McKinsey & Co.
McKinsey & Company is roundly considered to be the world’s most prestigious management consulting firm. James O. McKinsey, a professor at the University of Chicago who championed strict budgeting as the key to business management, founded the company in Chicago in 1926. Marvin Bower, who became McKinsey’s managing director in 1950, was later responsible for the company’s meteoric rise.
Bower was able to separate himself from his predecessor by becoming the first McKinsey director to prefer MBA graduates over experienced managers. He believed that fresh graduates could provide new insights and ideas that were lacking from within. Today, McKinsey hires from a broad pool of disciplines, such as engineering, law and the liberal arts, and is considered among the most desirable work places for graduates.
At present, McKinsey has over 9,000 consultants in 52 countries located in more than 90 offices around the world. Due to its sterling reputation, vast alumni network, and years of experience, the company has projects in almost every industry and sector, a key strategic advantage over smaller firms. McKinsey’s engagement fees are considered to be the highest in the industry. However, the firm is correspondingly known for taking an uncompromising focus on its clients’ benefit, which is probably why it serves roughly 90% of the top 100 corporations worldwide.
McKinsey’s reach extends to the highest levels of senior management. For example, it has the highest number of alumni members acting as CEOs of firms they currently service. More than 70 McKinsey alumni are CEOs of Fortune 500 companies. Among their alumni, one can find the CEOs of IBM, Boeing, BMW, Vodaphone, Morgan Stanley, and even the Governor of Louisiana.
Boston Consulting Group (BCG)
BCG was formed in 1963 by Bruce D. Henderson as the Management and Consulting Division of the Boston Safe Deposit and Trust Company – itself a subsidiary of The Boston Company. BCG is one of the most widely known consulting firms in the world. Despite this, it is only considered a midsize company with more than 4,800 consultants working in over 70 offices across 42 countries. BCG is best known for its clean sheet approach to engagements and groundbreaking consulting frameworks such as the “growth-share matrix” and the “experience curve.” In recent years, BCG has been ranked number two among “Fortune’s 100 Best Companies to Work For,” mainly due to its unique emphasis on employee development and work-life balance.
In 1979, due to an employee stock ownership plan, employees were able to collectively buy out the firm from the Boston Company. What started as 300 consultants has since expanded substantially. Among its alumni are GE’s CEO Jeff Immelt, Pepsi CEO Indra Noy, and Israel’s Prime Minister Benjamin Netanyahu.
Bain & Co.
Bain is considered to be among the top 3 management consulting firms (along with McKinsey and BCG). Bill Bain and former BCG partners in 1973 formed it. In its early days, the firm signed with only one client in each industry, as it believed that advising competitors was a conflict of interest. However, in the 1980s, Bain abandoned this model. Instead, it began charging success fees and equity option compensation and serviced competing clients. The firm is structured according to practice areas, and it is the world’s leader in Mergers & Acquisitions. Interestingly, financial services account for one fifth of the company’s revenue.
Since its formation, Bain has grown rapidly and currently has more than 3,900 consultants in 44 offices across 29 countries. Bain is the only leading management consulting firm led by a female CEO, Orit Gadish, who has been ranked by Forbes magazine as among the world’s 100 most influential women. For the past eight years, Bain has been ranked by “Consulting Magazine” as the Best Firm To Work For.
Booz & Company
Booz & Company is the oldest management consulting firm still in existence. In fact, Booz & Company coined the term “Management Consulting.” In 1914, Booz & Company was founded as a business research service by Edwin Booz. By the 1950’s Booz began to aggressively grow its business in Europe and later in Asia. In May 2008, Booz Allen Hamilton announced that it would split its US Government business from the global commercial consulting business. The government business was sold to The Carlyle Group and remained under the name of Booz Allen Hamilton, while the other operations became part of Booz & Company.
Booz has more than 3,300 consultants in 60 offices across more than 30 countries. It has been constantly ranked among the top-consulting firms in the world. It is best known for its vast experience in industries such as energy, transportation and aerospace, but it also works with the public sector, particularly with government agencies outside of the US.
Monitor was founded in Cambridge, Mass., in 1983 by several Harvard professors, most notably Prof. Michael Porter, the strategy guru who developed “Porter’s Five Forces.” It employs more than 1,600 consultants across 30 countries. For the most part, the group works with Fortune 500 companies and prides itself on making a lasting impact.
Monitor is unique since it works with its own merchant bank called Monitor Capital; a $1.5B private equity investment firm called Monitor Clipper Partners; and an early stage private equity firm named Monitor Ventures.
Mercer is the leading global human resources consulting firm and is headquartered in New York City. It was founded in 1937 as the employee benefit department of its current parent firm, Marsh & McLennan Companies, Inc. Mercer’s portfolio revolves around human capital disciplines such as health and benefit services, reward management, and executive pay. It also advises clients on issues related to administration, technology and investments.
Mercer has more than 19,000 employees serving clients in more than 40 countries. In recent years the company has built outsourcing capabilities offering specialized support for employee benefits, absence management, compliance, and other needs.
Deloitte Consulting is a subsidiary of Deloitte LLP, which itself is the US branch of the international DTT web of branded organizations. Deloitte’s organizational structure is such that, unlike other consulting firms, the US subsidiary acts as a separate entity from the rest of the branded organization.
Out of the Big Four accounting firms, Deloitte is unique in that it did not spin off its consulting arm after the Enron and Anderson scandals. It operates through five practices – enterprise applications, human capital, outsourcing, strategy and operations, and technology integration. Deloitte Strategy & Operations is Deloitte’s management consulting arm.
Deloitte is ranked as number one according to the 2009 BusinessWeek “Best Places to Launch a Career.” It has 80 offices in the US, with strategy and operational hubs in 20 major cities.
Like Mercer Consulting, Oliver Wyman is also a New York based management consulting firm and is one of the many layers of the Marsh & McLennan Companies. Its current structure was formed in 2007 when Mercer Oliver Wyman (focused on financial services management consulting), Mercer Management Consulting (general management consulting) and Mercer Delta Organizational Consulting (organization and leadership consulting) combined under the Oliver Wyman umbrella.
The company offers strategy, operations, risk management, organizational transformation andleadership development. It employs more than 2,900 consultants at more than 40 offices in 16 countries.
Accenture is by far the largest consulting firm in the world. It has offices in more than 150 cities across 49 countries and employs more than 178,000 people. Originally named Anderson Consulting, the company was formed in 1989 by a group of consulting partners from multiple Arthur Anderson firms worldwide. In 2001, the company separated itself from Arthur Anderson and was named Accenture, “accent on the future”.
The company is most known for its leading IT services, but its practice specialties cover three platforms: management consulting, systems integration and technology, and outsourcing. The latter represents 40% of the firm’s total revenues and is expected to grow.
Chicago based AT Kearney was originally part of McKinsey. After Oscar McKinsey’s death in 1939, McKinsey’s New York and Chicago offices split, and the Chicago office formed AT Kearney. The firm originally specialized in manufacturing and operations. In 1961, it opened its second office, before going international three years later. Today the company has offices in more than 34 countries with more than 2,500 consultants. It serves almost every industry in practice areas such as complexity management, operations, procurement solutions, and strategy.
Price Waterhouse Coopers (PwC)
Mostly known as one of the Big Four accounting firms, PwC has been rapidly growing its management consulting practice. This growth was driven by the firm’s sale to IBM following the Enron scandal.
PWC advisory practice areas include growth, operations, and human capital. In November 2010, PwC acquired Diamond Management & Technology Consultants, adding 500 consultants to its North American network of more than 35,000 professionals.