My View on the Current Top 10 Strategy Consulting Firms

Rondo12's picture
Rank: Orangutan | banana points 318

This is my take, and I've included some basic commentary about why I've listed certain firms in certain places. I'm definitely interested in hearing what people think, but before I give the list I offer two disclaimers:

  1. This is what I think the landscape CURRENTLY looks like. 5 or 10 years ago I would've had some of these firms in very different places on the list (and excluded some of them entirely)
  2. This is based on prestige for the US market. Things are of likely different in Europe or elsewhere

Anyway here we go.

Tier 1:

  1. Mckinsey
  2. BCG
  3. Bain

This is simply indisputable

Tier 1.5:

  1. Deloitte S&O
  2. OW

These are listed as T1.5 because they are considerably more prestigious than the T2 shops listed below, and they compete most heavily with T1 firms for projects and for talent... Look at the crop of emerging talent in any of MBB and you will see plenty of OW & Deloitte S&O alum. I also believe that these two have the greatest chance of joining T1 in next 5-10 years

Tier 2:

  1. LEK
  2. ATK
  3. EY-Parthenon
  4. PWC S& (tied with EY-Parthenon)
  5. Accenture Strategy

While I think ATK is probably on the decline, it is a well established player with a storied history (connection to McKinsey and one of the early pioneers of pre-1950s strategy & ops. consulting). It therefore holds its spot toward the top of T2... Next, despite some internal issues faced by S& and some uncertainty about where it's headed in the future, it's still highly respected in the market (espec. in the deal strategy space). It holds its spot for now but needs to distance itself from PWC audit/assurance when it goes to market in the US, as many clients fear a conflict of interest (Parthenon has done a far better job of keeping its brand separate from its big 4 parent...

Finally, ACN strategy has done a lot to bolster its strategy capabilities via inorganic growth (i.e. heavy investment in new acquisitions), it has poached key people from MBB and other top organizations to run its strategy group, and its among the best in the business for digital strategy, which bodes well for the future

Comments (56)

Feb 3, 2018

What would you say differentiates LEK from Parthenon?
I see you have them 6 and 9 and I'm sure the difference between tiers is small, but was curious to hear about your thoughts on those two.

Feb 3, 2018

Parthenon is smaller but has backing from EY. I'd keep an eye on them.

Feb 4, 2018

The differences are very small. Both great firms focusing primarily on DD projects. With that said, LEK has broader geographic reach and stronger ties to M7 business schools, making them marginally ahead in my view

Feb 4, 2018

Would you be able to elaborate on the geography/b school ties?

Feb 3, 2018

Broadly agree.

I would say that factoring in Europe and other emerging markets, I'd make some changes:

Some US strength (Bain, Deloitte, Accenture Strategy) doesn't transfer as much to other geographies. Means Bain remains prestigious but in effective market presence is a half step below McK and BCG. Deloitte S&O is not as big of a thing abroad as it is in the US (constrained by partnership structure across geographies; can't offer those gigantic signing bonuses to MBAs). Accenture Strategy can't get the same kind of talent outside the US.

Some firms are very strong in important markets (Roland Berger in Germany, OC&C in UK); these are some of the most important consulting markets in the world by wallet. I can't overstate how deep the UK and German consulting markets are. Think McK and BCG each have at least half a dozen offices there.

OW is pretty much the lone non-MBB that is active in multiple locations (very strong all throughout Europe to Dubai; weaker in Asia and Latam), has a coherent culture around the world (global staffing model enables that; see McK), and is financially sound (parent hold co keeps it insulated). So they get a bump. Still beneath Bain because they don't have the sector-breadth.

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Feb 3, 2018

Also broadly agree. However, contrary to 5-10 years ago, Bain is actually very strong now in Europe and Asia. They've caught up by investing in their current offices rather than opening new ones, and have scooped up a significant amount of (senior) partners from rival firms I believe. The article below says that the McK to BCG difference in scope (~40%) is still larger than BCG to Bain (~30%), while Bain is over twice as large as OW. I don't see MBB challenged soon by anyone. In Europe I'd consider OW on par with S& on most levels - except FS obvs and maybe energy. I think OW and S& will solidify themselves as the next best thing after MBB.

Article i referred to with quality analysis and new data: https://www. ** consultancy ** .uk/news/15028/ ** german-team-of-occ-strategy-consultants-joins-parthenon-ey

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Feb 4, 2018

Thanks for the article.

Half of what you said holds up in the geographies I know, and half doesn't.

Still, those markets are overall only a small slice of the global pie, so I'm sure what you say is true for the data to aggregate the way it does.

