of
remaining industry-neutral in the short term while you assess your options. That's why you
should consider consulting firms based on their attitudes to specialization. Almost every
consultancy encourages its consultants to gain an area of expertise as they increase in tenure –
the question is, how quickly does this happen?
Most of the big strategy firms prefer their new hires to follow a generalist track for a couple of
years before beginning to specialize. That said, once you're in a firm and have done a couple of
successful projects in a particular area, you'll often be asked to do other assignments in the area.

Chapter 3: ON THE JOB

SUB-CHAPTERS: < Analysts and associates > Types of consulting projects • The project life
cycle • One typical presentation • A day in the life of an associate • Career progression in
consulting • Up-or-out... sounds painful • Lifestyle in the industry

Analysts and associates

Trying to define and describe the role of a consultant is far from easy. The individual experience
of a consultant varies along a spectrum of firm styles, specialization, geographic differences, and
the huge range of roles that a consultant can take within a particular project. The analyst (college
grads) and associate (post-MBA) roles will involve different skill sets, although the differences
between a second-year analyst and a new associate are less pronounced.
The analyst role
Analysts are selected for their bright, inquiring minds, quantitative aptitude, and willingness to
learn, rather than any specific industry or functional experience. Most consulting firms have
training programs, but the main learning occurs on the job. Analysts play more important roles as
they gain experience.
Analysts will frequently be in charge of gathering and analyzing data, drawing conclusions from
the analysis, and pulling this into "the story" that the team will present to the client. Where client
members are involved in the team, an analyst may have responsibility in working with these
client team members, and to a certain extent managing their work on the team.
The associate role
The associate role evolves rapidly as the consultant gets up to speed and gains the confidence of
more senior consultants. At the onset, the associate may find that his role is little different to the
analyst role described above; a year or so later, he will be effectively managing the work of the
Page 11 of 44
team (client team members and analysts) and managing the day-to-day relationship with the
client. He will become responsible for much of the hypothesis generation, analysis phase, and
structuring (and increasingly delivering) presentations at client review meetings.

Types of consulting projects

Characterizing the typical role of consultants is complicated by the diversity of project types they
are exposed to during their careers. These can be categorized into a number of broad headings:
Strategy projects
In strategy engagements, a client will ask a consultancy to review and evaluate their overall
strategic direction. This typically happens after a change in leadership or following disappointing
results, though it may also be occasioned by pressure from the board of directors. The consultant
team examines whether the company is competing in attractive sectors of the market, whether
there are likely to be fundamental shocks to the market, or both. The team may recommend
acquisitions or divestments, shifts in emphasis on reinvestment in the business, or changes in
organization or personnel.
Sales/marketing/distribution projects
Consultants are increasingly being asked to assess marketing and distribution strategy,
particularly in this era of growing technology impact on distribution. The team may be asked to
recommend whether one channel of distribution is preferable to another, assess whether
distribution via parallel channels is viable, propose more effective marketing strategies, or
evaluate how the sales force functions within the company.
Reorganization projects
As more companies expand globally and make more acquisitions, their traditional organization
structure may become unwieldy. Consultants are often called in to advise the company on an
optimal organization – centralization versus decentralization? Product versus geography? Line
versus matrix? Because these projects often involve reallocation of power or territory, they are a
political minefield – which is why the consultants were hired in the first place!
Cost-cutting (or re-engineering) projects
Consultants are also called in when the company needs to self-prescribe a bitter pill and would
prefer to call in an outsider to take the blame. Cost-cutting does not just mean the identification
of job redundancies. A cost-cutting project looks at all areas of cost. Can the company reduce
raw materials costs? Is there excess inventory? Are marketing funds being spent effectively? Are
central costs being duplicated in the divisions? This type of engagement is very hands-on,
normally requires a significant period of time at the client site, and is very data-intensive. Its
satisfaction lies in the concrete nature of its recommendations – and the immediate impact of
saving the client money.

The project life cycle

Page 12 of 44
These are the typical stages of a strategic consulting engagement.
Pitching/Letter of Proposal
In comparison to investment banks, management consultants spend comparatively little time in a
formal pitching process. Partners carry out the main pitch process, either by responding to the
initial approach of a current or potential client, or by identifying a new or follow-up study with
past clients. Where associates may get involved is in some initial non-chargeable work to support
the partner's conversation with the client. The ultimate aim of this is the drafting of a Letter of
Proposal or Letter of Intent (LOP/LOI) – the nearest a consultant gets to a contract with the
client. The LOP lays out what the consulting team will focus their efforts on in the engagement,
what the results will be, what consulting and client resources will be required, and how long the
engagement is expected to take. It may or may not touch upon the vulgar topic of remuneration!
Although the letter itself is a little dry and boring, it's worthwhile trying to get involved in the
engagement at this early stage for two reasons. Firstly, it provides a good chance to get up to
speed on the client and industry before the study starts in earnest. Secondly, there's some chance
you might be able to mitigate the partner's (frequently) overly optimistic estimates of how
quickly the team will be able to complete the engagement!
Brainstorming/hypothesis generation
With the LOP signed, the engagement starts. The first few days are normally spent in an
intensive round of brainstorming involving the whole consulting team, and sometimes client
members. The idea is for the team to get down into the details of the problem, generate the
spectrum of options that their analysis could follow, and narrow these down to a number of
hypotheses that they can go and test. This hypothesis-driven approach, used by most of the major
consulting firms, is intended to limit the data gathering and analysis stage so the consultants are
not "boiling the ocean," or considering an overly broad range of data.
This brainstorming stage is at once the most exciting and the most frustrating stage of the
project. On the one hand, it gives a new consultant a firsthand opportunity to see how more
senior members of the team tackle the problem set before them. On the other hand, the team may
not seem to be making much headway. Ideas will be tossed about without any data backing them
up, and you'll wonder how on earth you're going to make any progress. The final part of the
brainstorming stage is to take each of the emerging hypotheses and determine how they can be
proved or disproved in the analysis stage. What data is required? How can it be gathered? Which
team member will take responsibility for each part of the analysis?

Data gathering and analysis

The meat of the engagement is in the data gathering and analyzing phase. Although the task is
focused by the hypothesis generation, data gathering can be fairly overwhelming. Your initial
port of call is the consulting in-house library, closely followed by that of the client – both of
which tend to result in large stacks of text-lines, brokers' and annual reports, and other reference
materials. You then leverage the intellectual capital of your consulting firm to identify firm
experts or consultants who have worked on similar but non-conflicting projects.

Page 13 of 44
During this stage, you're also likely to tap further internal sources of information at the client,
from systems and databases and via interviews with client personnel. Sources of external
information are more varied. Some studies may require you to consult industry experts for their
experience, others may necessitate more hands-on measures. Stories abound about the lengths
analysts resort to in order to gather data – including sitting outside a competitor's factory
counting trucks going in and out for a few days! However the data is collected, the likelihood is
there will be plenty of it, but none that exactly proves or disproves your point. This is where a
consultant's ingenuity comes to bear – to find a way of re-cutting the data, combining different
data sources, and making judicious assumptions in order to end up with data that definitively
supports or negates the hypothesis you are trying to test.
Pulling out conclusions and building the story
Developing a story is an evolving process throughout the project – it starts at hypothesis
generation. As a forcing mechanism, many consulting teams will draft the final presentation at
that stage, based on their emerging hypotheses, and, of course, subject to change. Therefore, as
each new piece of analysis emerges, the team tries to place it in the overall puzzle, notes how it
alters the rest of the story, and revises the further analysis to take that into account. It's an
elaborate process. By developing the storyboard up front, the team is forced to helicopter back
up to the top level on a regular basis and check that their analysis directly answers the client's
key questions.
Presentation to client How frequently and in what format the team makes update reports to the
client varies widely depending on the engagement. Where the client is involved on a day-to-day
basis, communication may be more frequent and informal. If most of the analysis is taking place
back at the office, updates with the client project manager may be scheduled on a fortnightly or
monthly basis. Consultants present each finished phase of a project and their major findings to
the board of directors.
Formal presentations are presented as a landscape of exhibits, held together by a storyline. While
the partner or the director with the senior client relationship tends to run the meeting, that person
will often delegate part of the presentation to the manager, even to an associate who has taken
ownership for that part of the work.

One typical presentation

What actually happens in a presentation depends on the consulting firm and the client? One
strategy consulting analyst describes a typical presentation: "However early in the project
planning we start planning for the final presentation, there is always last-minute intensive work.
As a rule of thumb, I block out the week before a major presentation – there's little hope of
maintaining a semblance of a social life during that period! The last few days are concentrated in
obtaining and analyzing the final pieces of data to tell the full story to the client. The presentation
itself is normally a PowerPoint book that we will walk through with the client. Each page
illustrates a message that comes together to form a structured storyline addressing our
conclusions to client issues.

