Management Consulting Sector Overview
The UK management consulting industry is amongst the best in the world and a vital part of the business landscape. The industry is worth more than £8 billion, with year on year growth since 2010 of between 4% and 8%, according to the MCA UK Consulting Industry Statistics 2017. A quarter of aggregate fee income is now accounted for by Digital and Technology Consulting of which 27% is earned within the Financial Services sector and a further quarter from Government and Public Sector work. The Financial Services sector remains the largest consulting market in the UK and one of the fastest growing with almost 7% growth in 2017 according to Source Global Consulting who published their UK Consulting Market Report in February 2018.
Management consultancy firms provide external advice to organisations, giving specialist expertise or an outside perspective on the whole or part of a company’s business in order to create efficiency gains, prepare for growth or implement technology. Consultants are typically employed to assess and analyse a specific area of an organisation and will deliver recommendations for improvement.
The work of consultants, therefore, falls broadly into a number of categories: strategic, business improvement, change management and information technology. Increasingly clients are seeking a more holistic approach to digital transformation and using consultancy support in developing their digital strategy across all service lines.
Consultancies vary in size and focus but it is possible to group them as follows:
Generalist consultancies. These are the large consulting firms offering a wide range of services including in some cases outsourcing. These firms operate on a global basis and provide the employee with a wide variety of work experience.
Strategy consultancies. Often smaller or medium-sized firms focussed on providing strategic advice to firms and long-term planning and reorganisation
Niche consultancies. A significant proportion of the growth of the UK consultancy sector has been driven by consultants leaving larger firms and establishing smaller specialist firms in a particular sector or service. These boutique consultancies have an in-depth knowledge of their sector or subject area, for example, Financial Services, Public Sector or Supply Chain, IT advisory etc.
In addition, a significant proportion of expenditure on management consultancy services in the UK now goes to independent consultants who work on a contract basis.
The Management Consultancies Association (MCA) is the UK management consultancy industry’s representative organisation and has been at the heart of the UK Consulting Industry since 1956. Membership of the MCA is recognised as a mark of quality for consulting firms and Associate members. The MCA’s mission is to promote the value of management consultancy for the economy and society as a whole. The MCA’s member companies comprise over 50% of the UK consulting industry, employing around 45,000 consultants.
The organisation provides and facilitates thought leadership on the key challenges and issues facing the management consultancy industry. In addition, they commission research and policy analysis and represent the industry in discussions with the government and other stakeholders.
The MCA provides networking opportunities and for the last 21 years have celebrated the best of management consultancy with the Annual MCA Awards, seen as the benchmark of quality in the industry.
The Institute of Consulting has progressively been developing its position and strategy as the professional body for the consultancy profession. The organisation, whose mission is “Better led and better-managed organisations”, provides guidance on good practice across the profession. It provides support and training for its members and a framework of qualifications.
A career in management consultancy
Management consultancy is a challenging and stimulating career choice. It is an industry that exists to support other businesses. As such, it is an exciting environment in which to work and provides ideal experience and a stepping stone into the corporate environment.
The major consulting firms typically recruit candidates who are at three different stages of their careers:
- New graduates: competition is intense and firms are aiming to recruit applicants with a very narrow and predetermined set of characteristics especially focussed on specific degrees and specific Universities
- MBA hiring programmes: leading consultancy firms, in particular, the strategy firms, hire candidates who have just graduated from the leading business schools. Again this is a very competitive mode of entry and most firms will consider applicants from only specific business schools.
- Experienced hires who will have specific experience or sector expertise of value to the firm’s clients. Sometimes entrants will not have prior consulting experience but at more senior levels this is essential because of the need to manage consultancy engagements and staff, manage clients and bring in revenue.
What makes a good management consultant?
Much has been written on this subject and specific skills and experience will always be required. However, there are a number of key generic requirements for success in all management consultancy jobs:
- Intellectual capability evidenced by a strong educational background and at least an honours level degree. Many consultants have a PhD or MBA
- Strong analytical skills and a desire and curiosity to find a solution to a problem
- Excellent communication, both written and verbal
- The ability to relate to people and quickly build rapport. A good consultant will listen and recognise another person’s point of view while at the same time being objective.
