Speaker 1: All right, everyone, welcome back to the channel. The reason you clicked this video is because you want to know the difference between management consulting and strategy consulting, and that's exactly what you're going to learn by the end of this video. And it's important for you to know the difference between the two because they can lead you down completely different paths in life. And one of these careers will be better for you depending on your goals and your personality. I've helped over 600 people land their dream consulting jobs. And over that time, I've been able to recognize which consulting careers are best for different types of people. So sit back, relax, and tap that like button if you appreciate my hard work on this content. All right, let's dive in. I'm going to cover the difference between the work that they do, the compensation they receive, the lifestyle, as well as which one is the better career path. In the world of consulting, there is no consulting that can be done if there's no business that hires these consultants. So when you look at a business, a business really breaks down to two things. What are we going to do and how we're going to do it. And this is where strategy consulting and management consulting fits in. So if a company hires a strategy consultant, the strategy consultant basically fits the first question, which is what do we work on? While the management consultant deals with both what we work on and how we work on it. In other words, all strategy consultants are management consultants, but not all management consultants are strategy consultants. And this comes into the type of work that you do as well as who you work with. Because strategy consultants think about the strategic picture of what we do, they oftentimes will work with the executives. So think about the CEO, the CFO, the COO, and all the other CXO roles out there. So they're going to work with the highest level of the company. Once the strategy is decided, the non-strategy management consultants will come in and figure out with the company how to do this. So the management consultants who aren't working on the strategy will likely work with the VPs, the directors, and the heads of the businesses and divisions. So that's pretty much how you can think about the strategy consultants as well as the management consultants and the different types of work that they do and who they work with. But the easiest way to understand this is actually to go through an example. So imagine that Dwayne The Rock Johnson, who happens to own a tequila brand called Terramana, true fact, and Terramana right now is currently in 150 countries exactly. But let's imagine that The Rock, as well as the CEO of the tequila company, wanted to know, well, we're in 150 countries now, but which country should be number 151? So what they'll do is they'll hire a team of strategy consultants. Let's say that they hire a strategy consultant from Bain and what they will do is the Bain team will come in, do some analysis, and they'll realize that, based on all of this, we recommend that you launch next in Thailand. So now that the company, The Rock, the CEO, know that they want to launch in Thailand, the question becomes, how do they launch in Thailand? So then the strategy consultant's work is done. So the next phase is they need to hire non-strategy management consultants to come in and figure out all the other pieces. How do we actually do this? So for example, they might bring in a management consultant who specializes in supply chain, so they can figure out how to get the tequila from all the countries it's currently in, where it's being created, to Thailand. They might bring in a management consultant who specializes in sales to figure out how do they build their sales team in Thailand. Third, they might bring in a management consultant who specializes in risk, for example, to assess, well, what are the risks? How do we work with the Thai government? Are there black markets? How do we counteract fakes that might be in the market as well? So as you can see here, strategy consultants focus on the strategy part, but management consultants can work on the strategy as well as all the other parts of a business. So management consultants, as a result, can be across various different things. And this example shows you one of many examples of how management consultants and strategy consultants provide value to companies that they work with. But now that you know the work that they do and who they work with, what is the compensation like? So overall, strategy consultants will be paid roughly about 20% to 30% more than management consultants. But remember, the term management consultant is pretty wide. That means that on average, management consultants who aren't doing strategy work will be paid less, but there are also management consultants who are paid more than strategy consultants on average. But why does this happen? Why do some management consultants get paid higher than strategy consultants? Well, it comes down to two things. First off is, is there an expertise that's very rare? For example, imagine that you went to your general doctor's visit and a doctor says, hey, you have this really rare disease. Who are you going to go see? You're probably going to go see a specialist. But imagine that there's only four specialists in the world who know about your disease. You're probably going to have to search them out and they're going to charge a lot because they don't get a lot of patients. So they have to be able to compensate through the few people that they have. But because that knowledge is very valued and very few people have it, they can charge more. So this is the same in management consulting, which is that if you have an expertise that's very rare, but that people want to be able to use, you can charge more. As a result, the project costs more and the management consultants who have this knowledge will cost more as well. So that's how the compensation for management consultants can be higher. The second way that a management consultant can earn more than a strategy consultant is if the knowledge and the work that they do would be costly if it was done incorrectly or wrong. So imagine, for example, that the client is an oil company and they want to dig for oil offshore. Well, they have to be able to put in the safety precautions so that their employees and their team members are safe. Because if they don't do it, then one, someone could die. Two, the PR that results from it is going to tank the company's value. But also third, it's going to put other people's lives at risk as well. So a lot is at stake if they get it wrong. So a management consultant who specializes in the oil industry, and in particular with HR and compliance and safety, they're going to be able to charge a lot more because they know that if the oil company gets it wrong, it's going to cost the company a lot more money than what they're paying for the consultants. So those are the two ways that some management consultants are able to make more than a strategy consultant. But just because strategy consultants