MBA Consulting Preferences at B-school
Hey everyone,
With MBA internship recruiting over, I am curious to see if anybody noticed any trends at their schools regarding how students ranked consulting firms. I am not trying to start a firestorm about why XXX firm is terrible, etc. but genuinely curious about the perceived hierarchy at other business schools. For example, at my school (top 15 on west coast) and when talking to one of my friends on the east coast, I noticed students tended to pick the following firms (groups by order of preference) when receiving multiple offers:
Group 1: MBB (McKinsey tends to win out, followed by BCG with a slight edge over Bain. Bain took a slight hit due to rumors of it being the one most likely to be acquired by a Big 4 if the industry consolidates further)
Group 2A: Deloitte, Strategy& (Students at my school have chosen Deloitte the majority of the time. Many students are worried about Strategy& being completely integrated into PwC overall MC practice. Students also enticed by 2nd year tuition reimbursement at Deloitte)
Group 2B: ATK, LEK
Group 3: Accenture, PwC
Group 4: IBM, EY, KPMG
Group 5: boutiques, etc.
Parthenon & OW did not have a presence on my campus so I didn't include them. What have you guys noticed at your school?
I'd have very similar rankings, and would probably make the below minor changes:
1) I'd say that Deloitte completely dominated Strategy& (quite a few cross-offers between the two here, and every one picked Deloitte). Deloitte has been killing it since the Monitor acquisition, and started winning a lot of contracts from MBB too which excited people (McKinsey partner I talked to said they viewed them as their biggest threat)
2) Boutiques were higher here (e.g. Parthenon, Cambridge, Point B)
3) I don't know how to put it in the listings, but McKinsey non-generalist lost out to BCG and Bain every time. Even McKinsey Generalist lost to Bain and BCG more than half the time which was surprising. McKinsey seems to be losing its luster a bit.
I'd probably rank it something like this
A+) McKinsey (generalist), Bain, BCG A) McKinsey non-general (BTO, Ops, etc) A-) Deloitte S&O B+) Strategy&, LEK, Parthenon B) ATKearney, Point B, Cambridge (I personally loved Cambridge and would place it between Deloitee and Strategy&, but I may have been outlier) B-) Accenture/ZS Associates C+) EY OTS/KPMG D-) Roland Berger
We also had some tiny boutiques come (Treacy, Axiom, Censeo, etc), but I don't know where to really put them.
p.s. Unrelated, but a senior McKinsey guy I talked to seemed to insinuate McKinsey might buy Bain, which is surprising to say the least. He might've just been drunk though.
I agree with the point about McKinsey generalist being the #1 preference for most and the non-generalist offers losing out to BCG and Bain generalist offers.
Talked to some of the second years at my program and it looks like Deloitte won out versus Strategy&/LEK/ATK. It looks like at some campuses, Deloitte is starting to become the top choice after MBB.
A MBB buying a MBB doesn't make sense to me from any standpoint. A Big 4 acquiring Bain would be much more likely, but still unlikely given the transactional costs IMO.
We are going off-topic here but I wanted to provide my 2 cents about IBTeaching's comment. A MBB buying a MBB may be difficult to finance (but not impossible) and may not deliver significant synergies and/or a competitive advantage (the trend in the industry goes towards providing end-to-end strategy to implementation service capabilities - e.g. I believe McKinsey's operations practice is its fastest growing practice). Usually these consulting firms sell for 1 to 1.25 times revenue.
All figures from 2014: McKinsey: 17,000 employees, revenue of ~$8B BCG: 9,700 employees, revenue of ~$3.95B Bain: 5,700 employees, revenue of ~$2.1B
Deloitte: 210,400 employees, revenue of $34.2B PwC: 195,400 employees, revenue of $34B EY: 190,000 employees, revenue of $27.4B KPMG: 162,000 employees, revenue of $24.82B
For example, PwC was easily able to buy Booz & Company. In my opinion Bain is a doable (both from # of employees and revenue/purchase price) and attractive candidate for any of the Big4.
