VAULT GUIDE TO THE TOP 50 CONSULTING FIRMS
Vault Inc.
TOP50 CONS FIRMS VAULT GUIDE TO THE
TOP 50 CONSULTING FIRMS
© 2002 Vault Inc.
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TOP50 CONS FIRMS VAULT GUIDE TO THE
TOP 50 CONSULTING FIRMS
© 2002 Vault Inc.
TOP50 CONS FIRMS VAULT GUIDE TO THE
TOP 50 CONSULTING FIRMS
DOUGLAS CANTOR AND CLAY RISEN
© 2002 Vault Inc.
Copyright © 2002 by Vault Inc. All rights reserved. All information in this book is subject to change without notice. Vault makes no claims as to the accuracy and reliability of the information contained within and disclaims all warranties. No part of this book may be reproduced or transmitted in any form or by any means, electronic or mechanical, for any purpose, without the express written permission of Vault Inc. Vault, the Vault logo, and “the insider career networkTM” are trademarks of Vault Inc. For information about permission to reproduce selections from this book, contact Vault Inc., P.O. Box 1772, New York, New York 10011-1772, (212) 366-4212. Library of Congress CIP Data is available. ISBN 1-58131-165-6 Printed in the United States of America
ACKNOWLEDGEMENTS Thanks to everyone who had a hand in making this book possible, especially Todd Kuhlman, Marcy Lerner, Ed Shen and Rob Schipano. We are also extremely grateful to Vault's entire staff of writers, editors and interns for all their help in the editorial and production processes. Vault also would like to acknowledge the support of Matt Doull, Ahmad Al-Khaled, Lee Black, Eric Ober, Hollinger Ventures, Tekbanc, New York City Investment Fund, Globix, Hoover's, Glenn Fischer, Mark Hernandez, Ravi Mhatre, Carter Weiss, Ken Cron, Ed Somekh, Isidore Mayrock, Zahi Khouri, Sana Sabbagh, and other Vault investors, as well as our family and friends. In order to ensure that our research was thorough and accurate, we relied on a number of people within the consulting firms that we profiled. A special thanks to all of the recruiting managers, public relations executives, marketing professionals and consultants who graciously provided feedback whenever we needed it. To the 1,100-plus consultants who took the time to be interviewed or to complete our survey, we could never thank you enough. Your insights about life inside the top consulting firms were invaluable, and your willingness to speak candidly will be a great service to job seekers and career changers for years to come.
Vault Guide to the Top 50 Consulting Firms
Table of Contents INTRODUCTION 1 A Guide to This Guide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 How We Wrote This Book . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
VAULT PRESTIGE RANKINGS 7 Ranking Methodology - Consulting Top 50 . . . . . . . . . . . . . . . . . . . . . . .9 The Vault 50 · 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10 Prestige Rankings by Practice Area . . . . . . . . . . . . . . . . . . . . . . . . . . . .12
OVERVIEW OF CONSULTING
15
The Scoop
What is Consulting? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Industry History and Trends: 2002-2003 . . . . . . . . . . . . . . . . . . . . . . . .20 Consulting Categories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 Getting Hired
Breaking In . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 The Resume/Behavioral Interview . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 The Case Interview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 Guesstimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41 Brainteasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 Featured Employers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .47 Featured Recruiters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
VAULT TOP 50
51
1 McKinsey & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 2 The Boston Consulting Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62 3 Bain & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 4 Booz Allen Hamilton . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82 5 Monitor Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92
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Vault Guide to the Top 50 Consulting Firms Table of Contents
6 Mercer Management Consulting . . . . . . . . . . . . . . . . . . . . . . . . . .100 7 IBM Global Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106 8 Deloitte Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112 9 Accenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .120 10 Gartner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .130 11 A.T. Kearney . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .136 12 PwC Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .142 13 KPMG Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .152 14 Cap Gemini Ernst & Young . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .160 15 Marakon Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .168 16 Hewitt Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .176 17 Mercer Human Resource Consulting . . . . . . . . . . . . . . . . . . . . . . .182 18 Towers Perrin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .186 19 Electronic Data Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .192 20 The Parthenon Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .200 21 Roland Berger Strategy Consultants . . . . . . . . . . . . . . . . . . . . . . . .204 22 L.E.K. Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .212 23 DiamondCluster International . . . . . . . . . . . . . . . . . . . . . . . . . . . .220 24 Computer Sciences Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . .228 25 Oliver, Wyman & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .234 26 Watson Wyatt Worldwide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .242 27 Sapient Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .246 28 American Management Systems . . . . . . . . . . . . . . . . . . . . . . . . . .254 29 Kurt Salmon Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .262 30 Stern Stewart & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .270 31 Mars & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .274 32 Hay Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .280 33 Grant Thornton LLP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .284 34 Charles River Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .288 35 ZS Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .294 36 Perot Systems . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .300 37 Dean & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .304 38 Andersen's Business Consulting Practice . . . . . . . . . . . . . . . . . . . .310 39 PRTM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .320 40 PA Consulting Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .326 41 Keane . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .332 CAREER LIBRARY
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42 First Manhattan Consulting Group . . . . . . . . . . . . . . . . . . . . . . . . .336 43 Logica . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .340 44 The Corporate Executive Board . . . . . . . . . . . . . . . . . . . . . . . . . . .346 45 Swander Pace & Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .350 46 Commerce One Global Services . . . . . . . . . . . . . . . . . . . . . . . . . .354 47 Aon Consulting Worldwide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .358 48 Aquent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .362 49 Value Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .366 50 Greenwich Associates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .370
BEST OF THE REST
375
Computer Task Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .376 First Annapolis Consulting, Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .380 First Consulting Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .384 Haverstick Consulting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .388 Integral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .394 Lante . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .398 Sibson Consulting (Segal) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .402 Technology Solutions Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . .406
APPENDIX
409
Industry Buzzwords . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .411 Index of Consulting Firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .417 About the Authors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .421
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Introduction You’re probably reading this book because you’re interested in a career in consulting. Well, you’ve got your work cut out for you — landing a consulting job is a tough assignment. Even during the boom years of the 1990s, the supply of job applicants far outweighed the demand; in today’s economy, the degree of difficulty has increased exponentially. Indeed, getting in the door at top firms can be a herculean challenge, even if you are armed with an impressive GPA, a degree from one of the finest colleges or universities, and the ability to stay cool and collected under intense pressure. Every year, tens of thousands of resumes flow into the recruiting departments at top firms, but only a handful of the candidates receive an offer letter. So how do you get past the front gate? How can you improve your chances of receiving an invitation to the big party? The answer hearkens back to an age-old piece of advice: do your homework. Consulting recruiters won’t hire you just because of your high grades or top-tier schooling or extensive volunteerism. These things matter, but they won’t get you the job. You need to do your homework. Consider this book a starting point for all of your research, whether it be industry-related or about a specific firm. In it, you will find two general types of information. First, we give an overview of the consulting industry and some insight into the workings of the hiring process. Second, we provide in-depth profiles of the top consulting firms. Each profile is the result of painstaking research and detailed feedback offered by consultants within the firms. This year marks the second time we have ranked consulting firms in order of their prestige. We surveyed more than 1,100 practicing consultants, asking them to give a rating of each firm with which they were familiar. There are definite advantages to working at a firm with a great reputation — such firms often attract a higher caliber of clients and projects. Addionally, consultants at very prestigious firms often find their future job prospects to be brighter. But remember that prestige should be just one reason to choose a firm — though for many consultants, it is the biggest reason.
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Vault Guide to the Top 50 Consulting Firms Introduction
A Guide to This Guide If you’re wondering how our entries are organized, read on. Here’s a handy guide to the information you’ll find packed into each firm profile in this book.
Firm facts • Locations: A listing of the firm’s offices, with the city of its headquarters bolded. For firms with a relatively small number of offices, all cities are included. • Practices Areas: Official departments that employ a significant portion of the firm’s consultants. Practice areas are listed in alphabetical order regradless of their size and prominence. • Uppers and Downers: Good points and bad points of the firm, as gleaned from associate interviews and surveys, as well as other research. Uppers and downers are impressionistic perceptions and are not based on statistics. • Employment Contact: The person, address or web site that the firm identifies as the primary avenue to receive resumes or to answer questions about the recruitment process. Sometimes more than one contact is given.
The Buzz When it comes to other consulting firms, our respondents are full of opinions! We asked them to detail their opinions and observations about firms other than their own, and collected a sampling of these comments in the first-ever version of The Buzz in the Vault Guide to the Top 50 Consulting Firms. When selecting The Buzz, we included quotes most representative of the common outside perceptions of the firms, even if in our opinion the quotes did not accurately or completely describe the firm. Please keep in mind when reading The Buzz that it’s often more fun for outsiders to trash than praise a competing consulting firm. Nonetheless, The Buzz can be a valuable means to gauge a firm’s reputation in the consulting industry, or at least to detect common misperceptions.
The stats • Employer Type: The firm’s classification as a publicly traded company, privately held company or subsidiary.
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Vault Guide to the Top 50 Consulting Firms Introduction
• Stock Symbol: The stock ticker symbol for a public company. • Stock Exchange: The exchange on which a public company’s stock is traded. • Chairman, CEO, etc.: The name and title of the leader of the firm. Sometimes more than one name, or the name of the head of the firm’s consulting business, may be provided. • No. of Employees: The total number of employees, including consultants and other staff, at a firm in all offices (unless otherwise specified). Some firms do not disclose this information; numbers for the most recent year the information is available (if at all) is included. • Revenues: The gross sales (in U.S. dollars) the firm generated in the specified fiscal year(s). Some firms do not disclose this information; numbers for the most recent year the information is available (if at all) is included.
The profiles The profiles are divided into three sections: The Scoop, Getting Hired and Our Survey Says. • The Scoop: The firm’s history, clients, recent firm developments and other points of interest. • Getting Hired: Qualifications the firm looks for in new associates, tips on getting hired and other notable aspects of the hiring process. • Our Survey Says: Actual quotes from surveys and interviews with current consultants of the firm on topics such as the firm’s culture, feedback, hours, travel requirements, pay, training and much more. Profiles of some firms do not include an Our Survey Says section.
Best of the rest In addition to profiles of the Top 50 firms, we’ve also included information on a selection of consulting firms that did not make the list this year.
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Vault Guide to the Top 50 Consulting Firms Introduction
How We Wrote This Book Though the consulting industry is growing more complex all the time, we have made every effort to make the Vault Guide as straightforward as possible. Here’s what you need to know before proceeding.
What a difference a year makes If you read the 2002 Vault Guide to the Top 50 Consulting Firms, you might notice that this year’s edition features a different list of firms. Where did firms from last year’s edition go, you ask? Some vanished altogether. For example, Cambridge Technology Partners (No. 23 in prestige in 2001) and iXL (No. 48) were gobbled up by other companies and no longer merit mention as independent players. Others were hit very, very hard by the dotcom implosion. This is especially true in the case of e-consultancies like Scient (No. 28 last year), Razorfish (No. 29) and Viant (No. 42). But to be fair, it wasn’t just the newbies who fell out of favor. Arthur D. Little, the world’s oldest management consulting firm and No. 16 in the 2001 Top 50, recently ended its 116-year run by going bankrupt and selling its assets piece by piece. ADL’s fate is a good indication of the state of the industry. A lot can change in a year. Indeed, while the top few firms remain the same from last year, there has been considerable movement throughout the rest of the prestige rankings.
The consultant’s dictionary Consultants just love to use jargon. Not so Vault. We have done our best to eliminate any references to “paradigms,” “thought leadership” or “maximizing value propositions.” Nor will you read any word that has been transmogrified into a different and improper part of speech. People do not and should not “synergize” anything, and the word “impactful” does not even appear in the Oxford English Dictionary. Most importantly, we have cut out the thousands of mentions of the phrase “work hard/play hard” from consultants’ descriptions of their firms’ corporate culture. If you’re interested in brushing up on the latest consulting vocabulary, we suggest you consult the Industry Buzzwords section at the end of this book.
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Vault Guide to the Top 50 Consulting Firms Introduction
Quotes in this guide The topic of quotes from our employee surveys and interviews brings up another key point: The opinions expressed in this book do not necessarily reflect those of every employee at a given firm. However, you can be confident that what you read in the Vault Guide is the consensus view among that firm’s consultants. We surveyed and interviewed a large number of people — compiling copious amounts of statistical data on various qualityof-life categories to assist us — to come up with the most accurate picture possible of life at the Top 50.
For detailed 40- to 50-page insider reports on top consulting firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com. Make sure you're prepared for your case interviews. Get case frameworks, strategies, tips, and detailed step-by-step analysis of actual cases used in interviews with the Vault Guide to the Case Interview and the Vault Case Interview Workbook. For one-on-one coaching, use Vault Case Interview Prep. Go to http://consulting.vault.com.
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TOP50 CONS FIRMS THE VAULT PRESTIGE RANKINGS
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Vault Guide to the Top 50 Consulting Firms The Vault Prestige Rankings
RANKING METHODOLOGY — CONSULTING TOP 50 The 2002 Consulting Survey is Vault’s most ambitious to date, with more than 1,100 consultants rating the top 50 consulting firms around the world. Our goal was threefold: gather informed feedback from consultants at top firms, analyze the results using criteria relevant to job seekers, and condense the results into an accurate, objective and useful career guide. After creating an online survey addressing issues such as work hours, compensation and diversity, to name just a few, we defined our targeted survey population. Using knowledge obtained from prior Vault surveys, conversations with consulting professionals, and new industry research we compiled for 2002, we approached top consulting firms and asked them to distribute the survey to their consultants. 1,107 consultants took Vault’s survey, giving us a detailed, insider’s perspective on life at the industry’s most prominent firms. Additionally, we asked each respondent to rate the consulting firms on a scale of 1 to 10 based on prestige. They also made brief comments on other firms, sharing their perception of each firm from the outside. (These impressions are represented in the book as The Buzz). Vault collected all of the survey results and averaged the score for each firm. For objectivity’s sake, consultants were not allowed to rank their own firms. The firms were then ranked in order, starting with the highest average prestige score to determine the Vault Top 50. We understand that there are problems inherent in any prestige ranking. However, we found that the rankings typically paralleled conventional wisdom — with a few interesting exceptions. Remember that in the Top 50, Vault is not ranking firms by profit, size, lifestyle or quality — we are ranking the most prestigious consulting firms based on the perceptions of currently practicing consultants at peer firms.
For detailed 40- to 50-page insider reports on top consulting firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com
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The Vault 50 • 2003 [ The 50 most prestigious consulting firms ] RANK
FIRM
SCORE
RANK 2002
HEADQUARTERS
1
McKinsey & Company
8.654
1
New York, NY
2
The Boston Consulting Group
8.119
2
Boston, MA
3
Bain & Company
7.563
3
Boston, MA
4
Booz Allen Hamilton
6.747
4
McLean, VA
5
Monitor
6.343
8
Cambridge, MA
6
Mercer Management Consulting
6.28
6
New York, NY
7
IBM Global Services
6.031
13
Somers, NY
8
Deloitte Consulting
5.936
10
New York, NY
9
Accenture
5.932
5
New York, NY
10
Gartner
5.766
9
Stamford, CT
11
A.T. Kearney
5.728
12
Plano, TX
12
PwC Consulting*
5.713
7
New York, NY
13
KPMG Consulting
5.446
14
McLean, VA
14
Cap Gemini Ernst & Young
5.394
11
New York, NY
15
Marakon Associates
5.08
21
New York, NY
16
Hewitt Associates
4.772
15
Lincolnshire, IL
17
Mercer Human Resources Consulting
4.747
18
New York, NY
18
Towers Perrin
4.741
20
New York, NY
19
Electronic Data Systems
4.687
19
Plano, TX
20
The Parthenon Group
4.68
30
Boston, MA
21
Roland Berger - Strategy Consultants
4.655
38
New York, NY
22
L.E.K. Consulting
4.591
25
Boston, MA
23
DiamondCluster International
4.459
34
Chicago, IL
24
Computer Sciences Corporation
4.111
26
El Segundo, CA
25
Oliver, Wyman & Company
4.1
40
New York, NY
* Acquisition by IBM announced July 2002
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Vault Guide to the Top 50 Consulting Firms The Vault Prestige Rankings
RANK
FIRM
SCORE
RANK 2002
HEADQUARTERS
26
Watson Wyatt Worldwide
4.066
27
Washington, DC
27
Sapient Corporation
4.06
22
Cambridge, MA
28
American Management Systems
3.992
41
Fairfax, VA
29
Kurt Salmon Associates
3.981
37
Atlanta, GA
30
Stern Stewart & Company
3.905
24
New York, NY
31
Mars & Company
3.902
39
Greenwich, CT
32
Hay Group
3.839
31
Philadelphia, PA
33
Grant Thornton LLP
3.818
36
Chicago, IL
34
Charles River Associates
3.747
45
Boston, MA
35
ZS Associates
3.698
NR
Evanston, IL
36
Perot Systems
3.642
35
Plano, TX
37
Dean & Company
3.623
43
Vienna, VA
38
Andersen's Business Consulting Practice
3.582
17
Chicago, IL
39
PRTM
3.535
44
Waltham, MA / Mountain View, CA
40
PA Consulting
3.518
NR
London UK
41
Keane
3.493
NR
Boston, MA
42
First Manhattan Consulting Group
3.421
33
New York, NY
43
Logica
3.413
NR
London, UK
44
The Corporate Executive Board
3.328
NR
Washington, DC
45
Swander Pace
3.143
NR
San Francisco, CA
46
Commerce One Global Services
2.973
46
Pleasanton, CA
47
Aon
2.816
49
Chicago, IL
48
Aquent
2.815
NR
Boston, MA
49
Value Partners
2.7
NR
Milan, Italy
50
Greenwich Associates
2.63
NR
Greenwich, CT
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Vault Guide to the Top 50 Consulting Firms The Vault Prestige Rankings
PRESTIGE RANKINGS BY PRACTICE AREA In addition to overall prestige, Vault also asked consultants to rank firms in terms of the prestige of three general areas of business focus: strategy, information technology and human resources. Consultants were allowed to vote for up to three firms as the most prestigious in each practice area. These charts indicate the rankings in each of the practice areas, as well as the total percentage of votes cast in favor of each firm. (As long as at least one consultant voted for more than one firm, no firm could garner 100 percent of the votes; if every consultant had voted for three firms, the maximum a firm could have received would be 33.3 percent.)
Strategy Consulting RANK
%
RANK 2002
1
McKinsey & Company
30.68
1
2
The Boston Consulting Group
23.84
2
3
Bain & Company
14.18
3
4
Booz Allen Hamilton
8.25
4
5
A.T. Kearney
3.32
6
6
Accenture
2.9
5
7
Monitor Group
2.87
7
8
Deloitte Consulting
1.76
8
9
Mercer Management Consulting
1.34
7
KPMG Consulting
1.18
11
10
12
FIRM
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IT Consulting RANK
FIRM
%
RANK 2002
1
Accenture
29.73
1
2
IBM Global Services
18.42
2
3
Electronic Data Systems
9.00
6
4
PwC Consulting*
6.72
3
5
Cap Gemini Ernst & Young
5.97
4
6
Deloitte Consulting
5.16
5
7
KPMG Consulting
2.94
7
8
Computer Sciences Corporation
2.89
9
9
Sapient Corporation
2.65
11
American Management Systems
2.56
10
10
* Acquisition by IBM announced July 2002
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Vault Guide to the Top 50 Consulting Firms The Vault Prestige Rankings
Human Resources Consulting RANK
FIRM
%
RANK 2002
1
Towers Perrin
18.24
2
2
Hewitt Associates
17.16
1
3
Hay Group
9.51
5
4
Watson Wyatt Worldwide
8.82
4
5
Mercer Human Resources Consulting
8.33
3
6
Mercer Management Consulting
6.08
7(tie)
7
Deloitte Consulting
3.43
7(tie)
8
Accenture
3.33
8
9
PwC Consulting*
2.84
6
Cap Gemini Ernst & Young
2.06
10
10
* Acquisition by IBM announced July 2002
Want to know in detail what consultants think about top firms? Get detailed breakdowns of Vault's 2003 prestige rankings by school (undergraduate and business), location, practice area and more with the 2003 Vault Consulting Firm Survey Corporate Research Report. Go to www.vault.com/consultingsurvey
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TOP50 CONS FIRMS OVERVIEW OF THE CONSULTING INDUSTRY
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The Scoop What is Consulting? A giant industry, a moving target Consulting is an industry without a fixed identity. Not only do firms rebrand themselves nearly every year, but areas of specialty (or “practice areas”) within the firms change frequently as well. The market for consulting services is similarly dynamic. With constantly shifting corporate needs, mergers and recessions, and with new industries on the make, the demand for consulting services is as unpredictable as the stock market. The term “consulting” can mean many things, most of which involve the giving of professional advice. One “consults” a business the same way one advises friends or family in need. When seen through that lens, it is clear how fundamental consulting is to business. Most people, however, are mystified by the actual job, the day-to-day responsibilities, the work itself. And why wouldn’t they be? Consulting terminology is notoriously unclear to most literate humans. Terms like strategy, process and change management are vague and ambiguous and only meaningful, it seems, to insiders who know how to decode them. So what exactly is consulting? For starters, consulting is not about walking into a client site, throwing down your briefcase and saying, “Look at the inefficiency. It’s everywhere! Have you no shame?” Spotting a client’s problems is only half the battle (Most people with a fair amount of common sense and an outsider’s perspective could spot a client’s problems just as quickly.) The job of the consultant, therefore, isn’t just about knowing what’s wrong, but figuring out how to make it right. Solutions are the hard part, and not because they are in short supply. Good consultants never lack solutions, but implementing even one of them in a corporate environment can be a major undertaking fraught with political and operational obstacles. That is key to consulting: getting past the corporate obstacles. Overcoming institutional inertia. And working with a client team that takes your involvement personally, because your involvement implies that they needed outside help.
Hire the consultants, fast Companies hire consultants for a number of reasons. But whatever those reasons are, they’re bound to be compelling — because consultants are very Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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costly. Given travel expenses, hotel bills and project fees, per-hour prices for consultants can easily climb into the $500-per-hour range. Every consulting project springs from a client’s need for help, or at least the kind of help that short-term, internal hiring can’t solve. Some clients, for example, need to overhaul their entire IT infrastructure, yet they’re out of touch with the latest back-end systems, or they don’t have the staff resources for such a large project. Other clients may be merging, but they lack any experience with post-merger staffing procedures, and they need a neutral party to mediate. Some clients may need an outsider’s perspective on a plant shutdown. Consultants get hired for political reasons too. Particularly in Fortune 500 companies, launching big projects can be very cumbersome. In order for a single dollar to be spent on such a project, most companies require senior executive approval. And without a major consultancy attached to the project, approval can be hard to attain. But once a consulting firm steps into the picture, everyone involved has plausible deniability in the event that the project fails. Second, even if a giant project gets the green light, there’s no guaranteeing it will be implemented. The reason? Simple bureaucratic inertia. Senior executives lose interest. Lower-level managers move on to other, more pressing issues. In short, companies lose their focus. By bringing in consultants to oversee large projects, companies ensure that someone is always keeping his eye the ball. And in many cases, the correct solution may be quite evident to many, but having it confirmed by an outside party makes implementing a plan politically much easier. In the era of downsizing, consultants have another political use. Companies with an itch to fire a percentage of their workforce often like to bring in consultants. When the consultants recommend a workforce reduction, the company can fire at will, gratefully blaming (some might argue hiding behind) their hired guns for the downsizing. There is, of course, the ever-present (and most important) motive for hiring consultants. Money. Consultants whose suggestions don’t make (or save) money are quickly shown the door.
All about the skill sets Consultants focus their energies in a wide variety of practice areas and industries. Their individual jobs, from a macro level, can be as different as one could imagine. While a supply chain consultant advises a client about
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lead times in its production facility, another consultant is creating a training protocol for a new software package. What could be more different? Despite the big-picture differences, however, consultants’ day-to-day skill sets are, by necessity, very similar. All consultants generally need to be wellversed in client management tactics. All consultants must be comfortable with spreadsheets, not to mention long, often last-minute presentations (Excel and PowerPoint expertise is essential to the job). All consultants need to have plenty of analytical ability, a preference for teamwork, and a passion for planning and implementing mammoth corporate initiatives. And all consultants need to be prepared to pull the occasional all-nighter, because clients pay a lot of money and don’t want to hear “Geez, we really tried to make it, but, um, it’s going to be late.” Nothing can be late in consulting. Consultants are a back-room breed of professional. In joint projects with their clients, they do much of the work and can expect little to none of the recognition. All consultants must deliver bottom-line value, and may spend countless hours huddled in cramped spaces to do it. The consultant’s job, aside from mastering strange subjects quickly, is to create presentations, write code, design extremely intricate new processes, and sometimes simply sit down with a senior client executive and give a progress report. Sometimes, what an average consultant does is even lower in profile: coding in a newly learned computer language, trying out PowerPoint skills to compile presentations, writing memos, and completing other fairly routine tasks. In any case, the boundaries of the job are virtually limitless. Each project carries with it a new task, a new spreadsheet configuration, a newly developed type of sales conference or an entirely new way of thinking about business. The client, meanwhile, stands by and watches you work. Are you lightning quick? Does your fancy degree actually translate into solid deliverables? Are you twice as good as current employees? You’d better be, because you’ll probably cost at least twice as much!
Want more inside information on consulting careers? Get the Vault Career Guide to Consulting, with day-in-the-life profiles, career paths, salary information and more, at http://consulting.vault.com
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Industry History and Trends: 2002-2003 A brief history of consulting People have traded wisdom for pay since the dawn of time. Nonetheless, consulting as big business only came into being around the start of the 20th century. The first consultants drew from their engineering backgrounds to conduct time- and motion-type projects for their clients. When James “Mac” McKinsey, a University of Chicago professor, established his “accounting and engineering advisors” firm, he offered a proposition similar to consulting. Over time, he developed a unique, integrated approach for his clients, which he called his “General Survey.” Instead of hiring traditional engineers, McKinsey recruited experienced executives and trained them in a framework of analysis. The new approach 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, The Boston Consulting Group (BCG), followed work with a semiconductor manufacturer client and developed the experience curve. This idea proposed that declines in most industries were directly correlated to cost as a function of cumulative experience. BCG later extended its original concept by developing the growth share matrix, a tool that assesses a company’s attractiveness within an industry.
The present day Consultants and their clients are in a state of constant flux.. The typical client now requires more sophistication from its consultants’ in-house skills and is more demanding in its consulting projects. For example, some clients use their own in-house strategy groups and have clear ideas of what their business means and the direction in which to head. This increased sophistication means a number of new developments in the industry, which in turn will impact your decision to enter the field.
Specialization Many consulting firms now specialize. Until relatively recently, the conventional wisdom at firms like McKinsey was to develop generalists who 20
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applied their learning across industries and geographies. That strategy is evolving. Clients increasingly demand that consultants come in with prior knowledge of their industry. While most of the larger firms still hire generalists, they now ask consultants to specialize earlier in their careers. They also tend to hire industry experts who might follow different (and possibly accelerated) career tracks than typical MBAs.
Implementation Many clients no longer want to pay for mere strategic musing. Hence, many strategic consulting firms are beginning to ensure implementation of their recommendations. As a result, consultants are more well-rounded, with systems consultants seeking more strategy assignments and strategy consultants taking on e-business work. Still, differences prevail — strategy consultants lack powerhouse information technology skills, and systems players have a hard time convincing clients they can come up with innovative strategic solutions. But the success of strategy/systems hybrids like Booz Allen Hamilton suggests that convergence adds a successful competitive advantage — which means more competition for all consulting firms. Web consultancies, much in vogue prior to the turn of the millennium, had an especially difficult time convincing clients that they had the same implementation capabilities as larger and more established competitors. Coupled with the downturn in the U.S. economy, such difficulties led to the demise of most firms of that ilk.
Cyclical nature Consultants like to estimate future revenues for other industries. Meanwhile, speculation abounds about the consulting industry’s own revenues. Up until the latest market swoon, consulting revenues had grown by an average of 16 percent each year and are still expected to grow at an equally brisk pace (taking into account occasional dips) over the next decade. Aggressive penetration of emerging markets by corporations (where consultants assess new markets) and rapid changes in client industries (privatization, IT changes and globalization) are responsible for the marked growth in consulting. As the ultimate service industry, consulting depends heavily on the prospects of large corporations. Though global recessions create many issues consultants can address, companies tend to cut outside costs (including consultants) when budgets are lean, which makes consulting companies vulnerable to layoffs and cost cutting.
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Nevertheless, consulting will never disappear. During economic downturns, consulting firms frequently attract distressed clients that need advice to cope with their fiscal situations. Additionally, previous tough times have forced consulting firms to expand their client rosters to include smaller companies. Entrepreneurial and middle-market consulting now makes up a large part of consulting revenues, and many firms dedicate entire departments to these groups. Many consultancies have teamed up with venture capital firms — or created VC funds of their own — to launch startup companies, to which they also provide business strategy and other advice. This practice was more in vogue during the dot-com boom of the late ’90s (remember that?), but certain targeted ventures are still being made.
Open trading Consulting firms traditionally have shunned the idea of going public — but this too is changing. In October 2000 the U.S. arm of global HR consultancy Watson Wyatt underwent a public offering. Then in February 2001, KPMG Consulting completed a successful IPO, raising hundreds of millions of dollars as part of its separation strategy from parent company KPMG LLP. Fellow Big Five firm Accenture, considered to be the largest management consultancy in the world, upped the ante five months later by raising about $1.7 billion. Since then Hewitt Associates and PwC Consulting (now Monday) have jumped on the IPO bandwagon.
Hello goodbye When in the course of human events, it becomes necessary for one consulting firm to dissolve the political bands which have connected it with another, the result can be a very public declaration of independence. Perhaps the most notorious divorce was that of Accenture and Arthur Andersen, a drama that appeared in the news beginning in December 1997 and did not end until 2001. But while Accenture and the de-Arthured Andersen waved goodbye, other firms have said hello. Some mergers have been of the mega variety, such as those between Price Waterhouse and Coopers & Lybrand in 1998 and Cap Gemini and Ernst & Young in 2001. But the industry has also seen smaller players joining forces in recent days. At the end of 2000 Atlanta’s Kurt Salmon Associates merged with San Francisco-based Swander Pace, combining two of the leading consultancies specializing in the consumer goods and retail industries. And in January 2002, The Segal Company acquired fellow human resources consultancy Sibson Consulting Group from Nextera Enterprises for $16 million and future considerations. Some of the 22
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mergers have been the product of companies in other industries attempting to create new consulting divisions or augment existing ones. Some recent examples include software company Novell’s July 2001 purchase of Cambridge Technology Partners and the December 2001 acquisition of Renaissance Worldwide by Aquent, an IT staffing firm.
Scandal rocks the industry On headline-grabbing development that has the entire consulting industry reeling is the Enron/Andersen scandal. Here’s the short version for our cavedwelling readers: Enron, a large Houston-based energy company, long held a reputation as a great American innovator and a stock market darling. However, due to a shadowy history filled with poor investments, an unnecessarily complex fiscal structure and other questionable managerial decisions, the company very publicly fell apart in 2001. Enron eventually was forced to lay off thousands of employees and to undergo the largest Chapter 11 bankruptcy in U.S. history. Meanwhile, in early 2002, the Securities and Exchange Commission and the U.S. Justice Department began conducting criminal investigations surrounding allegations of fraudulent financial reports and manipulation of energy markets. Waist-deep in the scandal was Andersen, Enron’s auditor. Andersen was indicted by the DOJ in March 2002 when it came to light that the firm had destroyed thousands of Enron documents and assisted the company in covering up losses and other dubious financial dealings. Three months later, a federal jury found the firm guilty of obstruction of justice. Granted, Andersen’s misdeeds lay with the accounting side of the firm, and with a small number of people working out of one office at that. In the court of public opinion though, the resulting stigma potentially could rub off on anyone even remotely associated with the scandal. Who is likely to be affected? There is of course Andersen, whose consulting arm, while not accused of any wrongdoing, garnered millions in fees from Enron. The Big Five firm’s sea of troubles has been well documented and continues to make headlines on a daily basis. Then there is McKinsey, a longtime Enron adviser and former employer of the now-notorious Jeffrey Skilling, the Enron executive primarily responsible for engineering many of the company’s shady reporting practices. Finally — and most importantly for anyone trying to get a job in the field — there is the entire consulting industry in general. In a March 2002 Vault poll, 45 percent of respondents believed that the Enron affair would make companies completely reevaluate their need for consultants. For now, consulting firms have yet to experience the full fallout
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from the whole debacle. But for the people trying to break into those firms, it is at best an unhappy circumstance.
Splitting up Another consequence of this saga has been a push to create greater separation between professional services firms’ auditing and consulting businesses. The SEC and equivalent regulatory bodies outside the United States are considering stricter rules to avoid potential conflicts of interest. The SEC has in the past encountered a tremendous amount of resistance from accounting firms, which fear losing some of their most lucrative sources of revenue. Indeed, according to The Times of London, auditing firms’ ability to offer consulting services would have been outlawed years ago had it not been for “fierce lobbying from the accounting industry.” Regardless, after paying lip service to such proposed rules for some time, all of the Big Five firms have now attempted in one way or another to split up their operations. Selling consulting divisions or spinning them off as distinct companies has become de rigeur in the industry of late. These moves have advantages of their own — separating their consulting operations has enabled firms to create new and innovative brands, while a successful public offering can raise money for acquisitions or expansion into new industries and regions (as well as snare new recruits with the lure of stock options).
Layoffs abound Even more central to the state of the consulting industry in 2002-2003 is of course the condition of the economy. Consulting firms have taken a huge hit since the market went south, seeing declining demand for services (especially in the technology sector) and declining fees. To put it in perspective, in his March 28, 2002 Inside Consulting newsletter, Consulting Information Services president Tom Rodenhauser says he has spoken with “one veteran consultant [who] says he’s currently billing at 1990 rates.” Coinciding with these developments has been a sharp decline in the consulting job market. Many firms have cut back or eliminated their campus recruiting efforts, and others have instituted overall hiring freezes. In addition, a large number of new undergraduate and MBA hires who planned to come on board after graduation have seen their start dates pushed back by a year or more, or rescinded altogether. The economy also has affected many consultants already ensconced in their firms. Few firms have been immune to the pink slips, from IT services giants 24
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like IBM Global Services to white-shoe strategy shops like The Boston Consulting Group. While this is hardly news at this point, it is no less depressing for lifelong consultants who find themselves out of a job or newly minted MBAs who have seen their six-figure salary offers rescinded. If there is any consolation at all, it is that the industry now appears to have weathered the worst of the storm. We can see, perhaps, the first glimmerings of the industry recovering after two years of economic turmoil and media scandal, with layoffs tapering off somewhat and billing hours beginning to rebound.
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Consulting Categories The types of consulting that firms offer can (roughly) be divided into four general categories: strategy, information technology, e-consulting and human resources. These categories often overlap, and most firms offer multiple areas of consulting. Clients now hire one firm, not several, to formulate overall strategy, review operations’ efficiency, implement conjoining technology solutions, and get online.
Strategy consulting Strategy consulting aims to help a client’s senior executives understand and face the strategic challenges of running their company or organization. Strategy consultants work with the client’s most senior management, since senior management sets a company’s strategy and long-term plans. Historically, strategy consulting firms made their recommendations, presented a “deck” (a report detailing the issues and recommendations), and then walked away. Increasingly, however, clients expect the strategists to stick around to implement their suggestions. Consequently, more consulting firms now tout their “implementation” capabilities, which address many areas of a client’s internal operations. (Operations consulting is often considered a separate field unto itself, but it continues to become more and more intertwined with strategic services.) These operations include, but are by no means limited to, customer service response times, inventory backlog costs, product quality and distribution efficiencies. Examples of typical strategy consulting engagements: • Analyzing why a clothing retailer generates lower sales per square foot than its competitors • Positioning a snack manufacturer to enter China, determining types of snacks most wanted, and assessing the market’s willingness to pay for snacks • Streamlining the equipment purchasing process of a major manufacturer • Working with a newly merged commercial bank to increase its customer response efficiency
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Leading strategy consulting firms include: • Bain & Company • Boston Consulting Group • McKinsey & Company • Monitor Group
Information technology consulting Information technology consultants (also called “systems consultants”) work with corporations and other clients to understand how they can best leverage technology for the organization. They design custom software or networking solutions, test for system and program compatibility, and ensure that the new system is properly implemented. Most IT consultants, by definition, boast sharply honed technical skills. But no one says you absolutely need to know how to rewire a router for maximum communications efficiency. IT solutions must be implemented as an overall part of a business solution. Otherwise, clients are sure to scream for costjustification and/or to fire their IT department heads for wasting money when solutions fail. Examples of typical IT consulting engagements: • Testing an investment bank’s vulnerability to hackers • Converting a commercial bank’s mainframe system into an Oraclebased client-server environment • Implementing a firewall for a retail chain’s e-mail and customer service servers • Upgrading a large law firm from WordPerfect to Word • Troubleshooting on a major SAP software installation Leading information technology firms include: • Accenture • American Management Systems • Computer Sciences Corporation • Electronic Data Systems
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E-Consulting How can you quickly change any term in standard English vernacular into a dirty word? Just put an ‘e’ in front of it. Truly, the business world has done a complete 180 from just a few years ago when it paid blind homage to all things Internet. But while the outlook for the future of the Net may have changed dramatically, e-consulting — solving problems connected with online business and electronic commerce on a widespread basis — remains an important and viable enterprise. Traditionally, e-consulting began as web consulting, which involved mostly front-end design work: programming, graphic design, and prototypes of company web sites. With the rapid proliferation of dot-coms in the mid- to late-’90s, consulting companies found that they needed to offer a wider range of services: e-commerce, B2B, valuations, branding, marketing and so on. Eventually it became apparent that clients wanted entire e-commerce operations created from scratch. The days of boutique dominance in this sector are over. After tremendous competition for market position, it appears that larger, more traditional firms with more capital at their disposal have gained the upper hand. Large firms are making it very difficult for pure-play e-firms like Razorfish and iXL Enterprises, particularly after the stock market took its toll (though the blue chips have had their own difficulties over the last two years). Given the nature of their chosen medium, e-consultants must be adaptable and dynamic to stay competitive in the market. Many once-promising upstarts on both the consulting and client sides have long since gone under. So tread carefully — while the consulting industry has learned many tough lessons in its relatively short history, e-consulting still remains a field fraught with a whole host of risks. Examples of typical e-consulting engagements: • Transforming a department store to an online shopping site • Creating online catalogs for a mail-order company • Advising a mutual fund company on how to provide its clients with access to account information online
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Leading e-consulting firms include: • Sapient • DiamondCluster International • Lante
Human resources consulting The best business strategies, the most up-to-date technologies and the most streamlined operations mean nothing if no one can put them into place. Hence, human resources consulting has become a huge business. Increasingly, companies conclude that investing in their human capital pays off. HR consultants maximize the value of employees while placing the right people with the right competencies. This kind of HR consulting, also known as organizational development or change management, is one of the hottest consulting fields. Clients hire HR consultancies as part of departmental or organizational restructurings, systems implementations, and ongoing initiatives and studies (e.g., diversity and work-life balance). HR consultants also provide technical advice. This advice involves mostly number crunching, and those who excel at it are generally known as actuaries. Their number crunching often focuses on restructuring benefits packages and valuating compensation structures, among other technical assignments. Actuarial consultants must pass many certification exams throughout their careers to remain eligible to practice their trade. Examples of typical human resources consulting engagements: • Bringing together the cultures of merged companies by developing or altering work cultures • “Managing relationships” to ensure focus on customers and open communication • Building “competencies” through better and more efficient training programs • Fostering employee creativity through “process innovation” • Counseling and processing laid-off employees and assisting them in finding new jobs • Creating or updating a new division’s benefits package • Reviewing and revising a law firm’s compensation structure
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Leading human resources consulting firms include: • Hewitt Associates • Towers Perrin • Watson Wyatt Worldwide • Mercer Human Resource Consulting
Want more inside information on consulting careers? Get the Vault Career Guide to Consulting, with day-in-the-life profiles, career paths, salary information and more, at http://consulting.vault.com
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Getting Hired Breaking In Getting your foot in the door Historically, consulting firms focused on a relatively small number of undergraduate and graduate institutions when recruiting for associates and analysts. That changed a bit during the dot-com boom, when talent-hungry firms broadened their list of schools in search of candidates. (The lists of schools at which IT-focused firms recruit were already fairly broad, as those firms tend to pay greater attention to candidates’ skills and certifications than school brand name .) And while the job market has once again tightened up, recruiters remain aware that many qualified people can be found outside of their standard channels. Consultancies have also begun to consider candidates with non-traditional advanced degrees, such as MDs or PhDs. This makes it easier to get on the radar screen if you come from a less traditional background or a college outside of their traditional recruiting list. Firms may also be receptive to a wider range of backgrounds when it comes to offering internships. Indeed, doing an internship (at any level) is one of the best ways to get into the field, especially when the economy is bad. One 2001 MBA grad tells us that his classmates “who did an internship at one firm [the previous summer] were more likely to get full-time consulting offers — even at other firms. It was because they had proved that they wanted to do consulting.” And while competition for any kind of consulting position remains high, there are ways you can increase your chances of being selected for an interview.