Page 14 of 44
"The book is developed in draft while we work to add the supporting data. Almost as much
importance is devoted to how we tell the story as to what we are saying. In the wee, small hours
of the night, this may seem like word-smithing, but everyone recognizes how important it is to
get the message into a clear and coherent form that can easily be digested by the client.
"On the day of the preparation – after a last flurry of photocopying and binding books – the team
heads over to the client offices, with a last-minute briefing of the partner as we sit in the cab on
the ride over. The presentation is normally to the main board of the company or to the CEO and
his top executive, depending on who has commissioned the study. The partner often takes the
lead to review the objectives of the project and explain the top-level conclusions, before handing
over to the engagement manager to talk through the findings and conclusions in a more detailed
manner. Sometimes the associate will take part in the presentation too. Everyone is on hand to
answer clients' questions about their area of analysis/expertise within the project.
"The conclusions that we've come up with should not be too much of a surprise to the client, as
we will have been updating the various constituents on a regular informal basis. Therefore, there
is normally agreement and support for the final presentation. The meeting concludes with an
agreement on the next steps to be undertaken – either by the client or the consulting team."

A day in the life of an associate

Greig Schneider is an associate at McKinsey's Boston office. He kindly agreed to share a

"typical" workday at McKinsey with Vault.com, noting that no day at McKinsey or any
consulting firm can be called typical.
6:15 Alarm goes off. I wake up asking myself why I put "run three times per week" into the team
charter. I meet another member of the team and we hobble out for a jog. At least it's warm out –
another advantage of having a project in Miami.
7:15 Check voice mail. Someone in London wants a copy of my knowledge building document
on managing hypergrowth. A co-worker is looking for information about what the partner from
my last team is like to work with.
7:30 Breakfast with the team. We discuss sports, Letterman, and a morning meeting we have
with the client team (not necessarily in that order). We then head out to the client.
9:00 Meeting with the client team. We've got an important progress review with the CEO next
week, so there's a lot going on. We're helping the client to assess the market potential of an
emerging technology. Today's meeting concerns what kind of presentation would be most
effective, although we have trouble staying off tangents about the various analyses that we've all
been working on. The discussion is complicated by the fact that some key data is not yet
available. We elect to go with a computer-based slide show, and begin the debate on the content.
10:53 Check voice mail. The office is looking for an interviewer for Harvard Business School
hell weekend. The partner will be arriving in time for dinner, and wants to meet to discuss the
progress review. A headhunter looking for a divisional VP. My wife reminding me to mail off
the insurance forms.

Page 15 of 44
11:00 Depart with teammate for an interview. We meet with an industry expert (a professor from
a local university) to discuss industry trends, and in particular what the prospects are for the type
of technology we're looking at. As this is the last interview we plan to do, we are able to check
many of our hypotheses. The woman is amazing – we luck out and get some data we need. The
bad news is, now we have to figure out what it means.
12:28 As I walk back in to the client, a division head I've been working with grabs me and we
head to lunch. He wanted to discuss an analysis he'd given me some information for, and in the
process I get some interesting perspectives about the difficulties in moving the technology into
full production, and how much it could cost.
1:30 I jump on a quick conference call about an internal knowledge building project I'm working
on for the marketing practice. I successfully avoid taking on any additional responsibility.
2:04 Begin to work through new data. After discussing the plan of attack with the engagement
manager, I dive in. It's a very busy afternoon, but the data is great. I get a couple "a-ha's" –
always a good feeling.
3:00 Short call with someone from legal to get an update on the patent search.
6:00 Team meeting. The engagement manager pulls the team together to check progress on
various fronts and debate some issues prior to heading to dinner with the partner. A quick poll
determines that Italian food wins – we leave a voice mail with the details.
6:35 Call home and check in with the family. Confirm plans for weekend trip to Vermont.
Apologize for forgetting to mail the insurance forms.
7:15 The team packs up and heads out to dinner. We meet the partner at the restaurant, and have
a productive (and calorific) meal working through our plans for the progress review, the new
data, what's going on with the client team, and other areas of interest. She suggests some
additional uses for the new data, adds her take on our debates, and agrees to raise a couple issues
with the CFO, who she's known for years. She takes a copy of our draft presentation to read after
dinner.
9:15 Return to hotel. Plug in computer and check e-mail, since I hadn't had a chance all day.
While I'm logged in, I download two documents I need from the company database, check the
Red Sox score, and see how the client's stock did.
10:10 Pre-sleep voice mail check. A client from a previous study is looking for one of the
appendices, since he lost his copy. The server will be down for an hour tomorrow night.
10:30 Watch SportsCenter instead of going right to sleep, as I know I probably should.
Note: Had this been an in-town study, the following things would have been different: I wouldn't
have run with another member of my team, and we'd have substituted a conference call for the
dinner meeting so we could go home instead. Also, I probably wouldn't have watched
SportsCenter.

Career progression in consulting

Page 16 of 44
Promotion profile
While there are differences in job titles between consulting firms, the levels and promotion path
across firms is remarkably similar. As we've discussed, students graduating from undergraduate
institutions come into a firm at an analyst stage while those with an MBA or similar degree, enter
at an associate (also called consultant) level. (At Booz-Allen, recent grads of undergraduate
programs are called consultants.) After one-and-a-half to three years as an associate, the next
promotion is to manager. Consultants at this level have a day-to-day relationship with the client
and responsibility for managing the activities of the team. The key difference in this role is the
need to step back from the details more often, and significantly more people management skills.
Following manager, comes a senior manager position which allows the consultant to begin to
develop more off-engagement relationships with clients and begin prospecting for new business.
At this stage, the senior manager is also given a broader range of projects to oversee at a
somewhat higher level.
The ultimate aspiration of a career consultant is to achieve the partnership/director position. This
level is about do with building and maintaining client relationships and developing the
intellectual capital of the firm. As most consultancies are still partnerships, promotion to director
normally involves a hefty increase in compensation, as directors begin to participate directly in
the firm's profits.
Analysts typically spend two to three years at consulting firms before returning to get their MBA
or abandoning the field of consulting altogether. Some consulting firms will now promote top
analysts directly to the associate level. At most top consulting firms (Bain, BCG and McKinsey,
for instance) the typical path for analysts includes business school and an MBA before a
promotion to associate. In rare cases, a sterling analyst may be given the option for promotion
without business school. In other firms (e.g. Gemini, Booz-Allen), analysts routinely win
promotions to associate after two to three years.
Performance assessment
Performance assessment is a key for consulting firms. After all, consulting firm value is derived
from the development of their consultants. Thus, performance reviews tend to be more regular
and more structured at consulting firms then at other companies. Usually, reviews are carried out
at the end of a project (or phase) to allow the people you have worked with closely to assess your
progress and any development needs you might have.
Your performance will be measured along similar dimensions to the criteria first used to hire you
– analytical and quantitative, teamwork, and leadership skills. As you progress, the emphasis
shifts towards evaluation of your people management and client relationship capabilities. Along
with checking whether your perceptions of your performance and deficiencies match those of
your managers, you should use the performance review to organize training and experiences to
address your development needs.
Office politics
Consulting is not especially political when compared to corporate America. This lack of
backstabbing and calculation by the relatively flat management structure and objective
performance assessment is observable in most consulting firms. "Up-or-out" tends to be
Page 17 of 44
dependent on the merits of the individual rather than a quota for promotion in each cohort, at
least until the partnership level. That said, some degree of political savvy is important in the
engagement assignment process. Consulting firms tend to have an official project assignment
process and a parallel black market. It's worth understanding the unofficial process from the start
and playing the game with the best of them – after all, the projects you're staffed on and the
directors that you work with will make or break your consulting experience.
First remember that project staffing tries to address conflicting needs from various
constituencies. On the one hand, the firm wants associates and analysts to get a broad exposure
to different industries and project types. On the other hand, both the clients and the partners tend
to prefer projects staffed with people who have some experience in the project area.
Additionally, directors may request to work with consultants that they have found to be reliable
on prior engagements. And you, the associate or analyst, may have your own specific requests
for future assignments. This often results in elaborate compromises. (At more junior levels, you
can expect to lose out to partners more often in your wishes.)
So what can the humble associate do to stack the assignment cards in his favor and participate in
the black market of staffing that never reaches the staffers' agendas? Tap into the unofficial
sources of information about projects which are on the horizon. The best sources of that
information are the partners/directors (either on your current or previous studies) or your mentor.
Talk to these senior people to learn about projects that you might like to work on and express an
interest up front. You should tell as many people as you can about your areas of interest. Then
when a relevant study comes up, you'll be remembered as an enthusiastic team member.
Another way of getting involved in a particular industry or functional specialty is to volunteer to
help with some knowledge development work that is being done in the firm. As this tends to be a
part-time (and non-billable) effort, practice development leaders are always in search of
additional help and will jump at the chance to get you involved. In addition to developing your
understanding of the industry, you will also gain exposure to the senior consultants who focus on
this field.
Mentors – top-level backing
You'll probably get allocated or given the choice of mentors fairly soon after joining your
consulting firm. Your mentor will be a senior consultant or partner who is responsible for your
success within the firm. Recognize from the start what a useful asset your mentor can be. Use
mentors wisely! First, the mentor is responsible for your development and so is a great person to
talk to about your aspirations, assignment preferences, and development needs. He will certainly
have influence over the staffing process, particularly if you don't get what you want first time
around. Second, your mentor will act as an informal channel of communication with the other
directors to tell you how you're performing and how you're perceived within the firm.
You may also develop a more informal mentor network among senior consultants you have
worked with or who specialize in an area of interest to you. These can often be even more useful
than assigned mentors – both because you may have a better personal rapport and because they
are genuinely interested in your progression within the firm.