Strategy& (Booz & Company): 3,000 employees, revenue of ~$1.1B
I would say a Big4 firm could buy any of the MBB if they want to (and it makes strategic sense). Question is whether the Partners of these MBB firms are willing to sell (after all it is a Private Partnership and it is a complicated transaction process - see the failed Deloitte/Roland Berger merger).
I agree with your assessment. I don't think the question is whether the Partners at MBB are willing to sell, it's at what price would they be willing to get bought out. Another factor is that any agreement would have to include a stipulation that all partners remain at the firm for some period of time after the merger. This might be more complicated and could potentially derail some sort of deal. Also, I could see Accenture make an offer instead of the Big4. They have revenue of ~$32 B which is in line with the Big4, and they are huge in IT/outsourcing which would bode well for the current trend of moving from pure strategy to end-to-end implementation.
I think your purchase price estimates are a bit high.
I think it's generally a bit under 1x revenue. Booz sold for under a billion, FYI.
Where does McKinsey Corp Finance rank?
McKinsey non generalist
McKinsey non generalist
What about Oliver Wyman?
According to a partner of OW I spoke to, they take very few MBAs. They like to train their own people was how he phrased it.
Great information in this thread, thanks to all who have contributed. Now a few questions on McKinsey because, why not. How is McKinsey Implementation viewed? Is the work similar to a big 4/ACN? What is recruiting process at business schools for non-generalist roles at McKinsey? If one wants to focus in a specific industry or functional role, is that automatically considered non-generalist, or is that tag assigned to special services (Recovery & Transformation, Analytics, etc.)?
@freddyflintstone OW didn't recruit MBA interns this year. Probably not a good sign for the firm
@blueapple Implementation is well below Big 4/ACN. I think most, if not all, would take tier 3 consulting over it. I don't even think they recruit MBA's for McKinsey implementation.
Same process, you apply to McKinsey from the same app. Top candidates get McKinsey generalist interview, and good but not top candidates get a non-generalist interview. You don't know which you get until mid-December after you apply. You list your top 4 preference when you apply, but they'll ignore that based on your experience.
They try to phrase it as a "choice" so you're free to pick function (not industry though), but the fact is the matter people doing non-generalist are less stellar than those doing stellar (as the generalist function is the one that has access to the true strategy projects McKinsey is historically known for you.)That said, if you love corporate finance or business recovery, and apply to that directly, you get the same compensation at the associate level, so go for it.
As a current MBB employee, I totally disagree with this, and I'm sad that this is the perception on campus.
MI I think has slightly lower bill rates, but Ops, corporate finance, BTO, etc. charges the same amount per hour as "generalists". Thus, the market values their work the same as generalists -- why would anyone else value it differently?
If anything, I think earlier specialization can lead to faster advancement and better exit options due to greater depth of knowledge. Building a broad base of knowledge is important, too, but I wouldn't take the stance that across the board generalist is "better" than specialist. Which is "better" varies based on what you want to do with your career and your particular situation.
Things MBA students say that tenured consultants roll their eyes at: * When during interviews candidates repeat verbatim the question you just asked them to make sure they heard it correctly -- ask clarifying questions, don't repeat the question * "I want to do strategy work"
It's not about bill rate (MBB is moving heavily into non strategy because that's where the money is), it's about career progression, or atleast the perception of career progression. The feeling on top MBA campuses is that McKinsey is "training to be CEO" and you lose some, or a lot of that, if you're working almost exclusively on risk or business recovery or whatever. Likewise, it's assumed to be tough to get the top corporate strategy roles (e.g.) Disney with non generalist experience.
I'm not working at McKinsey so I don't know the validity of the above, but it is definitely the perception of myself and others, and is reflected in offer acceptance rates.
I'm also an MBB employee. The issue is not market rate billing. Everyone knows a 6 month implementation project costs way more money than a high-profile 8 week strategy project for the CEO. The point is a generalist program allows you access to ALL projects, which provides broader training and experience before you ultimately choose a career path / next job.
