<p>What kind of skills/qualifications are needed for this field? From what I understand, workers do a lot of independent research on industries and then advise companies based on their findings? Are you limited to only working in your academic background? Why don’t these companies do their own research instead of hiring consultants? </p>
<p>How does the difficulty of getting into this field compare to investment banking? Is it usually less desirable? </p>
<p>Thanks in advance for any input.</p>
<p>
</p>
<p>Very good communications and presentation skills - what I dub “the look” (i.e. being a tall handsome guy or a gorgeous woman is definitely an asset). Ability to think creatively and quickly. Excellent physical stamina to put up with the 70 hour workweeks and massive travel. </p>
<p>
</p>
<p>Yeah, something like that. More specifically, you are given a business problem by a client and you have to figure out the best way to solve it. </p>
<p>
</p>
<p>Many reasons. Top reason being that they don’t have the expertise. Keep in mind that management consulting companies hire many of the sharpest minds in the world and have therefore amassed excellent ‘human capital’ A lot of companies, quite frankly, don’t have a lot of high quality ‘human capital’, and they know that. They have a lot of employees who are able to keep the company running, but not necessarily think creatively and perform wide-ranging high quality industry research. So that’s why they feel that they have to hire some consultants. </p>
<p>Keep in mind that your own employees will also have only seen problems within your company. However consultants will have experience in dealing with problems with a wide variety of companies, and a wide variety of industries. Hence, they have a diverse treasure-chest of experience which they can draw upon. Many of your own employees may be so inured to working for only one company or one industry that they won’t be able to think out-of-the-box. </p>
<p>There are also certain elements of institutional pride involved as well. For example, let’s say that you have worked in the steel industry all your life. You probably won’t be able to make recommendations that are painful to the steel industry, even if it’s the right thing to do. That’s because all your personal and professional pride is tied to a strong steel industry. So even if you know in your mind that shutting down a whole bunch of steel mills is the right move, you still may not be able to bring yourself to say it just from a purely emotional standpoint. A consultant who has no emotional ties to the steel industry may be able to say it. </p>
<p>Another important aspect is that the consultant can be seen as a neutral party. If you get some of your own employees to come up with recommendations for you, those employees may easily come back with ideas that enhance their own political power within the company. So you would then have the nagging suspicion as to whether those recommendations are really good for the company or were they made just because those employees are trying to increase their power within the company? Independent consultants have no stake in the internal politics of the company, so their recommendations can be considered more trustworthy. Completely trustworthy? Maybe not, because consulting firms may unsurprisingly recommend that you keep hiring them over and over again. But more trustworthy than handing it off to your own employees who may have their own political agendas. </p>
<p>I’ve also found that having consultants helps you to deflect blame for making painful and unpopular decisions. For example, let’s say that you’ve decided to lay off half the company. That’s going to be a tremendously provocative and upsetting decision that you will need to justify to the Board, to the stockholders, to your employees, and so forth. However, if you hire a consulting company, and they recommend that you lay off half of the company, then you can just say that you are only doing what the consulting firm recommended you to do. Never mind that it was secretly your idea the whole time. You have a convenient scapegoat with which you can deflect blame. </p>
<p>
</p>
<p>Probably about the same difficulty and desirability. Consulting makes less money but is also less physically taxing. Consultants work about 60-70 hours a week, compared to bankers who work 90+. 60-70 hours a week is still a lot, but it’s a whole lot better than 90+. Many people also see consulting work as more interesting because they can see a diverse set of business problems and work on lots of different things, whereas bankers tend to (obviously) be focused on finance work. But of course if you like finance work, then you would find banking to be more interesting.</p>