- Integrity and professionalism
- Willingness to deal with new challenges and adapt as circumstance dictates
- Willingness at times to compromise on work-life balance
For Clients: Recruiting and retaining great talent
Talent management is an essential component of business success. While there are many talent management models, the elements can broadly be categorised into five areas; planning, attracting, developing, retaining and transitioning (including succession planning).
An important key to success is to ensure the acquisition process is optimised. If there is a surplus of good candidates, consultancy firms are able to pick and choose and talent acquisition is not a constraint on business expansion. However, for some time there has been a “war for talent” and it has never been more important for consultancy firms, particularly small and mid-sized organisations to plan ahead.
With changing demands in expertise due to emerging and rapidly growing digital technologies consultancies may need to think more laterally about where they recruit staff and their approach to management consultancy recruitment. The traditional route of smaller firms hiring from larger consultancies (or consultancies within large corporates) may have to be augmented with recruits from non- corporates or even start-ups.
There are broadly four main routes to hiring staff
- Your own networks and those of your staff
- “In-house” recruitment
- Recruitment Outsourcing
- External recruitment providers .i.e. agencies and head-hunters
Within any organisation, the leadership team and hiring managers can find themselves being advised about recruitment by internal staff with their own agendas which are sometimes in conflict with what are really the best methods to find, attract and hire top talent. It is important to consider the pros and cons of each method and it is likely that a blended and hybrid approach may be most effective.
Lead time on recruitment can be months, so it is critical for firms to establish a talent pipeline. Management consultancy firms must be proactive, not reactive in their talent acquisition strategy and be receptive to hiring staff with the right character and fit for a firm, rather than delaying hiring by being too specific about exact experience. A survey of 500 leaders found that the right “personality” was judged the most important quality in a worker by 78% compared with “skill set” which scored 39%, though in practice many firms are looking for the elusive “perfect” candidate.
Why use a specialist management consultancy recruitment consultant?
The most compelling reason for using an external management consultant recruitment agency is that they have access to a greater talent pool than relying solely on an in-house recruiter. They also have the expertise and resources to streamline the process. Additionally, they are experts at marketing and presenting your firm’s Employee Value Proposition and role to prospective candidates, and seeking out specialist hard-to-find skills. Their understanding of the market enables them to assist with recruitment challenges such as Diversity and Inclusivity and the importance of retaining women within the consultancy industry.
External recruiters and executive recruitment firms may seem expensive, but they often only charge a fee when they find a suitable candidate. It is important not to view recruitment as simply an overhead but to apply a Return on Investment (ROI) approach as you would in other parts of the business. In this way consultancy firms should directly compare the cost of a hire with the returns (fees) that these hires produce and the loss of revenue of hiring is delayed or ineffective.
Selecting the right recruitment partner
Your choice of an external management consultant recruitment agency is important. They are the face of your organisation to potential candidates and an ambassador for your brand. It is important to take time to select a recruiter you can work with who you know will act with integrity. Personal recommendation is important, as is the ability to build a rapport to ensure you are able to maximise their effectiveness.
How you work with a consultant recruitment firm is also relevant. Recruitment problems cannot always be resolved by pre-determined, packaged services so it is essential to consider the options. Whilst contingent recruitment seems attractive (no success, no fee) there are a number of reasons why executive search might be much more cost effective and successful for an organisation. It is important to understand the best way to make recruiters work hardest for YOU.
Importance of the candidate experience
A company’s application process will have a direct impact on their ability to hire top talent. In a climate where demand for talent outstrips supply, how you treat your job applicants may make the difference between whether they accept a job offer or decline it. This applies to direct hiring and using a recruitment agency to find candidates for a job. Hence the need to ensure your executive search firm has the highest standards of professionalism. Providing a great candidate experience can be a differentiator between you and another company. Job seekers say that one of the most important factors in deciding whether to accept a job offer is the candidate experience with a prospective employer.