Nothing wrong with specialization. Indeed most MBB firms are moving in that direction. There is just value in delaying the selection process.
Also perception is important. Everyone I know chose BCG or Bain over a McKinsey non-generalist role for the above reasons.
Your just wrong on multiple points. Resume selection and interview criteria for McK non-generalist and McK generalist are the same, except that BTO and Corporate Finance prefer some relevant work experience / education eg pre-MBA role in IBD or and FLDP or software. BTO perception on campus varies by school but Corporate Finance and Ops are generally >= McK Generalist. Marketing too new to tell.
Source: I work at McK and have done multiple on-campus recruiting cycles including interview selection, first round interviews, and post-offer cultivation for both generalist and non-generalist positions.
I guess I am an outlier, choose a group 4 over 2A,
If it helps, people around me seem to rank
MBB(McKinsey, Bain then BCG) Big 4 + LEK + Huron Accenture does not seems to be as well regarded.
Placed with a MBB during FT recruiting, and I can second (third?) the perception among the current crop of students is Generalist >>>Non Generalist roles. It doesn't help that the recruiting process for the former (at least in my experience and that of my peers at a few other schools) comes first in the process, and is a lot more high visibility. Bain and BCG recruiters didn't talk about the non-generalist roles on campus, and didn't recruit for them in the same interview season. Those roles came later (same for McK) and simply were resume drops. It definitely leaves you with the opinion that those roles fall to "the leftovers".
Now, put all the different roles together and recruit from the same pool at the same time, and I'd expect to see some variety in what people preferred. There are certainly some people who have a preference for the types of projects they work on, and the opportunity to just matriculate into that side of the business right up front could be nice.
Top three are clearly MBB, but McKinsey has lost a bit of its luster in the past few years I think. There is the perception that both Bain and BCG care more about you and that McK has less of a prestige bump than it used to have. I'd wager that BCG has caught up with McK in perception in the US.
Note this is only for US offices, as internationally the pecking order is still McK>BCG>>>Bain, although again that is highly dependent on the specific office/geography (e.g. in Germany BCG=McK)
Deloitte is now clearly fourth on campus, supplanting Booz for that position. Booz/Strategy& didn't do itself any favors with their name change and there are a lot of questions of what comes next for Strategy& after their acquisition. The 2nd year sponsorship that Deloitte offers is also an interesting x-factor that some people consider if they don't get MBB.
Boutiques are respected, but so much smaller that it's hard to compare them to the larger firms and people also wonder if they're going to get acquired.
I'll corroborate the McKinsey generalist >> McKinsey specialist perception. There's also an office pecking order at MBB, because some offices are just more competitive to apply to than others. In the U.S., San Francisco, Boston, and New York seem to be the most competitive offices to break into.
I would agree with Joe123 that BCG and Bain people probably project themselves better during recruiting than McKinsey. I think people choose to work at McKinsey for good reasons, but you don't hear "I met at lot of really nice people" as one of them, while you hear that a lot with the other firms.
Tier 1A: McKinsey (generalist), BCG, Bain
For the U.S., the Big Three are very close overall but it varies from office to office. Really comes down to office and fit. For international locations, generally McK = BCG > Bain, but it's also country and region-specific. Booz/S& is actually really strong in certain international geographies too.
Tier 1B: McKinsey (specialist)
Tier 2A: LEK, Parthenon (the Bain spinoffs)
Parthenon might trend downward after EY acquisition; Booz & Co. and Monitor used to be at this level a few years ago. LEK and Parthenon only play in a few industry verts, but in those they compete with MBB for the PE due diligence work and big picture strategy stuff. That's why they're generally viewed as > than the 2B firms.
Tier 2B: Strategy&, Deloitte S&O, ATKearney
Deloitte S&O generally favored here because Strategy& has only specialist roles and Deloitte has second year tuition reimbursement $$.
Tier 3: Accenture (strategy), IBM, Deloitte (human capital), BAH, PwC
Tier 4: KPMG, EY, Deloitte (tech), Accenture (tech)
Definitely saw the Parthenon downward trend here this year. LEK got a negative rep here because people felt it had no work life balance (even compared to other consulting firms). If you're interested in PE DD, LEK is definitely the best after MBB.