In terms of my $0.02 on the future, I think McK's asset-based consulting approach pays off quite handsomely in revenue, but ceding the 'last pure strategy house' position to BCG and not resolving their cultural issues will result in some lost cache with both clients and talent. Kind of like a hypothetical Goldman pursuing crazy growth and turning into JPM. BCG will remain 2nd in revenue (and not be any closer than it is today) but McK's lost cache is their gain; I can see their brand sweeten among clients and talent. Rumors of Bain's demise (in other words, Big 4 acquisition target) are greatly exaggerated and Bain will continue to grow, though with some hiccups due to PE dependence. I'm lukewarm on S&'s prospects - good size and people remember what Booz stood for, but talent management is an issue (even Booz lifers in the - to them - all-important Middle East market have been jumping ship, not to mention entire teams in other markets). As for Oliver Wyman, I don't think it's all quite as rosy as AllStateRap suggests (Lippincott is the best at what it does but it's culturally so different from OW that real integration may never happen, or be a Pyrrhic victory), but I'm overall bullish on them to, as you say, solidify right behind MBB. I'd be more bullish if they were bigger, built more of a brand on campus, and broadened their industry reach (some of which AllStateRap says they have decided to do). Think Deloitte S&O will compete hard in a few geographies but overall they are already quite close to their glass ceiling. I'm not a fan of mergers in businesses like these, but if there's a culturally compatible buyer for ATK (and maybe LEK) that could make the market interesting. I said $0.02 and I'm not sure I'd recommend anyone invest even that much in this view.

+1 SB anyway. Don't always have to agree for something to have value.

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Feb 4, 2018

Fair points. My comment mainly applied to the main European markets. Not to argue, but see below for some elaboration. This is based upon opinions and observations and hence not an attempt to preach truth, as nobody can I think.

As for McKinsey ceding the 'last pure strategy house' position to BCG, I'm not too sure if that isn't just savvy marketing, or even long-term true - if currently true. Similarly to McK, they acquired Platinion and DV, which aren't strategy, and you don't acquire unless want to seriously grow them. And they do a lot of PMI it seems. Great niche for profits but not exactly the pinnacle of strategy imo. We'll have to see how those things pan out long term though.

Meanwhile McKinsey still has huge scope and depth, so they remain very attractive to clients as long as results are good. The most important seems partner quality, and those are more interested in revenue and profit metrics than anything else. There's no difference in talent between MBB so I think they'll be fine.

That some people still seem to think a Bain buy-out is realistic mainly shows how much of an echo-chamber online boards are. It's a very old rumour from when everybody got offered back in 2010 but they got singled out here I think. In fact, I think even the T2s won't get bought out. I think organic consolidation will happen/is already happening through the poaching of partners (which also poses a threat to OW and S& for instance). I've heard Bain poached a serious chuncks of FS and supply-chain groups from different T2s in Europe recently for instance, and BCG absorbed quite a bit of ex-Booz in 2015 I believe.

S& I don't know enough about and I think nobody can really know. They're still backed by huge capital, so anything can happen.

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Feb 4, 2018

Yeah. All these terms are more marketing than anything else - admittedly this is something that these consulting firms are good at deploying to their advantage. BCG does plenty of non-strategy work, but tries do it "strategically". OW does plenty of actuarial work, again, "strategically". And "asset-based consulting" - what assets are they, in the sense that they take up balance sheet and require funding? To me it frankly doesn't make any sense (almost a contradiction in terms) but it's the chosen strategy and quite publicly so.

So to the extent that I regurgitated each firm's propaganda and tried to evaluate it at face value, the entire thing should be discounted with the usual requisite grains of salt when dealing with consultants.

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Feb 4, 2018

Thanks for your post. I actually grabbed coffee with my buddy from S& over the weekend, and after that convo I am luke warm as well. Failure of partners to sell a sufficient number of projects recently has created a lot of issues with staffing and talent management, and while having the strength of the PWC brand behind them is great security, it creates a new layer of bureaucracy and organizational issues that I probably underestimated in my original post.

Feb 3, 2018

.

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Feb 3, 2018

Where is Booz now? Did I miss something? ;)

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Feb 4, 2018

I think their forte is in the public sector, and their pay reflects it. My buddy does some type of government consulting for them and is making about ~70K all-in his first year outta college. Not horrible, but compared to the others it's a bit less.

Feb 4, 2018

Booz and BAH - the company you're talking about - have been separate companies for over a decade, and one of them is now bought by PwC. They have nothing to do with eachother.

Feb 4, 2018

I knew that but I thought BAH still does some IT/Strategy consulting for private sector too? Am I wrong on that?