Up-or-out... sounds painful

Page 18 of 44
The "up-or-out" promotion model exists in many consulting firms. In essence, this means that
consultants who do not make the criteria for promotion to the next level within a specified time
are exited from the firm. Just looking at the organization structure of consulting firms provides
the evidence for this. A glance at the steep pyramid between associates and senior managers
indicates mathematically that not all associates are going to make the partnership. And you don't
see many gray-haired associates clinging to their positions after a dozen years.
So what does this annual culling of the ranks looks like? Actually it's (normally) not nearly as
brutal as it sounds. For starters, the majority of associates and managers who leave consulting do
so on a purely voluntary basis – they have never wanted to be a career consultant and when the
right position in the "real world" comes along, they will jump the consulting ship to pursue it.
Others, who want to stay in consulting, learn more gradually through their performance reviews
that they're not going to make the grade.
Moreover, consulting firms tend to be very good at helping in the job search process. Where else
will you be surrounded by a group of people with so many contacts in the business world, not to
mention the library facilities, support services, indeed anything you need to carry out a structured
job search? Consulting firms are careful to appreciate the fact that you may one day be a
potential client, so they want you to leave with fond memories of your alma mater.

Lifestyle in the industry

Salary and benefits

Consulting salaries are high – for college graduates they start at $40,000 to $50,000, exclusive of
signing bonuses. For MBAs, salaries start at $75,000 and go up – up to $140,000, including
bonuses. In 1998, the average MBA consulting employee earned a $88,000 salary, not including
bonuses. Many firms pay year-end bonuses, tied to the performance of the consultant as well as
the firm's overall performance. Some consulting firms offer performance bonuses of up to 100
percent of annual salary, though figures of 20 to 30 percent of base salary are more common.
Work hours and travel
Consultants aren't paid this money for nothing – they work hard and long hours. Typical
workweeks are 50 to 80 hours per week – though, due to the cyclical nature of consulting, hours
can shoot up to 100 hours towards the end of assignments. However, in a lull between
assignments, consultants are said to be "on the beach" – and normally spend this time writing
assignment proposals, leaving work early and scheduling all those doctor's appointments and
haircuts they haven't previously had time for.
Culture and social
The culture of a firm will have a profound effect on your career and personal life, due to the long
hours and the intensity of personal interaction that this job involves. Consultancies tend to be
quite collegial in atmosphere. Since consultants tend to base their hiring decisions on fit and
character, it's small wonder that firms often end up with a rather homogenous group of
Page 19 of 44
professionals. This similarity can be an advantage, as you get to spend time with like-minded
individuals, but can become claustrophobic after a while.
One characteristic all consulting firms share is a "work hard, play hard" ethic. Consulting firms
are known for frequent and often uproarious social events among project teams and offices.
Consulting firms are renowned for hosting lavish Christmas and summer parties to repay their
consultants for all their hard work. Additionally, some firms will organize an annual retreat or
office gathering with a joint training and social function. This gives consultants the chance to
take breath from the hectic office environment, both to discuss strategic thinking.

Page 20 of 44
Chapter 4: GETTING HIRED

SUB-CHAPTERS: < Get your foot in the door > Is consulting for you? • Resumes and
interviewing • The resume/behavioral interview • Behavioral questions • The case interview •
Case tips • Sample case #1 • Sample case #2 • Sample case #3 • More sample cases •
Guesstimates • Sample guesstimate • More practice guesstimates • Brainteasers • Practice
brainteasers
Get your foot in the door

Until recently, consulting firms have focused on a relatively small number of undergraduate and
graduate institutions when recruiting for associates and analysts. Talent-hungry consulting firms
now realize that they might be missing out on talent elsewhere. Under increasing competition
from Internet startups for smart candidates, consulting firms are beginning to take a more open-
minded approach to recruiting. This makes it easier to get on the radar screen if you're off the
main consulting recruitment track.
That said, competition, even for initial interviews, is high, and there are a number of things that
you can do to increase your chances of being selected for an interview.
Schmoozing
Good networking skills are important once you're inside the consulting firm – but they will also
help you immensely in getting a foot in the door with your favorite firms. You'll come across
several contacts who can obviate a cold call to your target companies. First off, consulting firms
may be coming to your campus prior to the interview process for a series of cocktails and
dinners. While a lot of them are open house, you may come across some invitation-only
functions. While it might sound a little impolite, if you're not on the guest list, give a call to the
event administrator at the company, expressing your interest in the company and asking for an
invite. Nine times out of 10, the company will be delighted to extend an invitation to someone
who shows genuine interest.
In the event that companies don't come to your campus, the schmoozing path becomes somewhat
less clear. The best plan is to find a contact within the firms you are targeting. This might be an
alumnus of your college, a fellow student who has worked there prior to business school. The
role of the contact is twofold – to get you an "in" to the recruiting process and to tell you more
about the company so that you are better informed prior to interviews. Recruiters tend to favor
job candidates who are endorsed by someone who is already working in the firm, so the more
people you know in a particular organization, the greater your chances of success.

Is consulting for you?

Page 21 of 44
Based on the description of the consulting role earlier, you might already have gleaned a fairly
good impression of whether consulting is for you. There are some general characteristics that
successful consultants share. How well do you fit the template?
Profile of the "ideal" consultant
Loves data and figures
Particularly at the analyst and associate stage, a consultant needs to be in his element gathering,
manipulating, and interpreting numbers. Nine times out of 10, data won't be in the right format to
test the hypothesis, so considerable ingenuity is required to combine data sources, fleshing out
the original numbers, while continuously checking the results. While a good working knowledge
of Excel and other spreadsheet programs is a must (and a degree of aptitude in pivot tables,
Monte Carlo simulations, and the like is the icing on the cake), the key skill is to be able to take a
mass of data and draw conclusions. "What's the message?" is a question managers commonly
throw at associates.
Does the helicopter thing well
A good consultant is a master of detail and can tell you where each number and each assumption
came from, but in the next breath can flash back to the overall strategy of the client. It is easy to
get drawn into the heaps of data accumulated at the start of the study and to head off down the
wrong track of analysis. A helicopter approach of moving up and down between the top-level
hypotheses and the details is critical to ensure that the team remains focused on what needs to be
done in the limited time available, rather than "boiling the ocean" of all possible analyses.
Related to this concept is the "elevator test." This is based on the following scenario: You get
into the elevator at the client office and at the very next floor the client CEO hops in. "So," he
says, "what are your conclusions so far in the four weeks since you began the project, and what
are you going to do next?" In the 30 seconds it takes you to reach the executive suite on the top
floor, you need to apprise him, in a concise and coherent fashion, of the key messages emerging
from the project. This scenario is designed to test the consultant's ability at all times to have a
handle on the bottom line – in effect, the executive summary.
Good with clients
"Would you put him in front of the client?" is a key question the recruiters will ask themselves of
you. Their answer will be influenced not only by your good grooming, but your poise and
speaking skills. You should relish interacting with people, have the ability to think on your feet,
and have strong oral communication skills. Commonly, you will be interacting with clients who
are older and more experienced than yourself, who may have biases against consultants, may feel
threatened, and certainly will not take kindly to being told about their industry, company, and
problems by a young, cocky consultant. Handling this interpersonal challenge takes practice, but
above all requires sensitivity to the client's concerns.
Is a willing team player
Consulting, more than most other jobs, is a team sport. Consultants brainstorm together, share
offices or work in communal project rooms at the client, travel together, socialize together –
they're just not solitary animals. Enjoying teamwork is key to enjoying the consulting life, and

Page 22 of 44
you don't need a detailed psychoanalysis to figure out if you're a team player. Do you like team
sports or would you prefer to go off jogging in solitude? Do you like group brainstorming
exercises or do you prefer to come up with the answer on your own?

Resumes and interviewing

Tailoring your resume for consulting
As consulting firms are often inundated with applications, your resume will be an important tool
in selecting you for the initial interview. You may find that you need to tailor it specifically to
consulting positions. Consulting recruiters look for the following on resumes:
• Does it show evidence of academic strength? (Some firms, like McKinsey, are very
exacting on this front.)
• Does it exhibit a propensity for leadership/taking responsibility?
Does it illustrate team player characteristics?
In some cases recruiters will be looking for relevant functional expertise (e.g. engineering or
finance), or for specific industry experience. Consultants tend to be quite tolerant of career
changers – as long as you can back up your reasons for wanting to change professions in your
interview.
The interview process
The wealth of consulting firms comes from their human capital – their consultants. Consulting
interviews are intense and lengthy, designed to measure whether you have the intellectual
horsepower needed for the job.
Consulting interviews tend to fall into two main types – the resume/behavioral interview and the
case/problem interview. The former aims to determine whether you fit into the consultant mold,
and equally importantly into the culture of the company. The latter tests your problem solving
skills and allows the interviewer to see how your mind works and, to an extent, how you deal
with stressful real-time challenges.

