What is strategy consulting? What's it like to work in the field? To find out, we spoke with real consultants.
1. What's strategy consulting?
🤔 But first, what's "strategy"?
✨ "Strategy consulting" defined
❓Why do strategy consultants exist?
🔍 What do strategy consultants do?
🆚 How strategy consulting differs from other types of consulting
2. Is strategy consulting for me?
💼 What do strategy consultants do day-to-day
👍 Best parts of being a strategy consultant
👎 Worst parts of being a strategy consultant
⚖️ Work-life balance
🌱 Learning & development
💵 Pay
🌟 Job outlook
🔀 Exit options
To understand strategy consulting, we need to first understand what strategy means. The easiest approach is to think of strategy as choosing "where to play" and "how to win."
Strategy is an integrative set of choices that positions you on a playing field of your choice in a way that you win.
Let's think about this from the perspective of starting a cafe in a city full of cafes.
Instead of opting for the most crowded street that's saturated with similar businesses, you might look for an area that, while still busy, lacks a cafe with the specific ambiance you're planning to offer.
This could be a neighborhood known for its vibrant community but underserved in terms of cozy, quality coffee spots. Alternatively, situating your cafe near office buildings or universities where there's a steady flow of coffee-loving individuals could be a smart move.
Simply setting up shop isn't enough! You'll also want to think about what special touch you can offer that no one else does.
Let's say you open your cafe near a college campus. In this case, you might decide to offer your coffee at the most competitive prices in the area, ensuring that students see your cafe as the go-to place for affordable coffee.
On top of your unbeatable prices, you also create a student-friendly atmosphere with fast Wi-Fi, plenty of power outlets, and seating arrangements that cater to both solo studiers and groups.
You could also collaborate with student organizations for events or sponsor events on campus, further embedding your cafe into the university culture.
In short, your “where to play” is about picking the right spot where your cafe can shine the brightest. And your “how to win” is all about making your cafe the go-to spot by offering something unique and delightful that keeps people coming back. This is your (hopefully) winning strategy!
Now let's talk about strategy consulting. Strategy consulting is when you help an organization figure out where to play and how to win. This can apply to a whole company or just a part of it.
This is about setting the big goals for the whole company and figuring out the best way to achieve them.
As a strategy consultant, you might help a company figure out what kind of company they want to be and what makes them different from everyone else (their competitive advantage). Then, you might help them plan where to spend their money and effort to grow and beat the competition, making sure everyone in the company is working towards the same goals.
A business unit is a smaller part of a company that operates somewhat independently, focusing on a specific market segment or product line. For example, a global electronics company might have a business unit dedicated solely to smartphones.
If you're helping a business unit with their strategy, you might help them understand how they fit into the bigger picture (the whole company) and how they can best contribute to the success of the entire company.
You'd also look at the market they're in (e.g. the smartphone market) to see what its strengths and weaknesses are and then using those strengths to get ahead in the market.
In general, what strategy consulting means is that we are helping our clients with their most important problems. The types of problems we'd be thinking about is:
- "What is the five-year strategy of my company?"
- Very major and transformative mergers
- "My whole business needs to change and become more efficient and just be better than it is today."
The stuff that we work on is more business-wide topics as opposed to some other types of consulting which might deal with things like integrating IT systems of two companies. Strategy consulting operates at a higher level.
– Former strategy consultant @ an MBB firm
At this point, you might wonder why companies hire strategy consultants instead of just coming up with strategies on their own. Let's go back to the cafe example to get an idea of why companies seek an outsider's perspective.
So you own a cafe right next to a bustling college campus, and your team is buzzing with ideas to make it the next big hangout spot for students.
The catch? Your cafe can't pursue all these ideas at once without stretching your resources too thin.
Enter strategy consultants. They act as the unbiased third-party, not caught up in the daily grind or too emotionally invested in the cafe.
They objectively evaluate all these ideas, identifying which ones truly have the potential to transform your cafe into the campus hotspot, discarding the less effective ones, and developing a strategy to make those top ideas a reality. Their outside perspective ensures decisions are made based on what's best for the business, not just personal preferences.