Unacknowledged applications, poor communication, lack of useful information or feedback and long, slow hiring processes rank as the biggest frustrations. A good recruiter can manage the process but not without a commitment from both the hiring manager and in-house recruiter.
It goes without saying firms should treat the candidates whom they reject with as much professionalism as those they wish to hire. When people have a bad experience, they tell other people – in person, or increasingly, via social media or Glassdoor.
Employee retention and career development
Retention is a key component of talent management, and dependent on a multitude of factors including
- remuneration strategy
- the culture within the organisation
- training and career progression
- challenging and varied work
- work life balance
There is a general acceptance that the millennial generation will have ten or more jobs during their career. Work-life balance is becoming increasingly more important not only to retain women in consulting firms but all staff and to ensure the success of succession planning. In this respect, the smaller or medium-sized firms have an advantage in that they can respond more quickly to employee demands and potentially offer more flexible working.
Evolution of consultancy firms’ talent acquisition strategy
When Prism was established as a specialist Management Consultancy recruiters twenty years ago the world was very different: few job boards, few people using email, no LinkedIn, and few companies had career pages or jobs on their website.
People looked in The Sunday Times for management consulting jobs and posted an application, or they registered with an agency.
Employers often had very small in-house recruitment teams whose job was often relatively high level and strategic, including managing agencies and head-hunters rather than finding candidates directly.
The recruitment landscape now looks very different and, as with many other areas of business, cost enabled by technology has been a major driver.
Many firms, large and small, now place much more focus on reducing recruitment costs even if, arguably, this is at the expense of the candidate experience and finding the best talent.
In-house recruitment consultants are to be found in abundance and the logic, of course, is that their fixed cost is much lower than agencies: although the latter are often paid on only on success, so a firm seeking large numbers of staff will soon have a very large annual overhead. In some cases, recruitment is, as an alternative, outsourced, applying the same logic as any other outsourced service or function.
These strategies can be very effective but can fail to cope with rapid increases in demand or a requirement for very specific or sought-after skills which is where head-hunters and agencies are still used. It is also more difficult for smaller firms to justify the fixed cost and in addition to such firms, an in-house recruiter can struggle to gain candidate engagement if the brand is less well known.
Recruitment of consultants for roles within corporates
Many “Corporates” recognise the value of experienced management consultants. Indeed for a long time, many industry leaders have, in their careers, worked with the top tier management consulting firms especially the strategy players. Also, historically many interims and freelancers have often had a consulting pedigree and can deliver high-quality work at a fraction of the price of the firms they used to work for.
What has changed is the increasing realization of the value to be gained by employing ex-management consultants in permanent roles as internal change and transformation leaders. This is partly cost but also recognition that in some cases people on the inside can do a more effective job that external consultants and that by retaining these staff they keep the knowledge and expertise “in house”.
Another area of a Corporate which has traditionally sought management consultants is of course strategy.
In both cases the breadth of experience that consultants can bring together with their typically strong “softer skills” e.g. stakeholder management, problem-solving, intellect, interpersonal etc. can make them an exceptional future talent with the capability and flexibility to work in other areas of the business and the ambition and talent for further career development.
Indeed the best candidates will be actively seeking career potential so when seeking talent from consultancy firms it is important to be clear regarding the career prospects and ideally to be able to support this with examples of other management consultants progressing within the organisation.
Another aspect to be aware of is how to source these individuals: mainstream finance or IT recruitment agencies (by way of example) will simply not have the contacts or experience to target and tempt the best consultants so you need to work with a recruiter that is focused on this market.
For Candidates: Career planning and job search
Importance of career planning
Successful careers almost never happen by accident: there might be lucky breaks along the way but there is always a goal and a strategy.
In the past when perhaps an employee reckoned on staying with an employer for life they could be confident that their talents would be recognised and that new roles, promotions, pay rises would come along regularly in exchange for their loyalty and hard work.