The resume/behavioral interview

These interviews are meant to ascertain whether you have the right personal qualities to be a
good consultant, and to fit into the prevailing culture of the consultancy. While the interviewer
may use your resume as a structure for the interview, be assured that he wants a lot more out of
you than a regurgitation of the key points on it.
Consulting insiders say interviewers first want to determine that you have the "mental
horsepower" (brains) and "quantitative and analytical ability" (math and logic skills) to be an
asset to their firm. Interviewers also want to make sure you have the work ethic to work long
hours and the kind of personality that will make you a good team player. Generally, consulting
firms are looking for smart, hardworking, dedicated, and analytical people who are pleasant to
work with. As most firms derive an increasing percentage of their business from international
clients and engagements, language skills and overseas experience are big pluses.
Page 23 of 44
During the interview, focus on highlighting examples from your resume that emphasize your
leadership and team skills. Discuss times when you have played a key leadership role, and be as
specific as possible. In addition to what you say, pay attention to how you say it. You should
make your answers as logical and structured as possible. Give relevant examples. Do not go off
on tangents or trail off midway through a sentence.
Some specific skills that interviewers look for in the interview:
• Leadership skills, as consultants must lead small teams and promote their ideas
• Teamwork, as consultants work with both other consultants and customers toward
solutions
• Analytical skills, to crunch numbers and work through information in a logical manner
• Presentation skills, because consultants must present their findings to fellow consultants
and clients alike
• Creativity, because solving problems often means "thinking out of the box"
There are a few specific points you should remember during the interviews:
• You should never express any uncertainty or insecurity about your math or logic skills.
• As consultants are constantly on the road, saying you don't enjoy travel or implying that
it would be difficult for you to leave home for long stretches will seriously hurt your
chances of receiving an offer.
• Because consultants work in teams, and with a wide variety of clients, there is a strong
culture of cooperation at consulting firms. Never say or show that you might be difficult
to get along with. (Consulting firms will often ask, "What kinds of people do you have
trouble getting along with?" in the hopes that you'll reveal your own shortcomings.)
During your interview, along with assessing your potential as a consultant, your interviewer will
likely, silently, be administering the "airport test." This means that they will probably be
imagining themselves sitting next to you on an eight-hour flight across the Atlantic. Would they
be able to maintain a conversation with you for more than 30 seconds? Or will they have to fake
sleep throughout the whole flight? What this means to you, the interviewee, is that you shouldn't
be afraid to show genuine interest in something outside the realm of business, or even to crack a
(tasteful and amusing) joke.

Behavioral questions
Consulting firms love to use "behavioral interview questions" to measure "softer" attributes.
Behavioral interview questions ask the interviewee to reveal how he or she has behaved in
particular situations in the past, both work situations and personal situations. Firms that use
behavioral interviewing believe that candidates' responses to these questions reveal a lot about
their personalities and skills.

Page 24 of 44
Some consulting firms use behavioral questions almost to the exclusion of more traditional
consulting case questions. It makes sense to practice an answer to some of the most frequently
asked behavioral questions, so you can answer them smoothly.
Practice behavioral interview questions
1. How do you deal with someone in your group who isn't pulling his or her weight, or disagrees
with your goals?
Don't criticize, motivate. Try to think of a time when you encouraged someone to do his best, or
won someone over to your side. Team sports examples are especially valid. Emphasize that
everyone has something to contribute.
2. What position do you normally take on a team?
Neither a follower nor a dictator be. Consulting firms want people (especially newcomers) who
can ask questions, make a contribution, and get their points across without either passively
receiving information or commandeering the entire case team.
3. Tell me what you're most proud of on your resume.
It's wise to choose something that both conveys the qualities consulting firms are looking for (see
above) and gives you the chance to explain or elucidate something that might not be obvious to
the interviewer. (Because so many consulting firms have many overseas branches, discussing a
study abroad program or an international position may win you triple points.)
4. Why have you chosen our firm to interview at?
Consulting involves a lot of research. Show that you've done yours. Explain why you're
interested in a strategy firm (or a change management consulting position, or whatever).
5. What is the worst mistake you've ever made?
This mistake should not involve an egregious lapse in judgment along the lines of: "It was really
stupid of me to violate parole." It's better to describe a valuable lesson you learned (and one that
preferably occurred some time ago). "I remember when I didn't fully research buying a car, and I
ended up buying a car that looked good but cost me thousands in repairs. I'll never fail to do my
homework again."
6. Why should we not hire you?
Don't point out an actual flaw unknown by your interviewer. Instead, explain why something that
looks like a weakness isn't. "I can understand that you would potentially be put off by my lack of
economics and business coursework. But I think my sales experience and my score of 770 on the
math portion of the SAT should alleviate those concerns."
The case interview

Consulting interviewers use interview questions designed to test your analytical ability,
reasoning skills, confidence, and knowledge of business concepts. Case interview questions fall
into three broad categories: cases, guesstimates, and brainteasers.
Business cases
Many of your consulting firm interviews will be case interviews. If you're interviewing with a
strategy consulting firm, you can count on receiving plenty of cases as you go through the
Page 25 of 44
interview process. In a nutshell, case interviews are problem-solving exercises. While some
interviewers may draw on their recent real-world experience in posing the case, you will not be
expected to have advanced industry knowledge. The interviewer is more interested in checking
out your thought process, and assessing your analytical ability, creativity, and poise.
Some cases are presented to the interviewee as a written document for them to read and prepare
(Monitor is prone to do this). But most of the time, the interviewer will describe the key facts and
issues of the case in a few minutes before asking the candidate for her analysis. One consulting
firm (Monitor again) actually asks you to solve a case as part of a team of other job applicants.
The case will probably consist of a question about a business scenario. For example: "A foreign
company with extra cash on hand wants to enter the American fast food market. What would you
tell them?" While every case is different, follow the tips below to improve your chances of
cracking it without too much difficulty.
Case tips
• Before jumping into an attempt at answering the question, you need to ask the
interviewer a number of questions to gather vital information that you'll need to solve it.
(You should imagine your interviewer as a corporate client presenting this case to you.
Certainly, you would ask the client plenty of questions before attempting to provide
advice, wouldn't you?) Your interviewer will answer these questions with pieces of
information that should help you formulate new questions and, ultimately, your case
recommendations.
• Ask lots of questions before beginning to offer recommendations! One recent interviewee
correctly cautions: "Consulting firms are looking for people who will think carefully
before answering; this is very important in the case interview. Don't say the first thing
that comes to your mind, even if you're certain about it. If you're trying to choose
between appearing to be slow and appearing to be a cocky idiot, choose the former."
• It is especially useful to ask your interview about best practices in the industry. What are
other companies in this industry doing that are facing the same issue?
• Don't make assumptions without checking them out with the interviewer – or at the very
least stating that you are making an assumption. If your case concerns a vehicle
manufacturer, don't assume it's General Motors. It might be John Deere.
• Having gathered all the information you think you need, you can start to formulate your
recommendations. It might be helpful to use a framework in your mind in order to ensure
that you are not forgetting a vital area of analysis. For instance, the Porter's Five Forces
model might help you to analyze a market situation and identify all of the areas of
potential threat in order to come up with recommendations for a company's market
strategy.
After you have finished giving recommendations, point out possible flaws and assumptions in
your thinking, which should impress your interviewer. You should speak and reason aloud
during your case interview. Since your thought process is much more important than your
ultimate conclusions, your interviewer must hear your reasoning and the logical steps you are

Page 26 of 44
taking to reach your conclusions. Always, always bring a pad of paper and a reliable pen with
you to any consulting interview. You may want to take notes during the case interview (and
almost certainly for any guesstimates or quantitative brainteasers your interviewer may throw at
you). Asking your interviewer for paper and a pen during the interview will give the impression
that you are disorganized and unprepared. No matter what, never show any signs of being
flustered in a case interview. Remember to breathe!
Sample case #1
Sample case
We have been engaged by a major film entertainment company to assist them in building a
distribution network for home video. They want to know whether they should build their own
distribution network or continue to contract with third parties.
First of all, you need to ask your interviewer some basic questions: It makes sense to ask your
interviewer about best practices – that is, what are other entertainment companies doing? What
are the current costs? Does the company have the staff and resources to create its own
distribution network?
• Of the major entertainment companies that produce videos, do most distribute through
their own proprietary supply chain or through third parties?
• What is the client's current cost of distribution through its contractual partner(s)?
• Has the client considered building its own distribution network before retaining us? If so,
what were its findings?
• Does the client have a dedicated functional staff assigned to the project? If so, what
functional areas do they represent?
After establishing some basic facts, it's time to get more detailed. Your interviewer may allude to
certain avenues to discuss, or shut down others. If the interviewer confirms that, yes, the
company does have enough current staff to handle setting up its own network, there's no call to
delve deeper into the ramifications of reassigning personnel.
Let's say that, through questioning, you've come to decide that staying with a third-party
distributor makes the most sense. Now the question is – should the company stay with their
current distributor, or choose a new one?
• Who are possible alternative partners? Who uses them?
• Could you characterize the relationship between the client's distribution partner and the
client? Is there a possibility of retaliation on the part of the distribution partner if the
client severs its ties to this party?
• How many weeks of supply are currently in the distribution partner's pipeline?
• How receptive are the client's accounts to changing distribution partners? Has a value
proposition been created to show the client's accounts that a client-owned supply chain
would be more efficient, valuable, etc. to the accounts?

