Is there HONESTLY a difference in the quality of work between Strategy& (Tier 2 consulting) and MBB?

I finally finished the horrible recruitment cycle for consultancies here in London, and have come out with an offer from Strategy&. My question is, is there actually a difference between them and MBB? For context, I was at a dinner and a very senior person said that at the end of the day its all just branding - what they all ultimately do is the same thing.

To focus it a bit, maybe we can break it down into:

  1. quality of work - will I be working on second rate projects because all the 'best' go to MBB
  2. exit opps - am I hindered in any way? Business schools, exit to industry

Thanks for clarity on this!

Comments (45)

Dec 18, 2016

The answer is Yes and No.

It's similar to comparing what happens in the NBA and what the difference is between being a first and second-round draft pick. On one hand, the difference is negligible as it's only a handful of the many thousand of players wishing they even had a chance that end up being drafted. It's a pretty select group. However, it's also true that there is a strong correlation between being a higher round draft pick and going on to become a superstar and a household name. Few second rounders encounter the same level of success.

Same thing for consulting. Truth is only a small percent of candidates in the big scheme of things get a job in the field. There are many more rejections than there are offers. But when things get to an "elite" level (e.g. top b-school admissions, prestigious buy-side roles, etc), for better or for worse.....there is a difference; and it's MBB ones that seem to get better results.

Note: this is not to say you can't do well coming from a T2 shop. I know many from such places who went on to HSW for instance, but just be aware there will be more than a marginal level of difference.

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Dec 19, 2016

An additional note about this, using your basketball analogy. There is usually a marked difference in skill between those selected in the first few overall picks in the draft and everyone else. Yet the majority of first rounders have a significantly higher chance of becoming the guy for a team. This has less to do with an skill differential between second rounders and late first rounders. It has everything to do with the level of attention one receives from outside sources.

The business world is similar but not near as correlative. The actual level of how good the work done by tier 1 and 2 consulting, banking, or even law firms isn't really that different. What is different is the prestige of the projects they get to work on.

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Mar 21, 2019

More or less agree. In terms of exit opps you can end up in the same place for sure - will just take more networking/work on your part to do it from T2. In terms of engagements, its hard to say exact percentage but for example if 70% of the engagements are high impact projects with global clients, you will get the same type of projects at a T2 but it might be around 40% of all the projects they have brought in (illustrative percentages).

Dec 18, 2016

I work at a T2 Strategy house on par with Strategy&. A few notes:

  1. Generally projects will be similar but MBB, McKinsey in particular, gets the lion share of the super high-end, rare consulting engagements (such as bringing a Fortune-100 to a new continent, CDD's for super high-profile acquisitions by KKR, Blackstone, etc., a complete turnaround strategy for a Fortune-100 company, etc.). That said, even at MBB these projects are not common. The "typical" work being done is very similar between MBB and T2 firms like Strategy&, Parthenon, LEK, ATK, OW, etc. A parallel is comparing a MM bank like Jefferies to Goldman Sachs; Jefferies works on many similar deals as GS but GS gets the lion's share of megadeals.
  2. Exit opps will be similar between MBB and T2 with the same caveat discussed above; far MORE opportunities will be available at MBB and they get the lion's share of "sexy" exits (such as Disney Corporate Strategy, buy-side gigs, etc.). Outside of the rare high-end exits, most MBB and T2 consultants exit into similar positions but T2 consultants definitely see fewer opportunities and have to work a little harder.
  3. As for b-school, same goes.... HBS, Stanford, Wharton, etc. have consultants from all top firms, including T2. It will be slightly easier to get in from MBB but frankly your GPA / GMAT will have a bigger effect than MBB vs. T2. Also I believe MBB helps its consultants study for the GMAT / work on apps more than most T2 firms but I'm not 100% sure.

Hope this helps!

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Dec 19, 2016

Couldn't have said it better.

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Dec 19, 2016

I think you exaggerate the differences quite a bit. For example, Blackstone used Deloitte S&O for quite a lot of due diligence.