SF/NY - SF is definitely the hardest to get into, and it wasn't even close. NY actually didn't seem that hard - a lot of people wanted NY, but the NY offices are HUGE. SF and Boston offices are tiny, so get hit by the supply side a lot more. (I also think NYC is a bit less of a value proposition from MBA students...NYC is a lot less fun and the cost side hits you a lot more when you're age the married/kids age). The Harvard/MIT kids for the most part seem to rather want to stay in Boston than NYC (which is why Boston office has gotten so hard).
I saw you post something similar on another thread and thought it's always helpful to provide more than one perspective. Can't speak for any other firms you've listed, but no-downward trend for Parthenon at my top 5 school this year; it was pretty evident here that they would operate separately.... For campus generated interest, would place it below big 3 on par with LEK (maybe a little above just because they have historically been of more interest on this campus; but this could easily differ campus to campus). A few LEK summer interns tried recruiting for Parthenon post summer.
Interesting insight on the Boston/NYC decisions post graduation. Would you say cost of living doesn't play as big factor in the decision to move to SF vs Boston than Boston vs NY?
Valuble input from @"opsdude1", @"consultant798", @"bigpicture", @"atleastimnotabanker", @"John-Doe8" and @"skdude" for my previous question. Much appreciated.
I’m glad @"opsdude1" and @"consultant798" brought up location, which I have a question.
For a variety of reasons, I almost need to work in the DC area post-graduation (family medical issues and my fiancé’s very specialized profession). How does location prioritization work among the schools? Does someone applying to a firm get more leeway in terms of location preference coming from a higher ranked school? Or is it more about the specific firm and the demand for that particular location?
That is, is there a point where regional schools take over from the national ones? Clearly M7 schools have better placement rates into the DC area than Georgetown. On the other end, if it was between Anderson and Georgetown, I would probably choose Georgetown due to the location despite the lower ranking. Yet where would Fuqua or Ross fall into that for consulting or corporate strategy? Does Georgetown’s location make up for its lower ranking? I’m leaning “no” for consulting, but unsure on the industry. Any input would be greatly appreciated.
It varies a lot by firms, what are you targeting? Also keep in mind, many companies don't even have a DC office, or if they do, it's very small (Bain DC only opened like a year or two ago).
For MBB, you list your top 3/4 preferences in order. You also go to "coffee chats" and hopefully invite-only dinners at your location of choice. If you pick a competitive location, or you have skill-sets that are useful elsewhere, you might not get your first choice location. You'll know before your first round interview, and are free to cancel the interview if you're unhappy.
Deloitte doesn't care, and will place you wherever you want to work for the most part, within reason.
Strategy& tends to run certain industry/functions out of certain offices, so you better pick a function or industry that's in DC.
UCLA has VERY little imprint at MBB (I think BCG took two people from UCLA last year for example, both in the LA office). MBB takes zero people from Georgetown.
Duke/Ross would be better than Georgetown for the DC for any major consulting firms, but their might be boutique firms that like Georgetown. Duke/Ross are really a completely different caliber of students, and recruiters are aware.
I spoke to an admissions consultant who used to recruit for McKinsey. She highlighted both Duke and UNC as MBB targets in the DC region.
Here's what your looking for:
http://poetsandquants.com/2014/01/17/where-top-mbas-work-in-consulting/…
Not by region, but you should see the importance of picking a good school.
Also keep in mind, some firms (e.g. Deloitte) will recruit heavily for non-strategy consulting gigs at the tier 2 business schools (e.g. human capital, tech, federal consulting, advisory), so if you go to a Georgetown/UNC or whatever, don't expect to get into S&O (a handful certainly do, but ~95% of the class is top 15 business schools)
Does BTO = Business Turnaround? And do the other firms have specialist groups such as these? Personally the turnaround stuff sounds really interesting to me.
BTO = business technology. (i.e. Technology Strategy).