Schmoozing Good networking skills are important throughout your career, but these skills are immensely helpful in opening doors at your firms of choice. Begin by seeking out several contacts to obviate a cold call to your target companies. Consulting firms sometimes arrive on campus the evening prior to interviewing rounds for cocktails and dinner. Although these events are usually open house, some are invitation-only functions. If you do not hold an invitation, call the company’s event administrator, express your interest in the company, and ask for an invitation. Nine times out of 10, companies gladly extend invitations to those who show genuine interest.
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Vault Guide to the Top 50 Consulting Firms Getting Hired
If consulting firms don’t typically recruit at your school, you have to work harder. Find a contact within the firms you are targeting — be it an alumnus, a colleague who worked there prior to school, your mother’s best friend, or anyone else. Then ask the contact for an informational interview. Use the informational interview for two purposes: to get an “in” on the recruiting process and to learn more about the company prior to your interviews. Recruiters generally favor candidates endorsed by someone already working in the firm. The more people you know in a particular organization, the greater your chances of success. Schmoozing involves more than just networking. When networking, you seek out people to help you on a single mission, without necessarily considering your ability to help them. Schmoozing, on the other hand, involves developing longer-term relationships for both parties’ benefit. You begin these relationships with the goal of productivity — you are seeking a mutually beneficial outcome. You find people with whom you can exchange ideas, favors and political assistance. Through schmoozing, you find people who will support you even when you do not need it. They actively get involved in your life, and vice versa. It’s an invaluable skill to develop, no matter what your profession.
Are they hiring? Despite your best efforts, the firm of your dreams may be in the midst of a hiring freeze. In the last year or so, many firms also have delayed or rescinded job offers to candidates from top undergrad and MBA programs. It is important to find out which firms have had such HR difficulties. (This book is chock full of such information.) Other firms have taken pains to avoid layoffs. Once you have weighed these risks and decided you still would like to work at a given firm, that’s when it’s time to prepare for the interview process.
The interview process The most valuable asset of any consulting firm is its human capital. (That means you.) Before clients see presentations, reports or results, they see consultants. Before clients work with products or services, they work with the people. Consequently, consulting firms purposefully make their interviews intense and lengthy to measure your intellectual, physical and emotional stamina.
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Consulting interviews fall into two types: the behavioral interview and the case/problem interview. The former determines the extent to which you fit the consultant profile and the firm’s culture. The latter tests your problemsolving skills and displays your thinking patterns to the interviewer. To an extent, both types of interviews also reveal how well you deal with stressful real-time challenges.
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The Resume/Behavioral Interview Interviewers first want to determine if you have the “intellectual horsepower” (brains) and “quantitative and analytical ability” (math and logic skills) to be an asset. You must also be able to think “out of the box” (creatively) to come up with innovative ideas and approaches. While your resume provides structure for the interview, be sure your side of the conversation provides more than a regurgitation of the resume’s key points. Focus on the same skills you underscored in your resume, but use different examples of teamwork, leadership, confidence and technical skills. A succinct description of past school or work projects that highlight your skills “gives the interviewer something to hold on to,” according to one consulting interview veteran. Meanwhile, show your interviewers that the examples on your resume do not constitute the entirety of your abilities. Interviewers take on the responsibility of shaping their firm’s culture and/or ensuring compliance with firm standards. Generally, consulting firms want smart, ambitious, hardworking, dedicated and analytical people with pleasant demeanors. During the interview, pay attention to what you say and how you say it. Listen carefully to the questions. Too many people lose points by answering the questions incorrectly, incompletely or inappropriately. Craft your answers so that they are logical and structured. Provide relevant examples. Speak in complete sentences, and do not go off on tangents or trail off midway through a sentence. Also, watch your fillers: “you know,” “um,” “like.” Ensure that your elocution is articulate and reflects your education. Some specific skills and qualities that interviewers look for: • Leadership skills, to lead consulting and client teams and to promote their ideas • Teamwork, to work with other consultants, clients and vendors toward solutions • Analytical skills, to crunch numbers and work through information in a logical manner • Presentation skills, to communicate findings to fellow consultants and clients alike • Creativity, to solve problems and think “out of the box” • Thick skin, for those times when your work is criticized • Personality and sense of humor, to defuse stressful situations
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During your interviews, remember these specific points: • Never express uncertainty or insecurity about your skills or give the interviewer any reason to question your confidence or abilities • Refrain from revealing your dislike for travel or your attachment to home • Avoid getting defensive or sensitive when answering tough questions, including, “What kinds of people do you have trouble getting along with?” or “Tell us about your shortcomings.” During your interview, be prepared for some version of the “airplane test.” The interviewer imagines sitting next to you on an eight-hour flight across the Atlantic. He or she decides which is more preferable: conversing with you for more than 30 seconds or faking sleep throughout the whole flight to avoid you. To pass the test, show genuine interest in something outside the business realm or crack a joke. Just be sure to choose a topic that presents you as mature, insightful and interesting, and make certain that the topic is tasteful, amusing and noncontroversial.
Behavioral questions Consulting firms use behavioral interview questions to measure “softer” attributes. Behavioral interview questions ask you to reveal how you behave in particular situations, be it at work or in a personal situation. Firms using behavioral interviews believe a candidate’s responses reveal a lot about his or her personality and skills. They also believe the firm can project future behavioral patterns based on the past. Some consulting firms use behavioral questions almost to the exclusion of more traditional consulting case questions. To prepare, practice answering frequently asked behavioral questions until you can answer them smoothly.
Practice behavioral interview questions When asking behavioral questions, your interviewers first listen to your answers at face value and then assess your thinking process (ingesting the question, processing the answer, assembling the words and presenting the answer). They also use their assessment to project the likelihood of your future success.
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1
What position do you normally take on a team?
Extremes never paint stable pictures. Avoid portraying yourself as an obsequious follower or a tyrannical dictator. Consulting firms want people (especially neophytes) who ask questions, make contributions and get their points across. They want someone who neither passively receives information nor commandeers the entire case team.
2
Why have you chosen to interview at our firm?
Consulting involves a lot of research. Show off your skills here. Explain your interest in a strategy firm (or change management, or whatever) and relate your interest to what you know of the firm. Include what you want to gain from the firm and what you believe you can contribute. State why the firm stands in a good position to accomplish your goals and how the firm can benefit from your contributions. Demonstrate your abilities to conjoin data from separate sources into a single analysis.
3
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.” Instead, describe a valuable lesson you learned (and one that preferably occurred some time ago). Remember to include your lesson and why the lesson still proves valuable to you even today. “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.”
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The Case Interview Consulting interviewers use case interview questions to test your analytical ability, reasoning skills, confidence and knowledge of business concepts. Case interviews simulate live scenarios to test the quickness of your mind and confirm the skills you claim on your resume. You must discuss hypothetical situations based on information provided to you and make assumptions based on commonly known facts. Even if you have no background knowledge of the case, you must still address the question thoughtfully under pressure. The interviewer cares more about how you arrived at your answer than if you answer correctly, so be sure to explain your thought process as well. Case interview questions fall into three broad categories: business cases, guesstimates and brainteasers.
Business cases If you are interviewing with a strategy consulting firm like Bain, count on plenty of cases during the interview process. Put very simply, case interviews are problem-solving exercises. While some interviewers draw on recent realworld experience to pose the case, you are not 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 companies present cases as written documents to be read and prepared. But usually the interviewer describes the key facts and issues of the case before asking the candidate for an analysis. Some firms (e.g., Monitor) ask you to solve a case as part of a team with other job applicants. The case usually consists of a business scenario and a question about it. 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 answer, ask the interviewer a number of questions to gather vital information about the case. (Imagine your interviewer as a corporate client presenting this case to you. Ask the client plenty of questions before attempting to provide advice.) Your interviewer answers you with pieces of information to help you Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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formulate new questions and, ultimately, your case recommendations. (At the same time, avoid tiring your interviewer and recognize when you have asked enough questions.) One recent interviewee 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.” A good question to ask is about best practices in the industry. Find out what other companies in this industry do when facing the same issues. • Avoid making assumptions without checking them with the interviewer or, at the very least, stating that you are making an assumption. If your case concerns a vehicle manufacturer, for example, you might simply assume the client is General Motors when it is actually John Deere. • After gathering all the information you think you need, start formulating your recommendations. If you like using standard frameworks, remember to use the appropriate one. Run the framework through your mind to ensure you are not forgetting a vital area of analysis. For instance, Porter’s Five Forces model might help you analyze a market situation and identify all of the areas of potential threat. Based on the model, you can recommend the company’s market strategy. • If you are unfamiliar with frameworks, say so and proceed as logically as you are able. Voice your analysis — why and how you come to your questions and conclusions is also important. • After giving your recommendations, point out possible flaws and assumptions in your thinking. • Speak and reason aloud during your case interview. Your thought process is more important than your ultimate conclusions; your interviewer must hear your reasoning and the logical steps you are taking to reach your conclusions. • Always bring paper and a reliable pen with you to any consulting interview. You might want to take notes during the case interview (and for any guesstimates or quantitative brainteasers your interviewer might throw at you). Asking your interviewer for paper and a pen during the interview gives the impression that you are disorganized and unprepared.
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• No matter what, never show any signs of being flustered in a case interview. Your composure before your client (or lack thereof) is a key factor in your evaluation.
Sample qualitative case question A major film entertainment company wants us 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. Start by asking your interviewer some basic questions: • 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 producing videos, do most distribute through their 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, get more detailed. Your interviewer might allude to certain avenues to discuss or shut down others. If the interviewer confirms the company has enough staff to handle setting up its network, stop delving into the ramifications of reassigning personnel. If, through questioning, you decide staying with a third-party distributor makes the most sense, ask the next logical question: Should the company stay with its current distributor or choose a new one?
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Vault Guide to the Top 50 Consulting Firms Getting Hired
• 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? Can it be shown that a client-owned supply chain would be more efficient or valuable to the accounts? • Does the client have any financial interest in the distribution partner that might have to be eliminated? When you feel ready, make a recommendation.
Make sure you're prepared for your case interviews. Get case frameworks, strategies, tips, and detailed step-by-step analysis of actual cases used in interviews with the Vault Guide to the Case Interview and the Vault Case Interview Workbook. For one-on-one coaching, use Vault Case Interview Prep. Go to http://consulting.vault.com.
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Guesstimates In guesstimates, your interviewer generally asks you to estimate the market size for a product or service and observes your reasoning process. The key is not necessarily to get the right answer, but to show your ability to tackle a problem logically, approach assumptions sensibly, and perform simple calculations quickly without a calculator.
Guesstimate cracking tips • You receive little real data (though you will not need to know much beyond basic population figures for the United States). • For use in your analysis, assume the United States has 270 million people and 25 million businesses. (Consider rounding up to 300 million, as long as you inform your interviewer that you are doing so.) • Make reasonable assumptions, with rounded, easy-to-work-with numbers (difficult numbers might throw off your calculations), and go from there. • Remember that you are expected to use a pen and notepad to work through your calculations. • If certain figures escape you, like the population of Brazil or the circumference of the globe, ask for them. Avoid stumbling your way through an answer based on inaccurate assumptions. • Talk through your steps aloud as you go through your calculations. • Remember that guesstimates, like cases, also involve elements of creativity and problem solving. For example, when asked, “How much change would you find on the floor of a mall?” ask, “Is there a fountain in the mall?”
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Vault Guide to the Top 50 Consulting Firms Getting Hired
Sample guesstimates 1
How many gallons of white house paint are sold in the United States each year? The “Start Big” approach If you are unsure where to begin your analysis, start with the basic assumption that 270 million people live in the United States. If 270 million people live in the country, perhaps half of them live in houses (or 135 million people). The average family size is about three, which measures out to 45 million houses in the United States. Add another 10 percent or so for second houses and houses used for other purposes besides residential. Conclude there are about 50 million houses. If houses are painted every 10 years on average, then 5 million houses get painted every year. Assuming one gallon covers 100 square feet of wall and the average house has 2,000 square feet, each house needs 20 gallons. Therefore, 100 million gallons of paint are sold per year (5 million houses times 20 gallons). (Note: If you want to be fancy, ask your interviewer whether to include inner walls as well!) If 80 percent of all houses are white, then 80 million gallons of white house paint are sold each year. (Remember that last step!) The “Start Small” approach Take a town of 27,000 (about 1/10,000th 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. Add another 10 percent for good measure, and there are really 5,000 houses in your guesstimate. Painted every 10 years, 500 houses get painted in any given year. If each house has 2,000 square feet of wall, and each gallon covers 100 square feet, then each house needs 20 gallons. Therefore, 10,000 gallons of house paint are sold each year in your typical town. Perhaps 8,000 of those are white. Multiply by 10,000, and you have 80 million gallons. If your interviewer asks you how you would actually get that number as a consultant, use your creativity — e.g., contact major paint producers, call the U.S. Department of Housing and Urban Development’s statistics arm, or conduct a small sample of the second calculation in a few representative towns.
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Other guesstimate samples 2
How many 747s are above Kansas right now?
3
How much beer is consumed in the United States each year?
Want more practice with guesstimates and brainteasers? Get the Vault Guide to the Case Interview and the Vault Case Interview Workbook. For one-on-one coaching, use Vault Case Interview Prep. Go to http://consulting.vault.com.
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Vault Guide to the Top 50 Consulting Firms Getting Hired
Brainteasers Brainteasers — or, as one disgruntled interviewee referred to them, “mind splitters” — are the genre of questions along the lines of, “Why are manhole covers round?” Some brainteasers look more like logic problems, while others require more mathematics. Be forewarned: some of these questions are tricky, and it is possible you might not solve them in a short amount of time. Their main function is to test your courage under fire. Keep your composure! Do not tell your interviewer that the brainteaser cannot be solved or is unreasonable. As a consultant, you find yourself on the spot all the time — your interviewer wants to ensure that you can keep your cool.
Practice Brainteasers 1
You stand 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. All lights are off. You have some limitations — you can flip only two switches and you may enter the room only once. Consultants and clients alike love “out of the box” thinking. Some suggest drilling a hole in the wall or calling a friend for assistance. One applicant suggested the switches might be dimmer switches — each light bulb could be set to a certain level of illumination, making solving the puzzle easy. One elegant solution, however, is to turn one light bulb on for 10 minutes and turn it off. Turn another bulb on and go into the room. The light bulb that is on clearly goes with the switch that you turned on last. Now feel the bulbs. The hot one was on recently.
2
Four men 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 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. How should they cross? First, Alan and Bert cross together with the flashlight, which takes two minutes. Alan returns with the flashlight, which takes one minute. Three
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minutes have elapsed. Cedric and Don then cross with the flashlight, which takes ten minutes. At the 13-minute mark, Bert returns with the flashlight, taking two minutes. Bert and Alan go back across the bridge, for a total time elapsed of 17 minutes.
Want more practice with guesstimates and brainteasers? Get the Vault Guide to the Case Interview and the Vault Case Interview Workbook. For one-on-one coaching, use Vault Case Interview Prep. Go to http://consulting.vault.com.
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Featured Employers SPONSORED LISTINGS
AT Kearney 222 West Adams Street Chicago, IL 60606 Phone (312) 648-0111 www.atkearney.com Misty Rallis Campus Recruiting Director Phone (312) 648-0111 Bain & Company Two Copley Place Boston, MA 02116 Phone: (617) 572-2000 Fax: (617) 572-2427 www.bain.com
[email protected] Recruiting URL: www.bain.com/bainweb/join/springboard /overview.asp Booz Allen Hamilton 8283 Greensboro Drive McLean, VA 22102 Phone: (703) 902-5000 Fax: (703) 902-3333 www.boozallen.com Undergraduate Opportunities: Katy Malesky
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Braun Consulting 20 West Kinzie Street Suite 1600 Chicago, IL 60610 Phone: (888) 284-5628 Fax: (312) 984-7371 www.braunconsult.com Integral 111 Huntington Avenue 10th Floor Boston, MA 02199 Phone: (617) 425-8400 Fax: (617) 425-8401 www.integral-inc.com For U.S. offices:
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Vault Guide to the Top 50 Consulting Firms Featured Employers
Marakon Associates For Recruiting in Europe and Asia, contact: 1-3 Strand London, United Kingdom WC2N SHP Phone: 020-7321-3683 www.marakon.com Melissa Brown Recruiting Assistant Phone: 020-7321-3683 Fax: 020-7930-9716
[email protected] Monitor Group Two Canal Park Cambridge, MA 02141 Phone (617) 252-2000 www.monitor.com Recruiting Contact: Kathy Romeo
[email protected] PA Consulting Group, Inc. 1750 Pennsylvania Avenue, NW 10th Floor Washington, DC 20006 Phone: 202-442-2000 www.paconsulting.com Margaret Larson Campus Recruitment Manager Phone: 202-442-2000 Fax: 202-442-2594
[email protected] Parson Consulting Parent Company: Management Consulting Group 333 West Wacker Drive Suite 1620 Chicago, IL 60606 Phone (312) 578-1170 Fax (312) 578-1355 www.parsonconsulting.com
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Stern Stewart & Company 1345 Avenue of the Americas 20th Floor Phone (212) 261-0600 Fax (212) 581-6420 www.sternstewart.com Recruiting Contact: Anna Danchak
[email protected] Valen Group 4665 Cornell Road Suite 335 Cincinnati, OH 45241 Phone (513) 241-7640 www.valengroup.com
[email protected] Viant Corporation 89 South Street Boston, MA 02111 Phone: 617-531-3700 www.viant.com Ken Elmer Chief People Officer 617-531-3700
[email protected] ZS Associates 1800 Sherman Avenue Evanston. IL 60201 Phone: (847)492-3600 Fax: (847)492-3409 www.zsassociates.com Sally Johnston Recruiting Manager Phone: (847)492.3600 Fax: (847)492-3409
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Featured Recruiters SPONSORED LISTINGS
Allied Search Inc. 2030 Union St. Suite 206 San Francisco, CA 94123 www.alliedsearchinc.com Don May Managing Director Phone: 415-921-1971 Fax: 415-921-5309
[email protected] Allied Search Inc. 3699 Wilshire Blvd. #850 Los Angeles, CA 90010 www.alliedsearchinc.om Don May Managing Director Phone: 213-680-4000 Fax: 213-680-4080
[email protected] Consulting Resource Group, Inc. 1100 5th Avenue South Suite 201 Naples, Florida 34102 Phone: 888-240-5556 www.CareersInConsulting.com Leslie Smith Recruiting Director Phone: 888-240-5556 Fax: 678-838-1244
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The Ford Group, Inc. 485 Devon Park Drive Suite 110 Wayne, PA 19087 Phone: (610) 975-9007 Fax: (610) 975-9008 www.thefordgroup.com Sandra D. Ford CEO & Managing Director Phone: (610) 975-9007 Fax: (610) 975-9008
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V A U L T
1
McKinsey & Company
PRESTIGE RANKING
55 East 52nd Street New York, NY 10022 Phone: (212) 446-7000 Fax: (212) 446-8575 www.mckinsey.com
THE STATS
LOCATIONS
Employer Type: Private Company Managing Director: Rajat Gupta 2002 Employees: 12,500 2001 Employees: 13,000 2001 Revenues: $3.3 billion 2000 Revenues: $3.4 billion
New York, NY (HQ) 84 offices worldwide
UPPERS
PRACTICE AREAS Automotive & Assembly • Banking & Securities • Basic Materials • Chemicals • Consumer/Packaged Goods • Corporate Finance & Strategy • Electric Power/Natural Gas • High Tech • Insurance • Marketing • Media & Entertainment • Nonprofit • Operations Strategy & Effectiveness • Payor/Provider • Petroleum • Pharmaceuticals and Medical Products • Private Equity • Retail/Apparel and Hospitality • Telecommunications • Travel and Logistics Services
• Unsurpassed reputation • Strongest alumni network anywhere
DOWNERS • Draining intensity • Enron entanglement
KEY COMPETITORS Accenture A.T. Kearney Bain & Company Booz Allen Hamilton Boston Consulting Group
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
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“The filet mignon” “Better at theory than practice” “Pinnacle of our profession” “Big brains, bigger bills and even bigger egos”
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Vault Guide to the Top 50 Consulting Firms McKinsey & Company
THE SCOOP
Top dogs In an industry with a handful of leaders, McKinsey & Company is regarded as the most influential consulting firm in the world. Founded by James O. McKinsey in 1926, the firm enjoys more boardroom access, performs more industry-shaping work, disseminates more knowledge and earns more money per consultant than any other firm. With 84 offices in 44 countries and more than 7,000 professional employees, McKinsey dominates the industry. In a 2002 Universum survey, McKinsey was rated the company where MBAs would most like to work for the sixth year in a row. Clients of “The Firm” — as it is known among its employees and clients — are the bluest of the blue chips. They include AT&T, Pepsi, IBM, General Electric and General Motors. Overall, McKinsey serves more than 60 percent of the Fortune Global 500 and 77 percent of the U.S. Fortune 100. Besides serving huge global companies, innovative startups, wealthy commercial banks, leading venture capital firms and vast technology companies, McKinsey also prides itself on offering pro bono assistance to educational, social, environmental and cultural organizations. In fact, half of the firm’s consultants work on a pro bono engagement at some time during their careers.
The ultra-international consulting firm McKinsey has a better claim than most firms to being a true global network. Its consultants are citizens of 90 countries, and McKinsey consultants provide their expertise to clients around the world. Since 1999, the firm has opened offices in Abu Dhabi, Athens, Israel and Dubai. In March 2001 McKinsey implemented a plan to strengthen significantly its corporate finance and strategy practice in Singapore. (Launched just three years earlier, the Singapore office has counseled some of the country’s most prominent clients, including Singapore Airlines and the chewing gum-banning national government.) McKinsey signed a December 2001 agreement to counsel the Savings and Deposits Insurance Fund of Turkey on problems of that nation’s banking industry. The firm also has done extensive work in India, advising liquor company Shaw Wallace on an operational restructuring, engineering and construction firm Larsen & Toubro on strategy matters and Prime Minister Atal Behari Vajpayee on foreign investment issues.
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Vault Guide to the Top 50 Consulting Firms McKinsey & Company
The road ahead Whether you call it “up or out,” “succeed or leave” or the natural workings of a pure meritocracy, the majority of consultants who start at McKinsey end up leaving along the way. On average, only one in four to five consultants who starts at McKinsey finishes the hallowed journey to principal. Then again, many leave by choice. “It’s a pretty competitive process,” says an insider, “though lots of people don’t want to make partner, so they leave.” Those who jump ship may find themselves in government (like Roger Ferguson, vice chairman and governor of the Federal Reserve Board), as best-selling authors (the authors of the enormously successful business guide In Search of Excellence were former McKinsey consultants) or founders of rival consultancies (as Tom Steiner did with Mitchell Madison Group, later purchased by the failed e-consultancy marchFIRST). Many McKinsey consultants wind up in top spots in corporations: The CEOs of Delta Airlines, Polaroid, Morgan Stanley Dean Witter, Amgen, CNBC and Levi Strauss are all alums of the firm (probably why Fortune once referred to McKinsey as “a CEO factory”).
Tech-savvy and prudent As an institution focused on the most important issues facing management, McKinsey builds relationships with clients — it has more than 400 active client relationships that span more than 15 years — and has historically been known as a strategy consulting firm. But the firm has been adapting to the dynamics of the changing economy and client demand, and is now pursuing technology clients and smaller, market innovating companies with more vigor. McKinsey’s technology arm (known as the Business Technology Office), composed of more than 400 consultants and integrated into the firm’s mainstream strategic competency, helps clients manage their IT investments and integrate technology into core strategies. The firm will not, however, do full-blown systems implementation. (That’s for Accenture and its ilk.) While it has tried to remain at the forefront of technology, McKinsey avoided some of the other fads of the era. “During the dot-com era, we very much said, ‘We are a client services firm,’” McKinsey managing director Rajat Gupta told Singapore’s Business Times in June 2001. “Unlike many of our competitors, we decided we were not going to own businesses, we were not going to start funds, we would stick to what we know best. We were going against what was fashionable, but I’m happy that we did.”
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Vault Guide to the Top 50 Consulting Firms McKinsey & Company
Shopping spree McKinsey pulled out its checkbook a number of times in 2001. In January the firm took a stake in India’s Aptech Internet in exchange for providing consulting services. Also that month, McKinsey acquired Chicago-based branding firm Envision for an undisclosed sum. But perhaps the firm’s biggest acquisition of the year involved just one individual: In March 2001, media and entertainment consultant Michael Wolf jumped ship from Booz Allen Hamilton. Wolf, whose client list at Booz Allen included MTV, Paramount Pictures and the National Basketball Association, became one of the first non-homegrown senior partners in McKinsey’s history.
Not recession-proof Gold-standard McKinsey may have avoided much of the turmoil that hit lesser consulting firms (a happy fate largely stemming from its avoidance of the dot-com bandwagon), but it has not proved totally immune to the recession of 2001. The firm’s utilization rate (the proportion of their time that consultants are billing) reportedly dropped to 52 percent in 2001 — the lowest it had been in 32 years — and it was forced to consider offering discounts to clients for some engagements. In November 2001, McKinsey announced that it was cutting 5 to 7 percent of its 3,000 support staff in the United States and Canada. Though no consultants have been laid off, with the firm’s voluntary attrition rate dropping precipitously as a result of the recession, more analysts and associates have been asked to leave as part of the firm’s up-or-out policy. According to The New York Times, 9 percent of consultants were counseled out in the fall of 2001, compared with 3 percent a year earlier. In addition, new hires in some offices have been asked to defer their start dates. McKinsey also initiated a July 2001 capital call in which many of its 850 partners had to make large cash contributions to the firm. The contribution was based on tenure and performance issues; some senior-level directors ponied up as much as $200,000 each. The move is not a new one for the firm, which employs a “just-in-time” cash management strategy, but it appears to be an indication that the current economic climate has finally hit the firm hard. (McKinsey contends that that capital contributions are routine and are not a reflection of firm performance.) Thus, facing an uncertain market and the end of Gupta’s reign as managing director (in early 2003), McKinsey now must apply its fabled business expertise to determine a strategy for its own future.
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McKinsey’s Enron engagement The fortunes of a consulting firm’s clientele can make or break the firm’s reputation. This has seldom been a major worry for McKinsey, given that its list of client companies reads like a Who’s Who of business success and power. There have been some chinks in the firm’s armor of late, however, with clients Kmart, Swissair, Global Crossing and others facing bankruptcy or other financial difficulties. But it was the collapse of one prominent McKinsey client, Enron, that brought the firm the lion’s share of its unwanted publicity. Amidst the resulting morass of criminal investigations and bankruptcy proceedings, the relationship between the beleaguered energy company and McKinsey came to the fore. The two had had ties dating back almost to the Enron’s inception. Erstwhile Enron CEO Jeff Skilling had come to the company after working as a McKinsey consultant, and senior McKinsey partner Richard Foster served as an adviser to Enron’s board of directors. Over the course of a number of years, McKinsey consultants worked out of Enron’s Houston offices, racking up millions in fees (one year topping out at more than $10 million) for dispensing strategy advice, according to BusinessWeek. As Enron’s accounting and legal advisers became embroiled in the scandal surrounding the company’s financial reporting irregularities, McKinsey’s role, predictably, has been scrutinized. In response, the firm has sought to distance itself from the activities that brought on the investigation. “In serving Enron, McKinsey was not retained to provide advice to Enron or any Enron-affiliated entity with respect to the company’s financial reporting strategy, methods of financing, methods of disclosure, investment partnerships or off-balance-sheet financing vehicles,” a firm spokesperson told The Wall Street Journal in January 2002. The firm further asserted that any allegations that McKinsey served as a “decision maker or a necessary review body on Enron’s asset investments are flat-out wrong.” McKinsey appears unlikely to come under investigation in the same manner as Andersen — which was found to have destroyed many of Enron’s financial documents and engaged in other shady accounting practices — but it could become involved peripherally. Should that be the case, the firm in all likelihood would be forced to disclose any information about its dealings with Enron that SEC and Justice Department investigators deem necessary.
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GETTING HIRED Think getting into a top-tier school is tough? Try McKinsey — only 2 percent of its approximately 150,000 applicants per year get offers, and a full half of those are from outside of North America. Put another way, one respondent says, “Some numbers I heard are that 15 percent of first-round interviewees make it to the second round and only 30 percent of those get an offer.” Strong academic records from high-ranking universities are just a prerequisite; a strong analytical ability and smooth presentation skills also are needed to get you over the top. On the other hand, while your school’s brand name is important, an Ivy League provenance isn’t essential: “The firm is pretty good at casting a wide net to reach out to schools not considered particularly prestigious because they have great talent as well.” Ultimately, wherever they’re from, successful candidates have it all, says one source. “I am surrounded by everyone’s consensus All-American.” McKinsey’s recruiters visit a large number of schools, and we hear that “every office has its own recruiting schedule.” Depending on the school, candidates either apply centrally to a McKinsey school team or to the office of their choice. In either case, it is the office that has ultimate say over whether they get an offer. The firm encourages candidates at schools where it does not recruit to complete an online application as a first step in the hiring process. The interview portion varies from school to school and office to office. The process consists of either two or three rounds of interviews, the first of which is usually held on campus. If there is an intermediary round, it may be held at a local McKinsey office. The final round of interviews takes place at the McKinsey office to which the candidate has applied. Most interviews are conducted by current McKinsey consultants, and tend to include “a combination of cases, resume/personal questions and some behavioral questions.”
OUR SURVEY SAYS
Getting there is half the battle … …the other half is staying. McKinsey is a faithful practitioner of the up-or-out system for associates (people hired from graduate school or industry) — if in two years you don’t get a promotion, you get the boot. This sort of bare-bones meritocracy “makes the atmosphere very demanding and shortens people’s careers,” Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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reports one McKer. Many people thrive in such an environment; one respondent calls McKinsey “extremely performance-oriented but at the same time very collegial and friendly.” McKinsey’s is by many accounts “a subtle pressure-cooker culture which people won’t admit to,” says another, while a third tells Vault that to succeed at McKinsey, “You sacrifice a great deal in terms of personal freedom. ‘Up or out’ is alive and well here — having it is good; getting caught in it will not be.” Nevertheless, it’s the place everyone wants to be — as one source reports, “Everybody who goes to a b-school wants to work here. Who wouldn’t be proud of that?” The typical undergraduate stays at McKinsey for around two years, then leaves for graduate study or another industry. Indeed, many view their time at McKinsey as a steppingstone. “The McKinsey name has a very strong reputation, which makes exit opportunities very attractive,” says one respondent. “It’s a fantastic springboard to where you want to work later on,” says another insider. “The McKinsey network is very strong.” And in any case, few see their careers as a long-term project: “I view working here like playing for the Yankees — I am not sure how long they will think I am good enough, but while I am here it is an amazing ride.”
I did it McKinsey’s way As the 800-pound gorilla of the consulting world, McKinsey expects its employees to do as it says — right down to their writing style and interpersonal skills. “[McKinsey has] a very strong culture,” one consultant tells Vault. “You are required to learn the McKinsey way of writing documents, interacting with customers and presenting.” Unlike some firms, McKinsey is very concerned about its internal culture, and aspires to create “a collegial, relatively non-political, and meritocratic environment in which people feel an obligation to express their opinions.” The company even includes an “obligation to dissent” in its values statement, meaning that if a consultant disagrees with someone, even a higher-up, he or she is required to say so. We hear that such dissent is “always well-received, even in high-pressure situations.” But while most sources say the firm has succeeded in that respect, at the same time it’s also a place where “people are a little more careful about what they say, have less time to shoot the breeze, and are a little more concerned with covering their own asses than with helping you out or being fair. However, it’s a friendly place on the whole.”
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Getting along McKinsey may attempt to maintain a uniform culture, but insiders tell us that the dayto-day quality of life can vary greatly from office to office. One source, based in Dallas, tells us that that office is an “extremely friendly place where the partners, even directors, know all the business analysts and treat them well.” On the other hand, the source tells us, “Houston is quite the opposite.” Many agree that the firm’s culture is “very partner- and office-specific,” while one consultant comments that “usually the treatment is professional and respectful.” But even with well-regarded partners, the lines of communication are not always entirely open, says an insider: “Learn to wear the management mask and talk the management speak. Don’t spill your guts with them; they won’t tell you the truth exactly either.”
What does it take? Success at McKinsey means work, and lots of it. Hours average between 50 and 70 a week, with spikes near deadlines. One insider says, “In my three years, work hours have ranged between 120 hours — the worst case — to 55 hours in seven days. The average was probably around 70.” As one analyst who worked 16-hour days his first year recalls, “It was pretty bad at first. But in the second year I got more responsibility and got to manage my own hours more.” A good work/life balance is tough, but possible: “In an American office you can certainly have a decent lifestyle, but you have to be organized.” Because McKinsey discourages weekend work, the typical day runs from 8 a.m. to 8 p.m., “although if the engagement requires [weekends], you have to work. In my experience you work one weekend day a month on average, but it varies a lot from project to project,” says one consultant. Beach time has increased because of a decline in the availability of projects, and those projects that do come along “are becoming shorter and shorter to meet client budgetary constraints.” As a result, “You find that you go through long stretches of beach time punctuated by six-week studies in which you work 90 hours a week.” The travel demands can be tough — “Almost all projects involve being at the client from Monday to Thursday.” And the travel load is also at the whim of the client; as one consultant tells us, “Some cheap clients prefer to lock you up in an office within the client building so they do not have to pay, while others will fly you everywhere to their individual country’s offices and pay for all your five-star hotel stays.” On the other hand, the four-days-a-week travel schedule applies more often to consultants staffed on domestic projects than for those based in offices outside the United States. Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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McKinsey’s clients in France, Spain and many other international offices are concentrated in large cities where McKinsey has offices, so travel on those client projects is minimal — though we hear that “in Germany and Italy you can expect to travel a lot.”
Tools of the trade For McKinsey, knowledgeable and capable consultants are its lifeblood. McKinsey is the type of place where “you learn a lot and are given a lot of responsibility from the first day.” To make that possible, it puts all its new hires through a program called BCR, or Basic Consulting Readiness, that “teaches the approach to solving client problems.” It includes “introductory consultant training, basic framework training, introductory leadership training, engagement management training, client development training and partner introduction.” Advanced training follows a year later, when McKinsey brings in an outside training firm to go over the more qualitative aspects of consulting like communications, leadership and influencing skills. On average, a consultant gets two days of training a month, as well as a weeklong program with each promotion. But because McKinsey relies heavily on its apprenticeship program, which matches new hires with more seasoned staff, the “focus is very much on on-the-job coaching.” One caveat: Despite excellent training at the associate level, McKinsey’s efforts are “not as extensive for business analysts [i.e. undergrad hires].” Nevertheless, respondents tell us the opportunities are always there if you want them: “If you’re interested in learning about a particular industry, you just ask the partners.”
What’s in it for me? Compensation at McKinsey is said to be “about average for the industry,” though one source says it “varies significantly, depending on geography, tenure, year of entry and performance. People with the same tenure in the same office may have differences of 30 to 40 percent.” Along with the industry-standard cell phone/PDA/laptop package, the firm also offers tuition reimbursement for advanced study. The offices are said to be “fairly comfortable but not luxurious” in general, with most consultants sharing an office. Southern European offices tend to be spacious, while Northern European offices are more densely packed and organized around hoteling systems. There’s “quite a bit of latitude to what local partners do with the offices,” though in most offices, “Space is tight, but the amenities are superb.”
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Giving something back In addition to a number of informal initiatives, McKinsey maintains a nonprofit practice, which coordinates the firm’s community and pro bono activities. Each office devotes five to 10 percent of its consultants’ time to work for nonprofit operations. The firm served more than 200 nonprofit and/or public sector clients in 2001, representing an in-kind contribution of well over $100 million. The New York office, for instance, contributes to “United Way fundraising drives, pro bono work for the opera, 9/11 relief organizational help and the World Economic Forum.” In fact, the Big Apple branch worked on nine separate pro bono engagements in the wake of September 11th, including serving the Lower Manhattan Development Corporation and overseeing the development of a victims database for New York State Attorney General Elliot Spitzer. In addition, the firm is also said to be “generally supportive of individual initiatives.”
Mixing with success Despite the fact that “there aren’t that many” minorities at McKinsey, our sources say that the firm is “proactive and genuine in trying to attract and retain” minority candidates. Insiders proudly point to the “demonstrable efforts” to “provide support and make sure candidates know we are a receptive environment.” There are both “formal and informal support networks,” and the firm has been supportive of these efforts “from the managing director on down.” The firm has been making some progress on this front — in Universum’s 2002 survey, McKinsey was the No. 1 preferred employer among minority MBA students. But despite these efforts, one consultant feels McKinsey “has had mixed success in getting blacks through the merit-based interview process and limited success in retaining partner-track women.” In short, diversity at McKinsey is “not perfect, but we’re getting better, and [we are] conscious of it.”
Life at the top Measured in terms of prestige, McKinsey is the best of the best in the consulting world. So what are the best aspects of life and work at The Firm? For some, it is the number of doors the McKinsey name opens: “It’s a good reference in the future,” says one ambitious source. Other insiders point to more specific positive features. “Working in teams with smart people solving interesting problems,” offers one source. Another consultant continues on this theme: “Colleagues are the smartest people you could find anywhere. The clients are the largest and most exciting firms in the world.” Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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V A U L T
2
PRESTIGE RANKING
The Boston Consulting Group
Exchange Place 31st Floor Boston, MA 02109 Phone: (617) 973-1200 Fax: (617) 973-1339 www.bcg.com
LOCATIONS Boston, MA (HQ) 54 offices worldwide
PRACTICE AREAS Branding • Consumer • Corporate Development • Deconstruction • eCommerce • Energy • Financial Services • Globalization • Health Care • Industrial Goods • Information Technology • Operational Effectiveness • Organization • Pricing • Strategy • Technology & Communications • Travel & Tourism
THE STATS Employer Type: Private Company President & CEO: Carl W. Stern 2001 Employees: 2,790 (consultants) 2000 Employees: 2,370 (consultants) 2001 Revenues: $1.5 billion 2000 Revenues: $1.1 billion
UPPERS • Little travel • Firm retirement fund • Community involvement
DOWNERS • Recent layoffs • Non-diverse management
KEY COMPETITORS Bain & Company McKinsey & Company
EMPLOYMENT CONTACT www.bcg.com/careers/careers_splash.asp
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Cream of the crop” • “NATO (no action talking only)” • “A role model for other companies” • “Smart but not McKinsey”
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THE SCOOP
The innovator A certifiable strategy master, The Boston Consulting Group and its late founder Bruce Henderson are credited with “being the father of strategic consulting, in every sense of the word,” according to Thomas Doorley, the CEO of Sage Partners and a BCG alum. Today, more than 2,000 consultants in 54 offices around the globe carry on the legacy of Henderson’s intellectual work. As a result, BCG has been responsible for a number of major management consulting innovations and concepts in its 39 years, including “time-based competition,” “deconstruction” and “capability-driven competitive strategies.” One of BCG’s best-known contributions is the “BCG Growth-Share Matrix,” which explains the relationship between a company’s profitability and its market share. (The famous Matrix is so widely applicable, in fact, that BCG’s web site proudly links to an article touting its use in square dance calling.) BCG uses tools and innovations such as this to help its clients gain a competitive advantage. The firm has distinguished itself by encouraging senior executives to think beyond the status quo and embrace strategic change. CEO Carl Stern has indicated that BCG should “buttress” some of its functional and industry areas of expertise. “Clients want the business judgment a generalist can offer, but also want real domain expertise in their industry and particular functions of their industry,” he told Management Consultant International. One potentially profitable move is not on the table, however — while the firm has been approached by potential partners, Stern also said in that publication that BCG will never merge with another consultancy or company during his tenure.