As a cafe owner, you probably aren't an expert strategist. Most likely, neither is anyone on your team.
Most companies are like this too. They don't have people devoted to strategy full-time – and even if they do, their strategy departments tend to be small – like a specialized unit within a large army.
That's because while strategy is crucial, it doesn't change frequently. So companies need a lot fewer strategy people (people thinking about how the company should be run and trying to improve it) than operations people (people who actually run the company).
This is why companies often seek the expertise of external strategy consultants when they want to make big changes.
You can get a taste of what strategy consultants do through the types of projects they work on. Here are some examples.
To get a more concrete idea, you can see examples of real-world strategy projects that consultants at McKinsey & Company worked on.
While all types of consulting share the goal of improving businesses, strategy consulting stands apart in its focus on high-level, future-oriented decision-making. It's about charting the course of a company, whereas other types of consulting are more about optimizing the internal workings of a company.
Strategy consulting, like the kind MBB firms do, is more helping a CEO think through problems that are on their mind that are a lot more strategic rather than a process improvement.
In financial services consulting, we also do some strategic work. For example, "Should so-and-so bank divest in a credit card?" The CEO would be involved with this decision but it's not a "front-page" event for the business.
If all of a sudden you see JP Morgan opening up an office in Dubai and putting an equity trading desk there and hiring investment bankers, that's a "front-page" issue the CEO would be actively involved with as he needed to have thought about whether that's a good area to invest in, whether the investments would be worth it, whether there's a client base there, etc.
And that's when strategy consultants would be called in. Then, once the company is established there, that's where other sorts of consulting would come in.
So strategy consulting is more higher-level and strategic and other types of consulting are more operational
Strategy consulting also tends to be more conceptual and analytical. Strategy consultants use market analysis, competitive intelligence, and financial modeling to craft strategies that propel businesses forward. Their recommendations may not always be about fixing something that's broken but about finding new paths to growth and success.
The outcomes are strategic plans and frameworks that guide a company's future decisions. Compared to other kinds of consulting, the impact of strategy consulting might take longer to manifest, as it's about setting the course for future success.
Businesses pay strategy consultants a premium because their work can shape the direction of a company for years to come, influencing everything from market positioning to investment priorities and operational improvements.
Because clients are willing to pay more for strategy consulting work, strategy consultants tend to get paid more than other types of consultants. For more specifics on entry-level consulting pay, check out From intern to partner: Consulting salary & career progression explained.
According to a former strategy consultant we spoke with, junior consultants do basically four things:
I'd say there are two general types of projects.
#1 Classic strategy projects
On this type of project, junior consultants would do market research and analyze the client's internal data.
As part of broader strategy exercise, one of the questions that a client might have is, "Which one of our business products hass been most profitable in the last five years and which will be most profitable in the next five years?"
So for last five years, you'd take a look at the client's financials, and as a first-year consultant, you'd be expected to run that analysis.
For market research interviews, you'd be expected to come up with a script for the interview, conduct the interview and research and summarize that for your manager, who'd ultimately provide that to your client.
So there's analysis and research and finally creating the actual powerpoint slides you'll give to the client.
#2 Mergers & acquisitions
If you're on a project where your team is helping a client merge with another company, you'd mainly do project management.
In those situations, a lot of what needs to happen is there's a list of tasks that need to be done at a particular time. So a first-year consultant might need to figure out what the status of those tasks are, keep that list updated, and report back to the client's team.
Let's say a company is merging with another company and there's a lot of IT systems that need to be integrated. If I'm the executive leadership team, I might not know where everything is at all times. I need someone to tell me if things are on-track or not.
So as a first-year consultant, one of your tasks might be to talk to the folks in IT to see whether they're at with their work. If they're off-track, you'd figure out ways to help them get back on track. Of course, you wouldn't be providing actual solutions to the IT people. But you'd:
- identify any roadblocks
- see if there are any people who aren't communicating with each other that you can help bridge
- think about when to flag issues to your manager (who would then flag it to the overall client leadership team)
Basically, your main job would be to spot issues in the process.