on average make more money, it doesn't mean that their life or their work is better. In fact, for a lot of strategy consultants, compared to their non-strategy management consultant counterparts, they work a lot more hours. So if work-life matters to you, this is something to keep in mind. So on average, strategy consultants at firms like McKinsey, Bain, and Boston Consulting Group will work on average 50 to 60 hours per week. Of course, there are some projects that will require more than 60. But on average, if you look at a career and look at a large sample size, it's going to work out to be about 50 to 60 hours. So how does this compare to their management consulting counterparts who aren't working in strategy? Well, on a whole, these consultants work anywhere between 45 to 55 hours. So you're seeing a wide variety here because a lot of the work-life in consulting varies depending on three factors. It depends on the project, it depends on the timeline, and it depends on the client. For example, if you have a project that the firm has never done before, there's less knowledge for you to leverage and less expertise. So you're learning on the job as well. Versus if a project has been done thousands of times, you probably have templates and models that you can leverage. Second is the timeline. If you have six months to come up with a strategy versus six days, that's going to vary a lot in terms of how intense the work is. And third is the client. Because if the client is calling you with other work and calling you at 2 a.m., that's going to extend your time. Or if you have to fly to the client's site, that adds more time because you have to travel to and from the airport and actually take the plane there. Versus if you have a client for a project you've done thousands of times before, the timeline is very generous, and the client doesn't want you on site, the hours will be lower. So again, it really depends. But on average, you can assume that a strategy consultant will work a lot more hours. So now that you know the work between a management consultant and strategy consultant, the compensation, as well as the work-life balance, which career path is the right career path for you? And there is a right answer. So when I advise the candidates who end up getting multiple offers and they have to decide between, well, do I want to be a strategy consultant or do I want to be a management consultant? And within management consultant, do I actually want to take strategy roles or do I want to take non-strategy roles or do I want to make sure of both? Because what you decide is going to affect your career. So how do you think through this? There's one question that I advise everyone ask themselves, and it's this, what do you want to do after consulting? Because the answer is going to tell you a lot about what you should do. If you want to work at a large company, let's say you want to be president or CEO of a large company like Google or Starbucks, then I recommend strategy consulting. Because as a strategy consultant, you're going to get exposure to the high level, the C-suite, that you're going to want to be one day. And you're going to get exposure to really difficult problems that these companies are solving. And this is going to come in handy when you become a leader within your organization. Currently, the CEO at Google and the CEO at Starbucks, we're both former strategy consultants. And there's a good reason for that. Second is, if you want to remain in operations or potentially even start your own company, it's okay to go down the non-strategy management consulting route. In fact, there are a lot of advantages to it. While strategy consultants will set the strategy, they're oftentimes not involved in the implementation itself. So what this means is that their management consulting counterparts tend to have a lot more operational experience. So in the early days of a startup, or when a company is relying on its operations, you're going to need a lot more operational know-how than strategic know-how. Because the strategy might change day-to-day depending on what's happening, but you still need to get from point A to point B. And this is why a lot of companies, the same ones I mentioned, Google and Starbucks, when they first started, relied a lot on former management consultants who had operational experience. And then later on, when they grew, they would hire a lot more strategy consultants who are leaving these firms and want a strategic role within the company. But what happens if you don't know what you want to do after consulting? For example, you don't know if you want to work for a large company. You don't know if you want to work in operations. You don't know if you want to start a company. You don't even know what you want to do tomorrow. Well, in that case, I recommend strategy consulting. Because as a strategy consultant, you're going to be able to see multiple projects across different industries, different verticals, and different functions. And that way, you can decide what you like and don't like. In fact, that was one of the advantages I had when I was at Bain, which was when I took on strategic projects, I got a chance to see different industries, and some I really gravitated towards, like education, while others like oil and gas didn't resonate as much with me. And so this helped me decide what I wanted to do. And in fact, if you're undecided what you want to do, and there's a chance that you might want to stay in consulting forever, having a strategy consultant background helps you, even if you're going to move into an operational role later. All of these skills are going to be transferable. So that's how I recommend it, is think about what do you want to do after consulting? So now you know the difference between management consulting and strategy consulting, which is going to help you with the recruiting process. But also, once you become a consultant, help you navigate your career. If you're 100% serious about becoming a consultant, whether it's a strategy consultant or management consultant, I want to help you get there. My team and I at MyConsultingOffer, we're a team of former McKinsey, Bain, and BCG recruiters, interviewers, and consultants. And we've helped over 600 people become management consultants. In fact, we have an 89.6% success rate. That is 9 out of every 10 people who go through our program, land at least one offer in strategy and or management consulting. And I want you to be our next success story. And how we're going to do that is, I want to get on a call with you for 30 minutes and map out exactly what you need to do in order to hit your goals, whether it's to be a management consultant or a strategy consultant. I want to lay out a plan for you. And all you have to do to book that free strategy session is to click the link below. But you don't take my word for it. I actually hear from a client who went through our program and landed their dream consulting offer. So there you have it. So now when you are applying for consulting jobs, you know the difference between management consultants and strategy consultants.