Moving abroad BCG is loosely organized into three main geographical areas: Asia-Pacific, the Americas and Europe. In recent years, BCG has expanded its presence worldwide, opening offices in Copenhagen, Berlin, Athens and Cologne, Germany. The firm has been active in Eastern Europe since 1985, advising on acquisitions and restructuring, including projects in the banking industry. By predicting the cost structures and service levels necessary for success in a deregulated environment, the firm played a major role in preparing companies for deregulation and privatization in post-Cold War Europe. BCG has an excellent reputation in Europe; in Universum’s 2002
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survey, the firm was ranked as the second-most ideal employer among European graduate students (behind McKinsey). The company gets almost half of its revenues from consulting engagements in Europe and one-third from the Americas.
BCG East BCG has had a home staked out in Asia since 1966, when the ever-prescient Bruce Henderson opened an office in Tokyo (making BCG the first Western consulting firm to enter Japan). BCG has retained this “frontier” feeling, according to one consultant who has worked in the region. “You feel like you’re on the edge,” that consultant reports. “You work hard to set up your office. You know everyone there.” According to the firm, its office in Hong Kong (opened in 1991) signaled the beginning of a truly strong presence in the Asian region. Offices soon followed in Kuala Lumpur, Malaysia, Shanghai, Seoul, Bangkok, Jakarta, Singapore and Mumbai, India. BCG’s overseas offices aren’t just for show. While some consultancies derive most of their business from American firms conducting operations overseas, BCG gets roughly half of its business in Asia from local entities: private companies, governments and state-run businesses. The firm’s clientele includes five of Asia’s biggest non-Japanese companies, three of the top five business conglomerates in Korea and eight of the biggest local commercial banks in Hong Kong, Indonesia, Malaysia, Thailand and Korea. In June 2001 BCG opened a second office in India; the New Delhi branch brings the total number of BCG consultants in the country to about 65. The two Indian offices were busy in 2001, implementing risk management policies for the Central Bank of India, revamping the operations of engineering confederation CII, and reworking corporate and retail banking strategies for UTI Bank. Elsewhere in Asia, BCG has found a rich crop of engagements focused on helping Asian businesses affected by the downturn in the U.S. economy.
Ambassadors abroad BCG encourages its international approach in other ways as well. The firm offers an “ambassador” program, which allows consultants to transfer to another office for six months or longer (though the typical period is 12 to 18 months). Overseas consultants also may transfer to American offices. (The Madrid office is said to be especially popular.) Additionally, consultants may work on international cases (normally for multinationals). Sometimes, consultants are required to relocate to a 64
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foreign office for the duration of a case. These relocations, however, normally are kept within BCG’s geographic groups. Consultants in Washington, D.C., for example, might relocate to Monterrey, Mexico (like D.C., another office in the Americas region).
Cut! Despite maintaining a perch at the very top of the consulting industry, BCG was bitten by the layoff bug in February 2002. With voluntary attrition declining and revenues down from the boom era of a few years earlier, the firm announced that it would cut about 12 percent of its North and South American consulting and support staff. Staffers at all levels of the organization got the ax. The firm did assert that it plans to continue campus recruiting and other hiring, albeit on a smaller scale than in the past.
Talking problems, finding solutions As a strategy firm, BCG specializes in helping clients face their most difficult obstacles and dilemmas. In the 2001 book The Change Monster: The Human Forces that Fuel or Foil Corporate Change, BCG Senior Vice President Jeanie Daniel Duck targets one of these problems, the “Change Curve” — the predictable challenges that face organizations. It exemplifies BCG’s work with change strategy and the strategy problems of CEOs. BCG has also developed what it terms a “Strategy Institute” to research and foster discussion on innovation. Founded by BCG Senior Vice President Bolko von Oetinger, the Institute gathers insights from leaders in various academic disciplines and attempts to distill them into coherent strategy ideas. BCG consultants with academic leanings may work at the Strategy Institute as counselors, and others can access articles and participate in discussion groups through the institute’s online “Strategy Gallery.”
In the community On a less abstract level, BCG allows its employees to participate in the company’s efforts to support economic development in America’s inner cities, with a particular focus on increasing available jobs and creating wealth. In 2001 CEO Stern made a commitment of $3.5 million per year to inner-city economic development projects, in addition to office-specific pro bono projects.
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With an eye toward the future, BCG for the past several years has been involved with another community initiative, business@school. Created in 1998 by consultants in the firm’s Düsseldorf office, the program teaches business, economic and workplace skills to German high school students, who take part in six to seven sessions a year, analyzing companies and creating a business plan under the tutelage of BCG volunteers. The program has grown to include nearly 60 schools during the 20012002 school year.
Award-winning At the same time that the BCG’s work has impressed clients and industry insiders, its workplace has also won acclaim. Consulting magazine, the self-appointed arbiter of success in the industry, ranked BCG No. 1 in its May 2001 list of The Best Consulting Firms to Work For. The publication cited BCG’s “open and honest” culture and “lack of political infighting.” Six months later, the Greater Boston Business Council echoed the latter point when it presented BCG with a Corporate Recognition Award for the efforts of the firm’s Gay and Lesbian Network. Also in 2001, BCG’s friends at Consulting named two firm staffers, Art Peck and George Stalk, to the magazine’s list of the 25 most influential consultants. Peck, a senior vice president in the San Francisco office, made his first appearance on the list, while Stalk, a senior vice president in Toronto, was honored for the second straight year.
Industry alterations The shape of the consulting industry is changing, and BCG is changing with it. The firm has always been known as a pure strategy shop, and indeed, most of its engagements are still strategy-based. However, the classic BCG “50/50” model — under which a consultant spends 50 percent of his or her time on each of two strategy cases — slowly but ever so surely is falling by the wayside, as BCG has been increasing the number of reengineering and process assignments that it takes. Insiders say that while “the strong majority of cases BCG takes are still strategy, and normally you will have two,” that is no longer universally true. “Some strategy cases aren’t just a 50 percent commitment, but a 100 percent commitment,” points out one consultant. Another says: “Process and reengineering cases tend to take up 100 percent of your time.” There may be other changes afoot with BCG strategy. “At BCG, we are trying to move much more toward long-term relationships with clients, as opposed to stopping in, doing our three-month project and taking off,” opines a consultant. “We aren’t
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Accenture. We don’t move in, but we do try to maintain that relationship.” The vice president on the case is usually in charge, “but people at all levels keep in touch. You do a lot of follow-up [to] build deeper relationships.”
GETTING HIRED BCG requires most of its applicants to apply through its web site. There is, however, a short list of elite universities the firm visits every year, and students can check the site to see if their school is on it. The BCG site includes in-depth practice cases and brainteasers, as well as a list of general hints for the interview process. The application wizard, within which applicants create a file that they can revise and update before submitting, asks for everything from a scanned copy of transcripts to top location choices. It’s “exactly like a college application,” we hear. “It all comes back to the academic reputation of BCG.” The undergraduate interview process typically consists of two rounds. Applicants at BCG-visited schools spend the first round on campus; others do both rounds in BCG offices. In either case, the first round consists of two “fairly straightforward interviews” with 15 minutes spent discussing a candidate’s resume and background and 30 minutes on a case. The typical case is “always from the interviewer’s own experience,” and applicants “can always expect a bit of math to see how fast they are with numbers, though it’s basically qualitative.” First-round interviews for undergraduate applicants are conducted by a local office, but the second round is at the applicant’s desired location (offers are office-specific, so it’s ultimately up to that office to decide whether or not to hire someone). The second round, conducted by more senior staff, consists of three or four interviews; all but the last follow the format of those in the first round. The final interview, with the head of the office, is for debriefing, and insiders tell us that by the tone of the conversation you can usually tell if you’ve got the job or not. And while it may take a while to get a formal response — though some sources report hearing back the next day — we hear the process is extremely fair and transparent. “The recruiting structure is very good,” one respondent tells Vault. “You always know your status, unlike at other firms.” MBAs spend both interview rounds at the nearest BCG office, to which they are invited after dropping their resumes at their career centers. The first round consists of two interviews, both heavy on cases. The second round involves four or five interviews with managers and vice presidents; two of these are explicitly “fit” Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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interviews. BCG case interviews, we hear, “are harder than all competitors. They are looking for you to outline the case like the other firms, but then dive deeply into one aspect of it [to] show that you understand (mathematically) how all the levers fit together, that of the 10 things on the table you can figure out which two to work on.”
OUR SURVEY SAYS
Beautiful minds Sources tell us that BCG lives up to its rarefied academic image — it’s an “informal culture full of friendly people” who are said to be “collegial, intellectual, eclectic and interesting.” The firm is extremely selective, with some respondents reportedly being turned down numerous times before getting the nod to hop on board. As one source tells Vault, the firm “seeks unusually accomplished applicants, typically from top schools or PhD programs.” Once accepted into the firm, consultants are thrown into what one employee called “your classic up-or-out system.” BCGers are “expected to perform at a high level and [to] add not only to the output and thinking of the team, but to the general direction of projects.” Another insider says that managers at BCG “always raise the bar on you. There is a lot of support, but they are always looking to see how high to push you.” The average BCGer is “intensely bright,” and firm meetings always involve a “lot of drawing on whiteboards, a lot of discussion on a higher level.” There is a “big emphasis on learning,” we’re told, “and it rubs off on you.” Some BCGers, however, say the intellectual atmosphere can also be a bit “smothering.” And some say it’s often the people who can crunch the most numbers — not think up the most clever solutions — who get ahead: “I felt overall that the wrong types of people were moving forward. [They were] not necessarily the most creative, strategic thinkers.” The same source notes an atmosphere of “internal capitalism” at BCG, in which consultants “need to seek stuff out. It’s very much on you to get on the right stuff.”
The balancing act BCG expects its employees to work hard, though not always for very long. “There is a motivation to be efficient,” says one consultant. Typical hours for any given week range in the mid-50s, and weekend work is rare. And BCG doesn’t value face time for its own sake; as one insider recalls, “If I was on the beach, I’d work not even 40 hours. That’s the time when you catch up on your life.” Another consultant tells 68
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us that managers are actually taken to task if their teams work excessive hours: “Managers are evaluated partly on their ability to create a good work/life balance for their team.” Travel is also kept to a minimum; because BCG uses a local staffing model for the majority of its projects, extensive travel is relatively rare. While one source reports traveling four days a week, he adds that “my degree of travel is very unusual for my firm.” Another insider tells us that “working on-site is somewhat unusual, unless it’s a post-merger integration,” and most consultants travel only for meetings and deal closings. Indeed, many BCGers report a very balanced approach to work and life; even “vice presidents leave when they need to go to [their kids’] recitals and soccer games.” And while hours can sometimes drag on, they’re usually “flexible and selfmotivated,” says one respondent. “Most of the late nights have been of my own doing, and I am free to work at home if I want to.” Another tells us that while staffers will work the occasional weekend, “I’ve never had a meeting scheduled on a weekend; the office is definitely not a full house.” On the other hand, we’re told, there is a palpable “give it everything” ethos among many at BCG, and “the people who managed to survive the layoffs are the ones who made that sacrifice.” Compensation at BCG is said to be competitive with other top firms, with yearly bonuses, as well as an added feature: The equivalent of 15 percent of each consultant’s annual compensation is put into a retirement fund, available as soon as they leave the firm. BCG also offers long-term disability insurance and tuition reimbursement.
An office of your own While BCG’s offices vary greatly, one insider tells us the New York facility is the “nicest office I’ve ever worked in.” Because much of the firm’s work is done offsite, BCGers spend most of their time at their desks — which, by the way, are their own desks; the firm eschews “hot-desking” and “hotelling” (that is, sharing desks and offices), to the point where some BCGers get territorial over their spaces. Every consultant gets an office, though everyone except partners shares with one or two other consultants. The firm is also “very responsive when you need something, or if something breaks. Say you need a new headrest, it shows up the next day.” And BCG makes sure to provide all the necessary fuel — food, soft drinks, coffee — for a long day of number crunching.
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Learning the ropes Most years, BCG has a thorough initiation program for new hires (in 2001, it shrank for cost reasons). During a weeklong worldwide orientation each fall, all of that year’s undergraduate hires are brought to Boston, where they meet their cohorts and learn the basics of the consulting trade. The following April, new hires based in the Americas are brought back to Boston for a second round, where they focus on the more advanced, technical aspects of the business. We hear that at this session consultants get “to see colleagues present war stories, which is good because at a place like this you get the feeling everyone else is a powerhouse.” Most regional training, though, has been suspended for cost-cutting reasons, and the majority of consultant education is done through individual offices, each of which has a training budget. Further training is mostly on the job, though each office has the option of creating study plans for their employees. First-year hires are also assigned a mentor (“one or two levels above, someone to vent to”) and a more experienced office mate (“to ask the stupid questions”). Class activities are handled by a class dean, who organizes such events as brown-bag speeches and class breakfasts.
Lending a hand BCG makes a real effort to help out in the community, something many respondents cited as a major strong point of the firm. “Each office has its own pro bono budget,” we hear, and the activities are “usually related to the local community.” Most projects draw on consultants’ professional skills, such as helping a community orchestra manage costs. The firm treats these projects just like its paid accounts, and we hear that the list to participate is usually longer than the list of available positions. What’s more, the firm also provides funding for employee-directed projects, such as running in charity races and volunteering at battered women’s shelters. “They don’t just say it’s a nice thing to do,” one consultant says. “They give the financial support to do it.”
The BCG rainbow Diversity is an issue with which many insiders say BCG is struggling. While it has an almost 50 percent male/female split at the associate level, further up the ranks the firm is increasingly male-dominated; as one source puts it, “As you look through the officer corps, the leaders are the same old white men.” One potential reason is the firm’s almost obsessive commitment to merit-based hiring: “[BCG] makes every decision individually, looking for the best of the best, and if that’s all women or no
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women, they don’t flinch.” And while racial diversity is said to be a non-issue — the firm employs many minorities and offers an African-American support group — in reality “Our diversity seems to come more from international hires than from U.S. minorities.” Nevertheless, BCG is making a positive effort to change. At the New York office, “there is a woman in charge of ethnic diversity, who works specifically with managers to do outreach at top business schools.”
What’s in the future? While every firm has had to undergo painful cuts over the last 18 months, respondents say that BCG has handled them better than most. When the layoffs came, one source says, the firm was straightforward about it: “They had to take an action, and they were honest about it. [BCG was] one of the only top firms to do it, unlike other firms that spun it as up or out.” And while no one can predict the future, the sense at BCG is that the worst is over. Insiders point to the firm’s strong suits — especially its ability to keep its core clients even as it expanded during the dot-com boom. “Our client relationships have remained in place,” says one BCGer. “As clients start to pick up, we’ll be right there next to them.”
For a detailed 40- to 50-page insider report on The Boston Consulting Group, and reports on other firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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Bain & Company
PRESTIGE RANKING
Two Copley Place Boston, MA 02116 Phone: (617) 572-2000 Fax: (617) 572-2427 www.bain.com
LOCATIONS Boston, MA (HQ) 26 offices worldwide
PRACTICE AREAS Customers E-Commerce Strategy Growth Mergers & Acquisitions Operations Excellence Organizational & Change Management Private Equity Strategy Supply Chain Management
THE STATS Employer Type: Private Company Chairman: Orit Gadiesh 2001 Employees: 2,800 2000 Employees: 2,800
UPPERS • “Unparalleled” training • No face time required • Relatively little travel
DOWNERS • High-pressure environment • Morale affected by the economy • Little diversity in upper ranks
KEY COMPETITORS Boston Consulting Group McKinsey & Company
EMPLOYMENT CONTACT http://www.bain.com
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Well-rounded; good people, good practice” • “Frat boys and sorority girls” • “Overcoming cult image” • “Non-Harvard MBAs need not apply”
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THE SCOOP
The existence of your Bain In 1973, with sky-high dreams and only one phone line, Bill Bain and three others set up office in his Beacon Hill apartment. The company soon outgrew its space and moved to Lewis Wharf, an old waterfront warehouse. Under Bill Bain’s savvy entrepreneurial guidance, the firm continued to expand and quickly opened branches in Boston, San Francisco, London, Munich, Paris and Milan. Today Bain has more than 2,800 employees serving clients through a network of 26 offices across 19 countries. Widely considered to be among the most prestigious strategy consulting firms in the world, Bain ranked fifth on the list of the 50 most coveted employers in the 2002 Universum survey of more than 2,000 MBA students at 35 schools. The firm’s client base consists primarily of diversified, international corporations in all sectors of business and industry, such as financial services, e-commerce, retail, health care, consumer products and technology. These clients tend to outperform the S&P 500 by three to one, but this isn’t the only reason that Bain accepts equity as a part of its fee — the firm measures its own success by its clients’ financial results. Staff members share the rewards of these investments through Bain’s equity compensation plan.
Inevitable changes Bain is the smallest of the “Big Three” strategy consulting firms and prides itself on its strong, close-knit culture. Unlike competitors McKinsey and The Boston Consulting Group, Bain is rather understated; the consultancy used to be called the “KGB of consulting” because it painstakingly concealed the identity of clients and never spoke to the press. (Bain has, in the past few years, become more forthcoming.) The firm also deliberately limits the number of offices it opens. Bain put off opening up shop in the world’s most popular consulting venue — New York City — for over 25 years, finally opening its first New York office in July 2000. Although Bain had no difficulty serving its New York clientele from Boston, many potential recruits had expressed a desire to live and work in the Big Apple.
A launching pad Many Bain consultants stay at the firm for a few years and then begin entrepreneurial ventures of their own. Insiders testify that the firm is not only aware of this new Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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pioneer spirit among its staff, it encourages it. (Take the case of Intuit, a California software firm started by Scott D. Cook, a former Bain employee, or of eBay, which ex-Bain consultant Meg Whitman helped found.) Where else do former Bain consultants wind up? According to the firm, approximately 55 percent of those who have left in the past five years have joined small companies or private equity firms. Another 20 percent have joined medium-sized firms, while most of the rest have landed positions in Fortune 500 firms.
Capital-izing on opportunities In 1984, Bill Bain founded Bain Capital, a private equity investment firm. Today, Bain & Company and Bain Capital have no official connection; Bain Capital, however, does exhibit a “preference” for Bain when it needs to hire a consultancy for its due diligence work, and the two firms are said to use a similar “results-based” operative framework. Bain consultants routinely make the move to Bain Capital; the consulting firm even circulates “help wanted” e-mails for its VC cousin, whose recent performance has been phenomenal. In another sign of the closeness between the two firms, Bain made a significant investment in Golden Gate Capital, a $700 million buyout fund launched by former Bain Capital partner David Dominik.
Bridge-ing the gap The Bridgespan Group, a legally separate nonprofit organization, is a January 2000 Bain innovation intended to provide strategic consulting to other nonprofit organizations for a reduced fee. The best and brightest consultants from Bain can volunteer for up to six months at Bridgespan (and take a large pay cut at the same time). The Boston- and San Francisco-based staff of 40 serves about 10 clients per year and is continuing to build its roster.
A new client While you rarely hear about Bain’s clients (remember what we told you earlier about the firm being closemouthed?), here’s an exception. Bain was hired by Circuit City in early 2001 to reevaluate its inventory management and to work on its somewhat antiquated cash registers. A Circuit City spokeswoman noted to the Richmond Times-Dispatch (the chain is based in Richmond, Va.) that Bain had been selected for specialized skills in point-of-sale terminals and inventory management. Other Bain clients include diamond seller DeBeers, computer maker Dell and juice king Ocean Spray.
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Bain’s culture of action “Bainies,” as the firm’s consultants affectionately term each other, have cultivated a very close-knit, action-oriented corporate culture. Employees continually tell Vault that they draw much of their energy from each other. “Bainies are an amazing set of people with whom one wants to spend time — not just while working,” says one. Within the offices are found “lots of self-starters” who maintain a constant focus on “the results-oriented goals of the firm.” “What are you going to do Monday morning at 8 a.m.?” is a catchphrase at the consultancy, which concentrates on producing immediately implementable and valuable results for its clients. Orit Gadiesh (or “OG”), the brilliant, flamboyant (and purple-haired) chair of Bain & Company insists that it’s better to have an 80 percent solution that is immediately implementable than a perfect, 100 percent solution that is purely theoretical. One insider elaborates: “Unlike other firms that have an academic reputation, Bain is extremely into quantifying each point and conclusion.” (The firm is quick to point out, however, that this does not come at the expense of producing real, tangible results.) Not surprisingly given the unique (some might say quirky) nature of the culture, observers both within (at least at the associate consultant level) and without the firm are often quick to label Bain a cult.
No firm is an island But no matter how insular Bain’s culture may be, the firm has not remained unaffected by events outside its walls. Among other developments, the first-year compensation package for 2001 hires was cut by 15 to 20 percent. (According to the firm, there were no pay cuts for consultants at other levels.) “The morale of the office has been hurt by the economic downturn,” admits one consultant. “However, as business picks up, everyone expects the office morale to return to the high level it was 18 months ago.” The ability of the Bain brass to connect with its employees has also helped keep things running relatively smoothly, says a consultant in San Francisco. “I was especially impressed with how our management handled some difficult issues this past year — for example, the September 11th tragedy, as well as the downturn in the economy. There were constant communications during the September events to ensure employees were doing well and to encourage discussion. Later on in the year, while other consulting firms were experiencing layoffs, our management would hold town hall meetings to provide a forum for us to ask questions and to quell any concerns.”
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GETTING HIRED On both the undergraduate and MBA levels, “Top schools are a must, unless you were a rock star at a middle-tier school,” though “each office has a group of core schools that generally are located near them geographically.” The hiring process consists of two to three rounds of interviews, which for MBAs “are conducted by the most senior staff at the firm.” Says one consultant, “One thing I really appreciate is that Bain uses managers and partners to interview consultants — not other consultants who are only one or two years ahead.” Interviews are heavily case-based, and approximately “90 percent of them come from actual client cases handled in the office.” One insider offers the following tip: “For cases, we’ll typically present some slides and let the interviewee know that there is information available if he asks for it. It’s a lot like a real case, where the client has tons of data and you have to figure out what to ask for. Getting the right data is half the battle.” Food is apparently a common theme in case questions; several former interviewees have been asked to “estimate the revenues of a McDonald’s,” and one was asked what considerations needed to be made to expand a bagel business into a new market. One downside of the emphasis on case questions is that “You don’t get much opportunity to showcase your personality. The best gauge for that is your behavior at informational events.” One source estimates that “about 60 to 70 percent of the evaluation is how well a person can work through a case during the interview.” However, Bainies do report that at least for some interviews, “The focus is on personal and cultural fit.” “If you’re not a fun, personable person, you won’t get hired,” says an insider. “That might work for McKinsey, but not for us!”
OUR SURVEY SAYS
Pass the Kool-Aid The people at Bain are routinely described with such adjectives as “young,” “friendly,” “energetic” and “outgoing.” But while those may seem like generic descriptions, insiders assert that Bain has a culture all its own. “This company has an atypical culture, to say the least,” says an associate consultant. “It is certainly described as a fraternity, and sometimes a cult.” Adds one consultant, “A certain Bain behavior is expected and there is little tolerance for people who do not fit in.” 76
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Officially, of course, Bain eschews the cult label. It asserts that its consultants are guided by a set of values known as “True North,” which encourages them to be direct, honest and informal and to coexist in an atmosphere free from hidden agendas and politics. Similarly, Bain’s approach to business is a departure from other firms, explains a consultant in the San Francisco Bay area. “The way we work may take some adjustment for new employees. Because we want to make sure we are providing the best solutions to our clients, we often debate ideas in as harsh a way possible to ensure that we have addressed every issue the client might raise.” Fortunately, “Once one has adjusted to this climate, one generally finds the debates and the challenge of preparing quality work thoroughly enjoyable.” Bainies genuinely seem to enjoy each other’s company and frequently get together outside the office. “We like to hire people that will really get involved in the firm outside of just their case teams,” says a consultant in Dallas. Both informal and firmsponsored social opportunities abound, particularly among the younger ranks. “There’s not a night of the week that I couldn’t find a group of associate consultants (ACs) doing something fun,” observes an associate consultant. “When meeting ACs from around the world, the story is the same.” (The firm also says that its employees, especially ACs, are active in their communities, frequently participating in office-run events.) Many insiders say that they “have made some of [their] dearest friends at Bain.” But the fraternal atmosphere has both good and bad points, according to one AC. “It’s consistently friendly and open, but potentially stifling when you factor in how much time many people in the office spend together.”
Friendly competition Employees may like each other personally, but they never lose sight of the fact that they are competing with one another professionally. “Performance is stringently tracked and assessed. People not performing up to high expectations are asked to go,” says a source. Before it comes to this, though, all employees are given feedback at least twice a year and receive assistance to improve their performance. Comments one consultant: “[Bain’s culture is] somewhat pressurized. Like any place where the bar is high and people are not expected to have leisurely career paths, performance is always emphasized. It can be disconcerting for people used to strong autonomy and independence to know that almost any moment can make it onto a six-month review.” As a result, while employees appear to be having a good time, “The culture is to push, push, push, almost like an investment bank.”
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Work a lot, stay at home How heavy is the workload at Bain? “You work until you get your work done. It is as simple as that,” says a contact in Chicago. We looked elsewhere for some more specific answers, and found that most consultants work an average of 55 to 60 hours a week. As at just about every consulting firm, the “work hours are extremely variable depending on the project and the length of the case.” For example, “There are spikes, with the beginning of a new case being particularly grueling.” Insiders warn applicants to find out ahead of time what they are getting themselves into, as “the hours are significantly higher than what is promised during the recruiting process.” Keep in mind that when it comes to spending time at work, quality trumps quantity. “No doubt [Bain’s work schedule is] longer than a 9 to 5 job, but the satisfaction of those hours spent is more important than the physical time in the office,” opines a source. “I’ve had great 60-hour weeks and terrible 30-hour weeks.” Indeed, insiders believe that the work they receive makes up for the occasional bankers hours.’” “They keep us all occupied. I’m typically restaffed within a few days of the project end [and] sometimes before the previous project ends,” says an analyst. “However, I’m really amazed at how well they make sure to put you on cases that would interest you. Big Brother Bain knows you better than you know yourself.” Also in the good news department, “Bain has a ‘no face time’ policy. As long as you get the job done, it doesn’t matter how early you leave. Through the upward feedback system, your managers and immediate supervisors are evaluated on their ability to maintain a sustainable lifestyle for the team.” Travel time, while “extremely case-dependent,” also tends to be less extensive than at many of Bain’s competitors, which “makes it so much easier to get to know the people in the office” and enriches the social experience. Sums up one consultant, “Bain offers a great way to get the consulting experience without the wear and tear involved with spending three to five days a week at the client.”
Train in Bain Bain gets the highest ratings from its employees when it comes to training. Raves one consultant, “Especially for a person fresh out of school and new to consulting, Bain’s training is unparalleled. There is truly a commitment to a worldwide training program.” Adds another, “Bain is fundamentally grounded on training. It is a cornerstone of the work we do.” The initial “sleep-deprived boot camp for ACs” earns the most praise. “The worldwide training at Cape Cod [for associate consultants] is great because you get so many perspectives from around the world,”
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explains a Windy City AC. “We typically work on a project till 1 or 2 a.m., then an office hosts a party till 3 or 4 a.m., and at 7 a.m. you get up and do it all over again.” Subsequent to that grueling two-week session, the firm offers other “major training events at each level every year,” “frequent specialty and ad hoc training sessions,” as well as “off-site worldwide training every 18 months or so.” In fact, there are four formal training programs in the first two years alone, where consultants and ACs are exposed to real firm issues in groups of four to six people. There is also “significant onthe-job training,” and Bain “achieves good results due to the firm culture of mentoring and helping to cultivate others’ skills.” The firm has developed two proprietary training systems, Bain Virtual University and the Global Experience Center, to assist new consultants while they are working on a case anywhere in the world.
Struggling with diversity issues Bain receives mixed reviews for diversity. “At the more junior levels, there are many women. At the manager and partner levels, however, women can be counted on one hand,” says a San Francisco consultant. (The actual numbers, of course, vary considerably by office.) Notes a senior associate, “Bain is supposedly ‘good about women’ because of Orit and Phyllis Yale, the head of the Boston office, but that does not really extend to the rest of the North American offices.” Despite the low numbers, Bain is “welcoming of women and treats them equally,” and “has one of the most generous maternity leave programs” of any consulting firm. One consultant diplomatically addresses the issue by saying, “The opportunities are absolutely there, but like in any highly demanding career, I don’t think Bain has figured out the magic fix for retention of senior women and how to make the career and life balance work. But they do keep trying.” Insiders are similarly ambivalent about the firm’s success in recruiting and retaining minorities. “They talk a lot about wanting diversity, but we don’t have it,” says an AC. The minority population is “generally represented by Indian- and AsianAmericans. However, we have few blacks and Hispanics.” This is believed to be “more of an issue of difficulty reaching critical mass rather than one of discrimination,” and the firm “is making a concerted effort to hire and promote minorities.” One source offers a small compliment to Bain’s accomplishments in this area: “Not many minorities apply, so we have wonderful diversity with respect to the number of applicants.” Bain tells us that it is trying to remedy the situation by cultivating relationships with more minority candidates early in the recruiting season in order to diversify the Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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applicant pool. The firm is also home to Blacks at Bain (BABS), which holds an annual conference and hosts inter-office dinners and other networking events to increase the recruiting, retention and professional development of black professionals at the firm. Other diversity initiatives include the Bain Gay & Lesbian Association for Diversity (BGLAD) and the Women at Bain program.
Surprisingly few pay complaints Compensation at Bain must be excellent, because employees only complain about it a moderate amount. “Our compensation is in line with our major competitors, however don’t expect to make the big dollars until you have been here at least five to six years,” says a $125,000-a-year earner. Those in the unlikely position of being able to choose between top firms are advised by an associate consultant in Los Angeles that “My offer from Bain was better than my offer from McKinsey.” Others aren’t convinced that Bain is on par with the rest of its peers, especially since “the pay scale is being ratcheted down in light of the economic climate.” Explains one consultant, “The firm reduced compensation for [2001]. The first-year consultants took a big hit.” Again, Bain contends that it was a 15 to 20 percent reduction, in line with pay cuts throughout the rest of the consulting industry. The firm is not alone in defending the pay cuts. The move “was management’s approach to dealing with the slowdown in business rather than reacting to the situation and laying off the new consultants or other consultants like some other firms did,” says one insider. “Almost all of the consultants in my class thought this was a good move on the part of the firm and believed that it was a well-thought-out decision. It also showed us that the firm values its people and is willing to invest in their assets to prepare for an upturn in the economy.” Sums up one insider, when it comes to compensation, “Relative to other firms and other types of consulting, we rock!” Bain provides all the perks, from insurance packages to electronic gadgets to free food, that one would expect from a top consulting firm. There are some extras as well, including off-site excursions to locales such as Hawaii, Acapulco and Banff. Gaming-minded employees can play pool in several offices, pingpong in the Singapore branch, and foosball in Dallas and San Francisco.
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“I’ve had great 60-hour weeks and terrible 30-hour weeks.” — Bain consultant
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Booz Allen Hamilton
PRESTIGE RANKING
8283 Greensboro Drive McLean, VA 22102 Phone: (703) 902-5000 Fax: (703) 902-3333 www.boozallen.com
LOCATIONS New York, NY (Worldwide Commercial Business HQ) McLean, VA (Worldwide Technology Business & Corporate HQ) More than 100 offices worldwide
PRACTICE AREAS Business Resilience • Corporate Strategy • e-Business • e-Government • Facilities Design & Engineering • Financial Policy, Strategy & Analysis • Information Technology • Infrastructure Assurance • Institutional Strengthening • Mission Assurance • Multinational Strategy • Operations • Organization Strategy/Change Management • Program Management & Acquisition Support • Wargaming & Strategic Simulation
THE STATS Employer Type: Private Company CEO: Ralph W. Shrader 2002 Employees: 11,000 2001 Employees: 10,350 2002 Revenues: $2.1 billion 2001 Revenues: $2.0 billion
UPPERS • Excellent training program • Community-minded firm
DOWNERS • Intense culture • Pay cuts for some new MBA hires
KEY COMPETITORS Bain & Company Boston Consulting Group McKinsey & Company SAIC
EMPLOYMENT CONTACT See “Career Opportunities” on Booz Allen’s web site
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
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“Stable, well-positioned” “Cutthroat culture” “Still doing a great job abroad” “Past their heyday”
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THE SCOOP
The consulting pioneer Some people travel after college or work until they find their calling. Others, like Edwin Booz, start management consulting firms. Booz, who founded his eponymous firm shortly after graduating from Northwestern University in 1914, probably had no idea that at the dawn of the next century, his firm would be among the most prestigious consultancies in the world. Over the past few years, Booz Allen Hamilton has expanded its service lines — and grown to more than 11,000 staff in more than 100 offices worldwide — to include e-business, e-government and infrastructure assurance. Booz Allen garners 80 percent of its revenues from previous clients — a strong track record of satisfaction.
Strong implementors Booz Allen isn’t a pure strategy firm. Putting an emphasis on transforming businesses rather than merely prescribing change, the firm reports spending one-third to one-half of its time helping clients implement its recommendations. Before implementation, Booz Allen works with a client to develop solutions for problems created by fundamental changes in a client’s industry or company — a “strategybased transformation” — and implement changes in its organization, operations and technology. Booz Allen involves its clients in the consulting and transformation process by making a point of integrating client executives and staff into the consulting team.
The Booz Allen split Booz Allen divides its operations into two major business sectors, Worldwide Commercial Business (WCB) and Worldwide Technology Business (WTB). Insiders say that in terms of interaction between WCB and WTB, “the twain rarely meet”; the firm, however, is now trying to service WCB clients using expertise and techniques traditionally associated with the WTB sector, and vice versa. For example, Booz Allen is working with commercial clients in the area of strategic security, a capability built with government clients such as the National Security Agency. WCB, headquartered in New York, is a classic management consultancy, to which mainly recent college grads and MBAs apply. It does work in strategy, organization, leadership, change management, operations, information technology and business Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Vault Guide to the Top 50 Consulting Firms Booz Allen Hamilton
transformation. Booz Allen’s WCB division offers these and other management consulting services to clients in a range of industries. The firm expedites the consulting process for its clients by organizing its expertise into what it calls Natural Market Teams, focusing either on an industry, region or key functional area. The industry-oriented teams are Aerospace and Transportation; Automotive; Communications, Media and Technology; Consumer and Health Services; Energy; and Financial Services. The regionally focused teams serve clients in the developing markets of Latin America, Asia-Pacific and the Middle East. Crossing industry and regional lines are function-focused teams: Strategy and Organization, Operations, and Information Technology. The WTB unit, based in the Washington suburb of McLean, Va., primarily caters to the U.S. public sector market — specifically, government agencies and institutions. (One of the unit’s major engagements, which it undertook in conjunction with WCB, involved a restructuring of the IRS’s business processes.) Approximately 42 percent of WTB’s revenue is defense-related, 30 percent is civilian, 20 percent is derived from national security clients, and 8 percent comes from international government work. WTB is divided into three market-focused teams (International and Infrastructure, Defense, and National Security) and two functional teams (Information Technology and Organization & Management). The firm is planning a greater emphasis on new business in the e-government area, as well as in information assurance. WTB hires staff at all levels and seeks technical professionals with backgrounds in IT and engineering, as well as management consultants with backgrounds in business and liberal arts.
Knowledge everywhere The firm’s Knowledge On-Line (KOL) intranet — which pools the knowledge Booz Allen consultants pick up while on assignment — is often called the best of its kind. The shared system keeps consultants from repeating each other’s work and provides information on an assortment of topics, including resumes, frameworks, databases and histories of employees. Booz Allen consultants in both WCB and WTB now widely make use of KOL. The intranet is set up to promote sharing of information; consultants often spend a considerable amount of time entering their own findings into KOL. Booz Allen achieves this informational exchange partially through an appeal to ego: Consultants who contribute to the database have their names prominently displayed, their entries are linked to their resumes, and it’s simple to search for any given consultant’s 84
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contributions to the system. The firm also encourages contributions through its performance appraisal process — a consultant’s evaluation is based in part on contributions to KOL.
Charitable Booz Allen Booz Allen is committed to performing pro bono work for clients. Recent clients include The Nature Conservancy, the Children’s Defense Fund, Lincoln University and the United Negro College Fund. Booz Allen consultants can keep track of their firm’s charitable moves via Community Relations On Line, the firm’s community intranet site, which reports on current and upcoming community-service opportunities worldwide.
Balancing act In addition to its charity work and other community efforts, Booz Allen also looks inward. The firm has made a strong push to create a comfortable workplace for its employees through work/life balance initiatives and diversity programs. According to senior director Jean Callahan in a June 2001 interview with The Washington Post, women comprise 39 percent of the workforce in the firm’s McLean headquarters office and 22 percent of the management team. Members of minority groups represent 24 percent of all McLean employees and 12 percent of management. While those numbers may not be overwhelming, the firm has received numerous awards for diversity and lifestyle issues. 2001 marked the third straight year that Booz Allen was named to Working Mother Magazine’s list of the 100 Best Companies for Working Mothers. The magazine praised Booz Allen for its flex-time program, on-site child-care facilities, paid family-leave plan and other familyfriendly policies. Also in 2001, Washingtonian magazine ranked Booz Allen among the top 50 Great Places to Work in the Washington, D.C. area, and it named the firm the Best Place to Be a Kid. Booz Allen also received the 2001 EVE Award for its diversity programs from the U.S. Department of Labor and the 2001 Torchbearer Citation from the Northern Virginia Family Service for promoting a balance between employees’ work and their lives. The firm was also a hit abroad, ranking as one of the top four companies to work for in German magazine Junge Karriere’s Attractive Employers — 2001 survey.
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See you later Feeling the effects of the economy, in May 2001 Booz Allen announced that it was laying off about 95 consultants (less than 1 percent of the firm’s staff) from WCB. The firm also saw many more employees than usual leave after performance reviews. All told, according to The New York Times, almost 9 percent of Booz Allen’s consultants departed in 2001. At the same time, many top MBAs hired into WCB in 2000 and 2001 saw their start dates pushed back considerably. In July 2001 the firm announced that the deferrals would be six to 12 months in duration; five months later offers for MBAs from “noncore” business schools (i.e., all but the Harvards and Whartons of the world) were deferred for longer. (The firm asserts that as of May 2002, all of the deferred MBAs have started work, or at least have a scheduled start date.) In early 2002 many new hires were told that their starting pay would be reduced. (“It was a pretty major pay cut,” laments one unlucky offeree.) Booz Allen pushed back start dates for newly hired recent college graduates as well until “sometime in 2002.”
GETTING HIRED Booz Allen maintains different hiring practices for its two main units, WCB and WTB. WCB hires only a small number of undergraduates, who usually come on as consultants and stay for two to three years before returning to business school. The unit does most of its hiring from MBA programs, other consultancies and the world of industry. The firm also hires a number of people through employee referrals. WTB, on the other hand, hires a larger number of undergraduates. The firm has a number of different interview process models, which vary according to level, the unit doing the hiring and the size of the applicant pool. For undergraduates applying to WTB who have a Booz Allen presence on their campus, the first step is usually an interview with a representative of the firm’s university relations team. From there they go to a second round at a Booz Allen office, where the firm holds an open house of sorts — various teams set up tables, and “candidates have to walk up to a table, introduce themselves, and explain why they were interested in working for that team. Team representatives then ask questions and allow the candidate to ask questions.” At the end of the day, each candidate selects his or her top three teams, and each team selects a short list of applicants. If the lists match up, there is a final interview round, followed by an offer.
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Off campus, for both undergraduate and MBA and other experienced hires applying to WTB, Booz Allen’s “gauntlet interview process” typically consists of a phone screening with “technical and experience questions,” followed by three to six 30minute interviews at the office to which the candidate has applied. “Each interviewer has a specific topic they drill on,” one insider says, “and then we review all the results to determine whether we should hire the candidate.” At the top business schools, WCB typically rents out a block of rooms at a hotel near campus. In the first round, candidates undergo a series of two to three interviews conducted by second- and third-year consultants and/or principals. Insiders estimate that about one out of three applicants makes it past the first round. The second round is identical to the first, except that more senior people (usually principals) conduct the interviews, and the cases become fewer in number as the emphasis moves more to fit. Third-round interviews take place at the office to which the candidate has applied. Here it is the same scenario once again — two to three interviews, including cases — but now partners run the show. Decisions and offers are made following the third round. Later in the school year, the firm hosts a “sell weekend” in many of its offices. We hear that Booz Allen is good about keeping applicants abreast of what’s going on; there are reportedly no surprises in this interview process. Everyone meets with a recruiter before the interviews, who explains the process and gives advice on what the particular interviewers might be looking for. “This allowed me to prepare myself for each interview,” says one source. “After the interviews I kept in touch with the recruiters until my hiring.”