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Dec 20, 2016
Canadiens16:

the lion's share of "sexy" exits (such as Disney Corporate Strategy

Lemme tell ya, the way Pocahontas shakes that booty is fan-tas-tic

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Dec 18, 2016

Brill, thanks guys. Yeah I have a lot to think about. Another aspect of this is the size of the incoming graduate group and how this effects the amount of focus / opportunities we have; I know for a fact that:
- this year Bain hired 38 out of 5k applications
- Strategy& hired 9 out of 4k applications

Again the same 'senior' person said that Strategy& is focusing on a few rather than many and want to focus on direct mentoring of younger hires (good for MBA reference letters??). Also setting up a scheme for London office grad hires to do 6/12 month in NY where a lot of the office has gone to top B. Schools.

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Mar 7, 2017

-

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Dec 19, 2016

'so what's your point'. lol.

I have an offer from an MBB (please don't jump to conclusions), Google, and Strategy& but i'm thinking outside the standard thought 'box' that dictates that MBB is automatically the best. All i'm doing is taking time to question this - so to your last point i'm not drinking the 'kool aid'.

on your point about 'talent', we know that on average you only have about 150~200 consulting places for top firms here in London (UK), with thousands and thousands trying to 'get in'. There are enough 'top' candidates to go around. I've met a lot from all the MBB's and Strategy& and there's honestly not a difference with the 'quality of person '- if anything you're able to sidestep the ego and arrogance of a lot of the MBB consultants. And again, how are you even qualifying the 'quality of person' - that's always changing and completely contingent on training / mentorship / exposure etc.

I don't care about brand and prestige. I want to be in a place that's going to invest in ME. I could compete with 40 or so others in a place that has an 'up or out' mentality, or be in a class size of 9 where i'm far more able to stand out and work directly with higher level people. (btw. this was the thought process for Strategy&, hire far fewer (they only gave out 9 offers) but invest everything they have in them).

People hate change. It doesn't mean they're right. Its hard to have a proper opinion on something that you don't fully understand due to lack of transparency. Again, Strategy& grew last year because of increased clientele and projects obtained through PwC partner connections.

I honestly can't really be bothered with a back and fourth, so we'll leave it there.

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Dec 19, 2016

I think the other responses have addressed #1 as well as the classic MBB vs T2 debate.

For #2, I'd chime in that exit opps shouldn't be considered as "Hindered" since you can essentially hit the same point from either position, but the path encounters more resistance.

For Business School, a MBB would place better in the top 7; plenty of T2 still go to top 7, but I have no doubt there is a difference in the percentages.

For Exit Opps, a MBB might have more options, but depending on what level you jump a lot of this becomes more heavily driven by experiences (e.g., roles, industries,). This ties back somewhat to your #1 since there's a correlation between firm and types of project experiences, but again - "hindered" doesn't seem to be the right word.

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Dec 19, 2016

So I'm at a buyside firm now that uses both Bain and "T2" firms for private equity due diligence, and from my perspective as a client, there's a pretty significant dropoff in the quality of work between Bain and the T2 firms. My experience is specific to PE due diligence, but I imagine the dropoff is pretty apparent with other types of work as well.

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Dec 19, 2016
humblebot:

So I'm at a buyside firm now that uses both Bain and "T2" firms for private equity due diligence, and from my perspective as a client, there's a pretty significant dropoff in the quality of work between Bain and the T2 firms. My experience is specific to PE due diligence, but I imagine the dropoff is pretty apparent with other types of work as well.

I'm not sure this particular datapoint is relevant to the question unless you're looking specifically at CDD projects (which OP isn't). Bain is the clear market leader in commercial due diligence and I've heard from partners at other firms that Bain commands ~70% of the upper end of the market. This happens to be their niche that they are best at. I would not generalize this to other practice areas.

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Dec 21, 2016

Part of the dropoff is certainly due to Bain's sector expertise, but part of it is also definitely due to the dropoff in talent between the firms.

I interact with the managers and consultants on a day-to-day basis, and the Bain folks are just a lot sharper, more discerning and better able to articulate their findings than the people I work with from "T2 firms".

And this is relevant beyond due diligence work because Bain and most other consulting firms staff treat their consulting staff as generalists at the junior level, so the guys working for my firm on diligence one week might be doing a corporate strategy project for an F500 company the next.

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Dec 19, 2016
humblebot:

So I'm at a buyside firm now that uses both Bain and "T2" firms for private equity due diligence, and from my perspective as a client, there's a pretty significant dropoff in the quality of work between Bain and the T2 firms. My experience is specific to PE due diligence, but I imagine the dropoff is pretty apparent with other types of work as well.