So to sum up, there are two general archetypes: there's more research and analysis projects and then there are projects where you're working with people and pushing a process forward.
– Former strategy consultant @ an MBB firm
Here's what different strategy consultants say about their favorite aspect of working in the field.
For me the best parts of being a strategy consultant were:
#1 The relationships that I built with the people on my teams.
Especially pre-COVID, many times we were traveling 3-4 days a week. So you really get to know the people very well. You're hanging out with them. You generally eat dinner together once or twice a week. If you like those people (which I did), it's such a deep way to get to know people that you like.
#2 The immense feeling of growth
Especially getting to be close to more senior people, I really felt like I was learning all the time.
– Former strategy consultant @ an MBB firm
Another consultant also mentions personal growth as one of their favorite aspects of the job.
Consulting has actually taught me life lessons and "ways of working" that have made me better in other areas of life including the non-profit and leadership aspects where I am helping people.
This may not be my forever job, but as long as I keep my head, stay humble, and work hard to both grow myself and capital that I can use to make the world a better place, I can do the job.
Some consultants also mentioned enjoying working on impactful projects.
I was at MBB for ~4 years and left a year or so ago. ... I found projects in healthcare as well as public sector to be really interesting and impactful.
You get to understand the issues in these spaces at a much deeper level than is typically covered in mainstream media, and better appreciate the complexity inherent with designing a solution.
Generating even a marginal improvement felt like a major accomplishment as you could see where many real lives were being impacted. It was also really inspiring to see how (some) folks were truly driven by a mission to make things better, even if they didn't always succeed.
I'd note that these were strategy projects that rolled into transformations, so I had the opportunity to work much closer with frontline folks and experience some of the change rather than having to stay at the 10,000 ft strategy level all the time.
For one strategy consultant, the hours were the biggest draw.
Biggest down side was the unpredictable hours. There were weeks where I worked 35 hours and weeks where I worked 90 (though that was rare).
– Former strategy consultant @ an MBB firm
Some consultants say they prefer hands-on implementation work over strategy work.
I'm strategy focused, but I'll be quick to admit that implementations work can be extremely valuable and rewarding, there's a few components of that:
Implementation teams get to take long term ownership of a product. They get to actually build something vs. coming in, telling people what to do, and jumping ship.
While strategy consultants are generally quite smart, there's an element of the work that can definitely be like throwing darts at a dartboard, so it's hard to feel truly responsible for transformational change. Also, this makes it a bit hard to differentiate between the good and bad. The great and horrible will still generally stand out.
Clients are often enabled to ignore strategy consultants, so their work often never even gets read. I think many will resonate with the experience of having a client email for the PDF password 6 months after delivery.
I did strategy consultin ... I also did some more hands-on project management type work, and I found it far more rewarding, because we are actually doing stuff rather than making up PowerPoint slides.
Unpredictable hours is a common theme in strategy consulting.
I'd rather consistenly work 60-70 hours a week rather than not knowing if I'm going to work 40 hours a week or 60 hours a week, which was the case for me when I was a strategy consultant.
The main problem wasn't the hours itself but the feeling of not being able to own my time. It was the feeling of "I might be on a plane next week" or "I don't know when my clients or my team might need me." So you get into this mode where you're constantly checking your work e-mail and you can't really plan spontaneous things.
It also messes with your routine. Like I could never get a gym membership, because whenever I got one, I got put on a case where I had to be in a different place.
I never had an issue taking vacations though. Like if I took a vacation for a month, people respected that. It's just hard to do things like see a friend for dinner on Monday night. Since you didn't know if you were going to be free or busy except for when you on vacation.
– Former strategy consultant @ an MBB firm
At McKinsey it's been more dependent.
- My first project I could leave the office around five or six and then continue working at home until seven or eight if there was anything to get done.
- My second project we left the office at around four. We would get home and then continue working remotely and usually I would be done around like six or seven.
- My last project was a little bit more intense because it was shorter term and I would say that we would usually be done around ten around in the office and then at home I could wrap things up until around eleven or twelve.
I'd say longer term projects projects that would last three months or longer typically have better work-life balances because it's not time crunched. The client's expectations are more like long-term impact, so you can pre-plan a lot of your work ahead of time and then get it done throughout the week without having to like crunch things.