OUR SURVEY SAYS
Intensity in 10 cities (or 100) Life at Booz Allen Hamilton is nothing if not intense. The average workweek runs slightly below 65 hours, and in WCB at least, Booz Allen “is very firm about its upor-out policy.” A number of insiders contend that the firm’s culture varies greatly, making it “somewhat hard to pinpoint and very different depending on the team.” Nevertheless, most agree that the firm is “demanding, yet rewarding.” And at least one source thinks that “the work environment is pleasant,” because “there are numerous programs that help to nurture and encourage a successful career, such as work/life balance, business casual dress, community outreach and effective
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communication programs to keep you informed of events and decisions that affect you and the company.” Even if the day-to-day culture is difficult to define, Booz Allen’s overall corporate culture isn’t: “Booz Allen has an ‘old school’ consulting culture where people are indoctrinated in the ‘Booz’ way very quickly.” Regular training is important, and “professionalism” is a watchword around the Booz Allen offices.
Brain train Respondents reserve their highest praise for Booz Allen’s training program. Two years ago the firm established the award-winning Center for Performance Excellence, a university-modeled program that coordinates and broadens training opportunities. Through the center, employees can access an internal core curriculum of courses as well as external opportunities, and the firm reimburses for any costs incurred. The headquarters office, for example, has even “set up relationships with universities to bring them on to the McLean campus.” “We all get monies for both internal and external training and are encouraged to use it,” says one contact. “My manager stays abreast of everyone’s training monies to ensure that you use it for training of interest.” In 2002, the firm made Training Magazine’s list of the top companies for human capital development. That year, it also received the Corporate University Xchange Excellence Award in the e-learning category, an honor given to organizations that have demonstrated innovation in corporate education and training. Indeed, even in a time when cash droughts are forcing training cutbacks at many firms, we hear Booz Allen has kept its education coffers full (spending $5,000 per employee on training each year, according to the Financial Times). “The opportunities to pursue such training are almost limitless,” raves one consultant.
Have some respect Employees generally appreciate the sense of mutual respect they find at Booz Allen; one called it a “very professional atmosphere, where junior staff are given the opportunity to excel from Day One.” Still, cautions another contact, “There is also a strong hierarchy at Booz Allen which often deems how the first interaction with an executive will occur,” though “after they know an employee, the hierarchy tends to break down.”
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The firm makes sure mutual respect and communication are part of the daily structure by providing an “extensive coaching and leadership training program to ensure all senior leaders are aware of their responsibility to the staff,” as well as “an appraisal system where staff have ample opportunity to give direct messages and feedback to their supervisors.” Most consultants give favorable reviews of their managers, who one source tells us “are always looking toward ways of helping us out. Sometimes we receive little thank you cards to express their gratitude for all the hard work we put into a project.” Ultimately, though, for those averse to Booz Allen’s intense atmosphere, the firm can seem “surprisingly competitive. [It is] superficially cooperative in verbiage and ‘values,’ but not in reality.” One consultant tells us that “there is no real levity in the workplace — human kindness seems to come more from an etiquette book than from the heart.”
Lots of hours, but flexible While the average hours at Booz Allen are demanding, the firm does what it can to make a relatively stable work/life balance possible. Of course, in consulting one can never predict how many hours will be spent on the job during a given week, and the bottom line is that “we are at the mercy of the client’s timetable. Based on their poor time management, our time is compressed, requiring intense last-minute efforts.” The hours “ebb and flow and are tough to gauge.” And at Booz Allen, it seems that the better a worker you are, the more responsibility and tasks you will be given: “The number of hours you work is directly related to your team’s growth rate, staffing levels, and your ability to assume more responsibility. If your team has a lot of work and you show yourself capable, you will get loaded down.” To help with the workload, Booz Allen managers give their employees as much flexibility as possible. “We have ‘core hours’ that staff are expected to be in the office,” reports one source, but “there is a high degree of autonomy to get your assignments completed.” In general there exists “minimal micromanagement, although each team differs in management style.” Employees can work from home if need be, and tough weeks are offset by light loads later on: “If I’ve had some very long hours, I’m usually able to take some time off afterwards to take care of personal business.” Travel is also said to be light; at WTB, where the clients largely are government agencies based in the D.C. area, very few overnight trips are required. “Most of the travel I do,” reports one source, “is within the local Washington metro area; traveling to and from client sites for meetings.” And while WCB employees Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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understandably spend considerably more time on the wing, even their load is less than the industry standard.
Cash and benefits Consultants at Booz Allen say that “compared to [the] industry average, we are wellcompensated,” though junior WTB staffers grumble about the lack of bonuses. Nevertheless, we hear Booz Allen is good about recognizing individual achievement at the junior levels, through incentives such as a VIP award and free vacations for employees in WTB. “Time spent on your work is reciprocated back to you in different ways,” says one Boozer. “The firm believes in identifying and acknowledging hard work and providing clients with the very best support possible.” Booz Allen gets high marks for its benefits. “The firm takes a lot of pride in keeping its employees happy,” one source tells Vault. There are company picnics and a “great holiday party in December”; the firm also offers on-site banking (in McLean), profitsharing, employee referral bonuses and a robust insurance package. And, in the United States, “the firm provides compensation by putting money toward your 401(k) directly, without needing you to match it.” It’s “the best 401(k) program out there,” remarks one source. Sports tickets, e-tailer discounts, amusement park discounts and a company store are added perks.
Home sweet office Most consultants couldn’t be happier about their offices. In McLean, there are “no cubicles or hot-desks”; rather, everyone shares an office with one other consultant (higher-ups, naturally, get their own). Things are nice to a fault, though, for some; one source complains that “Everything is dictated by level — including the size and shape of my desk. For example, I wanted to make the surface area of the desk smaller so I would have more room for a small table and was told no.” Some insiders say that the offices at the McLean headquarters are too small for two people, and employees “are tripping over each other. We cannot conduct informal team meetings with others, which provides for scheduling conflicts when conference rooms aren’t available.” One source reports that the regional offices don’t match up to the corporate headquarters: “Regional locations do their best to mimic corporate offices but fall short.” On the other hand, the source tells us that the regional offices make up for the disparity by creating “their own cultures and supplementing missing amenities with more social activities for the team.”
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The faces of Booz Allen Booz Allen is aggressive in addressing issues of gender and racial diversity, and it puts its money where its mouth is: “We have several women’s groups backed by the firm to ensure equal access and treatment,” notes one consultant; the firm also supports a diversity council. And in a July 2002 cover story featuring Booz Allen’s five African-American partners, Consulting wrote that the firm “arguably has the best record in the profession for attracting people of color to their senior ranks and retaining them.” However, many insiders think it could be doing more. “I think the firm does a lot to bridge the gap in terms of [gender] diversity,” says one woman consultant. “But it still has quite a ways to go. We are consistently named to the top-company lists for women because of perks such as parental leave and day care, but the tougher issues like women in leadership are not that well-addressed.” Another insider puts it even more bluntly, saying that “[Booz Allen] is the least diverse organization I’ve belonged to in over 20 years. It’s OK at the lower levels, but no one seems to find qualified women or minorities for the Level IV [senior associate] and Level V [principal] positions.”
Giving something back Community involvement at Booz Allen is very important, and insiders tell us that funding for just about any project you can think of “is easy to get.” Booz Allen maintains a community relations team that coordinates its charity activities and pro bono consulting work. Reports one source, “I’ve done several firm-sponsored events, [including] Christmas in April and the Homeless Walk. I’ve also had the firm provide a grant to the organization that I am personally involved with, Habitat for Humanity.” Another source tells us that “I was active with a Korean-American organization and Booz Allen was very active in sponsoring our college internship and high school mentorship programs.” The firm also matches donations for disaster funds and corporate challenge events. Yet another Boozer tells Vault about the firm’s sponsorship of his AIDS Ride team: “Transportation to North Carolina and lodging the night prior to the ride was provided by Booz Allen. Employees from Durham provided us with a breakfast the morning of the kickoff and we had a great welcoming committee in D.C.”
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5
Monitor Group
PRESTIGE RANKING
Two Canal Park Cambridge, MA 02141 Phone: (617) 252-2000 Fax: (617) 252-2100 www.monitor.com
LOCATIONS Cambridge, MA (HQ) 30 offices worldwide
PRACTICE AREAS Custom Model/Software Design E-Commerce Economic Development Consulting Executive Education Financial Assessment/Evaluation Marketing Strategy Nonprofit Consulting Operations & Logistics Organizational Design Private Equity Private Equity Consulting Scenario Planning Strategic Transactions Strategy Venture Capital
THE STATS Employer Type: Private Company Chairman: Mark Fuller 2001 Employees: 1,200+ 2000 Employees: 1,000
UPPERS • Flexible travel • Swank Herman Miller decor
DOWNERS • Budget cuts • Not enough training
KEY COMPETITORS Bain & Company Boston Consulting Group McKinsey & Company Mercer Management Consulting The Parthenon Group
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
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“Big thinkers” “Arrogant” “Impressive track record” “You can only cruise so far on HBS books”
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THE SCOOP
Monitoring the world Founded in 1983 by a group of professors and consultants, Monitor Group aims to put ideas created in the business and academic worlds into practice. Though only a medium-sized firm by industry standards, Monitor has developed a number of practices and expanded its client list to include everything from Fortune 500 companies and international firms to government agencies and major nonprofit organizations. Through its 30 offices in 23 countries, it offers advisory services in areas including private equity and venture capital, e-commerce incubation, and mergers and acquisition-related transactions.
Breaking it down Monitor divides its operations into three groups — Action Group, which focuses on consulting practices; Monitor Merchant Banking, which is involved in capital investing and venture projects; and the Intelligent Products Group, which designs customized data and software products. Each group, in turn, comprises a number of companies; for example, Action Group includes such operations as the Global Business Network, an organization of top firms in various industries, and Market2Customer, a marketing consulting operation. Merchant Banking companies, such as Monitor Clipper Partners and Monitor Ventures, have an equity stake in 20 firms and over their collective lifetime have invested over $1 billion.
Unified consulting Monitor predicates its consulting philosophy on a “unified theory” approach. Rather than applying a single strategy to every client or set industry practices, the firm integrates its operations across industries, allowing its projects to use resources culled from the firm’s various subsidiaries. Instead of relying on generic practices, Monitor consulting teams are able to draw on marketing, e-learning and software designers to customize their solutions.
It’s academic Much of Monitor’s strength comes from its grounding in the academic world. One of its founding principals, Harvard Business School Professor Michael Porter, is a veritable demigod among consultants and still remains an influence on much of Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Monitor’s structure and practices. Other principals, such as Bernie Jaworski, Mike Jensen and Tom Copeland, have strong ties to academia and retain fellowships or adjunct professorships at some of the nation’s leading business schools. In March 2001, MarketspaceU, Monitor’s research and publishing unit, announced a partnership with McGraw-Hill to produce a series of written materials on ecommerce for business professionals, students and educators. The title that spawned the series, e-Commerce (co-authored by Jaworski and Jeffrey Rayport, another HBS professor), is an integrated print and online textbook that has already been adopted by nearly 200 business schools.
Feeling the burn The impact of the recent economic downturn hit Monitor in mid-2001, particularly in its North America and European offices, as well as its e-consultancy, known as Marketspace. Layoffs hit Europe in July and North America in August, with cuts as high as 15 percent in some offices, (the deepest cuts came in satellite offices such as Los Angeles and Toronto). Nevertheless, the company continues to do well in Latin America and Asia, and both regions were spared from any staff reductions.
GETTING HIRED In keeping with the firm’s anti-hierarchy bent, new hires at Monitor go by the title “consultant” whether they are straight out of undergrad or seasoned MBAs (Naturally, salaries and responsibilities vary). In a normal year, the firm will hire about 50 MBAs and even more undergrads, but recently the economy has put the pinch on recruiting. Always difficult, getting hired is “now pretty much impossible.” Monitor recruits at top-tier universities and leading liberal arts colleges, though recruiting in the 2002-2003 cycle will be restricted to only a few top schools. To get in, candidates need more than good grades and a knack for business — Monitor goes the distance to make sure candidates fit the culture. As one source elucidates: “It doesn’t take much to get denied an offer. Monitorites who attended your college or university are often consulted as to your character even before you get an interview.” Monitor’s interview process typically consists of two rounds. The first round is a set of two short meetings: a resume briefing and a case question. The case interview sometimes “throws people for a loop,” one source tells us. “You get maybe 10 or 15 minutes to look over some materials and then with the assistance of the consultant, 94
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you solve three questions related to the data. It can be intimidating if you don’t process information quickly or if you don’t manage the time you have well.” The second round is an all-day affair, usually held at the nearest Monitor office. Eschewing the industry-standard brace of high-level interviews and one-on-one case problems, Monitor groups candidates into teams of five, who work together on a case presentation. There is also a videotaped role-playing exercise and a debriefing interview at the end. Monitor relies heavily on its summer internship program, using it as its primary source of new hires during lean years. Interns are staffed on firm projects as if they were full-time employees. “I did what a normal first-year consultant would do, says one former summer staffer. “I learned a lot about what consulting really means and got paid exceptionally well. There were a lot of nice social activities including dinners, tickets to baseball games, a whitewater rafting trip and other field trips.”
OUR SURVEY SAYS
Something different Despite its perennial spot among the top 10 consulting firms, Monitor’s employees like to emphasize how their firm rejects the cutthroat attitude of the Bains and McKinseys of the world. “Monitor does not have an ‘up or out’ policy like many of its competitors,” one insider says. The firm is close knit and casual, insiders tell us, and it likes to keep it that way — “Monitor regularly turns away extremely qualified candidates whom Monitor considers better suited to work at McKinsey, Bain, BCG and other large consulting firms.” While the Monitor culture “tends to vary from office to office,” those who stick with the firm do so because of “a combination of people who are incredibly smart but lowkey and lots of interesting things always going on.” And despite its avowedly intellectual flair, the consulting staff is “cooperative rather than competitive and really likes to socialize outside of work.”
Work for Monitor, sleep in your own bed Even though the firm has clients throughout the world, Monitorites say one of the best things about the job is the relatively low level of travel. “At Monitor there is no great emphasis on spending time at the client simply to spend time at the client,” one
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consultant reports. Employees are able to work with the firm’s allocator to find optimal assignments, and Monitor is very accommodating toward families: “I asked to be kept off of travel-intensive cases for personal reasons and I ended up being away for two days over the course of over a year.” When fully staffed, consultants usually work on two cases at a time, and seem resigned to the job’s long hours. “Hours are pretty standard for a strategy consulting firm,” says a source. “50 to 60 hours in a typical week, up to 90 in a bad one, which may occur once every few months.” Others put the upper end of a typical week closer to the 75-hour range. One tip for prospective Monitorites hoping to avoid a grueling schedule: Work on internal projects, which tend to have shorter and more regular hours. In any case, says one insider, be assured that “it is a consulting firm, so it’s not 9 to 5. [But] it’s also NOT an investment bank.”
Workers of Monitor, unite! One downside to life at Monitor is what insiders characterize as a imperfect level of communication between junior and senior staff. “The leadership tends to be secretive and evasive,” one consultant says, “the result of which is an ‘it’s us against them’ mentality for some junior consultants.” Another says that “There tends to be a lot of unspoken bureaucracy and it’s difficult to figure out how to navigate the system. Things tend to be more ad hoc here rather than systematized.” While insiders tell us that “immediate supervisors tend to treat [us] with a great deal of respect,” they say that some problems result from the firm’s “Mr. Nice Guy” image: “Monitor doesn’t always know how to deliver tough messages. For example, the 2001 end-of-the-year compensation and bonus messages were extremely vague, contradictory and confusing. I attribute this to Monitor’s inexperience with delivering unpleasant messages to its employees.” And while senior staff may seem less than forthcoming at times, junior staff have a check: an upward review system in which managers who “continuously receive poor evaluations from the junior members on the team have to address their performance.”
Painful cuts Like most firms, Monitor has been forced to cut back on expenses in recent years, and the brunt of its cuts have come in the areas of compensation and training. And while Monitor makes sure to pay new hires the industry average for top firms, it has lagged in handing out raises and bonuses (typically the firm bases compensation adjustments on performance). More than the money, many consultants say they are 96
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frustrated with the way the firm has handled the pay freezes: “Last year the firm led employees to believe that bonuses would be paid, right up until the week of Christmas, when they were canceled.” Another puts it into this perspective: “The system tries its best to be fair and meritocratic but just tends to confuse.” Nevertheless, most are happy with the salaries they take in, particularly at the firstand second-year levels. “I think for a recent college graduate with no experience,” offers one newly minted Monitorite. “I’m extremely well-compensated.” Monitor consultants have plenty to say about the firm’s perks, and most of it is negative. Many of the complaints surround the 401(k) plan, which does not include matching contributions. That appears to be the only area in which the grumbling is justified, however. For example, the London consultant who says that “Monitor has always had a very light benefits package by any standards,” also enjoys long-term disability insurance, an employee referral bonus, a laptop computer and an on-site gym, among several other perks. Additional offerings include stock options, an employee assistance program, sports and theater tickets, and free food and drinks.
Hot and cold Training has been a major area of cost cutting for Monitor, a formerly strong suit that sources say is sorely missed. “Monitor training is very hot and cold,” we hear. “When it happens it’s usually very good, but it’s the first thing to get turned off when times are hard.” For new hires, Monitor provides a five-day general orientation session, followed by three days of training at the local office. They are then assigned a mentor, and over the next two years they are required to complete a set of five courses in such key subjects as finance, marketing and interpersonal skills. Nevertheless, some insiders say that there is too little training on the front end: “Monitor has training programs throughout your career, instead of having intensive training when you start. It may make more sense for us to provide new hires with more up-front basic training.” And classics majors beware. While Monitor’s training program is typically strong, it assumes a lot of knowledge that most liberal arts students never acquired. One consultant reports that “The corporate finance training was geared towards an intermediate level, which was great for undergrad consultants who had majored in finance and accounting, but for liberal arts majors, the training was way over our heads.”
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Monitoring diversity Many female sources report being very happy at the firm. One female consultant says that “as a woman, I feel that I have role models — although not as many as I would like — at the group leader [partner] level.” On the other hand, she continues, “The company does need to think more about alternative career paths for women with children.” But others say that the long hours and travel required of Monitor employees are just the costs of being a consultant. It’s “a great job when you’re single or newly married,” one female source tells us, “but once you want to start having a family, forget it.” As for minorities, most insiders believe that Monitor is a tolerant and welcoming environment, but contend that the firm is still “very white-bread.” One source attributes the paucity of non-whites to the lack of a diversity infrastructure: “Monitor does not have support programs, which limits the number of minorities who see Monitor as an attractive place. The company could choose to address this, but does not do so explicitly. In general, Monitor is a fairly liberal environment but could do more in this domain.” The firm does, however, offer domestic partner benefits, and homosexual respondents report a strong gay and lesbian support network. “There are at least two long-term Monitorites I know of who have progressed well and have been openly gay/lesbian,” one source tells Vault. “I have never heard of any negative comments or bias in any way.”
Green and orange surroundings Insiders rave about the office space at the firm’s Cambridge headquarters. “Monitor has put great thought into the offices and the layout and amenities,” says one. “The Cambridge office is decked out with Herman Miller chairs, art everywhere and these crazy geometric walls painted subtle greens and oranges.” Consultants “share offices with one, or sometimes two, other consultants,” and “every office gets natural light.” Quips one source, “Offices used to be cramped, but layoffs solved that problem.” The office also has a nap room, “ a comfy TV room” and “ a small workout room with great showers that are always clean and stocked with fresh towels.” As one insider puts it, “If you are going to work as hard as we do, it’s nice to spend your time in a pleasant environment.”
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For a detailed 40- to 50-page insider report on Monitor Group, and reports on other firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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V A U L T
6
PRESTIGE RANKING
Mercer Management Consulting
1166 Avenue of the Americas 32nd Floor New York, NY 10036 Phone: (212) 345-8000 Fax: (212) 345-8075 www.mercermc.com
THE STATS
New York, NY (HQ) 22 offices worldwide
Employer Type: Subsidiary of Marsh & McLennan Companies, Inc. Chairman: Peter Coster 2001 Employees: 1,200 2000 Employees: 1,300 2001 Revenues: $2.2 billion (for all Mercer Consulting operations) 2000 Revenues: $2.1 billion (for all Mercer Consulting operations)
PRACTICE AREAS
UPPERS
Functional Practices: Business Design Innovation Customer Science Value Nets and Supply Chains
• Marked camaraderie • Programs allowing consultants to work on outside projects
LOCATIONS
Industry Practices: Communications, Information, and Entertainment Energy, Life Sciences and Core Industries Financial Institutions and Risk Enterprise Manufacturing Private Equity Retail, Consumer and Healthcare Travel and Transportation
DOWNERS • Recent cost-cutting measures • Supportive but “unforgiving” culture
KEY COMPETITORS Bain & Company Booz Allen Hamilton Boston Consulting Group McKinsey & Company
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“The slowly but surely rising star” “Unclear focus” “Hotshots” “Generic”
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Vault Guide to the Top 50 Consulting Firms Mercer Management Consulting
THE SCOOP
A part of the whole New York’s Mercer Management Consulting, a subsidiary of professional services titan Marsh & McLennan Companies, has made quite a name for itself. Formed in 1990 by the merger of Temple, Barker & Sloane and Strategic Planning Associates, Mercer has grown rapidly, opening offices in Europe, the Pacific Rim and Latin America and acquiring a number of boutique consultancies, including Corporate Decisions, Inc. (CDI), Germany’s Dr. Seebauer & Partner GmbH, Mexico’s Analisis y Desarollo de Proyectos and Switzerland’s St. Gallen Consulting Group. As of mid2002, Mercer Management Consulting has approximately 1,200 consultants and support personnel in 22 offices worldwide.
From outsider to insider When it was founded, Mercer was considered a brazen startup in a field dominated by giant, established firms like Bain and Booz Allen Hamilton. But the firm expanded its practice quickly by aggressively pursuing clients and rooting its work in a series of well-publicized books, including The Profit Zone, Value Migration and Profit Patterns. These books advocate a customer-focused approach to a company’s competitive advantages, a philosophy that apparently has rung true with many business leaders. But like many consulting firms in the last few years, Mercer’s attempt to situate itself at the forefront of high-tech and international markets left it exposed to the dot-com implosion and economic downturn. Marsh & McLennan reported that 2001 management consulting revenue was down 21 percent from the previous year. In November 2001 Mercer closed its Geneva and Washington, D.C. offices, displacing 77 employees. Partners were given the choice to relocate, while rank-and-file employees were given severance packages. The economy has affected recruiting as well — where in the past Mercer hired in the range of 30 to 45 MBA interns and 25 to 30 summer analysts each year, in 2001 the firm canceled its internship program. Happily, the program resumed in 2002.
Profitable publications One of Mercer’s greatest strengths lies in its intellectual capital, led by strategy guru Adrian Slywotzky. Slywotzky, a Mercer vice president, is credited with coining the Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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term “value growth” in his 1996 book, Value Migration, and with spearheading the development of a more outwardly focused approach to competitive strategy. In October 1999, Industry Week named Slywotzky one of the most influential people in management, along with business world luminaries like management theorist Peter Drucker and Microsoft founder Bill Gates.
Taking on the high-tech world In February 2000, Mercer and its sister company, MMC Capital, jointly formed a venture capital fund, the MMC Capital Communications and Information Fund. Capitalized in part by Mercer professionals, the fund invests in telecom and computing sector technologies and will ultimately allow Mercer consultants to reap part of the fund’s gains. Currently it holds stakes in CCC Network Systems, Equator Technologies, GlobeRanger, Southampton Photonics, Verance, Xanoptix and Xelus. In April 2000, Mercer formed a consulting practice that helps private equity firms identify new business opportunities. Also that year, the firm announced a collaboration with IBM to incubate and build new e-businesses.
Other engagements The firm stayed active in 2001, providing strategy advice for the December merger of Hawaiian Airlines and Aloha Airgroup into Aloha Holdings, Inc. (Hawaii-based Mercer consultants have continued to work on the project in 2002.) And in January 2002, Mercer advised Sinotrans, a large China-based shipping company, in a reorganization in preparation for a listing on the Hong Kong stock exchange. It also completed an exhaustive study of the success of transatlantic mergers and acquisitions and advised a major automaker on branding strategies.
Serious personal time In the fall of 1999, Mercer announced the 10/11 Month Year, a program that allows consultants to take one or two months off each year (without pay) to pursue projects outside the firm. Consultants can also take advantage of an externship program that allows them to work for six to 12 months at selected firm clients as well as other corporate, venture capital, start-up or nonprofit organizations.
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associate training. Consultants in the Core Consulting Group (generalists) are required to attend occasional weeklong programs to sharpen their consulting skills and to network with colleagues from other offices. Mercer also has a generous tuition sponsorship program on both continents for employees interested in going to business school. (They must commit to returning to Mercer upon completion of their MBA in order to qualify.)
GETTING HIRED Mercer hires recent college graduates for its analyst positions and MBAs for its associate positions. At the undergraduate level, Mercer actively recruits at Dartmouth, Duke, Harvard, Northwestern, Penn, Princeton, Stanford and Yale (in addition to a number of Canadian and European schools). In search of MBAs, the firm travels to Harvard, Kellogg, Sloan, Stanford, Tuck and Wharton, plus Canadian and European schools. Despite this far-flung search, Mercer does not staff its upper ranks strictly with business school grads. The firm employs a merit-based promotion structure in which consultants joining out of college can advance to the partner level without a graduate degree. Mercer maintains a detailed explanation of its interview process on its web site. It has background and tips to keep in mind during the firm’s case and resume interviews, as well as two interactive cases with which to practice. (The cases are general enough, and good enough, that even if Mercer isn’t on your list you should check out the site to bone up for other interviews.) Mercer urges interviewees daunted by the prospect of the case interview to relax — the firm is “not looking for a specific answer,” it’s simply “trying to gain some insight into your thought processes.” These aren’t “bad cop, stress interviews.” Insiders tell us to expect three rounds of interviews, with the first two on campus and the last at the office to which the candidate is applying. The first generally consists of one 30-minute case interview and one “fit,” or resume, interview, while the second round is typically two cases and one fit. The last, a half-day affair, also involves two cases and one fit interview. Because Mercer is “more of a pure strategy firm,” cases are a central part of the process; one contact reports that “success on the case interviews is absolutely critical,” though the right approach is also important. Insiders warn that candidates should “stop trying to use Porter or BCG frameworks to crack the case — use your head and good business sense from the perspective of the customer.” Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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One consultant advises: “Personality is really important. Mercer turns downs many people who ‘ace the case’ because they do not fit. Arrogance is a sure way not to get an offer.” Another source suggests “calling up someone from Mercer that you meet at an info session and asking them for tips,” because “people at Mercer are very committed to recruiting, so they will always be willing to squeeze you into their schedule.”
OUR SURVEY SAYS
Nice people, smart people Life at Mercer is pretty good, we hear. “One reason I joined Mercer was the culture,” says one source. “There are very smart people, but also very likeable people.” The offices are said to be friendly, sociable places. “Partners all have a very open-door policy,” comments one consultant. Work hours and travel are pretty typical for the industry, but few people work weekends, and travel, when necessary, is kept to a Monday morning/Thursday evening schedule. As always with consulting careers, however, one good or bad engagement can change everything. One respondent tells Vault that the Mercerian quality of life “is pretty project-dependent. The project I’m on now goes from about 8:30 a.m. to 9:30 p.m., with some weekends.” Mercer is also typical of its industry in that it is male-dominated; as one insider explains, “The lifestyle, for some reason, seems to attract more men.” Nevertheless, the firm has a number of initiatives, including a women’s consulting club, to encourage diversity. When it comes to negotiating child care issues, the firm is “pretty flexible in trying to work with people”; one respondent tells Vault of a female partner who was allowed to work half-days so she could spend time taking care of her young child. The firm adds that part-time schedules, leaves of absence and other work/life balance programs are available to both male and female employees.
Learning the ropes New hires at Mercer go through two weeks of consulting training at their home office. After six months, consultants undergo a week of more focused training in specific skill sets. Ongoing, online training is available over a company intranet, and Mercer consultants often coordinate office-based instructional sessions. As at most firms, training budgets at Mercer have been affected by the economic downturn, but mostly around the edges; for instance, instead of flying everyone to a single location for their six-month training session, instructors are now flown to different offices. 104
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Most respondents don’t seem to care all that much about official training anyway. “Informal channels are pretty predominant,” we’re told. “It’s probably 90 percent of the best training.”
Tightening the belt In addition to the closing of its Geneva and D.C. offices, Mercer’s cost-cutting focus has also caused the disappearance of amenities like free sodas (now they’re subsidized) and free lunches on Fridays. Another result of the belt tightening is the increased rigor of the firm’s periodic review process. “Mercer policy has always been that the bottom 10 percent get cut every six months,” one source tells us, though during the dot-com boom, when high attrition was a problem, the review policy had fewer teeth. Now “the issue is that no one is leaving,” and as a result the review process is much stricter. On the other hand, the firm asserts that there has never been an official policy of cutting a specific percentage of the workforce; rather, it says that underperforming employees are let go just as they would be at any other company.
For a detailed 40- to 50-page insider report on Mercer Management Consulting, and reports on other firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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IBM Global Services
PRESTIGE RANKING
Route 100 Somers, NY 10589 Phone: (914) 499-1900 Fax: (914) 765-7382 www.ibm.com/services
LOCATIONS Somers, NY (HQ) 300+ offices (including data centers) in 160 countries worldwide
PRACTICE AREAS Business Innovation Services (traditional consulting) Integrated Technology Services (systems integration) Learning Services Strategic Outsourcing Services
THE STATS Employer Type: Corporate Business Unit Stock Symbol: IBM Stock Exchange: NYSE Senior Vice President & Group Executive: Doug Elix 2001 Employees: 149,000 2000 Employees: 150,000 2001 Revenues: $35.0 billion 2000 Revenues: $33.2 billion
UPPERS • Wide range of opportunities • Work involves cutting-edge technology
DOWNERS • Bureaucracy • Semi-rural headquarters
KEY COMPETITORS Accenture Computer Sciences Corporation Electronic Data Systems Perot Systems
EMPLOYMENT CONTACT www.ibm.com/services/career
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“The behemoth of IT consulting” “Still too tied to their hardware” “Rock solid” “Stick to the outsourcing, boys”
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Vault Guide to the Top 50 Consulting Firms IBM Global Services
THE SCOOP
Biggest of the big IBM is the world’s largest high-tech concern, and subsidiary IBM Global Services is the world’s largest IT consultancy. With almost 149,000 employees, it is also IBM’s largest division, as well as its fastest growing (currently, it produces a 40 percent share of Big Blue’s total revenues). IBM Global Services may be getting much larger. In July 2002, IBM announced the $3.5 billion acquisition of PWC Consulting. Global Services’ biggest operation is outsourcing — running IT systems for some of the world’s largest companies — but it also provides such services as customer relationship management, hosting and IT consulting. The division is split into four operations: Business Innovation Services, Integrated Technology Services, Strategic Outsourcing Services and Learning Services. In 2001, the combined efforts of BIS, ITS, SO and Learning Services yielded $35 billion in revenue, and IBM Global Services signed services contracts totaling $55 billion. But despite being the center of the IBM universe, Global Services is a bit of a maverick. Much of its work is in areas outside IBM’s hardware and software expertise, and because it is committed to brand neutrality, it often recommends the products of IBM’s competitors. Its position has led to more than a few run-ins with the firm’s other divisions, which in the past have seen Global Services as arrogant, self-interested and a detriment to IBM’s overall success. These conflicts have been mostly put to rest; in any case, the division is in the catbird seat — Big Blue’s new CEO (as of March 2002) is Samuel J. Palmisano, former head of Global Services.
Collecting awards Global Services is not only the biggest in the IT consulting world, but it is one of the most respected. Its position was confirmed in February 2002, when it won the Management Consulting Association’s Best Management Practice Award for IT. The award came after the successful completion of a project for the U.K. government in which Global Services created an online system allowing civil servants 24-hour access to policy papers and statistics.
A demanding business One of Global Services’ biggest challenges has been the shift in customer demand from outsourcing to hosting. As companies face pressures to reduce their IT budgets, Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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they have begun looking for vendors to provide them with an easily scalable, fullservice product that they can tailor to their specific needs. In response, Global Services is heavily marketing its eBod, or “e-Business on Demand,” suite of services. Essentially an IT department for hire that treats computing as a utility, eBod offers all the personnel and applications a company might need for a simple user fee, which can be scaled to fit a client’s exact needs. The service has been very successful in Asia, already inking a multibillion-dollar deal with an unnamed, 100,000employee conglomerate.
Signing on the dotted line With the economy in a downturn and the high-tech sector in a tailspin, one might expect the last few years to have been rough ones for Global Services. On the contrary — thanks to increased demand for many of its services, the division’s market position has never been better. In January 2002 Global Services and Nextel announced a strategic partnership to develop, market and install mobile e-business solutions to U.S. customers, as well as a $1.2 billion customer relationship management outsourcing project over the next eight years. In December 2001, Global Services announced a 10-year, $1.4 billion deal to manage New York Citybased Cendant’s IT operations. That month the division also joined with Veritas, a Mountain View, Calif. software concern, to offer its storage management tools — even though IBM already produces its own competing brand, Tivoli. In January 2001, San Francisco software firm Autonomy also joined Global Services in an agreement allowing IBM staff to resell and install Autonomy software in clients’ computer systems worldwide.
Trimming the fat Despite its dominant industry position, Global Services laid off 4,100 employees during 2001 and 2002 as part of an attempt to curtail the rapid expansion of its employment rolls during the 1990s (it added 10,000 employees in the first part of 2001 alone). In July 2001, it cut 1,500 jobs in response to what it termed “changes in client demand,” and in April 2002 it cut another 600 workers, mainly customer engineers involved in computer and software repair. Even more cuts came at the end of May 2002, when Global Services cut almost 2,000 jobs, mostly in its large computer, software and global financing divisions. (Laid-off employees were given 30 days to find another position within the company.)
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The proliferation of pink slips — reportedly the largest IBM has undergone since the company’s struggles in the early 1990s — is part of an effort to slash costs throughout all of IBM’s operations. According to The Wall Street Journal, during IBM’s spring 2002 analysts’ meeting CEO Palmisano did not dispute Sanford C. Bernstein analyst Toni Sacconaghi’s prediction that the company as a whole could cut as much as 6 percent of its workforce, or 20,000 jobs.
Psst! It’s a secret In November 2001, responding to emerging worldwide security issues, IBM expanded its existing privacy services by introducing its Safety and Security practice. This corporate-level office provides businesses and the public sector with improved security solutions, from enhanced intrusion-detection services and vulnerability assessments to classes for corporate officers. Global Services also aligned itself with New York’s Kroll, Inc., a specialized security concern, to offer corporate security, crisis management and business and asset protection solutions.
GETTING HIRED IBM, as a whole, aggressively recruits graduates in technical degree programs. Ideal majors include electrical engineering, mechanical engineering, chemical engineering, computer science, computer engineering and information systems. The company also seeks candidates from other disciplines such as math, finance, human resources, business and marketing. Interviews, insiders say, are designed to discern a candidate’s “background, attitudes, knowledge, enthusiasm [and] flexibility.” Big Blue prides itself on offering attractive compensation and benefits, including educational reimbursement plans, flexible work schedules, global opportunities, activities, clubs and child care options. Job opportunities can be searched through IBM’s web site, and resumes can be submitted there as well.
OUR SURVEY SAYS
No one beats Big Blue Despite its large size, Global Services earns praise from employees for its personal feel. One IBM consultant reports that the firm’s superiors “go out of their way to get Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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me into discussions, mentor and instruct me.” While IBM Global Services doesn’t have a partnership structure, it does have promotion “bands [that] are extremely wide, especially at the high end, so compensation of a senior technical person with no administrative responsibility can easily exceed [that of] most managers.” This structure extends to the office space — “bright and airy” — where one insider reveals, “I’m in a cubicle, [and] so is the director of my client organization.”
Respected and respectable The “very friendly and open” culture at IBM Global Services extends to its approach to diversity — one very enthusiastic employee reports, “National or ethnic background, religion, sexual orientation and physical incapacity mean nothing at IBM. There’s more diversity in the 60 people in this office than in the U.N. General Assembly.” On top of this, “Diversity training is required annually of 100 percent of employees, not just a few managers.” And employees feel at home in the highperforming environment at IBM. One consultant says, “I am working with top-level executives of IBM around the world and am treated as one of them, not an underling in any way. My opinions are solicited and welcomed, and suggestions are often accepted.” And such kindness extends beyond the walls, since IBM “matches charitable grants and allows time off for charitable work.”
Not as old-school as you thought The traditional image of IBM suits has given way to a dress code where “the range permitted is extremely wide.” Also, don’t assume that you’ll be in the office from exactly 9 a.m. to 5 p.m. every day. One source has arranged “to work a four-day week, with three-day weekends most weeks.”
For detailed 40- to 50-page insider reports on top consulting firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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“Diversity training is required annually of 100 percent of employees, not just a few managers.” — IBM Global Services consultant
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Deloitte Consulting
PRESTIGE RANKING
1633 Broadway 35th Floor New York, NY 10019-6754 Phone: (212) 492-4500 Fax: (212) 492-4743 www.dc.com
LOCATIONS New York, NY (HQ) Offices in 33 countries
THE STATS Employer Type: Business unit of Deloitte Touche Tohmatsu (pending separation) CEO: Doug McCracken 2002 Employees: 15,000 2001 Employees: 14,000 2001 Revenues: $3.49 billion 2000 Revenues: $3.14 billion
UPPERS PRACTICE AREAS People Strategy & Operations Technology
• Strong alumni network • Aggressive in promoting diversity
DOWNERS • Cuts in pay and training • Bureaucratic structure
KEY COMPETITORS Accenture Bain & Company Booz Allen Hamilton Boston Consulting Group Cap Gemini Ernst & Young IBM Global Services KPMG Consulting McKinsey & Company PwC Consulting (Monday) Sapient Corporation
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
EMPLOYMENT CONTACT www.dc.com/careers
“Cares about employees” “Way-old oldsters” “Good and getting better” “Unspectacular”
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Vault Guide to the Top 50 Consulting Firms Deloitte Consulting
THE SCOOP
On its own In the wake of the Enron/Andersen scandal, most big accounting firms have taken steps to separate their consulting divisions from their auditing arms. Deloitte Touche Tomahtsu went one step further than most and decided in February 2002 to split off its consulting arm, Deloitte Consulting. After considering a number of options, including an IPO or a merger with another consulting firm, Deloitte Consulting finally announced in June of that year that it would proceed as an independent, privately owned firm. The move still must pass regulatory muster and receive approval from the board of directors of Deloitte Touche Tomahtsu and its member firms. In July 2002 the firm announced its post-separation name — “Braxton Consulting,” the name of a firm Deloitte had acquired in 1984 — and said that it would officially launch its new brand in the fall. Deloitte Consulting already ranks among the world’s largest consulting firms, with 15,000 employees in more than 90 offices in 33 countries offering everything from strategy work to customer relationship management. Its client list includes more than one-third of the companies in the Fortune Global 500, including heavyweights like Hewlett-Packard, Philip Morris and Cable & Wireless. But Deloitte’s much-ballyhooed separation plan coincides with a difficult time for the firm — depressed earnings forced salary adjustments at the end of May 2002 that saw a large number of employees receive 10 to 15 percent pay cuts (though a few received raises).
Rewarding work The last few years have seen Deloitte Consulting receive a number of awards and industry plaudits, including an impressive four-year sojourn on Fortune’s 100 Best Companies to Work For list. In 2001 it received one of 10 Corporate University Xchange Excellence/Financial Times Awards for corporate learning organizations, and in 2000 it received the Siebel Excellence Award (given, somewhat selfinterestedly, to companies implementing Siebel technology). Deloitte Consulting has also earned a spot on Fortune’s 50 Most Coveted Employers list for five straight years (it ranked No. 12 in 2001) and Working Mother’s 100 Best Companies for Working Mothers list for eight straight years. To top it all off, CEO Doug McCracken was named to CEO Magazine’s list of the 25 most influential consultants in 2001.
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Alliances and ventures Deloitte Consulting has used its powerful market position to ink a number of alliances and joint ventures. 2001 was a year bracketed by two major deals to create product information processes — one in January with San Jose’s BEA Systems, the other 12 months later with Palo Alto, Calif.’s Hewlett-Packard. Also that year, it joined with Redwood City, Calif.-based SmartForce to create an infrastructure for DC’s e-learning solutions, and struck a deal with PeopleSoft to expand the companies’ CRM software alliance. Finally, the firm launched a joint venture with India’s MASTEK to provide offshore IT services to Deloitte Consulting and its clients outside India.
