Consulting is a dream career for many. For many business school students, a career in management consulting is their dream. Many perceive it to be a glamorous profession and being recruited by a top management consulting firm might even be the basis for going to school to obtain an MBA. Consultants are paid astronomical salaries with benefits because of the high value contributions they make to their client companies.
Imagine being in your late 20’s and getting paid top dollar to advise upper management of oftentimes large corporations on restructurings and reorganizations? It can be exciting to have the power and prestige that comes with the responsibility of advising upper management on the reshaping of an organization.
Many wonder why upper management have a need for an outside advisor. Oftentimes, a management consultant is brought in to advise based on his or her wide experience, depth of knowledge, familiarity with similar companies and industries and to a large degree their impartial clear vision. And for the value a consultant brings to the table, client companies are prepared to pay handsomely. Consultants are frequently retained when a client company is under-performing or going through a period of major change and upper management is seeking unbiased and objective advice. Employees may have a vested interest in the status quo or may be reticent about change because they fear how it will impact them and or their division. An employee may feel more comfortable voicing his or her concerns and advice for moving forward with an outside advisor versus another employee. This can be a win-win situation for the company because they find out information that may otherwise be withheld from them.
Consultants versus investment bankers:
It should be noted that management consultants are oftentimes in direct competition with investment bankers for the facetime with upper management of what might be a company. Having said that, there are certain differences in the objectives of the two professions. Management consultants may be focused on the holistic health of the client company which includes their strategy for moving forward in a competitive environment in the context of a changing landscape. The investment banker is most likely to be concerned with financial issues to include but not limited to a merger, acquisition, leveraged buy-out, debt re-financing or an initial public offering.
The bottom line for any management graduate or professional is to develop a perspective on how the business world works and to evolve as a professional who is committed to adding value to his or her client.