Is there a big difference between bain vs the other MBs?

Dec 20, 2016

No, they are all very similar. The difference is more in culture and industry strengths. McK hits it out of the park for organizational work, BCG is really great for innovation and growth strategy, and Bain absolutely kills it in PE work. These are gross simplifications but it's to get the point across that all firms are very good at what they do but have strengths in different areas

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Dec 21, 2016

Have never used McKinsey or BCG as a client. When it comes to PE due diligence, Bain has the best reputation hands-down. Even the ex-BCG and ex-McK folks at our firm agree.

We pretty much only ever use "T2" firms if Bain has no capacity (happens every now and then) and we need to get started on the work ASAP.

But that's all specific to private equity due diligence work. Can't compare directly for other types of consulting work, but it probably depends on the particular type of project and which particular consultants you get. People should remember that these firms aren't monolithic. McKinsey has thousands of consulting staff in NA alone. There's a big difference between getting a team led by a rockstar AP out of their NY office vs. a team led by a guy who just barely made the EM cut out of their Cleveland office.

Bain has a centralized staffing model and they, for the most part, try to balance out teams in terms of putting stronger, more experienced performers with more junior, less talented folks. McKinsey and BCG have network-based staffing, so you probably see wider variance.

All of this is to say that your mileage may vary.

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Mar 9, 2017

This.

I have seen work product from each of the MBB firms and several T2 firms. The difference is stark. I would rank McKinsey>>Bain/BCG>>T2 in terms of consistently delivering objective quality pitch decks

However- This doesn't mean McK is the best firm to hire, or the best to work at. Customers are looking for various value props whether that be price,geography,expertise,relationship, or culture fit. I don't believe the firms are often competing for the exact same work; they've actually managed to subtly segment the market.

One example- I spoke with an McK-alum industrials CEO who only hires Bain. There's a single team he loves there. They are price competitive. And this particular group makes quick assumptions and focuses on practical impact. In his mind this is far better than McKinsey which he claims will produce 100 page decks to 'prove the sky is blue'

Mar 10, 2017
Joesummer:

This.

I have seen work product from each of the MBB firms and several T2 firms. The difference is stark. I would rank McKinsey>>Bain/BCG>>T2 in terms of consistently delivering objective quality pitch decks

However- This doesn't mean McK is the best firm to hire, or the best to work at. Customers are looking for various value props whether that be price,geography,expertise,relationship, or culture fit. I don't believe the firms are often competing for the exact same work; they've actually managed to subtly segment the market.

One example- I spoke with an McK-alum industrials CEO who only hires Bain. There's a single team he loves there. They are price competitive. And this particular group makes quick assumptions and focuses on practical impact. In his mind this is far better than McKinsey which he claims will produce 100 page decks to 'prove the sky is blue'

I'm going to play devil's advocate here. I agree that at the manager-and-up levels the difference between MBB and T2 is more defined ON AVERAGE but I second @humblebot 's opinion that variance there is more variance between teams than between firms. I've worked with/alongside McK teams led by AP's who I consider VERY poor and wonder how they ever got to that level. Conversely, and something that isn't stated much on this forum, I've worked with/alongside many small boutiques (<50 consultants) who have rockstar teams. At the Partner level, it's all about relationships because those guys aren't doing much of the work anyway. MBB tends to have the best relationships by nature of generally being older and more established AND having a better brand name (which is very important to many clients).

However, I also second @Joesummer 's opinion that clients look for various value props. My shop is cheaper than MBB and no doubt MBB, on average, turns in higher quality work, but higher quality work isn't always needed; sometimes us or a Big 4 is a better price alternative.

Overall, yes, this thread has beaten this topic to death a bit but I think it's one of the better threads on this forum.....

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Best Response
Dec 20, 2016

Since we are in the consulting forum, I'll be "answer first" - no, there is a not big difference between MBB and the Tier 2 firms, both in terms of the people and the work. I am speaking in broad strokes here, but I feel like the folks that try to accentuate this relatively minscule gap are insecure people who derive a lot of their self-worth from their pedigree (i.e., I am amazing because I work at MBB).

I feel uniquely qualified to answer this given my background, which is Tier 2 consulting -> MBB (I lateraled after 1 year) -> MF PE.