Page 27 of 44
 • Does the client have any financial interest in the distribution partner that might have to be
severed?
After answering these questions, make a recommendation.
Sample case #2
You may be asked a more qualitative case question as well. (Recruiting insiders tell us
undergraduates and graduate candidates without MBAs are more likely to get these sorts of
cases.) Consulting insiders say the point of a qualitative business case is to see whether you can
discuss a company intelligently and analytically, and whether you are able to use business
concepts and terminology naturally in conversation. This is an example of one such actual case:
2. Why is Intel successful? Will they retain their advantage in the future?
This is a common type of case question used in consulting interviews. Typically, the interviewer
will choose a company that almost anyone would have a basic knowledge of (for example, Coca-
Cola, Microsoft, or McDonald's). The interviewer is not expecting you to quote the latest stock
price of Intel or know how much CEO Craig Barrett got paid last year. She wants you to explore
what the company does right and the challenges that it faces in the future. Any business
knowledge that you have will come in handy.
Well, what do you know about Intel? You should know that Intel is a producer of
microprocessors (or chips), an essential component of computers. (That's about the level of
knowledge you need.) Intel currently has about 80 percent of the microprocessor market. Clearly,
they're doing something right, but what?
Intel is a technology company. In a rapidly evolving market like the computer industry, staying
abreast of changes in technology is vital. You might point out that Intel's heavy investment in
R&D has enabled the company to consistently produce faster microprocessors that its
competitors – and its headstart allows it to retain that R&D edge.
Intel's commanding lead in the market also allows the company to leverage its might to partner
with its customers, ensuring they buy only Intel products. With 80 percent of the market, Intel
has quite a bit of weight to throw around. And as such a high-volume producer, Intel has
economies of scale, cost advantages and operating efficiencies its competitors can only dream of.
Intel has also successfully branded its products, the Pentium chips, so that customers know them
by name and associate them with high quality. (It is unusual for a high-tech firm to brand itself
so successfully.) Remember all those "Intel Inside" logos? Intel partners with its customers in
order to cross-promote its products.
Now you might point out Intel's weaknesses. Intel's competitors, like AMD and Cyrix, have
managed to copy most of Intel's products (though the most sophisticated chips remain beyond
the reach of most competitors). Intel, for the time being, has succeeded by being first to market
with its products. You might point out, however, that as society becomes more "wired," the
major source of growth in the microchip market has been in lower-end, less-powerful chips - a
market in which Intel's competitors are well-equipped to compete in price-sensitive markets.
Already, many sub-$1,000 computers rely on AMD and Cyrix chips.
Sample case #3
Page 28 of 44
Some cases combine an explicit test of your quantitative skills with some broad strategic
precepts, such as the one below:
3. A restaurant owner is setting up a new restaurant and making some basic decisions on how to
fit it out. He is today making a decision on the facilities to place in the restrooms for customers
to dry their hands. Initial research suggests that he has three options – paper towels, roller
towels, and hot air dryers. What should he consider in his decision making process?
In the initial analysis, you might ask a number of questions, which will influence your decision.
• What type of restaurant is it going to be – luxury, moderate, or cheap?
• How many customers does he expect? How many tables? Is it open during the day? In the
evening?
• Has he done any customer research to see what customers would prefer?
Fairly soon in the process, you should start asking questions about the economics of the three
options - in which case the interviewer will give you some more information:
In the initial research, the restaurant owner has found out the following information from the
suppliers of the drying facilities:
• Dryers have an initial cost of $500 each (but you'll need two – one for each restroom) and
a monthly service charge of $100 per month. The supplier estimates that the lifetime of a
drier is four years.
• Paper towels cost 5 cents each and the number of paper towels that you will need varies
directly with number of customers. So if you expect 50 customers a night, they will use
50 towels.
• If you use toweling rolls, they will cost $5 per roll (and again you'll need two – one for
each restroom). The rolls will be changed daily if the restaurant has more than 2,000
customers per month or every other day if there are less than 2,000 customers per month.
At this point, it's obvious that from an economic standpoint, the option you select will vary with
the number of customers. Therefore, it makes sense to look at a break-even calculation.
First of all, take the dryers. They cost $100 per month, plus an upfront charge of $1,000 that you
should depreciate over their lifetime (i.e. an additional $1,000/(4 x 12) per month = $21 per
month). Therefore their total cost is approximately $120 per month – and this does not vary with
the number of customers coming into the restaurant.
Secondly, look at the paper towels option. These vary directly with number of customers in the
restaurant, at a cost of $0.05 per customer. Therefore, assuming few customers per month, paper
towels will be cheaper than dryers. How many customers would have to come to the restaurant
each month to make the dryers more cost effective? The cost of towels would have to exceed
$120 per month, equating to $120/$0.05 = 2,400 customers per month.
Is this break-even affected by the rolls option? At less than 2,000 customers per month, the rolls
would cost $10 every other day or $10 x 15 days = $150 per month. This in itself is more costly
Page 29 of 44
than both the dryer and the towels option, and with more than 2,000 customers, it will only look
more unfavorable. Therefore the real economic decision is between towels and dryers. At less
than 2,400 customers per month (or 2,400/30 = 80 customers per night) you would prefer the
towels. Once the number of customers increases above this, you'd switch to dryers.
Following the economic analysis, you might mention a few more non-economic points that
might sway the balance:
• Are there additional staff costs of cleaning up paper towel waste?
• How many suppliers of each option are there? If there is a single supplier, might he have
the power to raise prices in the future?
Hints on quantitative cases:
• Make the numbers easy – round up or down when possible to make further calculations
easier.
• When you're jotting down numbers, make sure you keep a track of what is what, so when
you pull together your recommendations at the end of the analysis, you can make
comparisons between the options.
• In break-even cases, it is sometimes effective to draw a graph to illustrate the break-even
decision (in this case, number of customers per month along the x-axis versus cost of
drying option along the y-axis).
More sample cases
4. There are three women's clothing chains with approximately the same merchandise, but very
different results in terms of sales per square foot. What could be accounting for these
differences? How could you identify the main drivers of these differences?
5. You are head of a large corporation. Your company must build a new paper plant. You must
decide which country to build the plant in. What factors would you consider?
6. A big health care company has hired you to determine a strategy for improving profitability
through growth. The company hopes to reach its goal in three years. What would you advise?
Guesstimates
Guesstimates are commonly asked in consulting interviews. Generally, your interviewer asks
you to estimate the size of the market for a particular product or service, and observes your
reasoning process. The key is not to get the right answer, but to show a logical way of tackling
the problem, a sensible approach to assumptions, and the ability to do simple calculations
quickly without a calculator.
Guesstimate cracking tips
• You won't be given any real data (though you won't need to know much more beyond
basic population figures for the United States).
• In your analysis, you can assume that the United States has 270 million people and 25
million businesses. (You might even round up to 300 million.)
Page 30 of 44
 • Make reasonable assumptions, with rounded, easy-to-work-with numbers (difficult
numbers may throw off your calculations) and go from there.
• Remember that you're expected to use a pen and notepad to work through your
calculations.
• If you don't know an elementary figure, like the population of Brazil or the circumference
of the globe, it's much better to ask than to stumble your way through an answer based on
inaccurate assumptions.
• Talk through your steps out loud as you go through your calculations.
• Remember that guesstimates, like cases, may also involve elements of creativity and
problem solving. For example, when posed the question "How much change would you
find on the floor of a mall?" you might want to ask "Is there a fountain in the mall?"
Sample guesstimate
How many gallons of white housepaint are sold in the U.S. each year?
THE "START BIG" APPROACH:
If you're not sure where to begin our analysis on a guesstimate, start with the basic assumption
that there are 270 million people in the U.S. (or 25 million businesses, depending on the
question). If there are 270 million people in the United States, perhaps half of them live in
houses (or 135 million people). The average family size is about three, so there would be 45
million houses in the United States. Let's add another 10 percent or so to that for second houses
and houses used for other purposes besides residential. So there are about 50 million houses.
If houses are painted every 10 years on average (notice how we deftly make that number easy to
work with), then there are 5 million houses painted every year. Assuming that one gallon of paint
covers 100 square feet of wall, and that the average house has 2,000 square feet of wall to cover,
then each house needs 20 gallons of paint. So 100 million gallons of paint are sold per year (5
million houses x 20 gallons). (Note: If you want to be fancy, you can ask your interviewer
whether you should include inner walls as well!) If 80 percent of all houses are white, then 80
million gallons of white housepaint are sold each year. (Don't forget that last step!)
THE "START SMALL" APPROACH:
You could also start small, and take a town of 27,000 (about one ten thousandth of the
population). If you use the same assumption that half the town lives in houses in groups of three,
then there are 4,500 houses, plus another 10 percent, then there are really 5,000 houses to worry
about. Painted every 10 years, 500 houses are being painted in any given year. If each house has
2,000 square feet of wall, and each gallon of paint covers 100 square feet, then each house needs
20 gallons – and so 10,000 gallons of housepaint are sold each year in your typical town. Perhaps
8,000 of those are white. Multiply by 10,000 – you have 80 million gallons.
Your interviewer may then ask you how you would actually get that number as a consultant. Use
your creativity – contacting major paint producers would be smart, putting in a call to HUD's
statistics arm could help, or even conducting a small sample of the second calculation in a few
representative towns is possible.
Page 31 of 44
More practice guesstimates
2. How many 747s are above Kansas right now?
3. How much beer is consumed in the United States each year?
4. How many barbers are there in Chicago?
5. How many gas stations are there in Los Angeles?
6. What is the annual size of the golf ball market in the United States? What factors drive
demand?
7. How many pay phones are there on the island of Manhattan?