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Feb 4, 2018

I don't know about BAH. What I'm trying to say is that you comment about the state of BAH, while the previous poster was talking about Booz/Strategy&

Feb 5, 2018

I was just illustrating that the following statement is complete nonsense as Booze git
Split and can barely maintain T2 Statu:

" They're increasingly a top contender, and for those who think the MBB/T1 fortress is impregnable, the history of Booz tells a different story."

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Feb 17, 2018

Still strong in gov. services.

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Feb 5, 2018

Honest question, what do consultants actually do for the company they're engaged with? Explain it to me with no buzz words.

Edit: I am secluded to the energy industry, maybe their work is more prevalent/needed/tangible in other industries.

Feb 5, 2018

You can google the answer to this pretty easily.

Now pay me for my time.

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Feb 9, 2018
The Nightman:

You can google the answer to this pretty easily.

Now pay me for my time.

^This is what consultants do

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Feb 9, 2018

That was the joke, and you ruined it a little by acknowledging it.

"Better to remain silent and be thought a fool than to speak out and remove all doubt." --Abraham Lincoln

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Feb 10, 2018

Are all of these >80% travel?

Feb 10, 2018

LEK, EY-P and to some extent S& are all less travel. You will find that holds true with CDD shops.

Feb 15, 2018

Any thoughts on PwC Management Consulting? (separate from Strategy&)

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Feb 18, 2018

Lots of deals advisory. Much more "concrete" than the S& projects - depending on area you'll be doing a lot of efficiency reviews and change management (e.g. post-merger analysis). Lots of emphasis on utilization within the department. Can be benched for many weeks at a time inbetween mundane projects ;)

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Feb 16, 2018

Is really BCG more reputable than Bain?

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Feb 16, 2018

No. They really should be 1a, b and c. I mean Bain is the industry leader in PE DD by a mile for example. There's no reason to put them behind (or ahead) of M/B.

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Best Response
Feb 16, 2018

This significantly depends on the geography. While I agree that Bain is equally strong in the US, they have limited presence in many other geographies compared to McKinsey and BCG.

I would also argue that while their bread and butter is PE, they are TOO tied to the industry's fortunes.

No doubt that Bain is tier 1, but it's important to note the relative lack of geographic diversity and broad-based sector strength compared to their competitors.

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Feb 16, 2018

Fair enough - my knowledge base is definitely just for the US. Appreciate the caveat to my post.

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Feb 16, 2018

For people who matter - clients and recruits - no. They do the same work, and have the same talent. Crossoffer wise - which I think is a decent proxy of relative popularity - some entire non-US countries go to Bain, some go to BCG, and everything in between. This goes for any region and you can't really generalize, hence there's probably not really a difference overall. However, McKinsey still seems to me to have a clear brand premium over Bain/BCG in most countries.

On the other hand, for the average laymen, maybe yes there is a difference, as BCG has more offices and more revenue and is hence somewhat more well-known. However, as you said, its dependent on the geography. Even more so, it fluctuates on a per country-level, and regions as 'Europe' don't make a lot of sense often.

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Feb 17, 2018

This is wrong. Inside the US, all 3 major consulting firms are about the same. For clients and recruits outside the US, it does matter, as the capabilities and geographic breadth are not there.

I don't need to "generalize" - I've been at my MBB for more than 6 years now and I'm acutely aware of industry changes.

PS: You should really stop trying to hit me with monkey shit because you disagree with my opinion.

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Feb 19, 2018

lots of monkey shit lol. I see that people get offended quickly

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Funniest
Feb 27, 2018

Lots of people that work at tier 4 shops I guess.

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Feb 17, 2018

Disagree with this ranking, I would place LEK and OW ahead of Deloitte S&O. No one I know from S&O breaks into PE/VC however friends over at LEK and OW get hit up by PE/VC recruiters all the time. Often times, Deloitte S&O come in to do 'strategy' assessments to help sell multi-year implementation engagements.

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Feb 17, 2018

Strong disagree.

1) PE/VC are nice, but not the end all be all for exit ops. I believe S&O > LEK for most corporate exits. At LEK you pick up the DD skill set which is great for understanding markets and competitive positions within them quickly, but you don't really dig in deep into a company like you would with a longer term strategy engagement. You get that at S&O. I think this sub has a hard-on for PE/VC when there are plenty of other great exits out there.

2) Related to point 1, you pick up a skill set that is more useful in the corporate world at S&O through those longer term strat and implementation projects. Corporates find it valuable to have someone who not only can do the strategic thinking, but also knows what's actually possible from an operational standpoint. You don't get that at a DD shop.

