Management Consulting Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 90,000 management consulting firms in the US assist businesses and organizations with administrative, strategic, and management-related issues. Major revenue categories include strategic and financial management consulting and implementation services. Firms may also offer operations and supply chain, marketing, and human resources management consulting services. Customers include businesses, institutions, non-profit organizations, and government entities.
Competitive Bidding
Many clients use competitive bidding when soliciting management consulting services and preparing bids is a costly process for consulting firms and requires significant amounts of managerial time and effort.
Dependence On Highly-Skilled Labor
Management consulting firms solve complex business problems and rely on highly-skilled, educated, and experienced industry professionals to provide consulting services.
Industry size & Structure
The average management consulting services provider operates out of a single location, employs fewer than 5 workers, and generates about $3.4 million annually.
- The management consulting services industry consists of about 90,000 firms that employ about 845,000 workers and generate about $307 billion annually.
- The industry is fragmented; the top 50 companies account for 41% of industry revenue.
- Large companies include McKinsey and Company, Booz Allen Hamilton, Boston Consulting Group, Bain, and Accenture. Most large firms offer comprehensive services and operate nationally and internationally.
Industry Forecast
Management Consulting Services Industry Growth
Recent Developments
Jul 18, 2024 - Consulting Firms Get Huge Boost from AI-related Work
- Consulting firms are enjoying a boom in business as companies seek help in making sense of how to leverage generative AI, according to The New York Times. The AI-driven boost in demand is a welcome turn of fortune as many consulting firms saw demand drop off after a pandemic-era bonanza when firms in almost every industry struggled with issues including broken supply chains and the pivot to remote work. The consulting wing of KPMG has notched $650 million in AI-driven work over the last six months when it generated zero AI revenue a year ago. Boston Consulting Group now derives about 20% of its revenue from AI-related work, compared to virtually none two years ago. About 40% of McKinsey’s 2024 revenue will be from generative AI work.
- According to a recent survey of technology buyers by International Data Corporation (IDC), there are three key areas where respondents believe generative artificial intelligence (GenAI) will have the greatest impact on an organization’s competitive position or business model. The top areas where AI will be most felt are financial and operations systems; technology decision making; and customer engagement, experience, and support. Matt Acara, IDC’s research director of Computer Vision AI Tools and Technology said, "What the survey results confirm is that the application of GenAI across business functions will be broad and its impact will span a wide range of competitive and business model areas. Another thing the results highlight is that GenAI's ability to process, understand, and derive value from a wide range of data sources is its real superpower. It is exactly this capability that enables GenAI models and applications to be integrated and used within so many different business and customer processes and workflows. As organizations gain more experience with GenAI technologies, we expect them to use what they have learned to deploy GenAI in new areas."
- There’s growing skepticism among some tech industry watchers that AI will deliver on its promises of improved sales and profits through revolutionary gains in workplace efficiency, according to The Wall Street Journal. Some AI industry observers suggest that generative AIs - like OpenAI’s ChatGPT and Google’s Gemini - made strong gains initially, but innovations are slowing. Gen AI tools were trained by combing nearly the entire internet, and that source is mostly tapped out, making huge leaps in improvement harder to obtain. About 75% of white-collar workers said they use AI at work, according to a recent survey by Microsoft and LinkedIn. Another survey by expense-tracking firm Ramp showed that one-third of firms pay for at least one AI tool. Industry experts note that the gap between workers experimenting with AI versus those whose firms are paying for it suggests adoption has been slow.
- Several major consulting firms - including McKinsey, Accenture, and BCG – have adopted merit-based hiring rather than relying on recruiting candidates with degrees from elite universities, according to The New York Times. Skills-based hiring strategies aim to pull potential recruits from a wider pool of candidates beyond the Ivy League. Some companies, including Accenture, no longer require a college degree. However, as well-meaning as meritocracy-focused hiring may be, implementing it can be challenging. A Harvard study examined hiring by large firms between 2014 and 2023. The study revealed that while there was a significant rise in postings that didn’t require degrees, only about 3% of the jobs were filled by people without a degree.
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