It is notoriously known that due diligences which are shorter term projects around three weeks typically have pretty bad hours ... Again it's not terrible it's just longer and they expect you to be there present a lot of the time actively contributing.
– Former consultant @ KPMG / consultant @ McKinsey
I think if your goal is to understand how business works, it is probably the best job you can have right out of college. You'll learn about business and business strategy and business process. It's an incredibly valuable education right out of college.
It teaches you various skills that are useful if your goal is to become a business executive. I'm not sure how many people have that goal, but that's what it does well.
What you learn is the ability to take very complicated problems and think about them logically.
You learn how to acquire new information really fast. A lot of the time, you get thrown into a case, and you don't know anything about whatever market you're looking at. (Sometimes they're very obscure or very complicated!)
But because you have a job to do, you have to figure out a way to look at the market you're looking at to answer questions and form your own conclusions about what's right from a strategy perspective.
So one of the key things you learn to do is how to get information fast and synthesize that information to useful conclusions. It's very much an extension of a liberal arts education but specifically for business.
For example, if you look up stuff on the internet, there are a million points of data. You learn to filter information on a particular topic into what's important and what's not important. You also learn to take data that's not perfect and make reasonable assumptions.
A classic question is "How much coal are we going to use in 2030?" There's not going to be a single source of truth to that question. There are a lot of questions that are hard to answer because of their future-looking nature.
What you're able to do is take data from different places and derive a reasonable answer. You can only do that if you've read enough about coal and what's important.
- So what factors are driving coal consumption?
- How important are all of those things?
So as you think about each of those drivers for coal use, the amount of data points that you can collect decreases exponentially.
You don't have all the time in the world to look at this. You need to form a conclusion in a couple of weeks so you have to understand how to get to the heart of the problem.
– Former strategy consultant @ an MBB firm
10/10. I got paid a ridiculous amount of money for how young I was. I've always been chill about compensation, but I felt like I got paid substantially. I never felt like I had any financial anxieties.
– Former strategy consultant @ an MBB firm
Strategy consulting is the smallest segment of the management consulting industry – and that's understandable given companies aren't looking to shift strategies all the time.
Strategy consulting takes around a 12% cut of the overall industry, making it similar in size to HR consulting. More than in other segments, the development of the strategy consulting industry is closely tied with overall economic growth, with high growth recorded during periods of prosperity, and dropping growth rates during downturns.
That said, demand for strategy consulting may grow as the world becomes ever more complex.
Consultants have for the last 30-40 years been a pretty ubiquitous part of the business world. I don't think consultants are going away. I feel like it'll probably continue to grow, as businesses are getting more complex. And the pace of change in the world is getting faster and faster so as a result of that, I think there will be more need for companies to work quickly and strategically in order to continue to grow and compete. So I feel like will only be more demand for strategy consultants.
– Former strategy consultant @ an MBB firm
There are very few jobs in business that you can't do after strategy consulting. Anything that has to do with running a business, you could probably do.
Now it would be very difficult to get a technical role. So you can't go to Google and be a programmer. But you could probably be a product manager or someone in Business Development.
As a consultant, you don't learn how to make stuff or build a product that the business is selling. You're helping them sell the product, how to make things more efficient.
– Former strategy consultant @ an MBB firm
One of the most common career paths is to go into a company's internal strategy team after doing a couple years in management consulting at MBB.
– Former strategy consultant @ an MBB firm
You don't necessarily start a company, but you can go to an early-stage start-up and help them with their strategy or operations. There's a lot of things you can do, since you have good overall skills, and a start-up that has a lot of technical people will need help doing business things.
– Former strategy consultant @ an MBB firm
A lot of the times, PE funds need people to help think about what companies they should invest or buy, so as a result of that, having a consulting background is great because you have all of these really good research skills and you understand how to do your due diligence on companies.
– Former strategy consultant @ an MBB firm
We hope this gives you a better idea of strategy consulting as a career. To get a better idea of what opportunities are out there, check out all the internships we have in the field of consulting!