There are still a handful of companies where that might be true and where the term “talent management” is not lip service. Or very high growth companies where an employee might be inexorably pushed further and further upward.
But increasingly people need to manage their own careers and, like any other strategy, there needs to be clarity around objectives and endpoints. Some can be very explicit. Some can be more fuzzy. But there needs to be a clear purpose and direction. This might sound obvious but it is often clear to Prism from a CV and a career discussion that people have made moves (or are considering doing so) without any career logic, perhaps based on gut feel, an enticing salary or a whole host of reasons which “seemed like a good idea at the time” but with hindsight can be catastrophic. The motivations can sometimes be because of a pressing need to find a new job: in those situations if possible it is always worth asking the question “if I were happy in a role and employer would I even give this the time of day?”. That can sometimes be a useful reality check.
These goals have to factor in personal circumstances indeed the ideal starting point is “what do I want from my life and career?”. What is important? Family? Money? Work-life balance? Running my own business? Retiring early? Never retiring? Remaining in consulting or moving “client side”? What sort of person am I? Do I really have the ambition motivation and perhaps sharp elbows to reach the highest heights? This is perhaps the “life the universe and everything” question.
So next steps are around timescale: working back from the end goal an employee should decide where that means they want to be in (say) 15 years’ time, 7 years’ time, 3 years’ time and then critically, what that means in terms of the next job move.
That doesn’t mean that it is wise to be dogmatic about what a role and employer is likely to be but actually the reverse is much more often the case in Prism’s experience: a candidate tells us they could consider contract or permanent, a large firm or a small firm, a delivery role or a sales role ie arguably looking too broadly without evidence of the aforementioned plan and strategy.
There will be times with a job or an employer where you definitely should not take that headhunt call or seductive LinkedIn approach, other times when you could be open to approaches and then times when all your efforts and energies are devoted to the next move.
Career planning can help you decide whether to move, when to move and where to move!
Entering the job market
It is estimated by LinkedIn that at any one time, 85% of the working population is either actively or passively looking for a job. There is a difference between being tempted by a speculative call from a headhunter and applying to a number of miscellaneous jobs. Much is written about the pros and cons of active and passive candidates, but from a candidate’s viewpoint, it is important to consider carefully how a particular job move fits into an overall career plan, to avoid becoming a job hopper.
If you are intending to actively enter the job market (or be receptive to approaches) a certain amount of preparation is required.
Assistance with your job search
It is tempting to think that writing a good CV for management consultancy jobs is straightforward, but unfortunately, this is not the case. It is important to consider how candidates are selected for interview either by an executive search consultant or an employer and design the CV accordingly. A decision is made very quickly whether to consider a candidate based on a swift initial review of their CV. The assessor will not read every word in this review, or indeed ever. They might have hundreds of applicants’ CVs to consider. It is therefore important to keep this in mind and to present information in an effective and accessible way.
Many CVs are mediocre, therefore to present yourself in the best possible way and stand a good chance of being selected for an interview, it is important to take advice from someone who is reviewing CVs on a day to day basis. There are a number of companies who offer CV writing services, but a professional specialist management consultancy recruitment firm will give advice and guidance on this as part of their remit.
It is advisable to keep your CV up to date but also to be aware that different jobs may require the CV to be tweaked to draw out your strengths and experience relevant to the role.
Your CV is key to your personal brand but a CV will be tailored to each individual job application and is only one part of the jigsaw. Your LinkedIn profile is an opportunity to paint a more comprehensive and three-dimensional picture of yourself, your career experience and ambitions.
Furthermore, your Linkedin profile is likely the first port of call for headhunters so it is important to view it as your marketing document. Advice on how to optimise your LinkedIn profile can be found here.
Congratulations, you have reached the interview stage! The key to success now is preparation, preparation, preparation.