Brainteasers
Brainteasers (or, as one disgruntled interviewee referred to them, "mindsplitters") are the genre
of questions along the line of "Why are manhole covers round?" Some brainteasers are more like
logic problems, while others require more mathematics. Be forewarned – some of these
questions are very tricky and it is entirely possible that you may not be able to solve them in a
short amount of time. Their main function may be to test your courage under fire.
Do not get flustered! Do not tell your interviewer that the brainteaser cannot be solved or is
unreasonable. As a consultant, you'll be constantly on the spot – your interviewer wants to ensure
that you can keep your cool.
Practice brainteasers
1. You and a neighbor are planning garage sales for the same day. You are both selling the
same used TV. You plan on selling the TV for $100, but your neighbor insists on selling
his TV for $40. What should you do?
It's easy to think that the right answer hinges on compromise so that you ultimately sell
your TV for more than $40 but something less than $100. But in the land of business, the
right answer requires taking an underutilized asset and turning it around for profit
maximization. In this case, buy your neighbor's TV for $40 and then sell each TV for
$100.
2. You're in a room with three light switches. Each controls one of three light bulbs in the
next room. You must figure out which switch controls which bulb. You have some
limitations – you can flick only two switches and you may enter the room only once.
Consultants love "out-of-the-box" thinking. Some suggest drilling a hole in the wall or
calling a friend for assistance. One applicant suggested that the switches might be
dimmer switches – each light bulb could be set to a certain level of illumination, making
solving the puzzle easy. There's one elegant solution, however. Turn one light bulb on for
10 minutes, then turn it off. Turn another bulb on. Then go into the room. The light bulb
that is on clearly goes with the switch that is turned on. Now feel the bulbs. The hot one
has been on recently.
3. There are four men who must cross a bridge in 17 minutes. The bridge is very narrow
and only two men can cross at once. It is nighttime and whoever is crossing a bridge
Page 32 of 44
 must carry a flashlight. Alan can cross in one minute, Bert in two, Cedric in five minutes,
and Don in 10 minutes. The men crossing the bridge go at the pace of the slowest
individual.
First, Alan and Bert cross together with the flashlight, which takes two minutes. Alan
returns with the flashlight, which takes one minute. Three minutes have elapsed. Cedric
and Don then cross with the flashlight, which takes 10 minutes. At the 13-minute mark,
Bert returns with the flashlight, taking two minutes, and Bert and Alan go back across the
bridge, for a total time elapsed of 17 minutes.
4. The classic brainteaser: why is a manhole cover round? (Originally asked by Microsoft,
this chestnut is still making the rounds among consulting firms and high-tech firms
alike.)
There are many answers to this puzzler. First of all, a round manhole cover will not fall
into a hole, making it safer. A manhole cover that is round can be rolled on its edge, and
will not cut anyone. Round covers also do not need to be rotated to fit over a hole.

Page 33 of 44
Chapter 5: OUR SURVEY SAYS

SUB-CHAPTERS: < Cutthroat camaraderie > Pay: Awesome • Food, sabbaticals, and travel...
too much travel • Social life: Out on the town • Long (and odd) hours • Management: Flat or
pyramidal • Dress: Well-rested suits • Diversity: The changing face of consulting? • Offices:
Looks like money • Support staff: Uneven • Training: Keeping up-to-date • The few, the proud,
the consultants

Cutthroat camaraderie

Like separate countries, consulting firms have their own cultures. One associate at a consulting
firm finds "the camaraderie here very appealing, because this industry is somewhat cutthroat and
it's good to have that human touch." Part of that competition is engendered by the "up-or-out"
promotion policy. "At my former firm" says one consultant, "you're either promoted or told to
leave after two years. That creates a lot of insecurity. It's survival of the fittest, and I don't know
how much teamwork that culture can really support. My new consulting firm doesn't have that
policy and that makes it a nicer place to work."
Consultants are generally bright overachievers, and so it's no surprise that one consultant thinks
his firm "attracts very aggressive business people who are well-rounded and down to earth. The
company values leadership and integrity." While consulting firms generally have entering classes
that are about half women and half men, others are still influenced by the residue of their former
male majority. One insider says his firm has a "notoriously macho and male culture," and the
firm's "go-and-get-it attitude" was "quite repulsive" to women for many years. However,
employees note that the company has made a "genuine effort" in recent years to recruit and retain
more women in its corporate structure, and that "this effort is showing results."
Some consulting firms are defined by their socialization. "My firm will spend to create a friendly
work environment," says one insider. Another insider reports that his firm's atmosphere is
"totally convivial – like an elite fraternity or sorority." Firm culture can be affected by outside
forces as well. "My firm had some problems two years ago, and people are still a little nervous
and still look over their shoulders," says one consultant, while another Big Five consultant says:
"The culture is still pretty much dominated by the accounting side, as you can tell by all the blue
and gray ugly suits walking around here, even though the consulting side of the firm is
increasingly profitable."
But despite these separate traditions and quirks, all consulting firms emphasize and value
teamwork. "The culture is very collaborative," say insiders. "People in Australia will get on a
plane and fly to your client in the middle of the night to help you out with a project," says
another consultant. Most firms look "for extraordinarily smart people who have the ambition, the
ability and the self discipline to give 200 percent where only 100 percent would suffice.
Consultants are experts in fields you've never heard of. They are mavericks and builders and it is
a true joy to work with them," gushes one insider.
Page 34 of 44
Pay: Awesome
By their own admission, consultants receive impressive compensation. "I have no complaints,"
says one consultant, "because my pay is about the industry average for management consulting –
which is to say, it's awesome." It gets better – "The pay in itself is good, but the bonus makes the
pay package even more attractive." At one firm, bonuses "can be substantial, up to 20 percent on
top of base pay," while another firm lavishes its consultants with "big, big bonuses that can be up
to 60 percent, and once in a while, 100 percent, of your base pay." But these bonuses aren't
handed out just for showing up – "they are performance bonuses, so a good and bad thing is that
how much you get depends on yourself." Don't expect radical differences in pay among firms;
"while sometimes firms will raid each other to get personnel, in general starting salaries at the
top consultancies are very similar. If one major firm raises its initial salary, they all do."

Food, sabbaticals, and travel... too much travel

Consultants work hard, and their firms want to keep them happy. Case teams usually have an
event or two during the engagement to break up all the hard work. One consultant reports that
"halfway through the case study, your team will have dinner at one of the fanciest restaurants in
town. It depends on the client's budget and the team, somewhat." Perks can be even more
extensive. "In San Francisco, we have fully catered TGIF parties, lots of free baseball and
football tickets, Napa Valley wine tours, good stuff like that," says one West Coast-based
consultant.
Some consulting firms offer leaves and sabbaticals to prevent burnout. One consultant tells us he
is thrilled that "the leave-of-absence policy [at my firm] is pretty incredible. Basically, if you're
not in the middle of an assignment, you can take an (unpaid) leave of absence for whatever
reason you want. I just spent a month backpacking through Australia and New Zealand." Even
the more traditional consulting firms are getting in on the act. One associate at a notable blue-
chip firm tells of her plans to take time off to write a book next year, and one of her colleagues is
directing a film part-time. Travel can be a perk or an albatross. One insider raves: "Things I did
because of my job here: flew the Concord, went to Lillehammer for the Winter Olympics, took a
cruise from Miami to the Bahamas, gambled in Monte Carlo, saw an opera at Covent Garden,
had dinner in the Eiffel Tower, spent a summer afternoon at a topless beach in Nice. The list
goes on." However, the consultant also admits, "I didn't have a huge social life because staying
weekends in all of these places was too good to pass up – not bad if you're just out of college, but
difficult if you have a girlfriend, or worse if you're married and have kids."
It's also worth remembering that travel does not always equate to glamour. For every trip to
Miami or Milan, there are another 10 to Duluth or Newark. Clients tend to choose their
headquarter locations for the tax breaks or the cheap land rather than for the weather or quality of
restaurants. Several consultants feel that the "travel stops being a perk after the first three or six
months, and then becomes a royal pain." One upside to all the travel: "frequent flyer miles, as
many as you want, you got 'em."

