Management consulting – where did it begin?

EXECUTIVES often rely on the advice of expert management consultants. Was it always this way? Where did it all begin?

The very first management consulting firm was Arthur D. Little, founded all the way back in 1886 by a professor at MIT whose name was (funnily enough) Arthur D. Little.

Almost 30 years later, Booz Allen Hamilton was founded in 1914. Booz was the first management consultancy to serve both industry and government clients.

Interestingly, McKinsey & Company was the world’s first pure management and strategy consulting company. Founded in 1926, McKinsey is is now the world’s most prestigious consulting firm.  The culture of the firm was heavily influenced by a man named Marvin Bower, who served as managing director from 1950 to 1967. Bower believed that management consultancies should adhere to the same high professional standards as lawyers and doctors. To this day, the core guiding principle at McKinsey is professionalism.

Boston Consulting Group, arguably the world’s second most presigious consulting firm, was founded in 1963 by Bruce Henderson. It all began when Henderson left Arthur D. Little to accept a challenge from the CEO of the Boston Safe Deposit and Trust Company to start a consulting arm for the bank.

Ten years later, in 1973, Bill Bain and others left the Boston Consulting Group to form Bain & Company, which is also one of the world’s leading consulting firms.

Top 5 Tips to Nailing the Management Consulting Interview

This guest post is by Neal Dodd, a former McKinsey consultant who has interviewed and prepared well over 100 potential candidates over the years. Neal currently manages Briefcases Direct.

TOP tier management consulting companies are the preferred destination for many MBA graduates, as well as graduates with less traditional backgrounds. In general, the consulting positions for those straight out of an undergraduate program are fewer and farther between. That’s because the more junior analyst positions typically don’t lead to partner track consulting positions in most firms; analysts are expected to return to graduate school and only then, should they return, be on a partner track. This can vary from firm to firm but is definitely true for the McKinsey, Bain and BCG type firms.

That doesn’t mean that fresh graduates cannot find positions, even in financial times as difficult as these. Believe or not, consulting companies are busier now than in the prior recession of 2001, so don’t lose hope. I have personally coached over a hundred potential candidates and many were truly amazed that they were able to secure the coveted offer letter during a competitive interviewing season. In order to maximize your chances during the interviewing process, it’s important to prepare carefully, below are some tips to help you ace the interview:

1. Make a good first impression

This goes for any interview you’re on but is particularly true for fields like management consulting. Make sure you look like a consultant – what does that mean? Many of the smart people that interview for consulting positions have not interviewed anywhere before or only for academic type positions. Others are foreign born graduates of top MBA or other programs – whatever, the case may be, they have never interviewed for a top tier management consulting job or similar positions in companies. The fact that these firms interview the brainy types only makes the situation worse. Invest in well made suit, dark blue or grey with or without pinstripes is perfect for men, for women, black can also work. A tie with a splash of color is fine, it can convey a little bit of energy or pizzazz, but nothing too flashy, they like energy but not attention seekers. A briefcase or attaché is a perfect complement to an outfit, you can always borrow a friend or colleague’s and it doesn’t necessarily have to be new to convey a polished look.

2. Keep your poise

Much of the interviewing process is very intense, with some companies intentionally playing “good cop, bad cop” between their interviewers. All this means is that you need to remain poised, don’t let them ruffle your feathers with abrupt or unfriendly behavior, pushing paper around or looking angry. Remember, you’re not here to make friends, you’re here to get a job and they’re here to test whether you can deal with nasty clients, managers and co-workers should the occasion arise. Keep smiling and a resilient positive attitude, you’re interviewers will find it irresistible.

3. Think and listen

This might sound obvious, but most people don’t do this during the case interview and miss the boat on what the interviewer is asking for or don’t get the hints that are being dropped during the discussion. A classic issue for interviewees is writing too much instead of listening to the question being asked. Practice listening to case questions and writing very few words, use symbols for profit (π), revenue (R) and other common words and don’t write down the fluff in the questions, flowery language is there to confuse, good consultants can spot the key facts quickly. Listen and then think about the implications of the question being asked. If there are declining profits in a business that is becoming commoditized, then opine as much and state your rationale. You can be thoughtful and comment on the question at hand based on what you know. Continue this process throughout the case interview, each piece of information is a clue, not just a plug into an equation or out of the box framework so common in business schools.

4. Ask questions

Now that you’re thinking about the case and the information you’re being given, be sure to ask intelligent questions; start a dialogue rather than barreling down a path that is preconceived or based on early inferences on the case at hand. Remember, you are expected to be engaging during team problem solving situations, be sure to appear this way during the interview and engage the interviewer. There is probably a lot you know about a particular industry based on general reading (you should be reading business publications to build your business acumen if you don’t have a typical business background). If the case is about the magazine industry, you should be able to guess what their sources of revenue are without having worked in the business – that’s just common sense, practice applying this common sense. Curiosity is a relentless trait in good consultants, mix this curiosity with intelligent thought to come up with hypothesis driven questions: “One would think that the roofing industry is seasonal…..are there seasonal variations in this company causing cash flow issues?” rather than, “is there uneven earnings throughout the year?”

5. Pass the airport screen

Consultants always ask, is this someone I’d like to be stuck at an airport with for 4 hours or in a small team room for 8 – 12 hours per day for weeks on end? Be sure you’re the type of person that is tolerable, hopefully enjoyable, to be around. Be yourself, don’t be too pushy or aggressive, it just turns people off. Have fun with the interview, if you’ve prepared well it should be fun for both you and the interviewer. Be sure to prepare well for the interview and the fit questions on your background, resume, interests, strengths and weaknesses – these all count, remember, they’re looking for the next round of leaders for their organizations, their people are their product so show them what a great product they’re looking at!