This should take a number of different forms:
Pre-interview planning. This should be thorough preparation and will include not only basic information such as location, travel etc, but also significant research into the company itself, its brand and values and the role. If you are applying via an executive search firm, a good recruitment consultant should brief you fully on the role and company, but this is no substitute for additional research.
The interview itself. It is a good idea to consider in advance your answers to a number of common interview questions. Popular topics are as follows:
- The “Why you” questions
- The “Why us” questions
- “Culture fit” and “Teamwork” interview questions
- Career expectations
Some management consultancy firms will ask questions which can seem like a cliché. It is tempting for a candidate to simply trot out a well-rehearsed answer but it’s important you are not missing the point of the question. See our advice on three classic interview questions.
Handling a counter offer
It is increasingly common that a job seeker, having applied for a consulting job, navigated the interview process and secured an offer, be ambushed with a counteroffer from their current employer. It is rare that accepting such an offer has any long-term benefits, but it is useful to examine in advance your reasons for seeking a job move so that you are in the best position to either avoid or respond to a counter offer should the situation arise.
Moving from a consultancy firm into a corporate environment
For many consultants, a move into a “client” or a Corporate (aka “client-side”) is the ultimate goal of their career. The reasons can be work-life balance or, often a sense of greater fulfilment which they might find missing in advisory projects or moving from client to client. Alternatively, they may not be comfortable moving into increasingly sales-orientated roles as they rise up their consultancy career.
It is however very difficult to make the move and more difficult still to make a move that then leads on to a thriving career without been pigeonholed into e.g. strategy or change roles which can be a dead end. There are a VERY small number of firms which are good at ensuring excellent transitions (i.e. McKinsey) but for the most part, a consultant is on their own.
Having made the move, many consultants can end up disappointed by their inability to really make an impact or by the lack of variety or, as suggested, by lack of career progression. If they decide to return they may be surprised to find they are not welcomed back into consultancy with open arms as they may be more expensive but from a consultancy employer’s perspective be no further forward or even have taken a step back in their career. There will also be potential doubts about the career planning: why the move out? What were they unhappy with about consultancy? Are we just a port in a storm as they seek to re-establish their consultancy career?
Tips for making the move would include:
- Focus your career in the sector you want to end up in rather than being generalist or hoping to swap sector
- Don’t leave it too late: the more expensive you are and the longer you have been in consultancy the more difficult it will be. Don’t forget no Corporate is interested in your ability to sell consulting work (i.e. a feature of Senior Manager roles and above)
- Always be passively receptive to approaches/job advertisements as options may not present themselves very frequently
- Never consider a move to other management consultant jobs i.e. be resolute and single minded, until such point as you give up looking or decide to change your CV (better skills, better brand names) in order to increase your chances
- Ask questions re career path and especially what track record do they have of moving people on from the roles you are being interviewed for. If you aren’t happy with the answer consider how the role will position you for future career development. A move to a Corporate is part of your career journey, not the destination.
- Never move Corporate side to get experience with a view to returning to consultancy unless you are prepared to return at (at best) the same level.
- Be realistic regarding salary: a small number of people may make a step forward but many don’t and you need to recognise that consultancy is often well paid as compensation for the long hours and living out of a suitcase
How to get the best service from a recruiter
The recruitment industry has its fair share of cowboys and calls from a recruitment consultant are sometimes unwelcome. It is advisable to rely on personal recommendation and trust your instinct when selecting who to work with. It cannot be overstated how important it is to find and work with a recruitment firm with integrity as they are your representative to a potential future employer.
A good consultancy recruitment firm will seek to establish a long-term relationship with a candidate and offer ongoing career guidance when necessary, not simply an easy fee. They will add value and provide useful insight into the current job market rather than just calling with the latest long list of consulting jobs they are trying to recruit for.
Prism has been working in recruitment for over two decades and has worked with a range of large corporates and management consulting and professional services companies. We pride ourselves on the services we deliver to all candidates and clients; our specialist approach ensures that we are experts in the sectors in which we operate, which has enabled us to fill numerous successful management consultancy jobs and other executive vacancies to date.