Family ties In response to the flight of employees to Internet startups during the dot-com boom, Deloitte Consulting established an alumni network to keep former employees in the consulting loop and to cultivate contacts in the high-tech industry. The firm invites network members to company events, enables them to keep in touch with colleagues, and even serves as an informal job network. Today the network has more than 3,000 members, with a goal of reaching 5,000 by the end of 2002.
A diverse vision Deloitte has long enjoyed a reputation for a sharp focus on workplace diversity. After concluding its Women’s Initiative, which ran from 1993 to 2000 and greatly expanded the opportunities for women in the company (the number of female partners increased from 6.5 percent in 1993 to 14 percent in 2000), the firm launched Vision 2005 to address what it saw as a lack of women in leadership positions. The new program’s goal is to achieve a 35 percent annual admission/promotion rate for female partners and directors by 2005, and to have a similar number of women at every level of the firm.
GETTING HIRED Deloitte Consulting does the majority of its hiring on campus. After a resume submission period, the firm invites selected applicants to a first round of interviews, held at the college or business school. It is composed of two 45-minute interviews, the first primarily behavioral, or “fit,” the second a case; the case is said by one
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insider to be “more qualitative, but [you] still have to prove an understanding of math.” Another, who was hired for a financial services position, says one case asked “how to assess a call center’s operations and what the primary cost and revenue drivers were. I also had one on increasing revenue generation within the credit card industry.” Fit questions, on the other hand, tend to be “basic no-brainer scenario questions. ‘Tell me a time when... and give me an example of...’” The second round, also held on campus, involves an interview with two partners that is almost entirely focused on a case review. Applicants can expect to hear back from the firm within two weeks, and if the response is positive they are invited to an “offer day.” We hear the firm is unwilling to negotiate salary, but will give prospective employees their choice of office. The key to succeeding at the Deloitte Consulting interview process is to “demonstrate an understanding of the kind of work that we do,” says one source. As usual in case situations, the case interviewers are said to be “looking for an indication of a rational thought process and a common-sense approach, rather than the right answer.” Arrive at the interview prepared — be sure to “research the company, rehearse answers to frequently asked questions, and think through the skills you bring to the firm and what type of work interests you.” Most people who have been through the consulting interview process describe it as “fairly long and stressful.” And while the firm supposedly “wants someone who is well rounded more than [someone] in the top 5 percent of their class,” grades do have importance. The prestige of a candidate’s school also matters. Deloitte Consulting “lets you know shortly [afterward] by giving a phone call and sending a basket of goodies.” The internship program, for one insider, was “an opportunity to understand in greater detail what the firm offered and what it valued.” Interns can “make meaningful contributions to the clients and get to know the people in the office.” In addition to “some really long hours,” “Deloitte makes sure that the interns get to know each other and have fun during the summer.”
OUR SURVEY SAYS
What does the future hold? Morale at Deloitte Consulting is on the low side, thanks to April 2002’s 10 to 15 percent pay cuts (technically termed “salary adjustments,” given that some Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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consultants did get raises) and earlier layoffs. “There is an overall consensus that the firm didn’t adopt ‘creative’ staff reduction schemes before the recent rounds of layoffs and their solution to cut pay,” says one source. “This has resulted in an overall distrust of management — especially as we try to forge our ‘new identity.’” The firm is “definitely in cost-cutting mode,” we hear, though much of the concern is “because of the consulting industry, not Deloitte specifically. Everyone has seen what has happened in consulting.”
Nice folks to work with Insiders are somewhat more pleased with the day-to-day operations of the firm. The culture, we hear, is open and diverse, with an emphasis on consultant-management interaction. As one source says, “I do not get the feeling that this is a very hierarchical place,” and adds that “you can walk up to and have an open talk with every partner.” Consultants are also happy with the level of diversity, saying that partners “try to make it a comfortable place to work.” On the other hand, another source comments, “there is also a problem of machismo — the perception is that you have to be “passionate” to be doing a good job. Type-B (or, more to the point, anything short of hyper-Type-A) personalities are perceived as less effective employees.” At the same time, some DCers complain that hard work rarely results in efficient work: “Work hours are long but productivity tends to be low,” reports one source. All in all, though, we hear the staff is friendly and fun to work with: “The junior staff in my group are by and large intelligent and dedicated individuals whom I hope to have as colleagues/references in the future,” concludes one source.
Making an impact Deloitte Consulting places a strong emphasis on volunteer work — every May it holds a firm-wide Impact Day, “in which all offices all over the world spend the entire day performing some type of community service.” In New York this means volunteering at local schools, while in Calgary it means teaching computer and related job skills at a community center. Other projects include working at elderly homes, building houses and giving resume workshops. Apart from Impact Day, each office organizes its own volunteer efforts — the Sacramento office, for instance, operates a program called Generating Involvement in Volunteerism through Education and Service, or GIVES, that coordinates employee volunteerism and in May 2001 won the city’s People Helping People Business Award. Participation in community events also “may be rewarded at evaluation time.”
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Where’s the beef? Compensation, for obvious reasons, is high on respondents’ lists of complaints. There have been no bonuses for the last few years, and we are told that salaries in general are “bad relative to the industry, and they price them knowing that.” Adds another source, “I would have said I was satisfied [with my compensation], but the likely blanket reduction in compensation, coupled with the complete dichotomy of skill and effort expended by consultants, is extremely upsetting.” Possibly to offset its low salaries, the firm sells itself as a consultancy with a better working environment than most, we hear, offering “more of a work/life balance, with lots of happy hours.” But while the firm is “always striving for balance, if the client wants something done in a month, it has to get done.” This can mean 70-hour weeks, which brings some Deloitte Consulting insiders great sorrow. “For the amount paid, and coming home at midnight, I was miserable,” carps one veteran of an arduous engagement. Another insider adds that “for a firm which prides itself on work/life balance, I work over 70 hours a week, and my salary will decrease next year. Not exactly the conditions for a motivated and empowered consulting staff.” For those who travel, DC tries to maintain a 5-4-3 schedule — meaning five days of work, four on the road, three nights away — but that, again, is something often left to the client’s whims; one respondent went so far as to say the policy “is a joke.” However, as one insider notes, “Travel requirements vary widely from project to project. It really is luck of the draw. The best way to dodge traveling too much is to specialize in an industry and live in the city where that industry predominates, [such as] financial services in New York, automotive in Detroit and so on.”
Office space: the luck of the draw Opinion of the offices at Deloitte Consulting differ wildly by location. New Yorkers aren’t thrilled, for one. “The New York office is way too crowded,” snoots one insider, even though it “was just remodeled, which is hard to believe.” But a Chicago consultant says the offices there are “very nice.” The Boston office is the “basic oldschool layout,” while Jersey City is lauded for its “stocked kitchen for breakfast and snacking.” In San Francisco, “Remodeling of many offices has focused on collaborative work areas, private communication booths and open, light, high-tech furniture.” But don’t get too attached to your desk. Deloitte Consulting operates a “hoteling” system whereby traveling consultants usually are able to secure space at any office, though “you are not always guaranteed a desk.” Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Rising in the ranks Insiders report that for analysts (new hires), the journey to a partner-level position will “probably take more than 10 years,” although one insider warns that “A new analyst would likely need to return to get an MBA in order to make partner.” Others report that the path “from senior consultant to partner is probably seven to eight years.” Consultants will spend, on average, “two years as senior consultant, three as manager, three to four as senior manager.” Consultants with “substantial industry experience may advance very rapidly. Consultants who sell a lot of work will advance the fastest.” And promotions are “made once a year in the fall.”
Continuous training As at most firms, training at Deloitte Consulting has been cut back significantly, but consultants tell us that it remains top-notch. All new hires are put through a weeklong program in Arizona. Continuing training is “focused on business associates going back to get their MBAs,” though there is also a strong emphasis on technical skills and on-the-job training.”
Changing faces Deloitte Consulting’s Women’s Initiative has “immensely improved” the career prospects for women and “has led a firm-wide realization that the retention of qualified women — and men — is important to the success of the firm.” One source remarks that “Deloitte is recognized as a leader in advancement, retention and promotion of women,” while another insider reports that the firm has “a number of affinity groups targeted at ethnic minority groups, as well as gays and lesbians.” Nevertheless, ethnic diversity could stand a bit more work, according to one consultant, who notes that DC has “few African-American or Hispanic partners or practitioners.” New initiatives are in the works, we hear. “We are working on [diversity], says one consultant. “We enjoyed great success in attracting, retaining and promoting women. We are now focusing that same attention on people from other cultures and ethnic backgrounds.”
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For a detailed 40- to 50-page insider report on Deloitte Consulting, and reports on other firms like McKinsey, BCG, Bain, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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Accenture
PRESTIGE RANKING
1345 Avenue of the Americas New York, NY 10105 Phone: (917) 452-4400 Fax: (917) 527-9915 www.accenture.com
THE STATS
New York, NY (HQ) More than 110 offices worldwide
Employer Type: Public Company Stock Symbol: ACN Stock Exchange: NYSE Chairman & CEO: Joe Forehand 2001 Employees: 75,000 2000 Employees: 71,300 2001 Revenues: $11.4 billion 2000 Revenues: $10.3 billion
PRACTICE AREAS
UPPERS
Global Service Lines: Customer Relationship Management • Finance & Performance Management • Human Performance • Solutions Engineering • Solutions Operations (Outsourcing) • Strategy & Business Architecture • Supply Chain Management • Technology Research & Innovation
• Smart, results-oriented consultants • Very competitive salaries
LOCATIONS
Operating Groups: Communications & High Tech • Electronics & High Tech • Financial Services (Banking; Health Services; Insurance) • Government • Media & Entertainment • Products • Resources (Chemicals; Energy; Forest Products; Metals & Mining; Utilities)
DOWNERS • Long, demanding projects • Interaction with partners can be limited
KEY COMPETITORS Computer Sciences Corporation Deloitte Consulting Electronic Data Systems IBM Global Services KPMG Consulting McKinsey & Company PwC Consulting (Monday)
EMPLOYMENT CONTACT http://careers3.accenture.com/
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
“The Big Dawg” “Arrogant” “Young buck” “Generalists in a specialist world”
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THE SCOOP
Almighty Accenture In December 1997, Accenture — then Andersen Consulting — petitioned to break away from Andersen (then Arthur Andersen), its sibling under the Andersen Worldwide umbrella. After a lengthy arbitration process, in August 2000 the International Court of Arbitration in Paris finally granted independence to the consulting firm that would (as of January 1st, 2001) come to be known as Accenture. Today, Accenture is among the world’s leading providers of management consulting and technology services. With more than 75,000 people in 47 countries, Accenture draws from a vast array of industrial and technical expertise. Consultants in its major operating groups (Communications & High Tech, Financial Services, Government, Products and Resources) and its eight service lines (Customer Relationship Management, Finance & Performance Management, Human Performance, Strategy & Business Architecture, Supply Chain Management, Technology Research & Innovation, Solutions Engineering and Solutions Operations) work together to design and deliver strategies and solutions for 89 of the Fortune Global 100 and more than half of the Fortune Global 500 — not to mention several hundred startups and spin-offs. The firm’s huge staff and wide range of experience enables it to bring both focus and massive manpower to any consulting task.
Long reach Accenture, which works with more than 2,500 client organizations worldwide, earned revenues topping the $11 billion mark in fiscal 2001. The firm has grand plans; through alliances, affiliated companies and other capabilities (known as its “network of businesses” approach), it seeks to “deliver innovations” to clients across a range of industries. When you’re as big as Accenture, the United States alone won’t provide all the revenue and opportunities you need to thrive. Indeed, Accenture is committed to maintaining a global presence — nearly half of all its revenues come from outside of its operations in the Americas — and to furthering its status as a technology leader. The firm garnered more than $3.2 billion in 2001 revenue from its Communications & High Tech operating group, a gain of 15 percent over the previous year. The unit
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accounted for 28 percent of Accenture’s total revenue for the year, the most of any of the firm’s divisions.
Going public In a widely anticipated move in July 2001 — following what most analysts believe was a successful IPO by competitor KPMG Consulting — Accenture raised about $1.7 billion through a public offering. (Despite that huge figure, the stock offered for public sale amounted to no more than 12 percent of the undiluted company.) On the initial day, the firm saw its stock rise 5 percent — not impressive compared to the moonshots of 1999, but extremely respectable for the IPO market of 2001. Accenture sold 115 million shares, leaving partners with control of over 80 percent of the company. Goldman Sachs and Morgan Stanley served as the lead underwriters. Through another offering completed in May 2002, Accenture sold approximately $93 million worth of its shares.
Taking leave Like most of its competitors, Accenture underwent layoffs in 2001. In June, 600 support personnel were cut, followed by an additional 1,500 staffers in August (1,000 of whom were consultants). All told, about 2 percent of the workforce received pink slips. The firm, however, primarily has attempted to reduce its payroll costs through its “FlexLeave” program. In this program, consultants may take voluntary sabbaticals of six to 12 months at 20 percent of their current pay and continued benefits, and their job at Accenture is guaranteed when their time off is finished. About 2,400 consultants had taken FlexLeave as of December 2001; the program has also been extended to Europe and Asia. The slow economy continued to hound Accenture in the first quarter of fiscal 2002, with net income dipping by 45 percent compared to a year earlier. The firm also took a $40 million charge relating to lost business as a result of the September 11 terrorist attacks, but managed to turn an $81.7 million profit in Q1 FY 2002 due in large part to a 32 percent increase in outsourcing revenue. It followed up those results with a $10.6 million profit in Q2 FY 2002. In June Accenture announced layoffs of about 1,000 employees (mainly from the management ranks in the United States, United Kingdom and Australia), but the firm still expects to increase its global staff by approximately 8,000 by the end of fiscal 2003.
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Forehand comes to the forefront In November 1999, Joe W. Forehand was named successor to George Shaheen (who bolted for the ill-fated Internet grocery service Webvan) as CEO and managing partner. Less than two years into his tenure, Forehand was named the industry’s No. 1 most influential consultant by Consulting magazine. (The managing partner for Accenture’s retail operating group, Angela Selden, ranked No. 15 on the June 2001 list.) Forehand also made InformationWeek’s list of the 15 most influential people in the IT industry. At the same time that its fearless leader was winning recognition, the firm as a whole has earned its share of accolades. In 2001, Red Herring named Accenture to its list of the 100 companies Most Likely to Change the World. The firm also ranked third that year among all employers in terms of diversity in Universum’s survey of U.S. students. And in 2002, the firm took fourth in the Universum survey of the most ideal employers according to European grad students.
Training days Accenture boasts that it spent $717 million in fiscal 2001 to train and develop its workforce. Newly hired analysts typically spend two to three weeks at Accenture’s main training facility in St. Charles, Ill., developing team-building and management skills. The system enables Accenture to offer standardized solutions and encourages consultants from disparate offices and backgrounds to work together better (important for a firm with more than 75,000 employees). After their time at St. Charles, Accenture professionals can access the company’s more than 4,000 classroom, computer-based and Web-enabled training programs via a Web-based learning portal.
Creating affiliates Accenture has been busy creating new affiliates to better position itself in the ebusiness marketplace. In March 2000, Accenture announced that it was teaming up with Microsoft to form Avanade, a jointly owned firm that focuses on large-scale technology integration surrounding Microsoft’s enterprise platform. Avanade initially was valued at more than $1 billion, and now has more than 300 customers and over 1,200 employees in 17 cities in 11 countries. Elsewhere, Accenture entered the e-learning market in March 2001 with the formation of Indeliq, a company that provides simulation-based eLearning solutions to help companies improve workforce performance. And in October of that year the
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firm joined Merck-Medco and UnitedHealth Group to launch Xceleron Health LLC, a venture designed to provide business services to the health care industry.
Out of the VC game Alas and alack — it seems that Accenture’s venture capital ambitions will not come to pass. The firm originally had planned to sink as much as $500 million in emerging Internet businesses through its Accenture Technology Ventures unit, but reversed course when many of its investments yielded losses. (According to the company, “The VC exit window lengthened and volatility began to impact corporate earnings.”) In March 2002, Accenture announced that it would sell all of its minority stakes in such companies. Accenture’s current plan calls for the firm to consolidate its holdings into one subsidiary, which would then be sold. Accenture would maintain a small piece of the subsidiary should such a sale occur.
Thinking ‘bout the government Accenture’s government operating group earned just over $1 billion globally in 2001 and continues to pick up new engagements. In May, Web surfers got their first look at Accenture’s redesign of NYC.gov, a portal offering government services for New York City residents. The site, which served as an important communications channel after the September 11th terrorist attacks, has been recognized as being among the “Best of the Web” by Government Technology, and received global recognition from the World Information Technology and Services Alliance (WITSA) for exceptional use of technology. August 2001 saw the firm sign a five-year deal worth a potential $33.6 million to redesign the Internal Revenue Service’s web site. And in December of that year, Accenture inked two deals with the U.S. Department of Education reportedly valued at up to a combined $234 million in a share-in-savings deal.
The move offshore While it claims to have to no corporate headquarters, in February 2001 Accenture became the first professional services firm to move its official residence to Bermuda. The scenic island has no income or capital gains tax, and has a number of other favorable business rules and regulations (or, more to the point, a relative lack of business rules and regulations). The firm points out, though, that it has never been a U.S.-based or U.S.-operated organization and has never operated under a U.S. parent organization. With more than half of its 2,500 partners non-U.S. citizens, it says that as a cultural matter it chose the neutral location of Bermuda — after considering a
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variety of options — for its post-IPO parent company. Accenture also owns an operating company in Luxembourg, another tax haven.
GETTING HIRED Accenture recruits via on-campus events at 125 U.S. universities and colleges, as well as many international campuses. (It also holds live webcasts, chat sessions and other online informational offerings for students at schools where it does not recruit on campus.) Prospective campus hires are generally “required to submit their resumes [along with a personal data form] through their career services offices” and resume drop systems. At schools where there is no formal resume drop system, would-be applicants should contact a recruiter from the office nearest them. Candidates may have up to two interviews on campus. The first is a screening interview, while the second is typically with Accenture employees (usually partners or experienced managers, as well as a peer). These interviews can vary, according to a contact in the recruiting office: “In some cases these interviews are behavioral, and in others they’re case-based.” Also, “Questions definitely depend on service line. Strategy gives case interviews while [other service lines] give behavioral interviews.” One insider reports that “At the second round I was asked a lot of ‘Tell me about a time when’ questions. One was ‘Tell me about a time when you had to work with someone you didn’t know.’” After making it through these screening rounds, there is a day at the nearest office. There are minor variations in the interview process at different offices and campuses; some candidates have had a second round with three managers or partners at an Accenture office. Employees say that “selectivity depends heavily on which service line you are aligned with. Strategy is extremely difficult to enter even with excellent credentials — [other areas] a little less so.” Insiders also say that “We tend to hire most of the people who make it to the office.” While candidates do have the option to fly out to visit their office of interest, “It isn’t necessary to interview where you want to work.” We hear that “Offers are usually extended to successful candidates shortly after the office visit.” Contacts say Accenture makes its big push “at sell weekend, which is very structured.” Reports one insider: “The first day is in the office and features a series of meetings with the various industry groups. They provide much more specific information than you get in the recruitment brochures. There is also the
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opportunity to speak one-on-one with peers, and you go out to wining and dining things and to a show.” The firm has identified several qualities that it believes make a successful Accenture consultant. They include a target GPA (which depends on the type of degree), critical thinking, ability to be a self-starter, ability to juggle multiple activities, problemsolving skills, being a team player, and a willingness to travel. One recruiter tells us that “the type of person we look for performed well academically and is wellrounded, a lifelong learner, is committed to developing a career, [and is] interested in and understands what we do.” The perfect candidate also has “strong written and oral communication skills.” This contact also informs us that “professionals who succeed at [Accenture] embrace the clients’ needs” and “are team- and results-oriented.” Insiders say that even the strongest candidates can improve their chances of being hired by “reading through the [Accenture careers] web site” and “educating yourself on what [Accenture] does, how the company is structured, and what the various organizations and their respective career paths are.” Sources also suggest that candidates “be prepared to articulate which is the best fit for you.” Finally, “It’s also tremendously helpful to have someone in the firm to talk to, so you can get a better sense of what the many choices are.” “There’s only so much you can glean from public sources of information,” insiders conclude.
OUR SURVEY SAYS
Make a mark in your market The amount an Accenture consultant travels has to do with “what market unit you’re in — it’s very regionalized.” Another source concurs: “Those in financial services rarely have to travel outside of the New York metro area; those in communications or other industry groups travel more.” Ultimately, “Unless you live in a market that has your industry group, you’re traveling a lot,” yet another source emphasizes. However, “The staffing coordinators try to take your preferences into account. And as you gain more marketable skills, there are more choices.” But if “you’re right out of college, they tell you where to go,” insiders say. Travel notwithstanding, most respondents have good things to say about the work/life balance at Accenture. Compensation is on par with the rest of the industry, but potential partners beware: As part of a major reduction in corporate spending,
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partner salaries are slated to be cut by 7 to 8 percent and performance option grants will be eliminated. Still, sources lower on the food chain comment that the compensation “is more than fair, especially when I think of the little extras that make work/life balance better: flexible vacation time and overtime for those under manager level, etc.” And “individual projects sometimes have their own perks, [such as] renting out clubs for private parties, PDAs for all on the project and vacations.” For those interested in community work, Accenture may be the perfect place — we hear that volunteer work is a “very important aspect of life at Accenture,” with organized projects including Habitat for Humanity and AIDS walks. It’s so important, in fact, that consultants’ performance evaluations “are based not just on work but other activities in support of the company and the community.”
The slant of the ladder Employees at Accenture have varying opinions regarding how partners treat other employees. One insider complains that partners “usually haven’t time to talk to anybody that isn’t a client.” “Until you are at their level, you don’t get the same respect,” another source explains. “Most of the time you are fairly invisible, but this is good and bad,” adds a third respondent. “While very few are ogres, [partners] are not easily accessible. Don’t expect to make mentors easily.” A few insiders disagree, however. One consultant explains that “executives seem genuinely interested in my ideas and sometimes fascinated by my different experiences.” One area where we hear executives are very responsive is training. While the emphasis has shifted from up-front, new-hire training to continued learning, the opportunities to gain consulting skills or more knowledge of a particular industry are many. “You can even leave in the middle of a project to get training if it will help you in your role better,” notes one source.
Flexing it One advantage respondents praise is Accenture’s voluntary FlexLeave program, which allows employees to take time off from their jobs and still retain 20 percent of their pay, as well as their benefits, laptops and office access. The program is especially popular because it has enabled the firm to keep layoffs and pay cuts down. “FlexLeave is a great option compared to being laid off,” notes one source, though it still doesn’t help some sleep at night. “A taste of the outside world plus a feeling of job insecurity is causing many to jump ship,” one consultant reports. Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Coddled in a cube Some consultants complain that Accenture offices are “too small for so many people,” with “small cubes” and “no privacy.” Another source says that “the offices are iffy,” with a mix of nice amenities and often cramped working quarters. “Sometimes you will have to walk around looking for a space,” reports one insider. On the other hand, another employee reports that the offices are “wonderful. My office building defines the city’s skyline. Executives have offices with immense windows and a great view of the city. Even the cubicles aren’t bad.” And while Accenturites work hard, the office environments are said to be “very friendly and fairly youth-oriented with a strong helping of life/work balance perks.”
Taking diversity to task Insiders report that Accenture handles diversity issues rather well. “There is a diversity task force and activities for just about every minority group. These are open to everyone in the firm, not just to members of the minority group,” says one employee. Another consultant adds, “We were taken to lunch by our office’s diversity task force during our first week to learn about diversity at Accenture.” Still another respondent notes that “There are lots of programs, internal groups (communities), diversity initiatives and efforts to promote these issues.” Nevertheless, “I am not sure if it results in actual progress up the ranks for minorities, who are still small in number.”
For a detailed 40- to 50-page insider report on Accenture, and reports on other firms like McKinsey, BCG, Bain, Deloitte Consulting and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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“Those in financial services rarely have to travel outside of the New York metro area; those in communications or other industry groups travel more.” — Accenture source
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Gartner
PRESTIGE RANKING
56 Top Gallant Road Stamford, CT 06904 Phone: (203) 964-0096 Fax: (203) 316-6300 www.gartner.com
THE STATS
Stamford, CT (HQ) 90 locations worldwide
Employer Type: Public Company Stock Symbol: IT/ITB Stock Exchange: NYSE Chairman & CEO: Michael D. Fleisher 2001 Employees: 4,600 2000 Employees: 4,300 2001 Revenues: $952.0 million 2000 Revenues: $858.7 million
PRACTICE AREAS
UPPERS
Community Consulting Measurement Research
• Flexible hours • Talented and smart staff
LOCATIONS
DOWNERS • Recent layoffs • Not enough internal communication
KEY COMPETITORS AMR Research Forrester Research IDC
EMPLOYMENT CONTACT Human Resources Fax: (203) 316-3445
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Good insight” “Should stick to being analysts” “Well-respected in their niche” “So 1990s”
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THE SCOOP
How does your Gartner grow? Gartner, a globally recognized firm, combines research, consulting, content and events — all with a technological spin. Under Gideon Gartner, who founded the company in 1979, Gartner Group (as it was then known) first went public in 1986 and was traded for two years until it was pulled off the market. A 1993 IPO put the company on the Nasdaq before it was transferred to the New York Stock Exchange in September 1998. Up through 2001, Gartner entered into a series of acquisitions to plump up its size and offerings.
Segmentation Gartner’s business is split between four sectors: Consulting, which focuses on strategy issues (though not implementation) in a variety of industries; Measurement, the performance benchmarking operation; Research & Advisory Services, which employs a staff of 650 experienced analysts who conduct research on more than 200 technology-related subjects; and Community, which brings executives together to compare experiences. A large part of Community is Events, which runs one- to fiveday conferences for business and IT professionals. The flagship event is the Gartner Symposium/ITxpo, the largest conference for the IT industry. San Diego, Orlando, Florence, Tokyo and Cannes will all host versions of the event at different points on the 2002 calendar. The Gartner stable also houses the IT market research firm Dataquest, as well as acquisitions, like telecommunications consultancy Rendall and Associates, public sector consultancy The Warner Group, European event company Integrator Forum Europe, and as of October 2000, Solista Global, a technology consulting firm. In August 2001 Gartner’s Japanese branch signed a joint IT consulting agreement with technology strategy firm Yahagi Consultants Inc. Two months later, Gartner acquired India’s Aims Management Consultants (AMC) for an undisclosed sum. The firm used that acquisition to form Gartner India Research and Advisory Services (GIRAS), a 17-person subsidiary that serves a stable of 85 clients in the country. Gartner also launched a new research arm in June 2001, dubbed GartnerG2, which as of July 2002 has more than 100 clients.
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Silver bells and consulting sales Overall in 2001, Gartner earned $952 million in revenue, up 11 percent from the $854.6 million it tallied the previous year. However, the firm posted a net loss of $66.2 million for the year, due in part to its unprofitable April 2001 sale of TechRepublic Inc. to CNET Networks. In fiscal 2002, Gartner is seeking to earn in the $950 million to $975 million range, with $290 million to $295 million coming from the consulting sector. The firm tallied $53.5 million in consulting revenue in Q1 2002 — an 8 percent increase from the same period a year earlier — but saw overall revenue dip by 3 percent from Q1 2001. On the heels of those results, in January 2002 Garner laid off 60 employees across the company. Gartner has carved out a reputation as a leader in technology research and consulting, succeeding in a year that was notoriously tough for consulting firms. In January 2002 Computerworld named Gartner CIO Bart Stanco to its list of Premier 100 IT Leaders. The firm’s efforts to create a comfortable workplace for its employees also have been recognized; the previous year, Computerworld ranked Gartner No. 52 among the 100 Best Places to Work in IT.
Fleisher’s the man Gartner’s top management underwent some changes in 2001. In May, firm president William McDermott departed to become executive vice president of worldwide sales operations for Siebel Systems, Inc. CEO Michael D. Fleisher took over the job, and after the retirement of Manuel A. Fernandez five months later added the title of chairman of the board to his portfolio. Just 36 years old at the time he was named president, Fleisher has been with Gartner since 1993, and has served as CEO since 1999. With the succession, Fernandez became chairman emeritus; he remains an adviser to the firm.
Furthering the team spirit Gartner, which favors internal promotion, also provides thorough introductory training. Ongoing professional development is available through the firm’s internal Gartner University for consultants employed longer than six months.
Them’s fightin’ words Gartner provides consulting and research services to more than 11,000 client organizations around the world, and boasts a client retention rate of 74 percent. But
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not everyone is so keen on what Gartner’s analysts have to say. In 2001, the firm became embroiled in a war of words with Oracle, the California-based software giant. On its web site, Oracle alleged that there was “documented bias” in Gartner’s August 2001 report on the company. According to The Asian Wall Street Journal, the report was critical of Oracle on some points, but rated the software firm “positively overall.” An Oracle spokeperson, however, asserted that an in-house review of Gartner’s reports on the software company revealed that over a six-month period, 23 percent were critical, compared to just 8 percent for reports on IBM. Gartner — which produced reports on many other companies containing negative analysis during that period — denied the charges, saying that Oracle was confusing “bias” with “independence.” The quasi-feud apparently has been quelled for the time being, however; since the August report, Gartner has given Oracle products a number of favorable reviews (again, according to the firm, purely as a result of objective research, not in an effort to appease irate Oracle executives).
GETTING HIRED The careers section of Gartner’s web site provides job listings for positions in all of the company’s 90 offices worldwide. There are also instructions for applying either by e-mail, fax or postal service. The Gartner HR department will acknowledge receipt of all resumes within 24 hours. Qualified applicants’ information is then reviewed and remains on file for up to six months or until an appropriate position becomes available. The interview process at Gartner is comprised of “several interviews depending on department,” though most respondents report a series of three interviews “with managers and future peers” in which they ask “questions about your experience” and “how you can contribute to the company.” The firm occasionally uses standard case questions, but most of the emphasis in interviews is reportedly on fit and resume strength.
OUR SURVEY SAYS
The smart kids Getting hired by Gartner means you’ll be “working with some of the smartest people in the industry,” one insider tells us. The firm has a diverse, young culture, we hear, Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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and “most staff have only been with the company for a year or two.” This can lead to some disjunction between management and the rank and file, though. As one respondent notes, there is sometimes the problem of “being physically remote from your manager and peers.”
The comforts of Gartner While Gartner may be cutting back from its explosive growth of the last few years, insiders still praise it as a comfortable, friendly place to work. The firm offers “very flexible work hours,” and employees “can work at home” if need be. There is only the occasional weekend at the office, and outside of “at least one internal off-site meeting a year,” there is very little travel involved. And while one source complains of a “lack of a consistent pay scale,” we hear that compensation at Gartner is “on target.” In addition to the full range of standard benefits, the firm also has a charity match program. And while we hear the training could be better, it “has improved in the past few years.”
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“Most staff have only been with the company for a year or two.” — Gartner insider
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A.T. Kearney
PRESTIGE RANKING
5400 Legacy Drive Mailstop B1-1A-01 Plano, TX 75024 Phone: (972) 604-4600 Fax: (972) 604-9596 www.atkearney.com
LOCATIONS Plano, TX (HQ) 60 offices worldwide
PRACTICE AREAS Operations Consulting Strategy & Organization Consulting Technology Consulting
THE STATS Employer Type: Subsidiary of EDS CEO: Dietmar Ostermann 2001 Employees: 4,600 2000 Employees: 5,000 2001 Revenues: $1.2 billion 2000 Revenues: $1.39 billion
UPPERS • No up-or-out pressure • Firm camaraderie • “Cushy” travel while on assignment
DOWNERS • Pressure to bill • Limited career development support • Recent layoffs
KEY COMPETITORS Accenture Bain & Company Booz Allen Hamilton Boston Consulting Group McKinsey & Company
EMPLOYMENT CONTACT North American Campus Recruiting:
[email protected] Phone: (312) 223-6030
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
“Hard-driving” “Solid but not special” “Smart people” “Best days are over”
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North American Senior Recruiting:
[email protected] Phone: (312) 648-0111
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THE SCOOP
A successful start A.T. Kearney is one of the oldest management consulting firms in the world. Founded in Chicago in 1926, it has operated exclusively under its current name since 1946. (The firm was bought by Electronic Data Systems in 1995 but retains its name and identity.) Solid results with early engagements, including an extensive study of U.S. Steel and a longtime relationship with the Kroger supermarket chain, helped put A.T. Kearney on the map. The firm’s growth accelerated when Fred Steingraber became CEO in 1983 (He retired in 2000.) Today, there are close to 5,000 A.T. Kearney employees worldwide, and the firm has operations in 60 cities in 37 countries. A.T. Kearney generally targets Fortune 200 companies. Client companies tend to show a remarkable degree of loyalty toward the firm — more than 90 percent of A.T. Kearney’s engagements are with past clients. While the firm claims expertise in many industries, it is particularly strong in automotive, communications, high tech, consumer industries and retail. And with its massive international expansion efforts, A.T. Kearney earned more than half of its $1.2 billion in 2001 revenue from engagements outside of the United States.
The A.T. Kearney-EDS relationship Is A.T. Kearney a nearly independent consulting firm or merely a “service line” of parent company EDS? The answer: somewhere between the two. EDS is trying to bring A.T. Kearney closer to the fold, while, according to A.T. Kearney CEO Dietmar Ostermann, maintaining the firm’s distinct specialties. In February 2001, A.T. Kearney headquarters were relocated to EDS’s Plano corporate campus. (A.T. Kearney hasn’t abandoned Chicago though — the same number of consultants and other personnel remained in the city.) On the other hand, A.T. Kearney continues to concentrate on shorter, more strategic deals, while IT powerhouse EDS’s forte is long-term, technology outsourcing engagements. EDS believes that the $2.5 billion in new contracts it signed in 2000 were due in large part to Kearney, according to BusinessWeek.
All around the world A.T. Kearney is committed to building a strong international presence. The firm’s newest permanent office is in Bangkok, servicing Thai clients in the banking, high Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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tech, manufacturing and other industries; the office opened in June 2001. A.T. Kearney is also the only major management consulting firm with a presence in China that has offices in both Beijing and Shanghai. Another major target of Kearney’s expansion plans is India. Currently, the firm has a stable of consultants in New Delhi and projects that revenue from the country will grow by 50 percent over the next several years. Most new business in India will focus on privatizations and downsizings. The firm also plans to set up a data and service center there. In April 2001, Kearney extended its India-focused sourcing and procurement alliance with supply chain management solutions provider i2 Technologies. And in June of that year, Indian auto company Tata Engineering hired Kearney consultants to work on a new marketing strategy. Going forward, the firm expects that its main competition in India will be McKinsey, which has been in the country since 1992.
Industry slowdown While international market expansion should help A. T. Kearney in the long run, the short-term late ‘90s Asian economic flu seriously affected the consulting firm’s revenues. Revenue growth slowed in 1999, causing the firm to lay off nearly 200 consultants and postpone start dates for a number of new MBA hires. History repeated itself when an economic slowdown hit the United States a few years later. In July 2001, EDS announced that it was laying off 400 of A.T. Kearney’s 5,000 employees. Start dates for new hires were pushed back as well — some for a year or more, some indefinitely — at several points during 2001 and 2002.
New business ventures and auctions galore In December 1999, EDS announced the creation of EDS-A.T. Kearney Ventures, a new e-business corporate venture capital fund. The $1.5 billion fund is half financed by EDS, with the other half coming from clients and private equity funds. One of the largest funds of its kind, it will focus on B2B and other types of Internet companies over five years, and will allow EDS/A.T. Kearney to take equity in clients for the first time. Also in December 1999, A.T. Kearney launched a worldwide business unit, eBreviate, which focuses on business-to-business Internet auctions. After operating for two years as a wholly owned EDS subsidiary, eBreviate was rolled into a new unit known as A.T. Kearney Procurement Solutions in December 2001.
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Working for The Man, here and abroad In October 2001, the Beijing Municipal Science and Technology Commission hired A.T. Kearney to recommend strategies to transform the city’s software industry. Three months later, the firm began advising the government of India on ways to remove regulatory barriers to foreign investments in the country. Also in January 2002, A.T. Kearney vice president Ben T. Smith IV signed on for a one-year project with the U.S. Department of Transportation, working on the planning and implementation of the department’s new Transportation Security Administration.
Rewarding achievements A.T. Kearney launched the Global Excellence in Operations (GEO) Awards in June 1999. These awards, the first of their scale or scope, recognize the most effective and innovative business operations at national, regional and global levels. The result is an extensive database containing some of the world’s most advantageous business practices. The 2001 winner was Italy’s Brembo S.p.A., a leading manufacturer of high performance braking systems. Internal A.T. Kearney awards for excellence include Great Client Work Awards, the Intellectual Capital Recognition Program and the Distinguished People Awards, a program celebrating outstanding contributions to A.T. Kearney’s culture.
New and newsworthy Fred Steingraber (now chairman emeritus) and A.T. Kearney jointly endowed the first chair in business strategy at the University of Chicago Graduate School of Business. The Fred G. Steingraber A.T. Kearney Professorship currently honors Toby E. Stuart, a leading scholar in technology strategy, corporate strategy and hightech entrepreneurship.
Road sage A.T. Kearney pledges that no consultant will work on an engagement for more than nine months. But while the firm’s projects are famously short, its hours are notoriously long. To combat the often brutal nature of employees’ travel schedules, the firm has adopted “434U,” a policy theoretically ensuring that consultants will spend no more than four days and three nights a week at a client site. Kearney also offers part-time and flex-time programs.
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GETTING HIRED Don’t expect to see an A.T. Kearney recruiter roaming around your school anytime soon. After hiring 248 new employees in 2001 (which turned out to be 248 more than it needed), the firm canceled all U.S. campus recruiting at both the undergraduate and graduate levels for the class of 2002. Hiring of experienced candidates has been restricted to the vice president and senior principal levels. The firm does expect to return to campuses in 2003, so it is still important to be aware of its past hiring practices. When applying to the firm, candidates choose to interview in one of three areas: General Practice, Strategic Information Technology Practice, or the Financial Institutions Group. The process consists of two rounds of interviews, usually completed within a three-week period. The first round includes two back-to-back 45-minute interviews. While this round is case-intensive, applicants have the opportunity to ask questions about the firm’s culture and preferred industries. First-round interviews are typically held on campus, at the most local firm branch or at a nearby hotel. Generally, the firm informs applicants if they have advanced to the next round the day after their first round of interviews. In the second round, MBA applicants go through another five interviews with senior Kearney staffers. Some of these again are case-based, and “each case is based on the practice [the interviewer] was in.” These interviews “are not focused on strategy. It’s more like supply chain stuff.” Although candidates still may not have a sense of whether an offer is forthcoming, by the third round they are in select company. “The largest percentage of cuts were made before the final round,” says a former interviewee. “If you make it [to that round] you have a good shot.” Insiders report that A.T. Kearney interviewers are “kind” and “supportive.” Although the interview questions — especially the case studies — are themselves often tough, the interviewers don’t try to bully or intimidate. One insider reports, “The Kearney consultants who interviewed me had a minimal amount of attitude. They were bright, friendly and very likeable.” Other insiders report that their overwhelmingly positive impressions of interviewers led them to pick Kearney over other firms. One offeree goes so far as to say, “I was willing to take a lower salary than I was offered at [another firm] because the people were great. Very smart and very fun.”
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OUR SURVEY SAYS
Quality-conscious Kearney As part of its “zealous” commitment to quality, A.T. Kearney keeps a close eye on employee performance. The firm conducts periodic evaluations to assess the quality of each employee’s work. These are “pretty thorough” and tied to any “bonus or pay raise.” A.T. Kearney was ranked 16th overall among Fortune’s 50 Companies MBAs Love in 2001. And one source tells us that A.T. Kearney gives “a lot of attention to my personal development. The review process is very thorough, and you have the opportunity to improve yourself.”
The issue of diversity A.T. Kearney is said to employ “a mix of people including new MBAs, undergrads and industry experts — especially from the high-tech industry.” Insiders consistently report that there is “no pressure to conform to any type of image.” Indeed, unlike the drone-in-a-suit stereotypes that permeate other firms, “you will rarely hear about the typical A.T. Kearney person.” However, “most [consultants at] higher levels are older white males” and “more conservative.” Despite one insider’s assertion that there is “no A.T. Kearney prototype,” not everybody agrees that the firm’s diversity is up to par. “A.T. Kearney’s better than most, which is not to say that it’s good,” notes one consultant. “About a third of the people I entered with were women. But I didn’t see that many non-Caucasians, especially at the top levels. That’s probably a function of the fact that this emphasis on diversity is a fairly new thing. Diversity hiring has only been in effect for four to five years, and it will probably take another four to five years before we see a difference at the top.” Nonetheless, one source recently described the minority presence as “really strong.”
