What is consulting?

Parents Forum
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I don’t want to clog up the thread where the parent is asking about whether to encourage the D to stay or not, so…

I am straight out asking. Everyone here seems to know what that job is, and I actually don’t. I mean, I know what it means to consult, but as a field, I’m confused. I looked it up, and I got definitions of experts hired to help corporations do this or that.

Bu a newly minted Bachelor’s degree holder is not going to be an expert, compared to the people in the field already, so what are they getting paid this big bucks for?

Not a snarky question–I am sincerely clueless on what this means.

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I have often wondered myself why a middle aged corporate leader would want the advice of a bunch of 22 year olds with no real experience.

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My understanding of Management Consulting is that it is a field wherein the business is analyzed structurally for any gaps or arbitrage areas against theoretical management models. Based on metrics and indicators, a report is compiled showing how best-practices can be leveraged (serving different markets, divesting underperforming units, mergers and acquisitions to streamline or full occupy a market niche, etc.). This is green-eyeshades work done by ambitious and very sharp people who have recently studied the best-practices. Therefore, while management continues to manage, and workers continue to work, management consultants analyze the business and make very specific strategic recommendations, supported by modeling of expected outcomes.

That is how I see it. Also, note that management must then fold the recommendations into their understanding of their cuture and marketplace and act, or not act, on recommendations as they see fit.

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I sort of follow that? I still am not quite getting how that could be so easily trained for; I guess it’s just applying algorithms?

It sounds deadly, though, if that’s what it is. No wonder she wants out.

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It is like any other job although it sounds odd that 22 year olds get to advise. The reason they get to is because they get hired by the expert companies in the field and get trained along the way (they start as analysts working 80 hours a week), produce information in nice report formats their managers at higher levels provide them advice on and then someone at a much higher level goes and presents the results to their client’s CEOs and VPs. Once they put 2-4 years, their companies allow them to go get their MBAs (some times pay for it) and voila, their billing rate now doubles.

What they do essentially is to review a business based on the industry, expected growth, cost structure and determine whether the business should make any changes. In reality, the business might bring a team to advise solely in a specific area like IT, supply chain, sales etc where they believe they are having issues in or want to change direction and make someone established in the industry to write them a nice report so management can take a specific action and have a CYA document in case things bomb.

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How long has this job existed?

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@texaspg , sounds like you might have worked at one of these firms!!!

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I haven’t but I know several kids who got hired at 22 and D is a senior whose classmates are getting hired now.

I have worked for a fortune 50 company for the past 15+ years where we see a parade of consultants whose advice gets implemented for all the wrong reasons and impacts our lives on a regular basis. We went through for a while with a CEO who hated them and never hired any but that is the way of life at many large companies and pretty much all our other CEOs have hired them for various requirements.

One thing the consultants do very well is benchmarking a company against the industry. They are able to take a company cost structure and provide analysis showing where the company is in each area compared to their competitors and that shows why a company is losing or making money when compared to their peers.

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Beyond the jargon of post #2, I’ve always wondered what a consultant does all day long. Do they stare at spreadsheets? Make phone calls? Write reports? What does their workday look like? What do they spend their day doing?

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Most consultants spend lots of time finding their next gig :slight_smile:

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I worked for one of these firms starting in the late 80s, and they weren’t totally new then. There are different “types” of firms.

There are firms like McKinsey – they do a lot of strategic level consulting, helping with big picture issues and strategic analysis, complex modeling, things like that.

Then there are the big firms like Accenture, Deloitte, PWC, etc. – they have different divisions (usually a small strategy division), but an awful lot of the work they do is called integration work. When a company has a BIG project (say they are completely replacing a significant core software system or set of systems, or are getting into a new line of business. or trying to put together two companies in a large merger), they need extra resources – they usually have neither the management resources, the project management skills, or the bodies to do all the work to do stuff like make software configuration decisions and develop reports, and write all the needed conversion code and test all that stuff and develop new forms and write business procedures, and track & report progress on a huge project – whatever needs to be done. These firms provide a significant portion of the resources needed to get these big projects done, then (mostly) leave when the project is done. The hiring company can hire for varying components of the project (say, just the conversion for an acquisition, and they will do all needed software changes themselves while the consulting company is responsible for converting all the data). Or they can hire them for most of the project work, and split the way resources are provided (say consulting company provides 75% of resource, and hiring company provides 25%). It is uncommon for the consulting companies to take on small jobs (providing just a few resources), unless there is the potential to convince the client to hire for a bigger job.

So the employees of these companies typically move from project to project, and from client to client. Often they have little say in the location, industry, or role – a body is a body when they are trying to staff a project. But one of these projects can take years – although they are often in overlapping phases, and not all consultants stay for the whole project. Of course the more experiences consultants are more valuable, and the projects are seeded with those. They often do more of the client interaction. Newer people might be writing test cases or writing requirements or coding (although most of these firms now use offshore companies like Tata for at least some of the coding). As they gain experience, they might work on proposals for clients, project planning, and have more say up front in the decision making part of what software will be selected – things that require more experience and knowledge to do well.

Those companies do some other things – maybe take on big training projects (worldwide rollout of something new and large for an organization), sometimes they take over whole departments in a sort of outsourcing role, and they may have some niche specialties.