In terms of the people:

  • This starts from the top of the funnel, which is recruiting. MBB and Tier 2 firms recruit from the exact same schools, and the batch of students going through consulting recruiting is largely similar. Of course you are going to have a rockstar now and then - but on average, most of them are smart and have prepared adequately for cases. My experience has been that there are many folks qualified for MBB who have an off-day when they are interviewing for whatever reason. Thus, they end up at a non-MBB consulting shop. Something that further validates this point - I have lots of friends who got offers from MBB but not from OW, LEK, etc. due to the point mentioned
  • For this reason, I personally didn't find a material difference between the quality of people I worked with at my MBB and my Tier 2 shop. Granted I was only there for a year, but everyone I worked with was as smart, driven, and capable as the people at MBB. The only difference I noticed was sometimes at the partner level, there were some incredibly bad-ass partners at my MBB that likely would not have been there at the Tier 2 firm. But honestly the partners do not have a ton effect on your day-to-day if you are joining post-undergrad, and I felt that those at the manager-level were very comparable

In terms of the work:

  • Both MBB and Tier 2 firms do shitty work these days. You may work on a strategy project or two, but there is a lot of operational and PMO work everywhere. Yeah sure, there may be the super sexy project that only MBB may get once a year, but what are the chances you are going to get staffed on that? Also, people who don't work in consulting don't realize this, but your workstream has a far bigger impact than your project. You could be on a super sexy due diligence, but that doesn't mean shit if your workstream is just primary research and doing 100 interviews
  • At the post-undergrad level, I would argue you will pick up the "consulting toolkit" anywhere - being hypothesis-driven, being 80/20 in analysis, Powerpoint, Excel, etc - whether it is at a Tier 2 or MBB

To put this into context of PE, are the people at Bain Capital really better than those at a solid MM like THL or Advent? You are ludicrous if you think there is a material difference. And to humblebot's point - my firm uses both Bain and LEK for private equity DD, and I have never once thought to myself "man, the Bain analysis / work is so much better than LEK's". They are both solid. There are folks who came from Bain who prefer to use Bain for all our DD work due to firm loyalty. But others who have no allegiance quite frankly do not care.

The one thing I will concede is exit opps at MBB are superior - it will be challenging to do MF PE coming from a Tier 2 shop, although I have seen my fair share of LEK folks at MM PE.

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Dec 20, 2016

Talking total sense here.

Dec 21, 2016

"And to humblebot's point - my firm uses both Bain and LEK for private equity DD, and I have never once thought to myself "man, the Bain analysis / work is so much better than LEK's"."

Your opinion would be very much in the minority at the firm I work at. It's not just firm loyalty. I came from Bain, but there are plenty of folks I work with that are ex-McK, ex-BCG, ex-bankers and even one who's ex-LEK, and it's pretty universal that Bain does a better job. Parthenon and LEK charge a lot less than Bain. If there were just as good, we'd never use Bain.

Question - do you take an active role in managing the consultants your firm hires or do you just sit in on the updates?

Because the dropoff isn't just in the quality of the work, it's also in the degree to which I need to devote my time and mindshare to the project. With Bain, I can generally trust them to correctly interpret the investment thesis and identify the key questions that need to be asked and analysis that needs to be done. With Parthenon/LEK, I need to be a lot more hand-on and prescriptive in steering them to prevent the work from being shitty.

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Dec 21, 2016

I think we'll have to agree to disagree. I can only speak to my experience at my shop, and I respect your opinion, which is just as valid as mine. I (along with the VPs) take a relatively active role in managing the consultants we hire. I don't know how your shop uses consultants, but we are generally pretty targeted and prescriptive from the beginning in terms of the key questions that need to be answered / analysis that needs to be done. We often ask them to answer a specific question to address a specific point of the investment thesis (e.g., we want to know how consumers perceive his brand, please go do XYZ interviews). A lot of the times, there's no need for them to even see the full investment thesis.

I can say with strong conviction at my MF PE firm, whether we use Bain or LEK for DD is very relationship-driven. In fact, we just hired Bain to do a DD, and I asked my VP why we used them today. He then went into a monologue about how he and the Principal on the case were from the same AC class at Bain and gave me all these stories about how they used to get hammered together...so I would say it's pretty relationship-driven, like all of consulting.

