4 Types of Consulting Firms

If you’re trying to get into consulting, it can be more than a little confusing trying to understand the various types of firms and their practices.

In this post, you will learn about the 4 major types of consulting and the firms that are typically associated with them.

1. Strategy Consulting

This is the type of consulting that business students are most familiar with. The leading firms that are generally associated with strategy consulting are McKinsey, BCG and Bain, also known as the MBBs.  They are known for doing high-level assessments of their clients’ business situation, and providing strategies to increase profit or growth by entering new markets, launching new products, or making acquisitions.  MBBs’ engagements tend to last anywhere from 2 weeks to 4 months, and it’s rare for their projects to last over 6 months.

These firms also use a generalist model, meaning that consultants tend not to develop a specialization until they become managers.  Although these strategy consulting firms are starting to build out their implementation capabilities, the strategies they recommend are often handed back to their client to implement or handed off to an implementation consulting firm.

2. Implementation Consulting

This type of consulting is most well-known for its association with the Big Four – Deloitte, PwC, EY and KPMG.  Unlike strategy consulting engagements, the projects these firms are engaged in tend to last anywhere from 3 months to over a year due to the nature of their work, which involves executing a defined set of strategies and the nitty gritty details of implementation.

Consultants in these firms are typically required to specialize as soon as they join the firm. They are assigned to service areas, industry verticals, or both.  Service areas – or functional areas – can include strategy, operations, technology, human resources, mergers and acquisitions, among others.  Industry verticals are centered around specific industries, for example telecom and media, healthcare, industrial and consumer goods, or financial services.

3. Specialised Consulting

Then there is the type of consulting that focuses solely on a specific industry or functional area.  Some of the most notable specialisations include healthcare, IT or tech, and turnaround consulting.  Although IT consulting firms can be big shops such as Gartner and Infosys, healthcare and turnaround consulting firms tend to be more boutique in nature. Their value proposition, as opposed to an MBB or Big Four, is their dedication to the industry and expertise in the subject matter relevant to the client’s specific needs.

Healthcare consulting firms, such as Syneos and Huron, may especially value past healthcare experience or academic backgrounds in science.  However, similar to the generalist consulting firms, they evaluate future consultants based on the candidate’s ability to show transferable skills.

Turnaround firms, like FTI Consulting, will typically value quantitative skills as the work typically requires rigorous financial analysis.

4. Internal Corporate Strategy Consulting

Let’s not forget that internal consulting divisions are common to large corporations as corporate strategy wings.  These divisions often do much of the same work that external consultants do, but are permanent staff of the company.  The benefit of being an internal consultant is that you have greater access to the company’s data, rarely travel for engagements, and get to see all sides of the company over a longer period of time.  The downsides may be that consultants only get to work with one firm, which limits the diversity of experience that can be gained.

Pharma companies, such as Pfizer, are notable for having robust strategy divisions. While they may still employ external consultants to obtain an outsider’s perspective, they complement these engagements with an internal strategy team that can work on longer term project that require continuity.

Final Thoughts

It is worth noting that the distinctions among these types of consulting practices are starting to blur.  LEK, for example, is a smaller strategy consulting firm that has a large practice area in healthcare relative to its size.  All of the MBBs are starting to take on select implementation projects, which follow on from their strategy engagements.  With the exception of KPMG, all of the Big Four have acquired strategy firms in the last decade.  Nearly all firms are also building out their digital practices, as businesses learn to deal with evolving technologies.

Whether you’re passively considering consulting or actively interviewing for a position, make sure you do your homework on the firm and the area you’re interviewing for.  Consider, for example, whether you’d prefer to work on shorter or longer-term engagements, and whether you would like to start out as a generalist or start developing specific subject-matter expertise sooner rather than later.

Not all consulting firms are alike, and it’s worth taking time to learn more about what they do.

Min Kim is currently an MBA student at NYU Stern School of Business where she is specializing in Product Management, Business Analytics and Finance.

Image: Pexels

🔴 Interested in consulting?