I don't mean to shit on LEK. I don't think it's really any better or worse than S&O, it just depends on the type of experience you're looking for. But I don't think it's fair to put it heads and shoulders above S&O.

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Feb 17, 2018

I understand what you're saying, but PE/VC exits > Corporate Exits, that's a fact. Veritas Capital (with a team of around 15-20 people) just bought PWCs entire public sector practice. Probably 1-2 Partners and 1-2 associates worked on this deal from Veritas, a deal affecting the lives of hundreds of PWC partners and thousands of consultants. Fact is, PE > Consulting/F500 Strategy career paths.

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Feb 17, 2018

I would take FAANG/unicorn corporate strategy/product management over MM/LMM PE any day of the week. I would take Disney Corp dev over everything else too.

It really is personal preference. Implying all PE > all corporate exits for all people is flat out wrong.

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Jan 8, 2019

Where does this idea that LEK is a DD shop come from? I've heard that the current work mix is 50% strat 30% CDD and 20% strategy dev/implementation. And that's with increased PE work lately. This is for a European office, mind.

Feb 17, 2018

I also believe LEK/OW have much better b-school placement than S&O. OW's revenue per employee is fairly close to Bain (~1.8 Billion in revenue with ~4000 employees for OW, and ~3.8 Billion in revenue for Bain with ~8000 employees). The billing rates are much higher than S&O

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Feb 17, 2018

I think Bain gets bought out by Accenture and OW joins 'MBOW'

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Feb 18, 2018

This rumor has been around since '07..... this is not going to happen

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Feb 17, 2018

.

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Feb 18, 2018

A lot of butt hurt consultants....

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Feb 18, 2018

Well this was your first post in this thread that I threw MS at haha. If you come in making bold, unfounded claims then I wouldn't expect it to go very well for ya. And claiming that everyone else is butthurt? Smh.

Feb 18, 2018

While I understand some people are genuinely interested in Corp Strategy roles/F500/FAANG career paths, the point I was trying to make is it's still far easier to get those types of roles than it is to make it into PE and VC.
Sure, someone can genuinely be interested in playing for the Canadian Football League, but playing for the NFL is much harder.

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Feb 18, 2018

the NFL and the CFL play the same sport,, with some minor difference in field dimensions Being in an investor/advisory role in PE/VC is not the same job at Corporate Strategy/Product Management/running a Business Unit at a Fortune 500. If you didn't know, that's where the CEOs of these massive companies come from, so if that's something someone wants to do, then going into investments makes less sense.

The irony with this obsession with "the path/the track" is that so few of the ppl we all recognize as leading finance/industry professionals followed it. They all took control of their career and dictated their own terms. Oh yeah, and almost none of them did Private Equity or Venture Capital, except when they founded their own firms, which is certainly not part of the risk-averse "track" that you people obsess over. You can't mass produce success like you would produce cookies in a baking sheet.

"Better to remain silent and be thought a fool than to speak out and remove all doubt." --Abraham Lincoln

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Feb 28, 2018

Can anyone speak to which MBA programs these tiered firms recruit from?

EG:
Tier 1 (HBS, Stanford, Booth)
Tier 2 (Ross, Darden)
etc.

Feb 28, 2018

MBB: Mostly M7, some T10 and a sprinkling of T15 for regional offices.

The rest: Many M7 and T10, some T15.

Outside of the M7, Tuck and Yale SOM do very well with recruiting. In the T15, Darden, Fuqua and Ross are fairly strong too.

Feb 28, 2018

Thanks for the reply.

What about Emory and Georgetown? Are they hitting the Tier 1.5-2 range?

Also, what about schools in the UK? Do Oxford or Cambridge place well?

Feb 28, 2018

I would imagine Georgetown and Emory are good targets for federal, but I'm fairly doubtful about the commercial strategy side. Maybe there are a few at regional offices. You can always search on LinkedIn to see where MBA grads end up.

No clue about the British schools though.

Mar 1, 2018

From my experience, Oxford & Cambridge place superbly and are joined at the top by Imperial & LSE. Other schools where MBB recruit include UCL, Durham, Edinburgh, Warwick, St. Andrews.

Mar 1, 2018

Sounds about right. From on-campus efforts and number of offers given out, the MBB targets are Oxbirdge - by a mile - and UCL/LSE/Imperial. McKinsey is pretty heavy on Imperial I think whereas Bain/BCG aren't. So, there are a few differences in accents, but these 5 are the targets.

Mar 1, 2018
Mar 1, 2018
Oct 17, 2018