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Dec 20, 2016

I've noticed that no one on this thread has mentioned Accenture when giving examples of tier 2 firms...are they not regarded at the same level as LEK, ATK, Deloitte, OW in the consulting world? Just curious. I had an offer from them coming out of undergrad in their general MC practice (different than strategy), but decided not to take it. It seemed strange to me, because I went to a non-target state school, and they began doing OCR there my senior year. They handed out so many offers to kids with super mediocre resumes, and to be quite frank it made my offer feel less valuable. This actually factored into me deciding to take my IB offer instead.

@23mich @Canadiens16 @a12345

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Dec 20, 2016

Accenture is primarily technology and implementation consulting. They have a strategy arm (Accenture Strategy), but it isn't considered on the same level as any of the T2 shops. Typically, they're considered T3 or T4, depending on how you cut it.

Caveat: That's not to say Accenture is a bad place to work - if you want a career in tech consulting or implementation (which is the way many strategy firms are going nowadays anyways), then it's one of the better places to start. But as far as strategy problems and "exit opps" and b-school placements, no, Accenture is not at the same level.

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Dec 20, 2016

Can't really comment here, but a small handful of people at my non-target state school got offers from Accenture and I think 1-2 were really superstars in their year. I think as one of the posts above said, sometimes people over perform or underperform in interviews. Who knows.

...

Dec 22, 2016

A lot of really great comments here...very good discussion.

Having been the client and the consultant, I believe the main difference from the client perspective is the likelihood of having an atypical experience. MBBs fail their clients less often.

Between an MBB and another firm, I think the likelihood of having a stellar experience is roughly the same. As a client, having an excellent experience is going to be totally dependent on the handful of folks you're working with at the consulting shop. Who those people are depends on a million factors...but primarily who's available to start the project at the right time. There will be plenty of times when a, what we're calling "Tier 2" firm, will outperform MBB because they had the perfect people for the project available at the right time. Across thousands of trials, MBBs might delight slightly more often, but it won't be a huge difference.

My suspicion, however, is that the MBBs deliver truly sub-par performances less often. Clients probably feel like they wasted money more often with these "T2s". Again, that won't be very often. The MBBs have a deep bench of experts and non-caseteam researchers...and if things are going south, they will find a way to throw a lot at the project to save the team. Might not delight the client, but they won't feel swindled.

Summary: in a aggregate there is a difference. However, the difference is not very big and it shows up is in the number of totally flubbed projects. MBBs fail less often.

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Jan 19, 2017

Fairly unrelated to the way this thread is trending (arguing about PE DD), but has anyone else noticed that both last year and this year that have been people wondering about whether they should take an S& offer or an MBB (last year this came out when the poster was trying to decide between S& NYC and BCG ATL). In both cases, the OP has then defended S& multiple times that strangely echo company talking points.

Just seems odd, as I haven't seen these types of posts for other Tier 2 firms and both posts seem very oddly similar despite fairly differing circumstances. There have been a couple other threads about deciding between offers that lead to extolling S& in other contexts as well that seem a bit out of place.

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Jan 19, 2017

Good spot, but I don't think S& is the only one. If anything it seems that the Big D has an army of indians posting.

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Jan 19, 2017
Carmbar:

Good spot, but I don't think S& is the only one. If anything it seems that the Big D has an army of indians posting.

Ah the infamous MBBD cadre...keep trying lads

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Feb 3, 2017

Adding to what has been said: at the Uni I came from, the people who went to Roland Berger, S&, OC&C, AT Kearney and so on are of the same calibre as the MBB folks. They would often have multiple offers and go by their fit with the office in terms of industries served and people.

What I want to add: keep it mind that due regulatory limitations in many countries, Strategy& is not allowed for ~25% of clients in the market as PwC is the auditor there. Mandatory firm rotation kicks in but only once in every few years. So if you really want to do consulting for company X and PwC will be there for 4-8 more years, it's likely not going to happen.

Feb 3, 2017

One small note (not much to add to what Canadiens16 said before) - think about the network as well.
Not sure that Strategy& has a strong network in terms of alumni support etc. and positions held.
MBBs on the other hand have very strong connections, ex-McK will easily hire someone who was ex-McK as well.

Feb 10, 2017
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Feb 10, 2017
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