Not sure what you mean about "turnaround"....if it's a cost issue, it'd be handled by Operations...if it's a strategic/growth issue, it'd be handled by "Strategy." If it's "We need to get rid of underperforming units/merge a new business" it would probably be corp finance/M&A, if it's "we need a new operating model", it'd be Organizations.
There are definitely turnaround groups within MBB. It is its own function
It's for companies/divisions that are looking for drastic change
Thanks. I had in mind a more general "Our business is in the dumps, we need MAJOR help" Think JCPenney after Ron Johnson got done with it and they're on the verge of bankruptcy.
Maybe there's not something as nebulous / generic as what I'm talking about. @"BigPicture" seems to indicate that there are turnaround groups in MBB. Do either of you know what they are called and how the different firms compare?
I'm not looking for restructuring advisors (e.g. Alvarez or Moelis).
McKinsey has the RTS practice which focuses on turnarounds. Does not recruit practice dedicated consultants out of BA/MBA programs but you can specialize early if you want to
p.s. and yes, they will often partner with industry/functional people as well, as @"opsdude1" suggests
@"opsdude1" and @"bmcrhino"
On opdude's second link ( http://www.mckinsey.com/client_service ), you can find the turn around practice listed under "Capabilities and solutions". I believe it is closest to #3 of opdude's options, although his #1 and #3 are basically identical, except one is higher paid, per him, and one is lower paid. And something about #3 being more focused on experienced hires.
But yeah, turn around is a "capability" according to the link above. I'd be surprised if these guys are systematically paid less than other consultants, as turn around is typically fairly intense and often requires some special knowledge (e.g., local bankruptcy laws as well as business knowledge).
@"BreakingOutOfPWM" and @"opsdude1"
Here are the numbers from the poets and quants link, but with a bit of math done. Below is the %MBB of all consultants for each school. I like this because it controls for smaller schools, and also schools that are more (Kellogg) or less (Stanford?) interested in consulting.
The downside to this metric is it makes schools lower on the list look better, I think, because these schools might struggle to fill the "non-MBB" bucket, so their denominator is smaller. For example, the link has almost as many people in consulting from Harvard as from the bottom 5 schools combined. C'est la vie -- no stat is perfect, right?
I added some annotations
Harvard 65.8% Stanford 75.1% Chicago 41.8% UPenn 55.2% Northwestern 50.1% MIT 61.6% Columbia 46.6% Dartmouth 63.5%
*****DROP*****
Duke 27.1% UC-Berkeley 24.1% Cornell 24.8% Michigan 23.0% Virginia 39.9% UCLA 22.9% New York 16.7% Carnegie 15.1% Yale 21.5%
*****SMALLER DROP*****
UNC 11.7% Texas 6.9% Indiana 3.3% Emory 11.2% Georgetown 6.3% Washington U 9.2% U Washington 2.5% Vanderbilt 5.4%
Top 25 Total 43.5% (weighted average, which will favor the higher tier schools as they have more total consultant placements)
Great post!
just to expand some limitation you brought up....
At Kellogg (and other top schools), a lot of people were MBB-only, or Top-5 (MBB+Deloitte/Strategy&) only. The reason for this, is that there's a lot of highly paid, tech, corporate strategy, and general management type of rules out there. At lower tier schools, people are much more excited about these 2nd and 3rd tier firms.
for example, here about 200 people apply for MBB (maybe even more). About 60-70 will get an MBB internship, The "true" conversion rate is only about 30-35%. But, a lot of those people who could've gotten Accenture, PwC, EY, etc decide to not do consulting.
At a school such as Stanford, I don't think its the 75% of people interview for consulting get MBB...it's more likely that the ones who strike out choose a non-consulting career instead.
Thanks guys - appreciate the color. I feel like I had a friend who worked in one of these groups at Bain. I'll reach out to him to see if I can get anymore insight.
Don't mean to hijack the thread, but can anyone comment on placement from USC Marshall into tier 2 (Deloitte, other Big4, Accenture) firms? Or even MBB?
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