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
                              Source: Vertical IQ and Inforum

                              Recent Developments

                              Jun 18, 2024 - Signs of an AI Boom Slowdown
                              • 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.
                              • In May, the Public Company Accounting Oversight Board (PCAOB) voted to approve updated controls over how audit firms perform their work, according to The Wall Street Journal. The move, which updates decades-old rules, will require auditors to do more to ensure the quality of their work. The existing standards require audit companies to have certain quality control policies and procedures in areas including ethics, audit-engagement performance, and personnel management. The new ruling will also require audit firms to do risk assessments related to achieving their quality control standards and create procedures to address those risks. Audit firms will also have to report annually to the PCAOB about the effectiveness of their methods and policies. Firms that perform audits for more than 100 companies per year must also have at least one person on their governance board who is not affiliated with the firm (employee, shareholder, or partner). The unaffiliated governance board member will be tasked with monitoring audit firm controls and proper performance of annual PCAOB reporting. Some audit firms have objected to the new rules, arguing they create unnecessary extra work. Audit trade group, The Center for Audit Quality, supports the PCAOB’s revised rules but suggests the board should have provided more specific audit quality standards.
                              • In recent calls with investors, bankers are increasingly mentioning “green shoots” to signal that they are seeing early signs of recovery from the recent weakness in mergers and acquisitions (M&A) activity, according to The Wall Street Journal. During an April earnings call, Wells Fargo’s CEO said, “While it’s still early, we are encouraged by the green shoots we are seeing.” Executive references to “green shoots” – a gardening/farming metaphor long used by bankers to indicate an emerging economic turnaround - are believed to have begun last year when Morgan Stanley’s CEO mentioned them during an investor call. So far in 2024, the value of M&A activity is up 20% compared to the same period in 2023, but totals are still well below the peak seen in 2021, according to Dealogic.
                              Get A Demo

                              Vertical IQ’s Industry Intelligence Platform

                              See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.

                              Build valuable, lasting relationships by having smarter conversations -
                              check out Vertical IQ today.

                              Request A Demo