Flexible promotions — and even casual dress Many consulting firms have a rigid promotion process. Not so at A.T. Kearney. One consultant praises the lack of an up-or-out policy. “That kind of policy creates a lot of insecurity. It’s survival of the fittest, and I don’t know how much teamwork a culture like that would encourage. A.T. Kearney doesn’t have that policy, and it makes it a nicer place to work.” And just to make sure people are relaxed, the firm allows business casual dress five days a week. Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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PwC Consulting
PRESTIGE RANKING
11 Madison Avenue New York, NY 10010 Phone: (646) 471-4000 Fax: (646) 394-1301 www.pwcconsulting.com
LOCATIONS New York, NY (HQ) Offices in 53 countries and territories
THE STATS Employer Type: A business of PricewaterhouseCoopers (pending proposed IBM acquisition) President & CEO: Greg D. Brenneman 2002 Employees: 33,000 2001 Employees: 35,000 2001 Revenues: $7.48 billion 2000 Revenues: $7.13 billion
UPPERS PRACTICE AREAS Application Management and Business Process Management Customer Relationship Management Solutions Financial Management Solutions Human Capital Solutions Information Technology Solutions Strategic Change Solutions Supply Chain & Operations Solutions
• Family-friendly firm • Great training for new hires
DOWNERS • Ever-changing culture • Recent pay cuts
KEY COMPETITORS Accenture Booz Allen Hamilton Cap Gemini Ernst & Young Deloitte Consulting IBM Global Services KPMG Consulting McKinsey & Company
EMPLOYMENT CONTACT THE BUZZ
www.pwcconsulting.com/careers
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Capable” • “Another accountant doing consulting” • “A formidable competitor” • “Big, big, big”
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THE SCOOP
Spin-off city PwC Consulting has undergone many changes recently, from its name to its future status as a public company. Formerly known as PricewaterhouseCoopers Management Consulting Services and soon to be known as Monday, PwC Consulting has 33,000 employees in 53 countries and territories, not to mention more than $7 billion in annual revenues. The firm was slated to be spun off from parent company PricewaterhouseCoopers in 2002, to enable it to compete as an independent entity with industry stalwarts such as Accenture, Deloitte Consulting, Cap Gemini Ernst & Young, and KPMG Consulting, as well as top strategy firms such as McKinsey, Bain & Company and The Boston Consulting Group. Yet another dramatic change of fortune came in July 2002, when PwC Consulting agreed to be acquired by IBM for $3.5 billion in cash and stock. PwC Consulting will not pursue its IPO.
A distance relationship between accounting and consulting In February 2000 PricewaterhouseCoopers began pursuing steps to “dis-aggregate” its businesses in order to satisfy regulatory needs, client needs and organizational aspirations. That May, PwC’s new restructuring plan seemed under way with the renaming of Global HR Solutions, now known as Unifi Network. In what also appeared to be an execution of the dis-aggregation plan, September 2000 saw Hewlett-Packard enter initial talks to purchase the Management Consulting Services arm of PwC, in what could have been an $18 billion deal. Hewlett-Packard, hurting from the tech slump, terminated these discussions in November 2000; however, rumors linking the two firms continued to swirl, especially following the May 2001 announcement of an HP and PwC Management Consulting Services aviation industry consulting alliance.
Taking it to the stock market In the summer of 2001, PricewaterhouseCoopers redubbed its consulting business PwC Consulting. The parent firm originally had planned the ultimate operational separation of its consulting arm from other business services to take place at that time, but apparently did not feel that the move went far enough. In January 2002 PricewaterhouseCoopers announced that it would file for a public offering of the
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consulting business. Press reports have speculated that the IPO, tentatively scheduled for August 2002, could be worth up to $9 billion. The firm had contemplated a public offering for about two years, but was either unwilling or unable to make it happen. In the wake of the scandal surrounding Andersen’s dealings with Enron, however, PricewaterhouseCoopers felt that the time was right to float PwC Consulting. The proposed offering is intended to send the public a strong message about the independence of the firm’s auditing and consulting businesses. In order for politicians, fellow Big Five-ers and potential investors to know just where it stands, PricewaterhouseCoopers has voiced its support for regulations that would ban professional services firms from offering internal audits or IT consulting advice to clients for which they perform independent audits. This point was driven home in February 2002, when PricewaterhouseCoopers auditing client The Walt Disney Company announced that it would no longer use the firm’s consulting services. Disney, which reportedly paid PwC $31.9 million for consulting work in 2001, was the first major company to make such a move. The media conglomerate did not cite any difficulties with PwC Consulting, and the firm hopes to regain the account once it becomes fully independent.
New blood at the top Leading PwC Consulting into this brave new world is Thomas O’Neill. Formerly the firm’s chief operating officer, O’Neill was named to the CEO post in January 2002. He succeeds Scott Hartz, who had held the position since 1995. O’Neill has been with the firm since 1967, and has been a partner since 1978. Before becoming COO, he served as CEO of PricewaterhouseCoopers’ Canadian branch. O’Neill’s appointment came less than two months after U.S. Chairman and Senior Partner Samuel A. DiPiazza Jr. was selected to succeed James J. Schiro as CEO of parent firm PricewaterhouseCoopers.
A firm by any other name In 1966, California pop quartet The Mamas and the Papas scored a No. 1 hit with their classic song “Monday, Monday.” The John Phillips-penned tune declared that “Every other day of the week is fine/but whenever Monday comes you can find me cryin’ all of the time.” Thirteen years later, The Boomtown Rats wrote “I Don’t Like Mondays,” further echoing the feelings of millions of music fans toward the day at the beginning of the workweek. Flying in the face of such popular wisdom, in June 2002 PwC Consulting announced that it was changing its name to “Monday” upon
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completion of its separation from PricewaterhouseCoopers. The firm asserted that the new moniker is “exactly what we want it to be as we create our new business: a real word, concise, recognizable, global, and the right fit for a company that works hard to deliver results.” While the reference to the name being a “real word” seems to be a direct shot at the much-maligned “Accenture,” the relative wisdom of the choice of “Monday” immediately stirred a great deal of debate among industry insiders. The point was soon moot — the announced acquisition of PwC Consulting by IBM effectively put the kibosh on the firm’s elaborate rebranding strategy.
Bumps along the road Despite its size, PwC Consulting has not been immune to the economic downturn of the last two years. As its Fortune 500 clients scale back on spending and personnel, so must PwC Consulting. Early in 2001, the firm cut 500 consultants from its U.S. and British operations. In April of that year, PwC announced further cutbacks that amounted to the loss of 1,000 consultants from the U.S. consulting unit, or 8 percent of consulting employees. A third round of cuts, representing another 5 percent of the U.S. consulting staff, came in August. An additional 78 newly hired grads were also let go that month, just weeks before they were scheduled to start work, though they were given the equivalent of two months’ salary for their trouble. The U.K. branch laid off 280 consultants in September, and 330 more IT consultants and support personnel were asked to leave voluntarily the next month. PwC Consulting staffers in other European offices did not escape the ax either — in October the firm laid off 2 percent of its 1,000-person workforce in Poland, and two months later cut 4 percent of its 1,500 employees in Spain.
New angles PwC Consulting has a particular affinity for new technologies (e.g., VPNs, virtual private networks and synchronous optical networks) that keep networking costs to a minimum and increase flexibility, reliability, and responsiveness. The firm’s intellectual capital can be accessed directly on the Web, and customers and consultants can link up to conduct business on secure sites. With such interest and proficiency in the market, it isn’t surprising that PwC Consulting has designed, operated and hosted some of the largest eMarket exchanges. The firm also has won considerable recognition for its technology leadership. It was ranked No. 1 for ERP Services by IDC in 2000, and that year landed at No. 3 on eWeek’s e-business networking FastTrack. In 2001 IDC named PwC Consulting the No. 1 firm in the realm of e-markets. And in 2002, the Federal CIO Council and the Industry Advisory Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Council’s e-Gov Shared Interest Group awarded the firm two Excellence.Gov Awards for innovation in the realm of e-government.
Female-friendly culture PricewaterhouseCoopers has been one of Working Mother magazine’s 100 Best Companies for Working Mothers for the past three years in a row. In 2001 PwC Consulting’s parent cracked the list’s top 10, becoming the first professional services firm to do so. Continuing in that woman-friendly tradition, PwC Consulting has recently implemented a number of new programs. Among these are a new parental leave policy, expansion of the sick time policy, emergency backup child care, and a new-mothers’ lactation program. PwC has appointed a female partner to be dedicated full-time to increasing “work/life effectiveness,” diversity recruiting and retention. The firm also facilitates “networking circles” for female staff in various offices across the country to encourage women to network and mentor each other through each stage of their careers. In addition to its efforts — and successes — in recruiting and retaining women, PwC Consulting has a dedicated Diversity Recruiting and Retention team and has adopted a variety of programs to foster communication, mentoring and networking.
An appealing place for all Other new PwC Consulting programs are aimed at work/life balance. More Nights @ Home helps staffers manage their time by offering alternatives to the traditional workweek, as allowed by project demands. A second program, For Your Convenience (FYC), is a concierge service available at many U.S. locations that for a small fee will run errands such as grocery shopping or dog walking while an employee is out of town. Consultants who have difficulty coping with the demanding lifestyle can take a one-and-a-half-day Personal Survival Series seminar, which includes stress management lectures and activities. The firm also allows consultants to telecommute or arrange flexible work schedules. Finally, the awkwardly named LifeBalance OneSource provides referrals to resources for matters ranging from emotional health to education and schooling and from child and elder care to work issues. All of these programs have paid off: PwC Consulting was ranked No. 7 in Consulting magazine’s inaugural Top Ten Consulting Firms to Work For list in May 2001 and No. 10 in ComputerWorld’s 100 Best Places to Work in IT list in June 2001 (marking the seventh straight year the firm has made the top 20). Of course, the consulting industry is not for everyone, so PwC Consulting offers a professional career
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counseling service through a Career Management Center. The center advises employees on other opportunities both within and outside the firm.
A nation of training opportunities Andersen isn’t the only Big Five consultancy with a swanky training facility. PwC Consulting has its Learning and Professional Development Center in Tampa, Fla., that can host up to 750 participants for 10- to 12-week IT training sessions. New hires head to the 23-acre center for courses on topics from application development to business process solutions. The Global Training Center is located in Philadelphia, and its courses teach best practices and professional development skills. There are also extensive opportunities for self-paced, computer-based courses, instructor-led classes, and on-the-job learning experiences. An added bonus is the distancelearning MBA program offered jointly by PwC Consulting and the University of Georgia’s Terry College of Business. The program is tailored to enable consultants to pursue MBAs while working on client engagements. In addition, PwC offers tuition sponsorship for other executive MBA programs across the country, as well as full-time sponsorship for top-performing staff members who want to pursue a degree full time.
GETTING HIRED In PwC Consulting’s traditional hiring process, undergraduate and MBA applicants generally go through two on-campus interviews, though some undergrads report making it through to the next round after just one interview. Second-round interviews, which vary in number, are conducted by several partners and staff members and usually take place at PwC Consulting’s offices. Case questions are sometimes used for undergrads and always used for MBAs, but “it’s nothing a candidate should try to prepare for. If you have up-to-date knowledge of the industry you are interested in, and can think logically through a problem, you should be able to breeze through it.” Brainteasers can also sometimes find their way into interviews (“How would you estimate the number of stop lights in Manhattan?”), as can other odd questions — one example we’ve heard is “Convince me that the sky is blue.” Candidates are notified of hiring decisions soon after the day’s activities have been completed. Says one MBA of his run through the gauntlet: “I had to meet recruiters, junior consultants, senior consultants, directors and ultimately several partners.” Advises another, “The consultants have a big say in whether the person is to be extended an Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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offer or not. Don’t just try to impress the partners!” Some applicants are also given the B-APT test, “which gauges how [you] would fare in the PwC Ascent training.” Unfortunately, campus hiring has been suspended temporarily, and many of PwC Consulting’s other recruiting channels “have dried up” recently. For now, “Most recruiting is on an ‘as needed’ basis for project-specific needs.” When the economy improves sufficiently, insiders expect the once “great hiring process” to come back into practice.
OUR SURVEY SAYS
Flux time With a merger (between Price Waterhouse and Coopers & Lybrand), a proposed public offering and a recession all occurring over the last couple of years, the culture at PwC, understandably, is in a state of flux. Says one veteran, “Before our merger, there was more of a ‘family’ environment. Everyone knew everyone else, and there was a feeling of community. Since the merger, it feels like we are too big to have a feeling of ‘one.’” “Up until the last fiscal year I think that the culture of this firm was extremely positive,” adds one insider. “However, given the slowdown in the economy and the additional pressures exerted on the industry by the Enron/Andersen scandal, our firm has made decisions at the executive level that have really damaged the firm culture.” Specifically, those decisions include job cuts and pay reductions. Notes one senior consultant, “Many of the all-stars are leaving due to the socialist stance the partners took in giving everyone a 7 percent pay cut.” Others put a different spin on the firm’s ongoing metamorphosis. “The culture was more pleasant a few years ago, but the pressure on the consulting industry is changing that,” observes an employee in New York City. “Given the constraints I believe this place is more pleasant to work at than some other consulting companies I worked for.” Aside from some complaints about the firm’s management, insiders have genuine affection for one another. It is a “very supportive, team-oriented culture where co-workers often develop close friendships outside of work.” At the same time, it is a “no-nonsense work culture” where “Type-A personalities abound.” Sums up one immodest source, “The people here are what make it home for me. We are social, capable, loyal, honest, fun-loving, occasionally hung over and hardworking. All in all, we are great people.”
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Great early training PwC consultants universally laud the firm’s training for new hires. “One of the main reasons for choosing PwC is the extensive training we receive when starting with the firm,” says an analyst. “Ten to 13 weeks, compared to the two weeks other Big Five firms provide, gave me a huge advantage on my first project.” Adds another, “I think that the company invests an incredible amount of resources and money in their new hires.” Employees “are required to have 20 hours of training a year, because we are still connected with the accounting side of the firm.” The training programs for seasoned consultants do not garner the same high marks, however. An employee in Los Angeles explains: “Training has become more ‘just in time’ lately, and the quality is questionable. There are a number of good, practical courses, but there are some that make you want to bang your head on your desk because they are too theoretical or simply living in a fantasy land.” Additionally, “If you are billable and working many hours, you usually have a hard time actually getting approval to take training, let alone training off-site. That would cost the firm money.” Consultants often fill their training requirement through the use of computer-based training (CBT) courses, of which “there are plenty offered,” but which “are not up to date with the latest technologies and are very boring.”
Lambasting the compensation structure Employees pull few punches when talking about compensation issues. The firm instituted a 7 percent across-the-board pay cut in the fall of 2001 — insiders say it was “an absolute morale killer” — and “it is rumored that there may be a pay cut coming again this year.” “Most people no longer feel any ownership or responsibility to this company,” says one source. Notes a senior consultant, “I am making 7 percent less this year even though I was given a promotion and am doing more challenging work. And frankly, we have no doubt that when business turns around, the partners will benefit and there will be little thought to restoring the 7 percent.” Adding to the frustration is the often-confusing nature of the bonus system. “They’ve changed their bonus structure every single year since I’ve been with the firm,” complains an employee in Charlotte. With the public offering looming on the horizon, “No one really knows what to expect.” Most believe that “post-IPO compensation will be incentive pay with a lower base,” but, says one consultant, “I’m not too optimistic that I’m going to like it because I have yet to see [a merit-based system] work.”
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Feast or famine When asked about their work hours, PwC consultants are diplomatic. “Hours are reasonable, but you never know when an assignment can pop up and you’ll be expected to put in some long nights,” says a consultant in Washington. Notes a colleague in Fairfax, “PwC does make an effort to stress the importance of work/life balance. One of the phrases is ‘You won’t enjoy life without work, and you won’t enjoy work without a life.’” At the same time, adds one insider, “It is expected that when there is work to do, that it will get done regardless of how many hours and/or weekends employees might have to work.” As is typical in the industry, the work schedule is a feast-or-famine proposition. “When it’s hot, it’s hot, but when it’s not, can you say ‘Institute of Art on Tuesday?’” asks a Seurat-loving consultant in Chicago. Many consultants report logging a fair amount of time on the beach of late, though “this year is the aberration.” Says one senior consultant, “Due to the rough economy I’ve been on the beach recently, but this is the first time in my employment history that has happened.” Beach time also varies quite a bit from one consultant to another. “How much time you spend on the beach really depends on who you know, not what you know,” says a source in the nation’s capital. This is not to say that employees are always lobbying for time off from projects, however: “People don’t complain as much about the hours, knowing that if you’re on the beach, you may be on someone’s list to be laid off.” Moreover, a manager warns would-be beachcombers not to misunderstand the phraseology: “Even when on the beach, we tend to work very long hours on proposals. In fact, it is not uncommon to work longer hours on the beach than on a typical client engagement.”
Nobody’s home While the hours are usually manageable, expect to be on the road a lot. Simply put, “You go where your client is.” For most PwCers, that means being at the client site for most of the week, though it does not necessarily entail getting on an airplane. PwC Consulting “provides the More Nights @ Home program, in which consultants “arrive at the client site early on Monday morning and leave late on Thursday night.” Most within the firm appreciate the intent of the policy, though one complains that “I have spent a total of two Wednesdays in my hometown in the last two years.” Insiders generally seem resigned to the idea that it is “nearly impossible to be a consultant without traveling to the client site.” Jokes one, “They say that this is a pretty good job if you have a bad marriage.” Fortunately, “The longer you are with the firm, the more likely it is that you can find your next gig locally.”
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Trying to improve Much like its peer firms, PwC Consulting has made strong efforts to address diversity issues. How successful those efforts have been, however, remains open to debate. The firm is said to be “very diverse, but not at the project management and partner level.” A consultant in Los Angeles remarks that “the firm has many diversity initiatives established, [but] sometimes communication about these initiatives is not given to all employees.” Men and women alike agree that they “have seen few organizations where women are given more opportunity,” yet many “still find it to be an old boys’ club.” The “partner ratio is still dominated by men, but it is quickly changing.” Others contend that “PwC Consulting can do more to assist lower-level women staff to make it through the ranks.” One woman says that whatever problems exist in this area are due more to the nature of the industry than any firm-specific deficiencies. “This is not the ideal career for many women. I fully expect to look for alternatives when children come into the picture. These alternatives may exist within PwC, but it’s not my expectation that they can bend completely to my priorities.” Views are similarly conflicting in regard to minority hiring and retention. “The firm seems to be making an effort to have programs that involve minorities,” says a D.C. consultant. “However, such programs are usually overlooked by non-minorities, and as such the programs don’t really promote interaction among different groups.” Many assert that “the firm hires more individuals of some minority groups than others.” For example, says a senior consultant, “The firm does fine with Indian and Asian [employees], as that comprises a majority of the people I work with. AfricanAmerican and Latin people are grossly underrepresented, due partially to the firm’s lack of minorities in leadership positions.” While the numbers may not be equal, other employees do not see a problem: “The firm does as it should — promote and hire on credentials,” opines a source in Atlanta. “If as a minority you are hired or promoted, you can be well-assured that it was because it was earned.”
For a detailed 40- to 50-page insider report on PwC Consulting, and reports on other firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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KPMG Consulting
PRESTIGE RANKING
1676 International Drive McLean, VA 22102 Phone: (866) FOR-KCIN www.kpmgconsulting.com
LOCATIONS McLean, VA (HQ) 163 offices worldwide
PRACTICE AREAS Broadband Solution Centers Customer Relationship Management Emerging Technology — Mobile Solutions Enterprise Solutions Government, Education and Health Care Solutions Homeland Security Infrastructure Solutions Integration Services Managed Services Strategy & Business Process Services Supply Chain Management
THE STATS Employer Type: Public Company Stock Symbol: KCIN Stock Exchange: Nasdaq CEO: Rand Blazer 2001 Employees: 10,000 2000 Employees: 9,100 2001 Revenues: $2.86 billion 2000 Revenues: $2.37 billion
UPPERS • Flexible hours • Community involvement assistance
DOWNERS • Turnover and travel • Bureaucracy can be overwhelming
KEY COMPETITORS Accenture Cap Gemini Ernst & Young Deloitte Consulting Electronic Data Systems IBM Global Services PwC Consulting (Monday)
EMPLOYMENT CONTACT https://kpmgconsulting.recruitmax.co m/eng/candidates/
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
“Family-friendly” “Trying to define itself” “Still strong” “Bargain basement”
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THE SCOOP
Growing the business Spun off from Big Five firm KPMG LLP in January 2000, KPMG Consulting, Inc. (also called KCIN internally) has been making a name for itself ever since. The firm offers consulting services in the areas of financial services, consumer and industrial markets, communications and content, high tech and public services; plus, KPMG Consulting has been forming new alliances to help grow the business systems integration area. As of mid-2002, KPMG Consulting boasted more than 9,000 employees worldwide. Revenues for this global behemoth totaled $2.86 billion in 2001 — a 20.5 percent increase over its 2000 revenues.
Public spectacle In May 2000, KPMG Consulting became the first Big Five consulting firm to file for an IPO, marking the end of a period of intense speculation. The waiting was over on February 8, 2001, when KPMG Consulting offered more than 112 million shares to the public at $18 and watched the value rise 30 percent to over $23 per share during the course of the day. Of the shares offered, KPMG Consulting had owned 31.8 million, and KPMG LLP, the firm’s parent, had owned 80.6 million. (KPMG LLP no longer holds a stake in KPMG Consulting; with the IPO, it sold off its entire investment.) The offering constituted 73.7 percent of the 152.1 million shares outstanding, and many on Wall Street hailed the IPO as a success.
Health problems However, KPMG Consulting has had a bit of a rocky road since going public. In February 2000 the company announced layoffs of 350 consultants due to “revised revenue expectations.” Chief executive Rand Blazer had been hoping for a growth rate of 38 percent for fiscal 2000 — but with growth running at a mere 20 percent, he decided to hand out pink slips. In April 2001, the company announced a workforce reduction of another 450 to 550 positions. In August the firm announced that while overall revenues for the year were up, fiscal fourth quarter revenue totaled $723 million, a 4 percent decline from Q3, (though an 8 percent increase compared with the same quarter in the previous year). Revenue in the firm’s financial services unit dropped by nearly 40 percent for the quarter, while health care revenue was down 24 percent. As a result, the firm restructured its health Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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care unit, folding operations into the public services and high technology arms. KPMG Consulting’s public sector continued to show strong growth, however, due to anticipated increased government spending. Unfortunately, the first quarter of fiscal 2002 brought more unsettling news, with revenue dropping by $114 million (in part as a result of September 11th), or 15.8 percent from the previous quarter. Revenue and net income figures continued to decline in Q2. In October 2001, several hundred employees were offered voluntary furloughs of three to six months, during which time they had the option of working on a part-time or on-call basis. According to company spokesman John Schneidawind, the furloughs were an attempt “to avoid layoffs at all costs.” Unfortunately they did not accomplish that objective — the following month the firm announced that it would cut 300 to 400 jobs, or about 3 percent of its workforce.
All the right moves KPMG Consulting has been making many moves to improve its business. The IPO initially included operations in the United States and 15 other countries (Canada, Argentina, Brazil, Mexico, Colombia, Costa Rica, Guatemala, Ireland, Israel, Japan, New Zealand, Nicaragua, Peru, South Korea and Venezuela), and the company has since expanded by acquiring the consulting practices from KPMG International in Australia as well as market rights in parts of Greater China. In June 2002 it announced an agreement to acquire KPMG Consulting AG, the German, Swiss and Austrian consulting practices of KPMG International, for $685 million. The firm’s boldest and perhaps most controversial move came in May 2002, when it signed a letter of intent to acquire most of Andersen’s global consulting operations — including the 1,400-employee U.S. arm, for which KPMG Consulting agreed to pay $63 million in June — in a deal reportedly worth up to a total of $284 million. With the deal, KPMG Consulting would increase its global workforce to more than 16,000 employees. In June the firm entered into definitive agreements to acquire the independent business consulting units of member firms of Andersen Worldwide Société Cooperative in Japan, Norway, Finland, Switzerland and Sweden. KPMG Consulting also acquired significant portions of the consulting units of Andersen’s member firms in Australia, Hong Kong and mainland China. At the time of this writing the firm was engaged in ongoing discussions to acquire additional Andersen practices as well.
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Tech fiesta At a time when many consulting companies have been trumpeting their e-business experience, KPMG Consulting slowly but surely has become an e-business powerhouse. In May 1999 it acquired Softline Systems & Integrators, Inc., bringing in about 450 new consultants and gaining control of Softline’s software. The firm also developed a new intranet, dubbed Inside KPMG Consulting, where consultants can access engagement-related documents and training and business development tools, as well HR policies and information. KPMG Consulting also has formed more than 40 strategic alliances. In 2000 the firm signed a number of agreements, including one with Internet software provider Inktomi and another with four other technology companies — DataChannel, Oblix Inc., BackWeb Technologies and Interlynx Technology. In June 2001, KPMG announced a partnership with Microsoft to develop new interactive television services. The two companies are joined in the alliance by software firms BSQUARE Corp. and Rachis Corp. Other alliances announced in 2001 include Vitria Technology, Mercator Software, webMethods, and an expansion of an existing alliance with Compaq. The trend continued in 2002, with KPMG Consulting announcing an exclusive supply chain solution marketing agreement with Procter & Gamble in March. The firm also expanded its alliance with Sun Microsystems that year and entered into separate agreements with e-Business platform provider IONA and HAHT Commerce, a provider of demand chain management applications for the consumer packaged goods industry.
On the road Acknowledging the sometimes hectic lifestyle endemic to the consulting industry, KPMG Consulting recently adopted a “Traveler’s Bill of Rights” to help its employees cope. The program is designed to ensure that consultants have a five-day workweek, during which they are not out of the office for more than four days or away from home for more than three nights. In order to make sure these policies are upheld, the firm staffs projects with locally based consultants whenever possible.
GETTING HIRED Since the firm’s consultants are focused on specific industries, KPMG Consulting places an emphasis on hiring professionals with experience in their chosen sectors. When it comes to hiring prospects, one source is optimistic: “For the most part, you Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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have to have a decent amount of skills, but occasionally specific projects hire a lot of people very quickly.” Candidates can expect “four to five interviews: a screening interview (usually over the phone) and then a series of interviews with employees from the group you will be working in, either during an office visit or over the phone.” Insiders tell us the types of questions are “driven by the individual interviewer, not by formal processes,” but typically, candidates can expect “a case study, lots of questions about your experiences, teamwork skills and so on.” To prepare, insiders advise researching the specific practice area in which you are interested and to “be flexible” as far as scheduling goes. Insiders tell us that new KPMG Consulting employees can expect “four days of training [including] two days of firm-wide material” that explain what the “values, goals, and mission of the firm are” and “two days of consulting-specific material” that include “procedures, case studies and so on.”
OUR SURVEY SAYS
A large bureaucracy Insiders tell us that KPMG Consulting employees have “a lot of freedom in terms of projects.” However, this freedom comes with a price. “If you don’t know how to work the system, you get screwed,” a source claims. “It’s not by design — the company is very disorganized.” This same source warns, “They’ll put you on something you don’t want to be on unless you’re firm about it.” Another consultant explains, “If you are honest from the beginning about your expectations and requirements, things can be worked out.” Insiders say that “newbies” should “find a manager you are compatible with and become a sponge” in order to get staffed on the best projects. KPMG Consulting tells us that its “Opportunities within Consulting” program provides an internal method for consultants to find a better niche within the company. “Sharp and motivated consultants can get a lot of opportunity quickly,” notes one employee. Still, insiders in the high-tech practice especially complain of staffing missteps. One frustrated consultant explains, “I was supposed to be the information architect on my project — but I’ve just been doing a lot of research.” Another adds, “I like the client engagements, but I don’t like the office environment. I would prefer somewhere where both were equally impressive.” 156
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The firm’s reputation in the technology consulting field is “very strong,” mainly because of “the firm’s focus on e-business and e-strategy and our partnerships with Microsoft, Cisco and SAP, among others.” Insiders say that the firm considers Accenture, IBM Global Services, PwC Consulting (Monday) and a few others among its chief competitors, although KPMG Consulting is also competing with Internet consultancies, such as Sapient, for clients.
Choose your office wisely Insiders report that “culture varies somewhat between offices. In D.C., for example, there’s a gay/lesbian support group. Raleigh is very stuffy and ‘old-boy’ and the Silicon Valley office is ‘very laid-back.’” In general, the smaller offices tend to be more rigid and controlling, insiders say, and “a lot of the culture depends on your practice and the group you are working in.” In terms of design, “the KPMG offices are nice” and “reasonably comfortable,” with “typical office décor — plain colors, nothing overly creative or unusual.”
Take a hike Now is also the time to sign up for your frequent-flier card. According to one source, “Most everyone travels from Monday to Thursday. Estimates another, “Consultants travel, on average, about 70 percent of the time. We try to stay regional in our business, but when the client has offices all over the country, sometimes it is necessary to work at all those offices.” Insiders say that the firm does try to ensure that its consultants get to go home each weekend, “except at the end of a project.” One insider tells us that there is “a degree of flexibility” in the amount of travel required: “I have some say in where I go and how much time I want to spend per week traveling.” There are also arrangements available to all staffers worldwide that allow for flex-time schedules and telecommuting.
Value-added culture As for the employees themselves, in some offices they are “fairly young, with most large projects staffed by people in the 20- to 30-year-old range.” (While some of the firm’s consultants may seem young, the firm reports that they average 13.5 years of experience.) Employees place great stock in the firm’s core values, according to one insider: “People put a lot of faith and belief into these ideas, and they serve the firm well.”
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While insiders say that the firm has a “large number of minorities,” they “tend to be mostly in technology-oriented [positions].” One female consultant tells us that she does not feel that “women are hindered in any way,” though “there is clearly male dominance in the company.” However, others report being pleased with the number of women executives in all areas of the company. Insiders say that the interoffice communication could use improvement. As one employee explains, “I find that the various departments barely communicate with each other. I don’t even speak with most people on my floor.” One step in the right direction is the biweekly e-mail newsletter, KCINsider, which provides consultants with news on all sorts of goings-on at KPMG Consulting and which always starts with a message from Rand Blazer.
Good use of time “Community involvement is encouraged” at KPMG Consulting, we hear. The firm recently established a new philanthropy program, the implementation of which was sped up after September 11th. The effort includes a support network, a matching gifts program and an initiative enabling employees to get involved with local volunteer projects. Insiders say that pro bono work is “typically up to an individual group — they may do it if they are currently unbillable or feel it is an opportunity for them.” KPMG Consulting also sponsors lots of “community events, practice dinners and sports teams” to help employees bond. Additionally, “continuing education opportunities abound and usually involve travel, with KPMG picking up the tab.” Another source tells us that the firm’s consultants “are required to participate” in a minimum of 40 training hours per year, involving Web-based courses and self-study. Insiders report that there is also “support for external training.” At the same time though, adds one source, “Training is very much self-driven — no one ever tells you ‘take this training this week so you can start a related project next month.’” The firm tells us that this is changing, however, with the spring 2002 introduction of a training initiative known as Competency Manager. As part of the program, consultants set training goals twice a year with their performance managers; the goals are then translated into formal training plans. The system also offers more than 1,000 courses through the online Learning Management System.
Standard benefits, varying perks The firm offers five weeks of personal time, but it’s not exactly all vacation. As one insider describes it, “KPMG Consulting is a bit unusual in that it combines vacation 158
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time with sick leave, so it’s great if you’re young and healthy, maybe not so great if you’re sickly.” Among the standard perks are “services provided by the company to help with day-to-day activities,” such as an online concierge service. Be forewarned, though, that “some [other] perks vary from office to office, or [managing director to managing director], or even manager to manager.” On the other hand, benefits at KPMG Consulting are uniform in all offices. Among these are medical and dental insurance, long-term disability insurance, a 401(k) savings plan with matching contributions, stock options, an employee stock purchase plan and an employee referral bonus.
Does anyone actually work those hours? There are no official hours in consulting, as the schedule depends on the person and the project. One consultant says, “Sometimes I do leave at 5:30 p.m., other days [I stay] until 7:30 p.m.” Another consultant concurs that “Ten or 11 hours a day is typical.” At times, “Hours can be very long [for consultants], with late nights spent compiling and analyzing data or preparing a presentation for a project meeting or board meeting.” Fortunately though, flex-time options are available to all employees. Furthermore, points out one consultant, “Work hard during the week and you won’t work many weekends.”
For detailed 40- to 50-page insider reports on top consulting firms like McKinsey, BCG, Bain, Deloitte Consulting, Accenture and more, get Vault Employer Profiles. Go to http://consulting.vault.com.
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Cap Gemini Ernst & Young
PRESTIGE RANKING
5 Times Square New York, NY 10036 Phone: (917) 934-8000 Fax: (917) 934-8001 www.cgey.com
THE STATS
Paris, France (HQ) New York, NY (HQ) Offices in more than 30 countries
Employer Type: Public Company Stock Symbol: CAP.PA Stock Exchange: Paris CEO: Paul Hermelin Chairman: Serge Kampf 2001 Employees: 56,500 2000 Employees: 60,000 2001 Revenues: $8.3 billion 2000 Revenues: $8.4 billion
PRACTICE AREAS
UPPERS
Business Solutions & Technology: Advanced Development & Integration — Network Infrastructure & Solutions B2B — Supply Chain Customer Relationship Management — DareStep Extended Enterprise Applications/ Enterprise Resource Management Finance & Employee Transformation
• Good profit-sharing plan • Diverse for an established firm
LOCATIONS
Outsourcing: Applications Management Infrastructure Management Business Process Management Strategy & Transformation: Strategy Consulting Technology Consulting
THE BUZZ
DOWNERS • Shake-up in culture • Constant travel
KEY COMPETITORS Accenture Deloitte Consulting Electronic Data Systems IBM Global Services KPMG Consulting PwC Consulting (Monday)
EMPLOYMENT CONTACT www.cgey.com/career/
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Strong ‘we can do everything’spirit” • “Layoff City” • “Solid and dependable” • “What a culture clash”
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THE SCOOP
CGE&Y around the world No matter where you are on this planet, you probably aren’t far from a Cap Gemini Ernst & Young office. The firm employs more than 56,000 people worldwide and has a significant presence in more than 30 countries. Formed through the May 2000 merger of French consultancy Cap Gemini and the consulting arm of Big Five firm Ernst & Young, the consultancy services the chemicals, consumer products, retail and distribution, energy and utilities, financial services and insurance, health care, high tech, life sciences, manufacturing, telecommunications, media and network services, and transportation industries. Working for both dot-coms and more mature companies, CGE&Y provides management and IT consulting services, systems integration and technology development, as well as design and outsourcing capabilities to companies looking to stay at the forefront of the connected economy. To accomplish its high-tech objectives, Cap Gemini Ernst & Young maintains strategic alliances with top tech firms like Cisco, Compaq, IBM, Microsoft, Oracle, PeopleSoft, SAP, Siebel and Sun.
Making connections During the Internet boom, Cap Gemini Ernst & Young placed its bets on helping traditional businesses and “dot companies” establish an online presence. Well, any observer of the economy over the last few years knows how that business plan played out. CGE&Y even created a stand-alone division dedicated to e-business in 2000 in an attempt to compensate for the firm’s slow entry into the dot-com market. The move backfired, however, when intraorganizational conflicts resulted. “We made a mistake,” then-COO Paul Hermelin told the Financial Post in May 2001. “It triggered some internal resentment and as the Internet hype was fading we had to reorganize.” Like most consulting firms, CGE&Y now targets more traditional firms, such as its current clients Bell Canada, engineering concern ABB, Eli Lilly, Heineken and Standard & Poor’s. Cap Gemini Ernst & Young has sought other, more promising markets as well. In December 2000, CGE&Y and Cisco Systems formalized their March 2000 agreement by launching a new industry practice, Cap Gemini Ernst & Young Telecom Media Networks. The practice works under CGE&Y’s auspices, providing software and other strategic telecommunications technology solutions to more than 150 clients. Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Cutting crew As corporations struggled in 2001’s rotten economy, Cap Gemini Ernst & Young CEO Geoff Unwin announced that he would step down from his post at the end of the year and leave the firm altogether in April 2002. (Unwin, 59 years old at the time of the announcement, said he had already planned to retire when he turned 60 and asserted that the move was not a result of pressure from the shareholders.) Taking his place was longtime CGE&Y executive Paul Hermelin. Coinciding with the announcement of the leadership change came word that 2,500 employees would be laid off, increasing the total for 2001 to 5,400, or about 9 percent of the firm’s workforce. Employees who lost their jobs in December could perhaps take solace in being informed of the layoffs in person; according to The Times of London, 750 staffers in the United Kingdom learned they were being let go via voice mail. CGE&Y made the moves as part of a massive cost-cutting initiative designed to save about $800 million, but layoffs were not the only money-saving measure the firm undertook. For example, in a devastating blow to bread lovers throughout the firm, the traditional free Tuesday morning croissants were canceled in some European offices. Also in the fall of 2001, the firm downgraded its annual revenue forecast from an original figure of $9.6 billion to $7.5 billion. (It ended up earning about $8.3 billion for the year.) As a result, financial analysts have been understandably skittish when it comes to assessing CGE&Y. “The [post-merger] integration challenge was massive,” Goldman Sachs equity research director Richard Leggett told The International Herald Tribune in November 2001. “But it took nine months to establish the structure of the new organization. Those turned out to be a crucial nine months. As the company emerged from that period, the bottom fell out of the market.” For his part, new CEO Hermelin remained rather tight-lipped about the firm’s future during this period, asserting only that CGE&Y did not expect to make any dramatic shifts in strategy until market conditions improved. This statement did not keep others from predicting such a shake-up, however; in December 2001 rumors surfaced that IBM Global Services had offered to acquire CGE&Y. The two companies have been the subject of merger rumors several times in the past, but both continue to deny that any kind of a deal is in the works. While Hermelin would not talk about the possibility of a merger, he did say early in 2002 that CGE&Y was through making major cost-cutting measures. Unfortunately, that was not to be. Despite the CEO’s earlier statements, in June of that year the firm announced a change in structure aimed at improving profits in its core consulting, IT
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services and outsourcing business lines. As part of the move, CGE&Y planned to cut another 5,500 jobs over the following six months — including 2,500 immediate cuts in the European and North American telecom and financial services divisions. An additional 3,000 employees, mainly in back-office positions, were expected to go by January 2003 (though some could move to other jobs elsewhere in the firm).
Pursuing partnerships In November 2000, Cap Gemini Ernst & Young began forming a number of partnerships and services extensions. That month it teamed up with Oracle and Fiat SpA to form an Internet consulting company, eSPIN, with Fiat’s new Business Solutions arm. In February 2001, the December 2000 partnership between CGE&Y and Vodafone was officially named Terenci, a company offering mobile communications services to a variety of industries. The following month, CGE&Y and tagmanet launched tagmaConsultant, an online consulting service. Despite its layoffs and financial difficulties, CGE&Y also has expressed interest in acquiring smaller information technology services companies. In May 2001 thenCEO Unwin reported that the firm had been approached by a number of companies about a possible acquisition, and that it was scouting potential targets. CGE&Y is looking in particular for companies to fill niche markets in Germany and the AsiaPacific region.
Recognition Experiencing firsthand the sting of pink slips and declining revenues, Cap Gemini Ernst & Young has undertaken a branding effort intended to unite the firm and its clients “against our common foe: The Economy.” The guerrilla campaign, officially called “Defy the Economy,” markets the firm’s methods of transforming companies into “adaptive enterprises” that can combat market volatility. As of mid-2002, CGE&Y had already launched it in Europe and had begun to target the United States. In need of a new acronym, the firm also created OTACE (On Time Above Client Expectations), a new tool through which clients can make known what they hope to accomplish prior to the start of an engagement and evaluate the firm’s performance on an ongoing basis. But if the awards on CGE&Y’s mantel are any indication, the firm’s client service was hardly in need of a boost. In February 2001, it received the “Greatest Business Impact” Lotus Beacon Award for Knowledge OnLine, the internal knowledge management system it created for the Fluor Corporation. The next month
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it brought home the Best Management Practice Award from the Management Consultancies Association (MCA). April 2002 saw the National Association of Colleges and Employers (NACE) give CGE&Y’s Multimedia Campus Presentation its 2002 Award of Excellence in the category of Educational Programming by an Employer. Three months later, CGE&Y’s Telecom Media Networks industry practice received the TeleStrategies Billing World 2002 Excellence Award for Integration Project of the Year for work it had done for Nextel Communications. It was the second straight year the firm had received an award for integration work at the Billing World conference.
