For once, Keith Bevans is in Paris. As head of global consulting recruiting for Bain & Company, he travels the globe each year, searching for top talent from business schools. However, 2019 was the first time Bevans visited HEC Paris, one of Europe’s best business schools.
This reflects Bain’s desire to broaden its reach beyond elite US institutions such as Harvard where Bevans himself earned an MBA in 2002. He is turning to graduates with different degrees as well as those in varied countries, including specialized master’s degrees in data analytics, to satisfy the “rapid” growth of Bain’s global and digital businesses.
MBA class sizes are not keeping pace with the growth in Bain’s hiring needs. Falling MBA application figures mean US schools are having to accept fewer students, or risk reducing the quality of their cohort.
Bevans says some 500 people will join Bain’s 2019 intake, about the same as last year, with the majority of them being MBAs. But the proportion of new hires with MBAs is falling. “We need critical mass and so are forced to look elsewhere for talent,” says Bevans.
The challenge of recruiting enough MBAs has been made more difficult by their growing interest in Big Tech careers at companies such as Amazon, Apple and Google.
Consulting firms hiring a more diverse range of people
An MBA has long been a ticket to a job at one of the so-called “big three” consultancy firms — McKinsey & Company, Boston Consulting Group and Bain — otherwise collectively known as the ‘MBB’ firms. But there are signs that the firms’ decades-long dependence on MBAs is waning.
About five years ago, a third of new hires at BCG had MBA degrees, according to the firm. In 2018 that number dropped to less than a quarter. Meanwhile Kevin Sneader, McKinsey’s global managing partner, told the Financial Times recently he wanted the proportion of staff with MBAs to decrease from 37 percent to “less than a third”.
One reason is the firms want to hire people from a more diverse range of backgrounds, such as those from the creative industries. This makes sense, given that consulting firms serve diverse and global clients.
Nick South, a partner at BCG, says: “Whilst we are continuing to recruit MBAs and they remain a strong source of talent for our business, the relative share of MBAs in the overall mix of people we are recruiting is changing.
“To support our growth we have developed a wider range of entry points and are increasingly hiring employees from other pools like PhDs, medical doctors, data scientists, data engineers and experienced industry hires.” For instance, fresh hires without a business education can take “mini MBA” courses to pick up the basics of business and mix with colleagues.
A survey by the Graduate Management Admission Council, the organization that puts on the GMAT, found that around the same proportion of consulting companies polled planned to hire MBAs this year as in 2018. But seven percent more of the firms wanted to hire data analytics master’s graduates, and an additional eight percent plan to recruit non-business master’s alumni this year. Also, 86 percent envisioned increasing the number of data graduates hired, compared with 39 percent for MBAs.
The big US-based consulting firms have also been hit by the Trump administration’s more stringent visa checks, making it harder for them to hire international MBAs from US business schools. “I’m hedging the risk by giving out more offers, regardless of whether people have US work authorization,” says Bain’s Bevans. “It’s an investment that’s important to us.”
MBAs have been mutually beneficial to management consulting firms since they emerged in the 1920s, when business schools arguably helped validate their budding profession. By outward appearances, the bond has been closest between McKinsey and Harvard Business School. So close in fact that Martin Kihn, a writer coined the phrase “McHarvard” in his controversial book on consulting, House of Lies.
After all, Harvard pioneered the case method with support from McKinsey, which is good preparation for a consulting career as it mirrors the work firms do. The big three consulting firms still use the case-based interview to recruit MBAs. But they influence far more than business school recruitment.
Many MBA programs have consulting modules, for example, including at Imperial College and the University of Oxford’s business schools. Others like Warwick Business School run MSc degrees specifically geared to consulting, while some schools invite consultants to teach on their programs.
Schools stress that MBAs are still highly valued by consulting firms. According to INSEAD’s 2018 employment report, 52 percent of MBA students joined the industry, up from 49 percent the previous year. “Consulting firms look for well-rounded individuals who have strong analytical, quantitative, problem solving [and] soft skills” which an MBA will help you hone, says Stephane Ponce, the school’s global consulting lead.
South, at BCG adds: “MBA recruits uniquely combine prior work experience with a well-rounded business toolkit, typically gained from world-leading business schools offering unparalleled academic teaching standards.”
The MBA is still a solid path into the lucrative consulting industry
At the University of Virginia’s Darden School of Business, 32 percent of 2018 MBA graduates accepted positions at consulting firms, which accounted for six out of the school’s top 10 employers last year. Christy Gunville, senior director of the school’s Career Development Center, says strong demand from consulting firms is evidenced by historically high compensation, with Darden MBAs earning an average salary of $140,189 and $31,940 signing bonus in the industry.
The fat paychecks, along with exposure to a wide variety of industries, big challenging projects, excellent networking, and rapid career acceleration remain attractive to MBA candidates, says Gunville.
For those set on a consulting career, the firms’ desire to broaden their intake should not cause too much worry, as job opportunities are still extensive and are in some cases still growing.
Bain, for one, last year ran its biggest ever summer internship scheme and nearly all the interns were MBA students, says Bevans. Approximately nine in 10 of those who finish the scheme received a job offer, with most accepting the offer.
That is not enough to satisfy Bain’s hiring needs alone, but Bevans adds, encouragingly: “On a longer horizon we are extremely bullish on MBA hiring.”