Social life: Out on the town

Page 35 of 44
Consulting firms, by most reports, encourage a healthy social life among their employees. "It
depends on the team you're working with, but a lot of off-the-job interaction is encouraged. I
mean, we go out almost every night for dinner together when we're on the road. And besides
that, we have a social dinner once a week, we play golf together on a weekly basis, and we have
a lot of events scheduled for us on the weekends, which you have the option to go to or not."
One exhausted insider reports: "There are a lot of extracurricular activities. In fact, I pick the
ones I want to go to and don't go to the rest, otherwise I'd be doing company stuff seven days a
week." Not all fun is run through the office, however. An insider says: "Most people I know here
have time to pursue outside interests. We have opera singers and rock climbers. One good friend
of mine is writing a novel." As for prevailing attitudes, another insider notes that "most people
are down-to-earth, although some are very elitist, but those people usually find that in the long
run they don't survive. When you visit a client you can't come off as uppity."
Another consultant tells us that "actually, some offices are a little more social than others. On the
research analyst level, everyone is always social, but in some offices, like DC, even partners will
come out and party." Still, "on case teams, we always got together one night a week. We would
rent a room in a sports bar, or maybe have a nice dinner together." At another firm, insiders tell
us that "there are always e-mails going around the firm inviting people to parties." One
consulting firm likes to help grease the social wheels, and "sponsors several intramural sports
teams and charity "fun runs."

Long (and odd) hours

While not as long as investment banking hours, consulting hours can be very long indeed. All
consultants, however, concur that it is impossible to predict just how long those hours will be.
One former analyst tells Vault.com: "The hours fluctuated a lot. I worked on a few projects at 70
to 80 hours a week. Others were more relaxed at 50 to 60 hours a week." Another insiders
cautions prospective consultants to "expect to clock about 70 hours a week. But you're expected
to come in only one day a weekend at my firm." "The worst I've heard," says one consultant, "is
a guy who worked 120 hours a week for two weeks, back to back."
Because consultants have to perform all sorts of research, they may have to occasionally work
odd hours. "Once I had to get up at 4 a.m. every day to work with farmers," reminisces one
analyst. "It was insane, yet satisfying." Other things can lengthen the consulting workweek.
Consultants say "the hours can be long, over 60 hours a week, and travel can take up to 80
percent of your time." One consultant bitches that "the hours are already 60 hours plus, and then
there is all the damn airplane time. The travel is the worst, just the worst." On travel, an associate
reports: "It's hard to define work hours in that situation. There is some flexibility to when you
schedule your work. Generally weekends are free if you want them to be – but not always."
However, some offices generally tend to have shorter hours than others do, with "New York and
Boston working longer hours than Los Angeles." One California consultant says: "We try to
clear out of here on Fridays by 6:30."
Management: Flat or pyramidal

Page 36 of 44
Consultancies don't thrive on grinding fresh ideas and vibrancy into dust, but in general, the
older and larger the consultancy, the more established the hierarchy. At one youthful firm,
insiders tell Vault.com that "job titles and pecking order are less important around here than what
you bring to the party." Another employee adds: "Vice presidents don't necessarily have greater
clout than principals – it's what you say, not who's saying it, that's important." One firm is so flat
that "there isn't a whole lot of difference between what an analyst does and what an associate or
even a VP does – we're all in this together."
This lack of structure isn't always a boon – "if you need someone to hold your hand, or teach you
something, forget it." At another firm, a consultant says: "There is definitely a pyramid here. It's
healthy and not stifling, but it's rigid." The Big Five consultancies – traditionally wedded to their
number-crunching brethren - are in this vein as well. One such consultant says: "This
consultancy is a bit more bureaucratic than I think it should be, but I think that is the way it is
with all Big Five consulting firms." At one consulting firm, insiders say they're happy that
"everyone in the firm shows up to parties, even the partners, and this is reflected in our open
management structure."

Dress: Well-rested suits

Dress codes vary at consulting firms. At many firms, "the offices are generally casual but on the
dressy side of casual." Otherwise, insiders say, "you dress for the client. When you're working
for a bank, it's suit day every day. If they get casual Fridays, so do you. In the office, you can
give the suits a rest unless you're doing a presentation." At other firms, "the dress code is casual,
which is awesome, except when you meet with clients," says one consultant. "It helps set a laid-
back mood." "At headquarters," says a consultant at a casual-dress firm, "the office tends to be a
tad more formal – khakis instead of jeans." Other consultancies require "business dress every
day, no exceptions," though some offices slip in "a casual Friday, though nothing grungy."

Diversity: The changing face of consulting?

Most consulting firms still have majority white male leadership. However, these companies are
very open to talent in whatever form it takes. A representative consultant says: "Although the
breakdown of men to women is 70/30, I feel women are well-accepted in the organization. As for
minorities, they are treated as equals. We also have minority-specific recruiting seminars." The
firm "is a salad bowl," say other insiders. "All persons are deeply respected." At one major
consulting firm, "the CEO is a woman." In addition, since consulting firms are invariably
international in outlook, they often have many non-American consultants in important positions.
"We are a very diverse firm internationally," says one consultant. "We have people from India,
from Africa, from all over Russia and Asia and South America. There is zero prejudice."
However, some consultants feel that "consulting by its very nature is not too friendly to women,
especially women with families, since the hours are so crazy and there is the whiff of machismo
in the air."

Offices: Looks like money

Page 37 of 44
Offices vary, though, as one consultant puts it, "everywhere they look like money." Some
consultancies put entry-level analysts into "bays, rows of desks," while at other firms "there's no
analyst ghetto, what they call the pen in investment banking. Everyone has an office; analysts
usually share them." Insiders say their offices often sport "plush carpet," "costly paintings on the
wall, as well as weird framed abstract art prints that I hope weren't costly," and "breathtaking
views." At one New York office, "the view from the bullpen is breathtaking – with a window
view that goes all the way from Midtown to the Statue of Liberty." Views apparently are
important to consultants – at another consultancy, "everyone has a window office with a nice
view, though everyone below the senior level has to share an office."
Some firms have a cafeteria for their employees, and even "lots o' free Snapple," while at another
firm "there's no cafeteria, but there is a kitchen. It's mostly the microwave that gets the workout
there." At other consulting firms, employees are lightly tied to the office indeed. One firm
"practices something called the virtual office, which means you fly to your client site Monday
through Thursday, and then you telecommute from your home on Fridays. Usually I spend
Fridays doing administrative work and returning calls. That is a big perk." Other firms practice
something called "hoteling," where "you just call up ahead to get assigned a desk. You have a
voice mail number, and when you are working out of an office, your phone will ring via that
number."
Support staff: Uneven
A helpful secretary or researcher can be a lifesaver, but these valuable allies are not ubiquitous at
consulting firms. Some consultants say: "We don't really have any help. Only directors have
secretaries. The rest of us do our own typing." Other consultants "have a production staff, which
will make up slides after you write them out." Insiders at one consultancy say that the firm
"recently downsized our research staff, on the theory that consultants should be able to do their
own research more efficiently. We kept one guy to take care of the copy machines and stuff like
that." Another consultant remarks dryly: "We have support staff, but in general the staffing is
pretty lean. There is a reason you're taught to use Excel and Access as soon as you get here." At
other firms, however, support staff "takes care of things like helping expatriate consultants
comply with U.S. tax laws."
Other consulting firms help out their teams in the field. "Every team has a team assistant, which
handles the administrative details of each team. There's also a word processing bay, where you
drop stuff out after you write it out." One consulting firm has "wondrous" research resources –
"The library is very modern; it has laserdiscs and CD-ROMs, the whole bit," say insiders.

Training: Keeping up-to-date

Most firms have some kind of training program, which varies in length, intensity and timing. At
one consultancy, "you do it after you've been working at the firm for a few months. It was held in
London in my year." Another insider says: "They don't send all of the new hires to initial training
at once. It's continuous and rolling, so about 100 of the people come in at any given time." A
recent training attendee says: "We study subjects like strategy, operations, and organizations and
some of the tools that have been developed over time." Another firm has "maybe two weeks of
very basic training when you start, and another two six months later, at which point you don't
Page 38 of 44
need it." At one firm, "training is an excuse for a vacation in Paris," while at another, "continual
training is very much emphasized and you always have access to education if your manager
allows it."
Similarly, firms want to ensure their consultants keep abreast of their progress. "They give you
feedback along the way. At least 50 percent of your promotional chances depend on your
feedback." Since "only one out of five new associates is still at the firm five years later," the firm
is "vigilant about pushing out those who don't meet its exacting standards." Insiders at consulting
firms say, "feedback is given in both formal and informal channels." At one firm, "the formal
part is done a couple of times a week during a study. The informal feedback can be weekly."
Feedback is "both written and verbal feedback. Written performance reviews of junior
consultants can be comprised of page upon page of blunt criticism." At another firm, insiders tell
Vault.com "we have 360-degree reviews, where you review your superiors and they review you."

The few, the proud, the consultants

Despite the rewards of consulting, consultants would like you to know that "consulting is not a
job for just anybody. A lot of people have second thoughts about being consultants for life.
That's just how the industry is structured." Even though one consultant thinks "job satisfaction is
high at [this firm], that satisfaction is relative to this industry, which doesn't have too many
happy people on the whole."
So what are the rewards of consulting? Employees cite the "super-intelligent and slightly
eccentric" group of colleagues. Working with such talented co-workers, employees report, gives
them "a chance to do very high-level work with big companies surrounded by a group of
extremely smart, resourceful people." Others love the "significant responsibility, incredibly steep
learning curve, and lots of money" that a consulting career brings. "The work is intellectually
challenging and personally satisfying," says one consultant, while another says to prospective
consultants: "Your body, mind, spirit, temperament, and willpower will be challenged in ways
that you cannot now imagine. But all in all, it's a good experience."