GETTING HIRED Cap Gemini Ernst & Young typically recruits on campus at a handful of top business and undergraduate schools, though it also finds candidates who submit resumes through its web site. We hear the firm’s actual selectivity “depends on what position you want and what industry or service line is ‘hot.’” The firm conducts two rounds of case-based interviews. About 50 percent of secondround interviews are again conducted on campus, with the other half at local CGE&Y offices. (For experienced candidates, an office or telephone interview is used in place of the initial campus interview.) In the second round, candidates also are given behavioral interviews (with the exception of the strategy and transformation group) with two to three managers, senior managers and/or vice presidents. Successful candidates are contacted with offers within 48 business hours of their second interview round. MBAs can expect to have three interviews. The first is with a manager, the second with a senior manager or vice president; if those are successful, there is a third with a vice president. CGE&Y uses cases in its MBA interviews, but not in every interview — “It depends who is interviewing and what skills are being sought,” explains one consultant. CGE&Y does not have a formal internship program, but does hire interns in some areas on an ad hoc basis. Those who make the grade can look forward to what is described as “a pretty easy summer.” Interns are staffed on regular projects and attend numerous “events for interns and trips.” One alum says it “helped introduce [him to] the personalities of the people and the culture of the firm, but didn’t help in terms of client service work since there was little exposure to the day-to-day.”
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OUR SURVEY SAYS
Hard times Insiders tell us that life at the firm has been unstable over the last year. As is the case for many of its competitors, new hiring at CGE&Y has slowed down significantly, and raises were on hold for most of 2001 and 2002. “Combine our leadership’s lack of ability to execute the post-merger integration with the recession of 2001, and what you have is not pretty,” laments one insider. “Given the layoffs and the poor economy, there was not much attention put toward culture,” adds another. “I will say there has been recent improvement on this. There is a push from all levels to rebuild a strong culture. I hope it will be successful, but it will depend on the economy improving.” Nevertheless, “The constant worry about the job situation has been extremely frustrating.”
Crunch time CGE&Y is a no-nonsense firm, which may explain why it has been able to do as well as it has, despite the economic downturn and the uncertainties associated with the merger. “The firm is a believer in being integrated into the client’s everyday work environment,” we hear, which can mean extremely long hours and little time on the beach. “On projects, I’ll leave around 7 to 9 p.m. generally,” says a source. “On crunch days — about 30 percent of a typical project — I’ll leave between 10 p.m. and 2 a.m.” A fair amount of time is dedicated to social activities as well, says a source: “Though most project members can go home Thursday evenings, a good number choose to stay at the client city Thursday nights and go out dancing and partying. Then they get up early Friday and fly home … The after-work social life is a great ending to a long day. This pace, however, wears one out and by the weekend I don’t even want to go out with my friends. I just want to sleep!” Some respondents estimate that they spend as much as 90 percent of their time on the road. Explains one source, “I have been fortunate to find local projects, [but that] is rare. My colleagues who do travel go by the 3-4-5 policy where they fly into the client city Monday mornings and can fly home Thursday nights. Fridays they typically work from home.” None of this should be surprising, of course; as one source warns, “Consulting in general is no place to have a family. The hours are long, and you never know what the future will hold.”
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Well-paid and diverse In return for their hard work, consultants at CGE&Y can expect a solid compensation package, as well as the standard benefits: accidental death/dismemberment insurance, an on-site gym in some offices, laptops and tuition reimbursement. They are also recognized for career milestones, receiving loyalty gifts for certain numbers of years of service at the firm. In addition, “The merger brought about a more concrete and lucrative bonus structure.” According to one consultant, “All staff, in the U.S. at least, receive profit sharing equal to 3 percent of their annual pay, deposited into their 401(k) each January. This is on top of the 401(k) matching we get.” The firm adds that it has further improved this benefit, increasing the profit sharing component from 3 percent to 5 percent of total compensation for eligible employees. It has also increased its contribution levels for all 401(k) plan participants. Another, less tangible benefit is what one consultant calls CGE&Y’s “very good learning environment,” where “the upper executives treat the relationships as a mentorship.” And despite the conservative nature inherent in being a large consultancy, CGE&Y is a diverse firm. “Four of my five projects have had women as my manager,” one insider says. “There also seem to be a reasonable percentage of vice presidents who are women.” For a consulting firm, CGE&Y is ethnically diverse as well: “If you look at MBA schools as a benchmark, I would say CGE&Y is average to above average.”
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“The after-work social life is a great ending to a long day.” — CGEY consultant
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Marakon Associates
PRESTIGE RANKING
245 Park Avenue 44th Floor New York, NY 10167 Phone: (212) 377-5000 Fax: (212) 377-6000 www.marakon.com
LOCATIONS New York, NY (HQ) Chicago, IL San Francisco, CA London Singapore
PRACTICE AREAS Change Management Finance Leadership Organization Strategy Consulting
THE STATS Employer Type: Private Company CEO: Ken Favaro 2001 Employees: 375 2000 Employees: 400
UPPERS • Challenging, high-level work • Great learning and development opportunities
DOWNERS • Tough, unpredictable lifestyle • Little name recognition outside the corporate world
KEY COMPETITORS Bain & Company Boston Consulting Group McKinsey & Company Mercer Management Consulting Monitor Group
EMPLOYMENT CONTACT www.marakon.com/careers
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“The quant jocks” “Living on an outdated rep?” “Cerebral” “A ‘one-big-idea’ firm whose idea is 20 years out of date”
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THE SCOOP
Value obsession Marakon Associates, founded in 1978 and today one of the world’s premier strategy consultancies, applies one overriding principle to its practice: that management’s governing objective should be to maximize a company’s long-term value for shareholders. Rather than offering best practices advice, Marakon instead rewrites a client company’s strategies and management processes to achieve top-quartile shareholder performance vs. its peers. To accomplish this lofty goal, Marakon consultants identify value creation opportunities by relentlessly delving into strategy, organization, finance and any other pertinent aspects of management. Approximately 30 percent of the firm’s business comes from financial services, 20 percent from the consumer products industry and another 20 percent each from the retailing and manufacturing/industrial products industries. The rest of Marakon’s clientele hails from a variety of other sectors.
A well-kept secret Marakon was founded by three Wells Fargo executives and a business school professor who foresaw the impact that value-driven strategies could have on the business world. They set up shop in San Francisco and started to spread the word through a small number of clients. Nearly a quarter of a century and two office moves later, the business world has validated their hunch — today nearly every strategy firm has a shareholder value practice, and countless corporations have altered their management processes according to Marakon’s principles. Nevertheless, few people outside the corporate world have heard of Marakon; even many MBA candidates have a hard time explaining what it does. The firm’s low profile is due in part to its size; in an industry dominated by big strategy consultancies like McKinsey & Company (12,500) and Booz Allen Hamilton (11,000), Marakon’s 250 consultants hardly seem a force to reckon with. But the firm’s relative anonymity suits its partners just fine; as they are apt to say, they only need to know 500 people — the CEOs of the Fortune 500.
Spreading a strategy Because Marakon is convinced that strategy is in the details, it has been known to analyze a client’s every business activity and decision — even those made at the Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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lowest levels. Ensuring that the strategies, organization and finances of a company are aligned to maximize value can be a long and expensive process; Marakon has been known to spend three to five years and charge $5 million to $10 million a year in consulting fees before completing an engagement. As a result, the firm has made a conscious choice to adopt a long-term partnership mode of operation — that is, staying with a small number of clients for several years, rather than cycling through dozens every year.
Strong growth and a diversity of clients Marakon’s success speaks for itself. Having assisted — and impressed — the likes of Boeing, Nordstrom, Coca-Cola and Dow Chemical, Marakon has proved that a meticulous working method reaps great rewards. The 10 companies with which Marakon has worked the most have seen double the shareholder returns of their peers during the time they worked with the firm. (The typical Marakon client outperforms its peers in total shareholder returns by five percentage points over a 10-year-plus period.) Marakon does quite nicely for itself as well. It maintains a revenue-perconsultant rate of $476,000, earning it a place as one of the three highest-paid consultancies on Consulting Alert’s Global Leadership Index in 2001. And since its founding Marakon has boasted a 27.5 percent annual revenue growth rate, more than double the industry average.
Up with people In 2001, Marakon underwent a “redesigned consultant compensation” project, which included increases in equity, base pay, annual bonus and the overall bonus range for consultants. According to the firm, its approach to employees, its so-called “people model,” focuses on three themes — learning, leading and living — and, at least in theory, the firm puts a premium on a healthy life/work balance. Marakon’s quarterly meetings, planned and run by consultants and staff, are one- to three-day events that incorporate activities like treasure hunts and talent shows. As with most firms, Marakon expects its consultants to report to their client sites usually three or four days a week, but the firm keeps careful track of hours and lifestyle conditions. And, like all good consultancies, Marakon tries to keep a handle on employee satisfaction through internal surveys. Marakon maintains a tight watch on its consultants’ performance, including biannual performance reviews and ongoing, informal feedback. Consultants at all levels participate in training programs in general business and consulting skills. Employees
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who plan to attend business school receive application coaching, and top consultants often receive full, up-front tuition reimbursement if they decide to return to Marakon afterwards. Those who do return — and many do — stand a good chance of making partner within six to seven years, one of the fastest tracks in the industry. According to the firm, employees whose performance is “on track” can expect their salary to double about every three years.
GETTING HIRED Marakon offers prospective consultants a variety of ways to enter the firm. It recruits from undergraduate institutions, U.S. and European MBA programs and advanced degree programs in the States. For students, Marakon has a 10-week MBA internship program in all of its offices as well as an eight-week BA summer program in its London office. Marakon typically limits its recruiting to Princeton, Penn, Duke and a few other topnotch undergraduate programs, as well as the top business schools. At the same time, as one respondent tells us, “It’s no McKinsey. We do not have 300 applications at every campus, nor are we as selective.” The interview process at Marakon involves two to three rounds, with two to three interviews in each round. “You meet with everybody from the level you would start at through partner,” reports a senior analyst. The first one or two rounds take place on campus, with the final interview at a Marakon office. The firm relies on case questions, and one source warns that “the content of the case studies requires more analytical skills than at most firms.”
OUR SURVEY SAYS
Working for a living Across the board, consultants describe working for Marakon as intense. Weekend work is a given, and while consultants are supposed to put in about 65 hours per week, that can quickly spike during crunch times. Says one Marakonite, “You will work hard if you join Marakon. Most people probably average around 70 [hours per week], with significantly higher hours quite often.” Though this kind of work isn’t for everyone, insiders believe that working at Marakon is rewarding for those willing to put in long, hard hours. The same consultant adds that “Although you do work
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hard, it is a great experience, and I genuinely believe you learn more than at any other firm as a recently graduated 22-year-old.” On the other hand, the flip side to working for an elite, focused firm is the lack of opportunity to take on projects beyond the immediate needs of the firm, a problem many insiders say is rampant at Marakon. Notes one consultant, “The heavily quantitative nature of the work and the focus on certain approaches limits the potential variety of projects done.” And, decrying the firm’s laser-like focus on improving shareholder value, another respondent says there is “the feeling that you have to ‘drink the Kool-Aid’ of Managing for Value,” providing “no opportunity to really specialize if you are interested in a particular industry.”
Life in the balance Most firms, of course, boast about their commitment to a work/life balance, but in many cases that dedication is more talk than reality. But insiders say Marakon is more serious than other firms about its employees’ quality of life; as one consultant notes, “Compared to my peers at other consulting firms, my hours are very reasonable. Marakon doesn’t value face time for the sake of it, and allows considerable freedom as long as the work gets done.” Ultimately, of course, balancing work and life is up to the individual, and at Marakon “The hours can creep up if you don’t actively work to maintain a balance.” Though the hours “get more predictable and manageable as you progress within the firm,” the workload can sometimes be overwhelming. One consultant notes, “The only problem I have is that it is constantly challenging and whilst that is good, it is also quite exhausting.” (Yes, she actually said “whilst.”) Not surprisingly, many people who come to work for Marakon find themselves in over their heads, and as a result the firm has only an average retention rate.
A nice place to work The majority of Marakon respondents praise the firm for its professional, collegial atmosphere and well-managed structure. The partners “really make an effort to ensure people are happy and satisfied with the job,” says one consultant. Another adds, “One of the things I value most about the Marakon culture is the absence of intellectual arrogance. People here are extremely bright and share a commitment to intellectual curiosity, which supports a culture of approachability at all levels.” Though some insiders say that Marakon project teams can be overly hierarchical, in general they characterize the firm’s management as friendly and easy to work with, 172
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often “making the rounds on Friday afternoons with a beverage of choice.” “Virtually all partners have an open-door policy,” says one consultant. “I have found the vast majority of them very approachable and genuinely concerned about the people that work for them.” Adds another, “Obviously treatment by executives depends on the individual, but over the course of my two and a half years here, I have worked one-on-one with the partner on nearly every project. I [am] always treated with the utmost respect and [have] learned a great deal.” Marakonites also give high marks to the firms’ offices. One respondent tells us that “All managers and higher have their own offices everywhere. In some offices, consultants have their own offices as well.” Another notes that while “I still only have a cube, the office is so gorgeous, I don’t mind,” while a third respondent even goes so far as to say that “The San Francisco office is the nicest office environment I have ever seen.”
Up and away Marakon consultants travel almost every week, with a Tuesday-through-Thursday road schedule being “the standard travel model for the firm,” though “there are always exceptions, a good example being international travel. That typically results in a two week away/one week home travel model.” The travel can be “intense, at times. It seems almost everyone has some form of elite status with the airlines. We do have local projects, but our smaller number of offices tends to increase our frequency of travel.” Nevertheless, for domestic projects, Sunday travel is rare, and travel loads lighten after the first few years.
Good rewards for good work Consultants at Marakon may be asked to give 110 percent, but their efforts are reimbursed with top-notch compensation packages. Salaries are “equal or above toptier firms,” with bonuses often 20 percent of yearly base pay or more, though they are tied to firm performance and thus can vary greatly from year to year. The firm offers stock ownership and profit-sharing plans, and has a tuition reimbursement program for top consultants returning to school for an MBA or another advanced degree. Added benefits include free food and drinks in the offices, gym membership discounts, Palm Pilots and in-house massage therapist visits.
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Training days While in recent years Marakon has cut back its employee training program, respondents tell us that it is still one of the best things about working for the firm. “Marakon invests a huge amount of time and resources into training,” one consultant says. “I don’t remember the exact statistics, but I believe the number of hours the average Marakon consultant spends in training during the first two years is one of the highest in the industry.” The firm is particularly concerned with bringing undergraduate hires up to speed on the latest business practices, through both in-class and on-the-job instruction. As one consultant reports, “The training provides a good balance between theory and practice. It is much more usable than training I have seen in other firms.” Marakon’s internship program also receives high marks from consultants. “I had a great, meaty role on a strategy project,” one former intern reports. “Marakon also provided an extensive training week and social calendar to ensure we met not only fellow summer interns, but also full-time Marakon consultants at every level.” The program “exceeded my high expectations,” says another. “I worked on real work — not ‘make work.’ I dealt with clients and participated in meetings and presentations. I saw the Marakon consultant lifestyle with minimal sugarcoating.” Each of Marakon’s offices also takes part in a number of community-involvement activities. The New York office participates in “tutoring of underprivileged students on an ongoing basis. We also volunteer at nursing homes, soup kitchens, and participate in events such as the Revlon Run/Walk for Breast Cancer.” The firm offers pro bono consulting for nonprofits, and “If anyone has a desire to set up additional charity-based (non-billable) work, this is always welcomed and encouraged.”
Marakon? Who’s that? As a small firm, the lack of name recognition is a constant problem for Marakon. CEOs and industry insiders recognize and respect it, but insiders say the company could do more to get its name out. While this is hardly a hindrance to Marakon’s toplevel work, it “can make things like outplacement slightly more challenging.” Nor is Marakon the most diverse of firms. While the firm hires a good number of female consultants, it has a hard time retaining them. As a result, the number of women climbing the Marakon hierarchy is small. “Very few women exist at the senior ranks,” says one respondent. “The larger problem is that the pipeline is also very thin.” Another consultant adds, “We only have two female partners, one of
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whom is not in a client-facing role, and only one minority partner.” And while Marakon reportedly has expanded its recruiting efforts to bring in minorities, at present there are very few at the firm.
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Hewitt Associates
PRESTIGE RANKING
100 Half Day Road Lincolnshire, IL 60069 Phone: (847) 295-5000 Fax: (847) 295-7634 www.hewitt.com
THE STATS
Lincolnshire, IL (HQ) 91 offices worldwide
Employer Type: Public Company Stock Symbol: HEW Stock Exchange: NYSE CEO: Dale L. Gifford 2001 Employees: 13,000 2000 Employees: 12,000 2001 Revenues: $1.5 billion 2000 Revenues: $1.3 billion
PRACTICE AREAS
UPPERS
Outsourcing: Broader Human Resources Business Process Outsourcing Defined Benefit Defined Contribution Health and Welfare
• Extensive perks and benefits • Flexible hours
Consulting: Health Management People Value and Human Resources Management Retirement and Financial Management
KEY COMPETITORS
LOCATIONS
DOWNERS • Low pay
CitiStreet Fidelity Mellon Financial Mercer Human Resource Consulting Towers Perrin Watson Wyatt Worldwide
EMPLOYMENT CONTACT http://was.hewitt.com/hewitt/careers /index.htm
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Tried-and-true” • “Pink collar ghetto” • “The best HR policies around — they really care” • “Tough”
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Vault Guide to the Top 50 Consulting Firms Hewitt Associates
THE SCOOP
Seizing an opportunity In 1940 Ted Hewitt opened an insurance brokerage in Lake Forest, Ill. After working with his first client, Parker Pen, he realized what the company really needed was a well-designed benefits package for employees. Soon after, Hewitt Associates augmented its actuarial work, eventually offering a broad array of human resources consulting and outsourcing services. Over the years the firm expanded its presence, initially by opening offices in Minneapolis, New York City, Milwaukee, Los Angeles and Dayton. It reached beyond the borders of the United States with the creation of a Toronto office in 1974, and opened branches in Paris and St. Albans (outside of London) in 1985. Today, Hewitt Associates is headquartered in Lincolnshire, Ill. and has approximately 13,000 associates in 91 offices (including joint venture operations) in 39 countries. The firm boasts a client roster that includes more than half of the Fortune 500.
Continuing to grow One of the 20 largest management consulting firms in the world as well as the largest benefit consulting firm in the United States, Hewitt is growing rapidly. In 2001 the firm posted revenues of $1.5 billion, up from $1.3 billion the previous year. (According to the Chicago Tribune, the firm has increased its revenue at a 20 percent average annual clip since 1997 and has added about 1,000 new employees each of the last three years.) Hewitt also has become one of the largest providers of benefit outsourcing services — in fiscal 2001, that business line garnered $952 million in net revenue, a 19 percent increase over 2000. Not bad for a year in which the world economy turned decidedly shaky. In June 2002, Hewitt finalized a merger with Bacon & Woodrow, a United Kingdombased actuarial and consulting firm, adding further consulting depth in the areas of financial management, human resource management and administration. Hewitt also expanded its capabilities through its May 2001 acquisition of Canadian consultancy The Alberta Actuarial Group (AAG). One area where the firm is hoping to increase its market share is the Asia-Pacific region. In June 2001 Hewitt opened its Asia Pacific Measurement Centre. The firm’s third such endeavor (the other two are located in Brussels, Belgium and Scottsdale, Ariz.), the Centre is designed to manage the mass of human resources information
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contained in the firm’s global databases. And in September 2001 Hewitt struck an outsourcing alliance with India Pension Services Ltd., thereby becoming the largest HR services provider in that country.
A lauded place to work Hewitt has won a number of honors for its technological prowess. For example, the firm’s tech support center received a Best Practices Award from eWeek magazine and Technology Managers Forum in November 2001, and the firm took its place among the “Best in IT” by making the InfoWorld 100 a month later. The firm has earned recognition in other ways as well. In 2000 alone, Hewitt earned a spot on several award lists, including Chicago Magazine’s Best Places to Work for in Chicago, Central Florida Family Magazine’s Top 100 Companies for Working Families and Connecticut Magazine’s Top Places to Work in Connecticut. Hewitt’s recognition isn’t limited to the United States, though — in China, Hewitt won the China HR Consultancy of the Year award from China STAFF magazine for the second consecutive year. Hewitt continued to garner accolades in 2001. In June, the firm ranked second among local employers in The Orlando Sentinel’s list of the Top 100 Companies for Working Families. Within the same month, Hewitt picked up “Human Resources Consultancy of the Year” honors at the Asian HR Awards. Perhaps most notably, Hewitt ranked fourth on Consulting’s first-ever Best Consulting Firms to Work For list. And the firm added yet another mark of distinction in 2002 when Computerworld named it one of the 100 Best Places to Work for IT for the third year in a row. (Hewitt ranked No. 34 overall.)
Time to go public In March 2002, Hewitt — No. 155 on the 2001 Forbes list of the 500 largest private companies in the United States — registered with the Securities and Exchange Commission for an initial public offering. On June 27th of that year, Hewitt executives rang the opening bell at the New York Stock Exchange before offering 11,150,000 shares of the company to the public. By the end of the day’s trading, Hewitt had a market capitalization of $2.3 billion, according to the Chicago Tribune. The reported $211.8 million the IPO raised will be used for strategic acquisitions and alliances and to expand the firm’s current service lines, as well as to pay off debt from the Bacon & Woodrow merger.
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GETTING HIRED The firm divides its services into two categories: Outsourcing (which includes health and welfare, defined contribution, defined benefit, and broader HR business process outsourcing) and Consulting (which includes health management, retirement and financial management, and people value and HR management). The firm’s web site has information about current openings, for which interested visitors may apply online. At the beginning of the hiring process, Hewitt usually meets with candidates on campus, over the phone or on-site for a half-hour, first-round interview. Promising candidates are then invited to a Hewitt office, where they have three to four interviews with associates and learn more about the firm’s various departments. One associate relates his second-round experience: “Four interviews took place in one day. I met with all levels of the team for which I was being recruited. They asked questions about my ability to adapt, my experience with specific computer programs, my ability to cope with stress, and why I chose my major.” Case interviews are reportedly not used. Once part of the Hewitt team, most associates hired directly out of college join the Outsourcing area. Hewitt hires a variety of majors but often gives preference to those in computer science, MIS, accounting, economics and math. Most new hires are placed in the firm’s Lincolnshire headquarters, while a few are asked to relocate to other offices. College students who have completed their junior year and hold a GPA above 3.0 are encouraged to apply for an internship, which may lead to permanent employment.
OUR SURVEY SAYS
All about atmosphere Hewitt has a reputation as a friendly, family-oriented place to work, and insiders verify the rumors. They say that “almost everyone in the firm is very pleasant to work with,” and that “The overall culture is very laid-back and not as intense as other firms that I have worked with.” Hewitt’s population is very young; one source reports that “The median age for workers at Hewitt is 25 to 27.” But the corollary of a young population is Hewitt’s high attrition rate, with most associates staying only a year or two. “The turnover at this firm is incredible,”
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reports one source. “It seems to be understood that most employees will only stay with the firm for a short period before moving on to better opportunities.” On the other hand, the recent IPO doubtless will serve as an incentive for a greater number of consultants to stay. Indeed, one of the reasons Hewitt decided to go public was so that it could offer company stock to employees as incentive compensation. But the firm disputes the claim that attrition is a problem to begin with, asserting that its retention rate remains over 70 percent. Some say the firm has lost some of its chumminess as it has expanded; as one source tells us, the firm tries “to follow a non-hierarchy-type structure, although that seems to be changing since I’ve been with Hewitt.” The firm says that it has no worries on this front, though, asserting that employee satisfaction is close to 80 percent.
Perks upon perks Hewitt consistently ranks as one of the consulting industry’s best firms to work for, with good reason. The enormous suburban campus has multiple buffet-style cafeterias offering free breakfast, lunch and dinner, and each floor has a well-stocked snack station complete with soft drinks, bagels and coffee. But there’s more than food — try gym membership discounts, an on-campus credit union, sports and theater tickets, profit sharing, massages, dry cleaners, employee referral bonuses, laptops and other personal electronic devices, and long-term disability insurance, which is available for domestic partners. The company also pays almost 100 percent of its associates’ health insurance plans. Hewitt encourages its employees to participate in charity and nonprofit activities, and allows them to work two days a year on volunteer projects on the firm’s time. “It does sponsor quite a few charities. [There are] too many to name,” says one consultant. (Another source tells us that “tutoring is very popular at this firm.”) The firm also sponsors a number of charity events each year, most notably the Chicago AIDS Walk.
Pay and hours both on the low side Though the list of perks is extensive, employees tell us that pay is an area where the company could do better. “The inequity between hours worked and compensation seems to grow every year,” says one source. “Compensation is probably the biggest issue within Hewitt,” says another. And while the hours at Hewitt — like at most consultancies — certainly can add up, the firm offers a number of alternative work
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options to alleviate the pressure. Several groups utilize flex-hour schedules, in which “we need to be able to put in at least 40 hours,” but are only required to “be in the office in the core hours of 9:00 to 3:30.” Many of the firm’s offices and practice areas offer summer hours “when [employees] have half a day every other Friday from May till September.” Travel varies depending on position, but tends to be minimal for associates just out of college.
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PRESTIGE RANKING
Mercer Human Resource Consulting
1166 Avenue of the Americas New York, NY 10036 Phone: (212) 345-7000 Fax: (212) 345-7414 www.mercerHR.com
LOCATIONS New York, NY (HQ) Offices in 142 cities worldwide
PRACTICE AREAS Client Relationship Management Consulting on the Administration of HR Programs Corporate Finance Function Corporate Marketing Function Health Care & Group Benefits Consulting Human Resource Operations Consulting International Consulting Investment Consulting Retirement Consulting Rewards Consulting Technology Function
THE STATS Employer Type: Subsidiary of Marsh & McLennan Companies, Inc. President: Karen Greenbaum 2001 Employees: 13,000 2000 Employees: 13,000 2001 Revenues: $2.2 billion (for all Mercer Consulting operations) 2000 Revenues: $2.1 billion (for all Mercer Consulting operations)
UPPERS • Flexible hours • Extensive benefits
DOWNERS • Conservative culture • Layoffs
KEY COMPETITORS Hewitt Associates Towers Perrin Watson Wyatt Worldwide
EMPLOYMENT CONTACT www.mercerHR.com
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Knows how to get the job done” “Stuffy” “The best at what it does” “Hanging in there”
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Vault Guide to the Top 50 Consulting Firms Mercer Human Resource Consulting
THE SCOOP
Try to keep it straight Mercer Human Resource Consulting — not to be confused with Mercer Management Consulting — is a world leader in employee benefits, compensation and communication consulting. One of several firms owned by Marsh & McLennan Companies and one of five firms in Mercer Consulting Group (the other four being Mercer Delta Consulting, Mercer Management Consulting, National Economic Research Associates and Lippincott & Margulies), Mercer Human Resource Consulting has more than 13,000 employees and 142 offices in 40 countries, from the Netherlands to New Zealand. Until April 2002, Mercer Human Resource Consulting was known as William M. Mercer; Marsh & McLennan changed the firm’s name in order to brand its consulting companies more uniformly. The firm’s investment practice will now be known as Mercer Investment Consulting, though it will still operate under the aegis of Mercer Human Resource Consulting. As part of the transition, the firm also launched MercerHRMetrics, a consulting framework to help clients more consistently measure the impact of their HR programs on the success of their business.
Living large Size matters for Mercer Human Resource Consulting; thanks to its huge stable of consultants, it is able to provide a broad spectrum of HR services, from designing employee benefits programs to HR strategy and policy development. The firm’s human capital strategy group assists clients in organizing their various HR efforts into sustainable, value-focused activities. Its global communications practice, with 410 people worldwide, helps companies create internal web sites to communicate with their employees, shareholders and customers. The firm staffs each team with a principal, a project manager and a group of interdisciplinary consultants, from economists to psychologists, to provide clients with the broadest view possible of their human capital landscape. But size isn’t the only distinguishing characteristic of Mercer Human Resource Consulting. The firm also does quite nicely in industry rankings, thank you very much. It consistently ranks among the top five HR consultancies in the world, and in March 2002 it beat out rival Watson Wyatt Worldwide to be named the top firm in Britain, according to a Financial News poll. The following month, Finance Asia
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named Mercer Investment Consulting, Mercer Human Resource Consulting’s investment practice, the best of its breed in Asia.
Expanding opportunities Mercer Human Resource Consulting has spent the last few years expanding its overseas operations, particularly in Europe. In May 2001 it opened offices in Istanbul and Prague, and in August of that year it bought Vienna-based Constantia Neuberger Bednar & Partner BesmbH, a benefit and retirement consulting firm. In early 2000 it increased its presence in South America, particularly in Colombia and Venezuela, by teaming with DeLima Marsh to form DeLima Mercer Consultoria Ltda. This complemented the company’s existing presence in the region, which included 10 offices in Argentina, Brazil, Chile, Colombia, Mexico and Venezuela. Mercer Human Resource Consulting has expanded domestically as well. In October 2001 it completed its purchase of SCA Consulting, a value management firm, adding 100 consultants to its offices in Chicago, Dallas, Los Angeles and New York, as well as its office in London. The firm did not weather the recent recession unscathed, though; in June 2001 it laid off approximately 3 percent of its employees in the United States. Nevertheless, clients continued to rely heavily on Mercer’s HR services, and the company was able to pull through better than many other consultancies.
GETTING HIRED Visit the “Joining Mercer” section of the Mercer Human Resource Consulting web site for all employment information. (All students interested in a position are required to begin their search there.) For each position, the site lists a description of requisite skills and experience, as well as credential requirements. The firm also accepts resumes and personal profiles directly on its web site. As the firm hires people into a wide variety of different positions and levels, there is no set hiring process. Some candidates may undergo a phone screening with a recruiter, and the number, duration and location of interviews can vary. In any case, comments one insider, “I don’t think the interview process is a breeze, but it isn’t terribly stressful either — depending on how you interview, I guess. The format ranges from technical questions, which are analytical and tough, to sharing experiences about yourself and testimonials from the staff.” 184
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OUR SURVEY SAYS
Going mobile Mercer Human Resource Consulting features a “casual, yet hardworking environment,” according to insiders. Says one, “There are plenty of career paths to choose from. You can be very mobile within the company.” Job postings can be accessed internally through the company intranet. As there is no formal firm hierarchy, employees say that “promotions are based on individual performance and drive, not necessarily seniority.” Sources estimate that minorities constitute “probably 1 percent” of employees in mid- to upper-management levels, while women are “about 50 percent of mid to upper management.”
Life at Mercer Mercer Human Resource Consulting fosters “an informal culture, with flexible hours,” although many employees arrive for the regular “9 to 5 shift — and then some.” The dress code has recently gone business casual. Because of the firm’s HR focus (coupled with its support from Marsh & McLennan), it comes as little surprise that it offers “excellent benefits [which vary by country], including health, a 401(k), a pension plan and stock options,” though “support for non-billable employees” is considered an area where the firm could improve.
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Towers Perrin
PRESTIGE RANKING
335 Madison Avenue New York, NY 10017-4605 Phone: (212) 309-3400 Fax: (212) 309-0950 www.towersperrin.com
THE STATS
LOCATIONS
Employer Type: Private Company CEO: Mark V. Mactas 2001 Employees: 9,000 2000 Employees: 8,400 2001 Revenues: $1.47 billion 2000 Revenues: $1.45 billion
New York, NY (HQ) 78 offices worldwide
UPPERS
PRACTICE AREAS Benefit Administration Solutions • Change Management • Communications • Executive Compensation • Global Resources Group • Health & Welfare • HR Delivery Solutions • Mergers, Acquisitions & Restructuring • Organization & Employee Research • Retirement • Rewards & Performance Management
• Internal flexibility
DOWNERS • Long work hours
KEY COMPETITORS Cap Gemini Ernst & Young Hay Group Hewitt Associates Mercer Human Resource Consulting Mercer Management Consulting PwC Consulting (Monday) Watson Wyatt Worldwide
EMPLOYMENT CONTACT http://careers.towers.com/towers_career/
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Clients love them” “Soft, not dynamic” “Take good care of their people” “Smart people, for HR”
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THE SCOOP
An HR veteran Towers Perrin has been a leader in human resources consulting for nearly 70 years. Today, the firm has approximately 9,000 employees working in 78 offices in 23 countries. Its clients include three-quarters of the world’s 500 largest companies and more than 700 members of the Fortune 1000, and it has worked on behalf of governments, educational institutions, nonprofit organizations and private sector corporations. Three divisions make up the bulk of Towers Perrin: the eponymous management consulting unit; Tillinghast-Towers Perrin, a provider of actuarial and risk management services (primarily to the insurance and financial services industry); and Towers Perrin Reinsurance, a large reinsurance intermediary. Despite rumors, the firm has repeatedly resisted going public, instead distributing its stock among 650 of its partners and employees.
A long history Towers Perrin began in 1934 as a Philadelphia firm called Towers, Perrin, Forster & Crosby, which specialized in reinsurance and employee benefits consulting. By the 1960s, it had spread throughout North America, and by the 1970s it had an international presence. In 1987 the firm changed its name to Towers Perrin. The company continued to grow throughout the 1990s, adding areas of expertise to its existing services by acquiring small specialty consulting firms. In 1998, it bought the North American Risk & Insurance Services arm of Watson Wyatt, a Maryland-based HR consulting firm (the unit was absorbed by the Tillinghast-Towers Perrin division). In May 1998 Towers Perrin purchased MillerHoward Consulting Group, an Atlanta-based change management specialist.
Shopaholic If you think you know how to shop, Towers Perrin probably has you beat. Over the last few years, Towers Perrin has inked a lengthy list of acquisitions and partnerships, mostly intended to give it a stronger position in the growing online benefits sector. In June 2001 it teamed up with WellMed of Portland, Ore. to develop customized benefits intranet sites, and the next month it consolidated its internal Web-based efforts into its HR Delivery Solutions group. In December 2001 it bought Columbia, Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Md.-based Working Concepts, a boutique consultancy that helps clients implement HR technology systems such as PeopleSoft, Authoria and Oracle. That same month it signed a deal with TALX, a payroll services firm in St. Louis, to provide more efficient income verification to clients’ employees securing a mortgage, leasing a car or renting an apartment.
Dealing, if not wheeling February 2002 was a banner month for new deals at Towers Perrin. It expanded its partnerships with two Massachusetts-based firms — its new deal with BrassRing, a recruiting software company, allows the two firms to provide talent management products and services, and its deal with Authoria now includes joint marketing and sales activities. And that same month ATOFINA, a French chemical manufacturer, became the first client to implement tp e-Health, a Towers Perrin system designed to give employees complete access to their benefits online.
Beyond the Web Towers Perrin also has been aggressively expanding its retirement benefits business, no doubt noticing the increasing age of the average American. In October 2001, it reached an agreement with J.P. Morgan/American Century to provide comprehensive retirement services backed by JPM/AC’s investment strategy services. And in 2000, it introduced Retirement Financial Management, which was developed as a framework for managing all aspects of a defined benefit plan — including plan design, accounting, funding and asset management. A second framework, “mypaymyway,” gives employees the flexibility to customize their benefits package to reflect their individual needs and preferences.
Publications Towers Perrin shares its knowledge with clients through a variety of industry-related publications, including the Towers Perrin Monitor, Perspectives and a number of surveys, special reports and studies. The publications cover key developments and trends in employee benefits, compensation and HR management, as well as in financial services, risk management, pension funds, executive compensation and health care in countries where Towers Perrin has a business presence.
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GETTING HIRED Towers Perrin recruits at approximately 60 schools; a list can be found on the firm’s web site. The firm encourages those whose school is not on the list to send a resume by mail. In either case, Towers Perrin will contact candidates to set up an interview — on campus if the firm is around, over the phone if not. This interview will be primarily behavioral, focusing on accomplishments and interests. If the firm is interested, it will then invite the applicant to a local office for a day of interviews. The second round consists of three types of interviews: an “experience and accomplishments” interview, a “hypothetical situations” interview and sometimes a case interview. At the undergraduate analyst level, says one insider, “the company looks for people with degrees in communications, math, economics or another business-related field,” though it has hired students with degrees ranging everywhere from actuarial science to liberal arts. Towers Perrin reportedly hires people by probing for “assertiveness, integrity, initiative, organization, communication, listening [skills] and team awareness.” Insiders say that the review process is “democratic” and that “Positions are not filled because there’s a particular opening. We hire those we feel show potential. We always will find work for a good candidate.” Says one source, “We actively recruit from a select group of universities, though the door is open to everyone,” and candidates can expect to “meet with people at all levels, from two years of experience to 25-plus years of experience.” As for MBAs, the firm prefers people with at least two or three years of relevant work experience. The interview system is also slightly more rigorous; insiders report a three-round hiring process. The first round usually consists of “two half-hour case interviews.” In the second, sources say, “You get two 45-minute case interviews.” For the third round, candidates “are given a case and 45 minutes to develop a presentation, which you give in front of the interviewer.” Our contacts say this type of case interview “is nerve-wracking in the beginning, but easier than the traditional case questions because you have time to organize and prepare.” Understanding the industry is key, as “Candidates need to anticipate what the case questions will be about.”
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OUR SURVEY SAYS
Great culture Insiders overwhelmingly agree that the culture at Towers is “non-hierarchical,” “friendly” and “supportive.” Reports one source, “I have never felt much pressure to avoid approaching anyone because of their level or title,” while another adds that “There isn’t a big division of ‘executives’ vs. ‘non-executives’ at the firm.” And the “doors are always open” at Towers. Says one employee, “If I want to call the CEO to discuss something, he treats me as though I’m the most important thing he’s got going on.” Overall, consultants at Towers “have a reputation for being down-toearth, not stodgy.” Indeed, “The firm’s culture has become less stodgy over the last five to 10 years, as younger individuals have risen to senior management positions.”
An egalitarian workplace As with all large companies, the “quality of office space varies by location.” One source comments, “For the most part, offices are high-end, high quality, comfortable environments. A handful of office locations are sorely in need of updating.” San Francisco, though, needs no remodeling — as one resident raves, “The office space is aesthetically very appealing; the décor is very fashionable; and the view — from the 29th floor, overlooking San Francisco and the surrounding bay — can’t be beat. Individual accommodations, cubicles and offices, are very comfortable and are conducive to both collaboration, as well as affording each person some privacy.” One denizen of a “brand new office” believes it “looks like it was designed by Starbucks.” Even the “CEO has the same size office as a consultant.” The firm tells us that this is part of a corporate standard — all offices with a door are the same size and all cubicles face windows.
Path to partner While some insiders agree that “most diligent, good performers will eventually make partner,” others argue that it isn’t so simple. There are “some examples of very young partners,” but insiders have pegged the trip at seven years for a very strong candidate from the undergraduate ranks or as little as five years for an MBA. Of course, the firm tells us that the time frame for achieving partnership varies with each individual and can’t be given a specific range of years. One insider says that if you want to make partner at Towers Perrin, you need to “sell a lot of work, network well
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within the company and local market, do consistently high-quality work, and stay billable.” In a startling case of policy transparency, the criteria for making partner for each role and each line of business are available on the HR section of Towers’ intranet.
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Electronic Data Systems
PRESTIGE RANKING
5400 Legacy Drive Plano, TX 75024-3199 Phone: (972) 604-6000 Fax: (972) 605-2643 www.eds.com
[email protected]
LOCATIONS Plano, Texas (HQ) Offices in more than 55 countries
THE STATS Employer Type: Public Company Stock Symbol: EDS Stock Exchange: NYSE CEO: Richard H. “Dick” Brown 2001 Employees: 143,000 2000 Employees: 122,000 2001 Revenues: $21.5 billion 2000 Revenues: $19.2 billion
UPPERS PRACTICE AREAS Management Consulting (A.T. Kearney) Operations Solutions PLM Solutions Solutions Consulting
• Excellent benefits • Career Mobility Program
DOWNERS • Low morale • Training budget cuts
KEY COMPETITORS Accenture American Management Systems Computer Sciences Corporation IBM Global Services PwC Consulting (Monday)
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Nobody can touch them in IT” “Stodgy” “Big, consistent” “Glacial”
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THE SCOOP
Sailing the stormy e-seas At a time when a stigma has settled on all things “e” and high-tech consultancies have taken a beating, EDS remains a bright star in the digital sky. In March 2002 the company announced more than $1 billion in contract signings, and in 2001 the company arranged a multibillion-dollar list of IT deals, including a $1.5 billion extension on its communications outsourcing deal with Xerox. EDS CEO Richard Brown, who took over the reins in 1998, attributes his company’s success to its “endto-end” solutions — EDS is so large that it can provide a client with initial consulting services, build the necessary IT infrastructure, and manage the business processes the new architecture makes possible. And because business process management is a long-term affair, EDS is somewhat better insulated from the recent decline in demand for tech consulting than many of its competitors. In April 2002, EDS announced a strategic realignment of its three main business units — Information Solutions, E.Solutions and Business Process Management — into two divisions, Operations Solutions and Solutions Consulting. Operations Solutions is more or less a continuation of the firm’s core practice — IT outsourcing as embodied in the Business Process Management unit — while Solutions Consulting is a combination of E.Solutions, EDS’s IT consulting practice, with Information Solutions, which focused in implementation services. The resultant Solutions Consulting claims 40,000 employees, almost one-third of the total EDS workforce, and boasts $7.2 billion in annual revenue. EDS is also the parent company of management consultancy A.T. Kearney.
