And there is no doubt that it is one of the most competitive functions. Demand for MBA jobs in consulting continues to grow each year, with an 11 per cent average increase in business school graduates entering the industry in 2013.
In Latin America there was a staggering 33 per cent increase in demand by MBAs last year, according to a recent survey by QS Top MBA. Africa and the Middle East saw a similar 26 per cent demand growth, with Eastern Europe reporting 18 per cent increases, according to the same study.
And it is not surprising; the average MBA salary in consulting, bonuses included is a whopping $104,200. The industry is worth $100 billion globally and has grown at a phenomenal rate throughout the economic crisis.
Equally in-demand are start-ups and entrepreneurship. At some U.S schools, record amounts of MBA graduates shunned traditional functions to pursue their own ventures and world-wide, there has been a similar trend.
MBA students are consulting at these start-ups to stay ahead of the competition. “The networking you get in these projects is really important and an advantage to MBAs. You get training in so many areas; things that my buddies on the MBA program don’t have,” says Juan Pablo Manfredi, a Cass Business School MBA student who consults a small tech firm as part of his degree.
Consultancies have stepped up their hiring due in-part to economic strife, undertaking restructuring and strategic realignment projects for many companies. EY, a leading firm, plans to hire 3,700 new employers in the UK this year alone.
An MBA remains an entry-level business qualification at top firms, and almost certainly results in higher salaries than undergraduates starting out their careers.
“We have been growing at a double-digit rate since 2003 and we expect that to continue for the foreseeable future,” says James Platt, partner in charge of MBA hiring at Boston Consulting Group in London. “Quality MBAs could not be better matched to the needs of the consulting industry.”
But the bad news is: competition is fierce. Leading firms are reserved for the crème of the crop and many business graduates fail to make the cut. “It is ridiculously competitive and ridiculously hard to get to get into the firm. And I got a very lucky break,” says Imperial Business School MBA Nick Strange. He consults at McKinsey & Company.
Rajat Handa, a Lancaster University Management School MBA graduate that now works at PwC, agrees. “You'll have heard how bad the competition is. If you don't have the confidence, you won't get the job,” he says.
Business schools have responded by giving their MBAs a chance to consult start-ups. Cass, part of City University London, for example, place MBA students in the London City Incubator (LCI), which helps early-stage high-growth start-up businesses to prepare for investment.
The LCI works primarily with SMEs in clean technology, medical devices and digital media. MBA, MSc and PhD students apply to become an LCI Associate, who then get the chance to take part in live projects with real companies.
The experience is different than consulting with established firms like Bain & Company or Accenture because it grants you more freedom, says Gregory Finke, a Cass MBA student. “I’ve worked at start-ups and at larger companies but the thing that attracts me to SMEs is the ability to see how your work translates into real results. Every day you develop a piece of work and see direct translation, and that can get lost at a bigger firm,” he told BusinessBecause.
Satrupa Ghosh, another LCI Associate and MBA student, says start-up consulting can’t be matched. “The experience you get at a start-up; you can’t match it with any big firm. And the work speaks for itself. You’ve worked through successes and failure, and that hands-on experience is invaluable for future career prospects,” she says.
We reported this month that MBAs were turning to short-term project work with “rent an MBA” websites, offering companies the chance to hire out quality business talent for small-scale consulting projects – at a reduced rate.
Leading companies obviously have a bigger budget for this type of work, whereas start-ups need to be more cautious with their capital, says Michael Ter-Berg, CEO of Thomson Screening, a tech start-up that has used MBA consultants through the LCI. “We use MBA students partly because of opportunism and cost,” he says.
“We wouldn’t have the budget for Bain & Company and we don’t need a Bain & Company. We want smart people working for us – not too expensively. And I think it has been delivered well.
“While there are variations in quality, you get a very dedicated effort [from MBAs]. They’re willing and they try to help as much as possible.”
A closer connection to start-ups has given some MBA consultants a huge advantage, agrees Satrupa. “Absolutely, I can’t tell you how much it’s been an advantage. The MBA is good but LCI work is tremendously helpful for me. It gives me a huge advantage,” she says.
Gregory says that you get to have a hands-on experience in all aspects of the business – something that can’t always be found elsewhere. “I’m right in the middle of all the business problems and it’s a great way to learn in the classroom and apply it to a business that can benefit,” he says.
He is considering working as a management consultant after his MBA. And consulting start-ups on an ad-hoc basis instead of working at top firms could give him an additional edge, he adds.
“I advocate this type of work to all the other MBAs I come across. It translates well and companies can see the value and the experience that we’ve got.”
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