Then there are more niche consulting companies. Some of them work at a high level in a given industry – I have friends who work for a smallish highly regarded health care consulting company. They specialize in health care projects, and do a lot at the strategic level in that industry.

There are “body shops” that call themselves consulting firms (lots and lots and lots of those). They provide resources on a one-off basis – a couple project managers here, a business analyst there, a test coordinator, a program manager, a coder with specialized package or software language skills. But those firms are essentially only responsible for the resource. The other types of firms previously discussed often have some skin in the game for the completion and success of the project. The body shops are just that providing resources. They will replace them if they quit or prove incompetent or whatever. Maybe even not charge for all the hours in some situations like that. But they don’t tie billing to the project or business success.

And there are a lot of independent consultants. They usually form a relationship with a body shop, or sometimes one of the other types of firms, and work under their umbrella. The consulting company takes a cut of the hourly rate – deals vary depending on the industry, who found the contract, length of contract, etc.

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I know someone who graduated from Stanford with a chemical engineering degree. He decided he did not want to be an engineer, so he interviewed and became an associate consultant at one of the largest consulting firms in the US. I understand from my son, who is his friend, that he is now working like 80 hours a week and wishing he had stayed in engineering. He told us the average person stays in this job for two years, then finds an industry he wants to be in and gets a job with them. It pays a lot of money, which is why so many graduates go into it. But it seems to be the two year average in the job is probably due to being burnt out from so much work. The associate consultants work in a team of five, like with three associates and two main consultants… he thought he would probably start out doing spread sheets and things like that, but I have no idea exactly what he is actually doing.

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If he is a ChemE, he is probably doing a lot of quant type work. If he is working in an industry which he understands due to his background, i.e., industrial type of company, he could contribute a lot more since he will understand what they are doing. If his clients on the other hand are something like a accounting firm, then he would be spending a lot of time learning about the business.

It all comes down to billable hours which is why the 80 hours.

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This is fascinating, guys! Thanks. (Not my world, but I’m insatiably curious and interested in hearing about other worlds.) Still sounds soul-sucking, though.

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Not to mention they travel almost 100% of the time, which is fun at first…then it gets old.

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@garland, OMG, I just finished the other thread and started googling. I was watching a Sunday morning political show the other day and one of the guest was "such and such, from “Xo.XO” consulting and I have no idea what that person does for a living.
Thank you for reading my mind!

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My husband was a consultant. It definitely has its pros and cons. On the con side, he was often gone from Monday through Thursday at the client sight.

Yes travel gets old, but the frequent flier miles were wonderful. Also on vacation, his status allowed us to board early and to get frequent upgrades.

Of course the pressure of billable hours requires very long days. But my husband focused on acquiring knowledge and skills with each job. He actually enjoyed the work…he liked problem solving and the challenge of dealing with new clients. (It also helped that when he started doing consulting, I was a “workaholic” teacher…we were career focused, pre-kids.)

I guess what I’m trying to say is that for just about every difficult aspect of his consulting career, there was a corresponding growth opportunity that contributed to his success later in life. He learned to communicate with decision-makers in a company, to produce deliverables, to manage a team and to deal with setbacks.

It was during my husband’s consulting phase, we were able to save a tremendous amount. Frankly we didn’t spend much, because we were so busy working. We didn’t use our combined income to change our spending habits…no expensive house or cars. Nice vacations were relatively cheap because of airline and hotel rewards.

Then when we were ready to start our family we had saved enough that I could comfortably stay at home. He left consulting shortly thereafter. Leveraging his consulting experience and contacts he was able to find a job that “leapt over” entry/mid -level positions. In a nutshell the hard work and experience during those stressful years was a large factor in attaining his last position, which, with a lot of hard work and some luck, allowed us to retire very early. We wouldn’t have changed a thing.

P.S. But please don’t ask me to explain what he did on a daily basis in strategic planning. :wink:

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I know what most professions do on a daily basis; I could give an hour-by-hour account of how a professor, dentist, radiologist, banker, or family attorney spends their work day. Despite many helpfulish posts above, I repeat my question because this has piqued my curiosity for years: What does a “consultant” do all day long at work?

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Getting to and from airports and client sites. Meeting with clients at their site to better understand their business, which can be interesting depending on the industry. You could find yourself in a brewery, a coal mine or a cannery. Then it’s meetings and conference calls. Meeting with clients to understand their industry and in particular the problem(s) they want to address. Meetings with team members to determine the best approach to compile data needed to address the problem. More meetings, emails and conference calls as client needs change. Analyzing data as a team, working on solutions and making client presentations. Then more going to and from airports.

That’s the way I understand it anyway.

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I think @intparent gave a really good description of consulting.
@danstearns has it right as far as the types of things they do.
Really it just depends on the type of consulting gig they are working, and the persons role on the team. I work for the government, and have worked with many different consulting companies. Some people are very specialized, and some are generalists/warm bodies. Usually you are hiring the firm/company for its specialty knowledge in what your company is trying to do.
My son wants to be a consultant when he graduates with a business degree, because he can move from client to client and figure out what he really likes to do. Then he can focus on that one area.