In the beginning Long before Ross Perot set his sights on the Oval Office, he founded Electronic Data Systems. Perot had been working for IBM for 10 years, and he proposed that the computer giant begin offering clients electronic data processing management services. IBM turned the idea down, and a disgruntled Perot left in 1962 to start his own company. In the mid-1960s, EDS entered the medical claims processing, insurance and banking markets — and went on to become the leading provider of data management in each of these industries. General Motors bought the company in 1984, and the rocky relationship between GM and Perot led to the founder’s departure in 1986. GM spun off EDS as an independent company in 1996 (though
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GM continues to provide EDS with a large amount of business). Today EDS provides e-business and IT services to 9,000 corporate and government clients in 55 countries.
“E” efforts EDS put Brown’s strategy of aggressive expansion into play with the November 2000 establishment of bluesphere, a multipurpose agency that integrates and executes web design for the e-commerce market. Less than two years later, EDS bluesphere had more than 2,500 employees and 750 customers. But bluesphere was only the latest in a series of new-economy initiatives, and in January 2000, EDS launched eBreviate, an “eSourcing” unit that provides procurement and strategic-supply management services (it was later integrated into A.T. Kearney). And in December 1999, EDS established CoNext, which the firm describes as network procurement for Fortune 500 companies to increase speed and achieve cost savings in more than 50 percent of large company purchases.
A venture adventure In December 1999, EDS announced the formation of EDS-A.T. Kearney Ventures, an e-business fund with $1.5 billion in seed money. The fund enables EDS to take equity positions in Internet-based consulting clients or alliance partners, with a primary focus on investments in the Internet and business-to-business arena. EDSA.T. Kearney began by investing in CoNext and Tradex Technologies.
Sprouting wings EDS got involved in the airline and travel industry in a big way when, in March 2001, it signed a multibillion-dollar deal with The Sabre Group. The transaction included EDS’s purchase of Sabre’s airline infrastructure outsourcing business and internal IT infrastructure assets for $670 million, as well as a 10-year, $2.2 billion contract for EDS to manage Sabre’s IT systems. In December 2001, EDS agreed to provide IT services to former clients of Atraxis, the bankrupt IT subsidiary of Swissair Group. By the end of the year, EDS was the world’s largest provider of airline IT solutions.
Keep it like a secret In the last few years, EDS has also been pumping itself up as a leader in electronic privacy matters. In January 2001 it named Paul D. Clark chief privacy executive and Detlef Eurich chief information security officer; it also began to offer electronic
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signature software to its clients. At the COMDEX convention in April 2001, EDS launched its Cyber Security Institute, an electronic-security curriculum for IT personnel, and announced an agreement with Fortress Technologies to market the IT security company’s Virtual Private Network software, which allows companies to share sensitive information securely. And just six months later, at the COMDEX fall convention, EDS introduced a suite of security programs: the Security Assessment Tool, the Privacy Assessment Tool and EDS Cyber Risk Management Tool.
Government circles In October 2000, EDS signed a $7 billion deal to build and maintain an intranet for the Navy and Marine Corps. And in January 2001, in cooperation with Indentix, EDS demonstrated a new secure digital voting solution for members of Congress. The system would allow U.S. military personnel overseas to vote online, eliminating the need for absentee ballots (and maybe a few Supreme Court cases). EDS’s activity in government electronic security increased even further after Sept. 11th, and in January 2002 it named retired Army Major General Robert L. Nabors as the head of its Homeland Security initiative, which integrates EDS security offerings into federal, state and local governments.
International sights After buying out Karden Technology’s 45 percent stake in EDS Israel in August 2000, EDS announced plans for continued expansion overseas. In October 2000, EDS and A.T. Kearney launched Kearney Interactive in France, which combined EDS’s E.solutions group with management consultants from A.T. Kearney to provide IT strategy consulting throughout Europe. Based in Paris, Kearney Interactive hopes to grow to 1,000 consultants in France, as well as to expand into the United Kingdom, Italy and Germany by 2003. In March 2001 EDS bought Germany’s Systematics, a firm focused in e-consulting, e-applications, systems services and hosted services. The $570 million deal added 2,700 employees and clients including Singapore Airlines, as well as several e-commerce subsidiaries that Systematics had purchased in the previous year.
GETTING HIRED EDS is an IT firm, but you might not guess it from the variety of people it hires — the company says it prizes brains and initiative over proven skills. The firm has Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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internal training for its new hires, concentrated in three areas: systems engineering; engineering systems development; and finance, accounting and financial services development. The extensive careers section of the company’s web site provides a firm overview, the EDS campus recruiting schedule and a database of available jobs. Those interested can submit a complete application online. EDS accepts resumes for most entry-level positions on a continuing basis. The firm visits some colleges — though these days, as one source tells Vault, “We receive 20,000 to 30,000 resumes a month, so we don’t do as much campus recruiting as before.” While the hiring process at EDS can vary, sources report a basic set of three interviews. The first, with a recruiter, is a standard resume review; the second, a discussion of the position applied for; and the third, a meeting with three management-level representatives who ask primarily behavioral questions. One source, who interviewed with four people, says, “They flew me to corporate for one day of interviewing, [lasting] six to seven hours, after the initial phone interview. I met with my future customers, my manager and the person I was replacing in the position.” Another former interviewee says he was also asked about his “interest in joining the client’s company after 18 months should the opportunity be presented to me,” an understandable concern for a company that places most of its employees at client offices. But take all of this with a grain of salt — one source warns that EDS’s “recruiting processes are inconsistent and/or nonresponsive at most times.” Internships at EDS are available to students after their sophomore year in college. For this program, EDS seeks students with a proven track record of academic excellence, strong communication and teamwork skills, professionalism and leadership ability, and an interest in pursuing a career in information technology. In return, EDS provides a salary and academic credit. And a separate opportunity, the Cooperative Education Program, is available for college juniors and seniors who are enrolled in their university’s co-op program and who demonstrate the same qualities as internship candidates.
OUR SURVEY SAYS
How do you rank? The public face of EDS may be smiling, but inside many of its employees are grumbling. “Employee morale is low and fears of losing your job recur every payday,” one source tells Vault. Says another, “I have not talked to one person that 196
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would not leave right now if the job market was better. That’s about 75 people on my site and over 100 at another. The morale is the lowest I have ever seen.” On the other hand, insiders roundly praise their clients and co-workers, and couch their criticisms in the fact that, on a daily basis, the average consultant spends more time at client sites. And one consultant tells us that perspectives at EDS tend to differ based on a person’s position and potential in the company: “If you are in the top 10 percent of the 140,000-plus employees, you will be paid generously. If you are in the top 10 percent of the 140,000-plus employees, your career progression can be wide open and unlimited providing you’re willing to prove yourself.” And another notes that one’s experience “completely depends upon your manager and the organization you work for in EDS. For two years I had a very unpleasant time in one organization with three different managers, while the last two years I have worked in a different organization with the same manager with a great culture.”
Cuts in training Getting in — and up to speed — at EDS is understandably harder than it used to be. The firm is still hiring, though we hear its U.S. employment rolls have been slow to expand in recent months, with most of the growth taking place overseas. These days, one EDS employee tells Vault, “It is either complete luck or you know someone if you are hired at EDS.” At the same time, “our retention rates over the last two years have steadily improved,” another source reports. “We do a better job of hiring less and completing less workforce reductions, thus saving money on training and reskilling employees.” The firm maintains a database of more than 7,000 online training courses, and up until 2001 encouraged employees to attend conferences and off-site training courses. In 2002 the training budget has been slashed, and “All training is restricted to online Web training at your desk.” (It used to be 40 hours per year of classroom work.) And because that desk is usually at a client site, computer-based training can be tough to get around to: “[Online training is] very difficult to do when at work as the customer does not care to see us on their time in training. [You] can’t blame them.”
The EDS life One of the benefits of working at EDS is the low amount of travel and work hours relative to the industry. Hours for our sources average 50 per week, with only the occasional Saturday. And once employees are staffed at a client site, they rarely
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travel from it, especially at a time when “all nonessential travel is not allowed and off-site client meetings have been halted.” Compensation, we hear, could be better, and bonuses have been frozen for 2002. Bonuses, when they are given, are divided up according to a company-calculated ranking system. As one source tells us, “If you are ranked in the top 10 percent, you will receive a salary increase review, which is not a guarantee of an increase, every 12 months. If you are in the bottom 10 percent, you will not get an increase but you will be provided the benefit of a salary discussion with your direct manager. If you are in the middle 80 percent, you will receive a salary review — again, not a guarantee of an increase — every 15 to 18 months.” Benefits, on the other hand, are some of the most expansive in the industry, and are particularly thorough for working mothers. They include adoption assistance and reimbursement, mothers’ rooms, elder care support, health care reimbursement accounts, free legal consultation and flexible work hours (for certain positions). Other benefits include discounts on GM vehicles, relocation services, home mortgage support, moving support, personal pension accounts and support for patent/white paper creations. And we hear that, at least at EDS headquarters in Plano, the facilities are particularly nice, with three cafeterias complete with Krispy Kreme and Starbucks vendors, “along with Aramark providing the largest variety of meal services I have ever seen.” Outdoors there are “ponds, trees and well-manicured landscaping throughout the several-hundred-acre campus.”
Career opportunities One EDS source remarks that “with over 140,000 employees in [more than 55] countries and in eight industries, you can do just about any job you want at EDS.” And she means this literally — the Career Mobility Program allows EDS employees to seek other jobs within the company after 18 months in a position. “You may interview for internal postings,” one source explains, “and your current manager doesn’t have to know until you are hired by another manager. You don’t have to leave the company to work in a different organization if your manager didn’t support your move. He or she doesn’t have a say in it after 18 months.”
Giving something back EDS commits itself to volunteer work through its Corporate Community Affairs Council, which receives a yearly budget to disburse funds to various charity and
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nonprofit groups. The firm also maintains a list of employees willing to help with and/or coordinate projects. According to one source, “We track our volunteer time among employees, and the more local volunteering, the more money that goes to those communities from corporate.”
Good job on diversity EDS does a good job at promoting diversity in the workplace; not only are there a lot of women and minorities, but they reportedly are promoted as easily as white males, even up to the management levels — in fact, a woman even heads the newly formed Solutions Consulting unit. One respondent tells Vault, “I have worked for some really great women with enormous potential and seen them move on to bigger and better things,” and another reports noticing “lots of women managers in the last five years.” As for minorities, one insider says, “There is a lot of diversity in my workplace. The company is global and has a lot of potential for any person, regardless of religion, race, color or creed.” Another adds, “We have extensive diversity tracking for applicants and senior positions. We are proactive in hiring women and minorities.” EDS provides benefits for same-sex partners, and the firm supports local gay and lesbian group meetings at various locations. The firm also has a number of “people that are in management and non-management positions that are gay and lesbian.”
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The Parthenon Group
PRESTIGE RANKING
200 State Street 14th Floor Boston, MA 02109 Phone: (617) 478-2550 Fax: (617) 478-2555 www.parthenon.com
LOCATIONS Boston, MA (HQ) San Francisco, CA London
THE STATS Employer Type: Private Company CEO: Bill Achtmeyer 2001 Employees: 150 2000 Employees: 150
UPPERS • Happily hiring • Community-minded
DOWNERS PRACTICE AREAS Principal Investing Strategy Consulting
• Very small firm • Narrow recruitment from only a few select schools
KEY COMPETITORS Bain & Company Boston Consulting Group McKinsey & Company Oliver, Wyman & Company
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Young and happening” “Not quite top-tier” “Ivy League-full” “High compensation”
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THE SCOOP
Small is beautiful Since its 1991 founding by two ex-Bain consultants, Bill Achtmeyer and John Rutherford, The Parthenon Group has grown rapidly — about 30 percent a year. The company intentionally has remained on the small side, with 150 consultants in three offices (in Boston, London and San Francisco). Despite fierce competition from much larger strategy firms, mighty mite Parthenon has amassed an impressive client list that includes Microcom, Pepsi, Ocean Spray, Starwood, Thomson, Madison Square Garden and American Express, though, like many other small firms, Parthenon also advises smaller entrepreneurial enterprises.
Cashing in Parthenon is one of the few consulting firms willing to put its money where its mouth is. Through an innovative equity incentive program, the firm encourages its executives to buy shares of its client companies, putting consultants in the same position as their clients’ senior management and fostering commitment and an entrepreneurial environment. It has also netted consultants between 50 and 100 percent more than they would have earned with a traditional compensation package.
Caring for the community Parthenon claims that 90 percent of its assignments are at the CEO level, but bigname, high-level clients aren’t the only file in Parthenon’s cabinet. The firm also commits a substantial amount of effort to community-oriented projects, whether that means pro bono consulting for nonprofit groups, investments in arts and education or participation in Habitat for Humanity projects. Reflecting his firm’s “lead by example” philosophy, CEO Achtmeyer chairs the Massachusetts Society for the Prevention of Cruelty to Children. Parthenon’s Charitable Contributions Committee directs its philanthropic activities.
Spinning off In 1998 Parthenon spun off its successful due diligence practice, Investor Group Services, which had been in operation since 1992. Now the two firms cooperate on a number of projects, with IGS providing the in-depth research to companies looking
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to make major investments and Parthenon providing the management advice to implement those investments.
Debut fund Founded in 1998, the Parthenon Capital fund began with a target of $250 million and closed at $350 million. The fund has drawn interest from industry spectators because its strategy and portfolio of companies depend upon management consulting. Not surprisingly, The Parthenon Group and Parthenon Capital work collaboratively, the former providing clients with operational advice and the latter their financial resources. Following Parthenon Capital’s initial June 1999 investments in a staffing company and a children’s clothing company, the firm opened a second fund — Parthenon Capital II — with $650 million. Together, the funds have invested in eight firms to date.
Fine-tuning the staff Parthenon has a number of continuing education programs for its associates. “Best Demonstrated Practices” luncheons are held throughout the year and examine analytical tools and presentation, management and feedback skills. At the end of each project, both junior and senior members of the case team submit evaluations. The firm also provides an end-of-the-year evaluation, including both upward and downward feedback, to facilitate professional development. Associates are paired with a mentor who helps them establish and meet careerdevelopment goals. For new associates, training begins during the first six weeks at the firm and covers everything from office practices to basic tasks and analytical and modeling skills. Additional on-site half- and full-day sessions include GMAT prep classes and MBA application assistance. Later, new associates are run through in-depth business training sessions in which Parthenon principals teach them the tools and concepts of consulting. The firm also sends associates to classes with Harvard Business School and Tuck School of Business professors. Their training culminates with casework that combines the classroom lessons with teamwork exercises. Parthenon will pay business school costs for associates who choose to return to the firm after pursuing an MBA.
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GETTING HIRED Like all consulting firms, Parthenon seeks individuals with superior intellectual and interpersonal skills, although it emphasizes the importance of a friendly personality to boot. It focuses its recruiting at a select number of top undergraduate and business schools. Parthenon looks to undergraduates and pre-MBA professionals as associate candidates, while MBA students join as principals. About 10 to 15 MBA students have the opportunity to join the Parthenon team via a 10-week summer program, and there is a similar program for undergraduates. Parthenon’s interview process consists of two rounds, with two or three 45-minute interviews each. Candidates can expect the standard set of questions, with case, brainteaser and personality questions making up the bulk of the discussion.
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PRESTIGE RANKING
Roland Berger Strategy Consultants
350 Park Avenue 30th Floor New York, NY 10022 Phone: (212) 651-9660 Fax: (212) 756-8750 www.rolandberger.com
LOCATIONS Munich, Germany (HQ) New York, NY (U.S. HQ) 32 offices worldwide
PRACTICE AREAS Corporate Strategy IT/E-Business M&A Marketing/Sales Operations Strategy Organization/HR Management Restructuring
THE STATS Employer Type: Private Company CEO: Roland Berger 2001 Employees: 1,650 2000 Employees: 1,600 2001 Revenues: $448.3 million 2000 Revenues: $379.8 million
UPPERS • Good compensation • International opportunities
DOWNERS • Low brand recognition in the U.S. • Still making cultural adjustments
KEY COMPETITORS A.T. Kearney Bain & Company Boston Consulting Group McKinsey & Company
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• “Solid strategy work” • “In Germany fine — outside Germany nothing” • “The German McKinsey” • “Tough environment”
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THE SCOOP
The big boy on the Continent With 1,170 consultants in 22 countries, Roland Berger Strategy Consultants is the largest consultancy of European origin. Having almost tripled its revenue since 1995, the firm is engaged in an aggressive U.S. expansion plan, opening a new San Francisco office in March 2001 to complement its offices in Detroit and New York City. Indeed, for the last three years Munich-based Roland Berger has been growing at more than double the consulting industry’s 7 percent average annual rate. The firm concentrates its efforts in a small number of industries, including automotive (hence the Detroit office), high tech, telecom, pharmaceutical, transportation and insurance, and counts such esteemed firms as DaimlerChrysler and the German utility giant e.on, as well as a number of Silicon Valley startups, among its clientele.
The über-consultant Roland Berger, a German businessman and former consultant at The Boston Consulting Group, founded his eponymous firm in 1967. Since then he has leveraged his success in the consulting world to become one of Germany’s most powerful public figures and a confidant of both left- and right-wing governments (he even refers to German Chancellor Gerhard Schroeder with the informal “du,” rather than the formal “Sie”). He sits on a number of corporate boards and was invited to serve as Schroeder’s finance minister (he turned it down). Berger’s personal influence is so widespread that, despite his firm’s success, when Germans hear “Roland Berger” they reportedly still think of the consultant, rather than the consultancy.
Buying its own freedom Until 1998 Deutsche Bank, Germany’s largest money manager, owned a 95 percent stake in Roland Berger, which it had held since 1987. However, thanks to two management buyouts in July 1998 and June 2000, Deutsche Bank no longer holds any part of the firm; today it is wholly owned by its 130 partners and associate partners. Since the first buyout the firm has grown rapidly, particularly in its foreign operations — from 1999 to 2001, its North American business grew 76 percent, its Asian business grew 68 percent and its Western European business grew 30 percent.
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Public sector consulting Given that Germany’s public sector accounts for 47 percent of its GDP, it’s no surprise that Roland Berger is deeply involved in consulting for the German government. Berger himself is a strong advocate of privatizing at least 10 percent of the German economy, and the firm has been involved in the privatization of a number of local, state and federal utilities and services. It has also set aside part of its public services knowledge center to advise German states on how to run their public services more efficiently, what it terms “an approach to holistic transformation that focuses on new visions and priorities, redesigned business processes and organizational structures, and new incentive and controlling systems.”
Brainy industry experts Over 50 percent of Roland Berger’s consultants are trained as engineers, natural scientists or doctors. And while only 10 percent of its consultants have MBAs, a full 20 percent have PhDs. Roland Berger has affiliations with a number of European business schools, and there are endowed Roland Berger chairs at INSEAD and Munich’s Technische Üniversitat. The firm is organized into so-called Functional and Industry Competency Centers, and consultant teams cross the two in order to offer optimal client solutions. Currently, 17 percent of the firm’s revenue is derived from the high-tech industry and an additional 14 percent from its InfoCom (telecom) practice, with consumer goods and retail weighing in at 14 percent of revenue.
Happy clients A key to Roland Berger’s success is its client retention rate — 78 percent of its 2001 clients were repeat customers, and on average clients rate their satisfaction a 15 out of 16 in the firm’s internal Happy Customer Index questionnaire. The firm even has a clever name for its approach to clients: proCLIENT, an acronym for “competence, leverage, implementation, experience, network and target.”
New economy co-operations In July 2000, Roland Berger purchased 10 percent of BMP AG, another German business consultancy, combining BMP’s venture capital activities with Roland Berger’s strategy practice. Roland Berger has also set up a turnaround fund of €100 million to be used to acquire companies in need of rehabilitation in order to profit
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from their sale. This is all in conjunction with the firm’s “Roland Berger 2005” strategy, aimed at distinguishing the firm as a leading resource in what it terms “the network economy.”
GETTING HIRED Because of continued growth, Roland Berger says its “hiring need is almost unrestricted in our offices worldwide,” and applicants are interviewed on a cyclical basis throughout the year. The firm is international to the core, and it expects its applicants to be as well. Though the official language of Roland Berger is English, a working knowledge of another European language is a big help. And the firm looks for people who have had at least some experience abroad, whether that be studying or completing an internship. Roland Berger interviews at top schools around the world, though it encourages hopefuls to complete its online application first. It then selects a number of applicants to interview on campus. Those who make the cut are invited to join a “Super Saturday” recruiting event, a half-day event (for U.S. offices) in which applicants go through four 45-minute interviews — a personality/fit interview, an interactive case and a two-part case-presentation interview. As one consultant tells Vault, “We consider [the case presentation] a better simulation of what consultants face on a daily basis — [where you have] some time to prepare before you submit your analysis — than off-the-cuff responses, which are necessarily less in-depth analytically.” Another insider reveals that “besides competence and intellectual skills, personality and adaptability heavily count to make the whole team, including the newcomer, happy!” For European offices, Super Saturday is a grueling 10-hour affair in which applicants go through multiple interviews and are presented with a number of case and presentation assignments. The day breaks down into four modules: The first is composed of a 50-minute personality interview and two 50-minute cases, the second is a 45-minute analytical test, the third is a 60-minute team case preparation, and the fourth is a presentation of that case with your team. The European offices don’t mess around, either — at the end of the day interviewers meet to discuss the candidates (we hear the cases and the personal interview are the most important factors), and extend offers that same evening.
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MBAs and experienced hires go through much the same process, though more individualized. At the recruitment day, applicants can expect three first-round interviews (one personality and two professional interviews) in the morning. During lunch, the interviewers meet to decide whether to continue; if so, the afternoon comprises three modules of 45 minutes each: case-study preparation, case-study presentation and a professional skills interview. Applicants are expected to use such support materials as transparencies and flip charts, which are provided. At the end of the day, the interviewers meet one last time to decide whether to extend an offer.
OUR SURVEY SAYS
A global culture Insiders characterize Roland Berger as a “non-hierarchical” culture that is “entrepreneurial, but with structure.” An international firm, Roland Berger nevertheless puts a strong emphasis on corporate culture through a high level of “collaboration across offices, competence centers and regions.” As one respondent puts it, “There exist no internal ‘domains’ that are protected, since the success of the firm directly translates into the compensation of the management — we all win or no one wins.” At the same time, employees note that as the firm transitions from a Germany-focused operation to an international company, the inevitable culture clash can make getting along a little harder than it normally would be. “This is a work in process,” says one source. “The hours can be long, and there are cultural adjustments working for a Germany-based firm,” adds another consultant. Partly to guard against flooding the ranks with too many divergent attitudes, sources tell us Roland Berger is extremely selective in its hiring, not only in terms of competency, but in fit as well. “We are not a firm that is hiring ‘bodies’ in order to grow in numbers,” says one Bergermeister. “We expect individuals that are not only high in caliber, but who also demonstrate an entrepreneurial spirit and the ability to face difficult challenges without faltering.” And while Roland Berger looks for intelligence above all else, in reality it “prefers a balance of academia with practical work experience.” Across the board, Roland Berger consultants report extremely long work hours, though much of that work appears to be self-motivated. As one go-getter comments, success “means taking the initiative upon yourself to establish new tools and penetrate new clients. No one said that consulting was easy.” And, at least in the 208
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firm’s U.S. operations, one insider says a big downer can be “the hours you spend if you are really dedicated to making this firm a success within the United States.” Another reports the amount of work has employees “dreaming in charts.” At the same time, weekend work, at least Stateside, is rare. Ultimately, the workload “really depends upon the projects — right now we are quite busy, with more and more rolling in — but 2001 was slow for us.” Travel can also be extensive. The firm’s client-centric approach means logging a lot of frequent flyer miles: “Within Roland Berger, there are no cookie-cutter solutions — each client is a new challenge with a new methodology and a new solution,” contends a Berger insider.
A little something in return In return for their hard work, Roland Berger employees get a healthy compensation package — competitive salaries, a full spectrum of office amenities and a robust insurance plan. (Though there was a freeze on raises for all of 2001, this “is loosening in 2002.”) And, making use of its international scope, the firm offers an international exchange program, “permitting employees to rotate internationally for varied periods of time. Short-term central staffing permits employees to work elsewhere in the world on a project-specific basis.” In addition to the personal perks, we hear the facilities at Roland Berger are great; the New York office is “the penthouse suite, with very lofty ceilings, well laid-out and airy.” The firm also operates a number of support systems to help get the job done easier, providing such services as graphics and editing, translating and even in-house IT consulting.
Tools of the trade Roland Berger relies on both off-site and on-the-job training for its employee development. All new hires participate in a two-week kickoff event, held “at a venue chosen from a number of attractive European locations.” There, new consultants learn the basics of their industry and network among their peers. Afterward, each is assigned a mentor, who guides them through the beginning of their time with the firm and makes sure they learn about Roland Berger’s continuing education opportunities. “Off-site training is encouraged and provided throughout the year,” one source reports. “But on-the-job training as you are attempting to face a new client challenge is usually more fun anyway.” The firm also offers PhD and MBA programs run in coordination with leading European business schools, enabling employees to work toward advanced degrees without having to leave their jobs.
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Branching out Gender diversity is an issue that has only recently come to the forefront at Roland Berger. The firm’s approach has always been evenhanded (as one consultant puts it, “There is absolutely no discrimination of any sort within the firm — instead, individual performance is what will set you apart from your colleagues”). Nevertheless, we hear that Roland Berger is paying increasing attention to the representation of women at the firm. “The culture is adjusting and learning,” one source tells Vault. “The U.S. [office] is one of the leaders in expanding the firms’ awareness of female diversity.”
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“There are cultural adjustments working for a Germany-based firm.” — Roland Berger insider
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L.E.K. Consulting
PRESTIGE RANKING
28 State Street 16th Floor Boston, MA 02109 Phone: (617) 951-9500 Fax: (617) 951-9392 www.lek.com
[email protected]
LOCATIONS London, UK (World HQ) Boston, MA (U.S. HQ) 15 offices worldwide
PRACTICE AREAS Business Strategy Development Merger and Acquisition Support Shareholder Value Consulting
THE STATS Employer Type: Private Company Chairman: Iain Evans President, North America: Marc Kozin 2001 Employees: 500 2000 Employees: 450 2000 Revenue: $125 million
UPPERS • Good social life • Excellent training • Progressive firm
DOWNERS • Relatively low pay • Few perks
KEY COMPETITORS Bain & Company Boston Consulting Group Marakon Associates McKinsey & Company
EMPLOYMENT CONTACT
[email protected]
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Focused and smart” “Work your ass off” “Valuation jocks” “Boutique of boring old Englishmen”
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THE SCOOP
Growing and changing L.E.K. Consulting has expanded from a high-end boutique founded by three ex-Bain and Company partners to one of the world’s leading strategy consultancies. Started in London in 1983, today the firm has more than 500 employees in 15 offices spread throughout Europe, North America, Australia and the Pacific Rim. L.E.K. derives 90 percent of its business from repeat clientele or client referrals. In 1993 the firm, then known as the LEK Partnership, merged its U.S. operation with another consultancy, The Alcar Group, creating LEK/Alcar, later to be known as L.E.K. Consulting. Always seeking to boost its image and name recognition, L.E.K. has improved its marketing with efforts such as a self-branding study, which led to the adoption of a consistent worldwide name and logo, a comprehensive web presence and the addition of periods in “L.E.K.” (“We didn’t want to be called ‘lek,’” quips one executive.)
The royal troika of business lines L.E.K.’s work is split along three business lines. The business strategy practice, which accounts for about 40 percent of the firm’s work, assists management in developing high-level corporate and business strategies. Another 35 percent of the firm’s workload is dedicated to its mergers and acquisitions practice. In this capacity L.E.K. performs several services, including acquisition strategy, acquisition screening, target due diligence and post-acquisition planning for both strategic and financial buyers. L.E.K. has been a player in more than 500 M&A transactions since 1996, with a total value of more than $300 billion. L.E.K.’s third area of expertise is shareholder value analysis, representing approximately 25 percent of the firm’s business. L.E.K.’s approach — founded on the principle that cash flow drives value — helps executives understand investor expectations, develop value-based corporate and business unit strategies, allocate capital, and measure and reward performance. Across these three business lines, areas of industry expertise include the life sciences (biotechnology, pharmaceuticals, medical devices, etc.), chemicals, construction, energy, high technology, media and entertainment, telecommunications, and utilities. Nevertheless, L.E.K. prides itself on being a firm of strategy experts, not industry experts, and places a premium on associates’ ability to adapt, rather than their ability to absorb knowledge of a given industry.
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The Boston/London axis More than half of all L.E.K. consultants are based in its Boston and London offices. The firm is known to be unusually flexible in its international assignments, and employees can switch easily between offices for either short-term “swaps” or permanent transfers, depending their on preference. The firm does not require its consultants to specialize in a particular practice area, though generally they gravitate toward two or three preferred industries. L.E.K. consultants (those with MBAs or advanced degrees) travel frequently, but perhaps not as much as the industry standard. And the trips they make tend to be short in duration (on average one day per workweek) with associates traveling even less. Associates typically return to graduate school, while consultants — those with MBAs or advanced degrees — can expect to be promoted to the managerial level within two to three years.
It’s all about image L.E.K. has a reputation for working on the nuts-and-bolts, number-crunching level of a case, a fact it likes to emphasize when trying to differentiate itself from the competition. The company is also flexible and sensitive to clients’ time requirements — L.E.K. averages significantly less time per assignment than other firms. To enhance the firm’s intellectual property and responsiveness to market needs, L.E.K. has established an advisory board of 10 renowned professionals from the academic and business worlds.
Extracurricular activities L.E.K. distributes a quarterly publication, Shareholder Value Insights, written by VPs at the firm. It also collaborates with The Wall Street Journal on the annual Shareholder Scoreboard, a unique periodical that ranks companies by shareholder returns. L.E.K. produces similar publications with The Australian and The National Business Review of New Zealand. It was also a major sponsor of the winning yacht in the BT Global Challenge 2000/2001 (the boat, the LG Flatron, completed the race in June 2001).
Pushing out at the seams The last few years have seen L.E.K. expand considerably In 2000 the firm opened an office in San Francisco, its fourth in North America. Also that year it merged Alliance Asia Pacific, a Beijing-based affiliate, into its global partnership. AAP’s
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offices work with L.E.K.’s Bangkok and Singapore offices to offer services throughout China and Taiwan. The firm says it plans continued expansion in the future.
Meetings of the minds L.E.K. Consulting emphasizes the day-to-day involvement of its 68 senior partners, who spend about 70 percent of their time in daily contact with the rest of the firm. L.E.K. also promotes senior and junior staff interaction through regular professional development sessions that cover analytical concepts, management techniques and project reviews. An open-door policy at L.E.K. encourages the sharing of ideas and also fosters mentor relationships between associates and consultants. (These mentors provide career support and guidance, as well as a forum for discussing “noncasework issues.”)
GETTING HIRED As with many top consulting firms, getting a foot in the door at L.E.K. has gotten significantly more difficult over the last few years. Thanks to the downturn in the economy and the drop in dot-com business, L.E.K. and others can afford to be extremely picky about who gets hired; one source tells us that “it’s incredibly competitive, especially in the current economic environment. We still had a full recruiting effort last season, but since many other firms scaled back recruiting, we were able to be extremely selective.” L.E.K. consultants report that personality fit is more important than a flashy resume. “We have a work culture that is cherished, and we are keen to maintain that by hiring people that fit into our approach to work,” says one. “The resume won’t dictate the offer,” adds another. “People would be surprised to learn how much a strong interest in L.E.K. will do for their chances. If you really follow up and show that you’re interested in the company, you will be automatically looked at more closely, even if your resume is a step below the top.” L.E.K. hires recent college graduates for its associate positions and MBAs for its consultant positions, though it’s not uncommon for associates to move into consultant spots without an advanced degree. The firm interviews on campus at a number of top-20 schools and accepts resumes by e-mail. Some quantitative or business training is helpful, but there are many at L.E.K. who, prior to arriving at the firm, hadn’t dealt with numbers since freshman econ.
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There are three rounds of interviews at L.E.K. The first two are on campus and involve two or three interviews with consultants (in the first round) and managers (in the second round). Expect a mix of case questions and fit discussions, but also guesstimate problems (“How many staples are sold in Kentucky each year?”). The third round, held at an L.E.K. office, consists of three meetings with senior management; we’re told that “Usually in this round, one of the three is designated the person more responsible for ‘fit with the firm,’ and the other two are more focused on case questions.” For detailed job descriptions, visit the “
[email protected].” section of the firm’s web site. Applicants may mail, e-mail or fax resumes to the recruiting coordinator at the U.S. or international office of their preference.
OUR SURVEY SAYS
In the family “Like a family” isn’t a phrase you expect to hear describing a consulting firm, but that’s exactly what many respondents have to say about L.E.K. “People are friendly, are willing to help and see each other as teammates, not competitors for a promotion,” one source tells us. (Apparently, L.E.K. is actually more functional than most real families.) Socializing outside the office is a big part of the life at L.E.K.; another respondent says that “on any given weekend, there will 95 percent of the time be some sort of gathering going on that involves a large part of the associate, and often even the consultant class.” And while a number of respondents say that “the partners often seem a bit distant,” they also praise the strong spirit of teamwork at L.E.K. They describe the typical consultant as “friendly and quirky.” As one put it, “People at L.E.K. word hard. You will never hear ‘I can’t’- or ‘that’s not in my job description’-type comments here. And when I say ‘work hard,’ I don’t mean plugging away at the same task over and over and over. Working hard at L.E.K. means figuring it out.”
Staying close to home Employees are also very happy with the minimal amount of travel involved with L.E.K. projects. “This is probably the number one reason why I chose L.E.K.,” one respondent tells Vault. “No traveling to clients within your first two years.” “This is
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a good thing,” says another, “as I think the novelty of frequent-flier miles and nice hotels quickly wears off.” Hours at L.E.K. aren’t bad, either. “I can’t complain,” says one source. “I think they’ve been better than the hours for many [of my] friends in consulting, and definitely better than the hours for friends in banking. I’ve probably averaged 55 hours a week for the last several months.” L.E.K. keeps weekend work to a minimum, with one insider telling us, “I’ve done it two years,” and during that time, “I’ve only worked two weekends.” Others, though, tell us that the hours can vary greatly depending on the partner managing a project. “Some partners are notorious for needlessly boiling the ocean,” one reports, while “others are concise, work smart and get you out without pointless hours.”
To perk or not to perk L.E.K. is not the place to go if you want full-service perks. “Occasionally the firm does things that seem pretty cheap to the junior staff members,” one source reports. “We are one of the few consulting firms where everyone flies economy all the time.” Another adds that there are “often inconsistencies in perks from office to office and person to person, which results in some frustration and perception of bias.” And the offices, while “aesthetically pleasing,” are “not luxurious enough to make me wonder how much of my potential pay goes towards décor.” But many respondents say they don’t mind L.E.K.’s no-nonsense approach to its employees. “I’d rather be economical with useless frills and get a relatively fatter profit share,” says one. While the company reportedly does pay well, with profit-sharing plans and ample bonuses, one senior associate has this to say about L.E.K.’s compensation plan: “Don’t come to L.E.K. for the money. It is a great firm in many ways. But pay is probably the area where L.E.K. is least competitive. In profitable years, profit sharing can help close the gap with other firms. But I don’t think L.E.K. pays as well as other top strategy firms.” At the same time, L.E.K.’s moves to cut back on pay increases in recent years is in part a tradeoff with its commitment to avoid layoffs; sources in the firm’s Sydney office report that while 2002 raises have been frozen, no one has been laid off in the last 12 months.
Constant training L.E.K. “trains like mad,” insiders tell us. The firm requires all employees to attend at least four hours of professional development training a month, usually focusing on the latest statistical techniques and software applications. In one source’s opinion, Visit the Vault Consulting Career Channel at http://consulting.vault.com — with insider firm profiles, message boards, the Vault Consulting Job Board and more.
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Vault Guide to the Top 50 Consulting Firms L.E.K. Consulting
“Associates at L.E.K. get exposure and experience with far more sophisticated analysis than counterparts elsewhere.” The firm also has a library of educational modules, covering everything from how to approach prospective clients to how to implement advanced financial models. “Professional development is taken very seriously,” one L.E.K.er reports, “because they don’t want people in the position to not be able to handle the work.”
Changing faces Though the consulting industry’s effort to diversify its ranks over the last decade have yielded varying results, L.E.K. has been more successful than most. Much of the senior management is made up of white males, but the rank and file is almost evenly split between men and women, with a growing number of minorities. One woman consultant characterizes the firm as “definitely not an old boys’ club. The typical L.E.K.er is not a white male business major.” She adds that “In Boston, women make up half the associates, a third of the consultants, two out of seven managers and one of the [vice presidents].” L.E.K. is a progressive firm on issues of sexual orientation as well. Insiders say that “People at L.E.K. are extremely open-minded; for example, at any L.E.K. gathering you expect to see significant others, and are upset if they’re not there, regardless of whether the relationship is heterosexual or same-sex. You want to see them because chances are you’re friends with them as well, through your co-worker.”
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Vault Guide to the Top 50 Consulting Firms
“People at L.E.K. are extremely open-minded” — L.E.K. consultant
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PRESTIGE RANKING
DiamondCluster International
Suite 3000 John Hancock Center 875 N. Michigan Avenue Chicago, IL 60611 Phone: (312) 255-5000 Fax: (312) 255-6000 www.diamondcluster.com
[email protected]
LOCATIONS Chicago, IL (HQ) 12 offices worldwide
PRACTICE AREAS Execution Strategy Technology
THE STATS Employer Type: Public Company Stock Symbol: DTPI Stock Exchange: Nasdaq Chairman and CEO: Mel Bergstein 2001 Employees: 1,141 2000 Employees: 1,063 2002 Revenues: $203.0 million 2001 Revenues: $307.4 million
UPPERS • Choice in home base • “Phenomenal” internship program
DOWNERS • Culture in flux • Iffy training
KEY COMPETITORS Accenture Booz Allen Hamilton Boston Consulting Group McKinsey & Company Sapient Corporation
EMPLOYMENT CONTACT www.diamondcluster.com/careers
THE BUZZ
WHAT CONSULTANTS AT OTHER FIRMS ARE SAYING
• • • •
“Cool projects” “Questionable business model” “Lots of potential” “Where are they now?”
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Vault Guide to the Top 50 Consulting Firms DiamondCluster International
THE SCOOP
Shine on you crazy Diamond DiamondCluster International is a management consulting firm based in Chicago and one of the nation’s few publicly traded consultancies. It got its start in November 2000 after Diamond Technology Partners, founded in 1994, merged with European firm Cluster Consulting, founded in 1993, in a deal worth $930 million. The firm helps clients in the financial services, telecommunications, energy and health care industries utilize technology-based strategies to improve their businesses. It is also the home of such notable consulting works as the 1998 bestseller Unleashing the Killer App and the critically acclaimed business journal Context.
Raising intellectual capital Recently, DiamondCluster has established a number of study centers and joint ventures devoted to researching various aspects of the high-tech industry. One example is the DiamondCluster Knowledge Center (KC), which offers online tools and a support help desk to assist the firm’s consultants with their work. The Field Leader program, run through the KC, engages cross-global teams to pull together the firm’s intellectual capital and develop methods of delivery. In September 2001, the firm opened the Chicago-based Center for Technology Innovation, a conceptual laboratory where the company develops ways to help clients better integrate hightech methodologies. DiamondCluster also operates the Center for Market Leadership, based in Boston, which examines the drivers behind market dominance. And in March 2002, it announced the first round of funding for DevLab One, a joint venture with Motorol