Page 39 of 44
Chapter 6: APPENDIX

SUB-CHAPTERS: < Industry buzzwords > Recommended reading • About the author
Industry buzzwords

The consulting industry uses many "buzzwords." Following is a basic list that can raise your
level of familiarity with consulting terms. Consultants often lapse into their own lingo while
conversing with civilians, thus further panicking those who were unaware that they possessed
something called a "skill set" (for what it's worth, the things that you're good at). Here is a short
rundown of some of those worlds that consultants like to fling about in case interviews:
Bananagram: A graph showing profitability (the typical measure of profitability for this graph
is return on capital employed, or "ROCE" [pronounced roachy]) vs. relative market share. The
graph shows that the higher market share, the higher the profitability.
BCG matrix: A portfolio assessment tool developed by BCG. Also called a growth/share
matrix.
Benchmarking: Measuring a value or practice or other business measure (such as costs) against
other companies in the industry.
Blank slide: Initial sketch on paper for a slide to be used in a consulting case presentation
(called blank because it does not include data until analysts put it in).
Brainteaser: A type of consulting interview questions in which the job seeker is asked to solve a
logic problem.
Business Process Re-engineering (BPR): BPR is the process of reviewing a client's business
processes, eliminating unneeded or "non-value-added" tasks, and then implementing the leaner,
more efficient process.
Case team: Team that works on a consulting project for a client. Usually composed of one
partner (or director), one consultant and two or more analysts.
Change management: One of the services provided by consulting firms, in which the firm helps
a company cope with a period of significant change (such as a merger, downsizing or
restructuring).
Consultancy: A typically European name for what we call a "consulting firm" in the U.S.,
though the term has picked up currency in the U.S.
Core competencies: The areas in which a company excels. Consultants believe a company
should enter only those businesses which are part of its core competencies.
Critical path: This term comes from Operations Management theory. Every business process is
made up of a series of tasks. Some of these tasks are related to maintenance of the process or
Page 40 of 44
administrative and bookkeeping issues. Taken away, they do not directly impact the end result of
the business process. If you eliminate these non-meaningful tasks, you are left with the core set
of tasks that must occur in order for the process to produce the desired result. This is the critical
path. In everyday consulting language, it is used to refer to only those work tasks which are the
most important at the time.
DCF: Discounted Cash Flow. The present value of a future cash flow.
Drilldown: Asking questions to gather more detail about a situation, usually from a high-level
(big picture) view.
80/20 rule: Getting 80 percent of the answer first will take 20 percent of your time. The other 80
percent of your time may not be worth it.
Engagement: A consulting assignment received by a consulting firm. Also called a "case" or
"project."
Experience curve: The principle that a company's cost declines as its production increases. One
assumption used by consultants if that a company's costs decline by roughly 25 percent for every
doubling in production (e.g., a company's 200th unit of a product costs 75 percent of the 100th
unit's cost).
Granularity: This simply refers to the basic elements that make up a business problem. Imagine
a handful of sand. At a high level it's simply a handful of sand. At a granular level it is bits of
many different kinds of rock and shell matter reduced to fine granules over time by the action of
the ocean. Consultants are not usually this poetic.
Guesstimate: A type of consulting interview question. Guesstimates require job seekers to make
an educated estimate of something (often the size of the market for a particular product or
service) using basic calculations.
Helicoptering: See high-level view.
High-level view: This is also referred to as a "50,000-foot view." It refers to describing a
situation in general terms or as an overview of a situation.
Hoteling: Consultants move around so much that in some firms they are not assigned permanent
offices, just a voice mail extension. Each week, they must call up the office nearest them to
request a desk. This is called "hoteling."
Hurdle rate: A company's cost of capital. In general, if the return on an investment exceeds this
"hurdle rate," the company should make the investment; otherwise, the company should not.
Implementation: The process by which a consulting firm ensures that the advice it gives to a
client company is enacted.
Learning curve: The rate at which a consultant acquires background information or industry
knowledge needed for a case. A "steep" curve is a good thing.
NPV: Net present value. The sum of a series of discounted cash flows. Used to assess the
profitability for a client of making an investment or undertaking a project.

Page 41 of 44
O'Hare test: A test consultants use to assess personality "fit" in interviews. If I was stuck
overnight with this person at O'Hare airport, would I have fun?
On the beach: For consultants, the spare time between assignments, when their work hours
decline drastically. Consultants between assignments are said to be "on the beach" (not literally).
This expression originated at McKinsey.
Out-of-the-box thinking: Creativity.
Outsourcing: Taking a process normally performed within a company and hiring an outside
vendor to perform the task, often at a lower cost and with better results. Examples of processes
that are commonly outsourced include: payroll, data processing, recruitment, and document
processing. Outsourcing is a growing trend among corporations.
Re-engineering: A largely discredited fad of the early 1990s, which advocates a complete
overhaul (and usually downsizing) of a company's strategies, operations, and practices.
Rightsize: Also "downsize," this is just a kinder, friendlier term for restructuring the elements of
a company. This is most often used in reference to headcount reductions, but can apply to plants,
processes, technology, financial elements, and office locations.
Shareholder value: The total net wealth of a company's stockholders. The primary goal of
consultants in undertaking any engagement is to maximize shareholder value.
Stakeholder: A critical person who has a stake in the outcome of a particular situation. Most
commonly, the stakeholders in a case are the shareholders, creditors, or employees.
Total Quality Management: Also known as TQM. Management with the purpose or intent of
producing a product or offering a service of the highest quality, with zero tolerance for defects.
Value migration: The flow of economic and shareholder value away from obsolete business
models to new, more effective designs.
Value-added: Used to define a service or product in a marketplace that adds value to a
preexisting product or way of doing things.
Work plan: A schedule for completing a consulting engagement.
Writing a deck: Preparing slides for presentations to clients.
White space opportunity: An opportunity for a company to make money in an area in which
they are currently generating zero revenue (for example, a launching a new product line,
licensing an existing brand or technology, or entering a new geographic market).

Recommended reading
• Hammer, Michael and James Champy. Reengineering the Corporation. New York:
Harper Business, 1993.
• McTaggart, James. The Value Imperative: Managing for Superior Shareholder Returns.
New York: Free Press, 1994.
• O'Shea, James and Chales Madigan. Dangerous Company: Management Consultants and
the Companies They Save and Ruin. New York: Times Business, 1997.
Page 42 of 44
 • Porter, Micheal. Competitive Strategy. New York: Free Press, 1980.
• Prahalad, C.K. and Gary Hamel. The Core Competence of the Firm. Harvard Business
Review, (1990).
• Schlotsky, Adrian. Value Migration. Boston: Harvard Business School Press, 1996.
• Stern, Carl and George Stalk, Jr. (ed). Perspectives on Strategy: from the Boston
Consulting Group. New York: John Wiley & Sons, 1998

About the author

Nici Audhlam-Gardiner was a consultant in the London office of McKinsey and Company
from 1993 – 1995, and a project manager in the international division of the Royal Bank of
Scotland from 1995 – 1997, where she headed the development of the bank's new investment
business. From 1997-1999, Nici attended Harvard Business School, graduating with a Masters of
Business Adminstration. Post business school, Nici intends to return to consulting.

Page 43 of 44
LEADING EMPLOYERS

• A.T. Kearney • Hay Group

• Advisory Board Company • Hewitt Associates
• American Express Strategic Planning • Integral
Group • KPMG
• American Management Systems • KPMG Consulting
• American Practice Management • Kurt Salmon Associates
• Andersen Consulting • L.E.K. Consulting
• Arthur Andersen • Marakon Associates
• Arthur Andersen Business Consulting • Mars & Co
• Arthur D. Little • McKinsey & Company
• Bain & Company • Mercer Management Consulting
• Booz-Allen & Hamilton • Mitchell Madison Group
• Boston Consulting Group • Monitor Company
• Braxton Associates • Navigant Consulting/SDG
• Buck Consultants • Oliver, Wyman & Company
• Cap Gemini Ernst & Young • Parthenon Group
• Charles River Associates • Pittiglio Rabin Todd & McGrath
• Computer Sciences Corporation • PricewaterhouseCoopers
• Cornerstone Research • PricewaterhouseCoopers Consulting
• Corporate Executive Board • Roland Berger & Partners
• Dean & Company • SCA Consulting
• Deloitte & Touche • Stern Stewart & Co.
• Deloitte Consulting • Stone & Webster
• Diamond Technology Partners • Talus Solutions
• Edgar, Dunn & Company • Towers Perrin
• Ernst & Young • Vertex Partners
• First Manhattan Consulting Group • Watson Wyatt Worldwide
• GartnerGroup • William Kent International
• Gemini Consulting • William M. Mercer
• Grant Thornton LLP • Yankelovich Partners
• Greenwich Associates • ZS Associates

• Zentropy Partners

Page 44 of 44