What’s the Difference Between Management Consulting vs Strategy Consulting?
- Last Updated March, 2023
Are you considering a career in consulting? With so many terms and definitions floating around the industry, it can be overwhelming to figure out where to start. Two common terms you may come across are “management consulting” and “strategy consulting.” But what exactly do they mean, and how do they differ?
In this article, we’ll discuss:
- Understanding the difference between management consulting vs. strategy consulting
- Examples of various consulting projects over a consultant’s career
- How top firms define themselves and what that means for your job search
- Our top 4 tips for figuring out which path is right for you
One thing to note is that even after you know these definitions, whether you decided to use “management consulting” or “strategy consulting” in your vocabulary, it doesn’t affect your job search.
Real-life consultants focus more on the specific skills and experiences they can bring to a project rather than worrying about fitting into a particular label.
Let’s get started!
What is Management Consulting vs Strategy Consulting?
Are these different types of consulting? The short answer is that in today’s consulting world, the two are nearly synonymous but there is a technical difference.
All strategy consulting falls under the umbrella of management consulting, but not all management consulting is focused on strategy. Management consulting is a broader term that encompasses a range of topics, including strategy, operations, and implementation.
Thus all strategy consultants are management consultants, but not all management consultants are strategy consultants.
It is like all Telsa cars are electric cars but not all electric cars are Telsas.
Here is how to think about the two –
Strategy consulting projects are high-level initiatives that focus on shaping the future of a company’s core business for competitiveness and profitability and long-term planning to achieve that future vision. These projects focus on “what should we do?”
A senior executive is the main client on these projects.
While some small boutique firms may specialize exclusively in strategy projects, most consulting firms offer a range of services to help clients tackle complex business challenges.
Examples of strategy projects:
- Developing a long-term growth strategy for a company, which might involve expanding into new markets or developing new products and services
- Overhauling a company’s digital strategy to improve efficiency and competitiveness
Management consulting projects include strategy work but also encompass a broader range of topics that addresses “how should we do it?”such as:
- Conducting customer research to see which product should be launched first
- Recommending changes to organizational structure to improve efficiency and collaboration
- Designing and implementing a customer loyalty program to boost retention rates
Brief Origins of the Consulting Industry & Where the Terms Come From
To understand more about the terms and the consulting industry today, it’s interesting to know its history. Originally, consultants provided high-level strategic advice to managers in the manufacturing industry. As technology advanced, businesses required more consulting support, leading to an expansion of services.
The Great Financial Crisis in 1929 sparked a new phase for consulting, as banks were no longer allowed to be involved in business advisory activities. This resulted in a growing demand for expert advice on financial, management, strategic, and operational problems. During this time, McKinsey was founded as the first official management consulting company.
The industry continued to grow, particularly as markets deregulated in the 70s and 80s. The emergence of computer technology led to the rise of information technology consulting to help companies adapt.
As industries evolved, more types of consulting firms emerged to serve their complex needs.
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How Modern Consulting Works Today
In today’s consulting world, the lines between management consulting vs strategy consulting are increasingly blurred. Most consulting firms offer a mix of both types of services, and consultants often work on projects that span multiple areas. A consultant isn’t classified as only a management consultant or only a strategy consultant.
The consulting industry has evolved to cover a diverse range of functions and disciplines, with firms specializing in a variety of industry verticals. General management consulting firms, such as McKinsey, offer high-level advice across different functions, while others like IBM, focus more on technology and digital consulting. Boutique firms often specialize in a specific niche, like sales and marketing consulting for health and life sciences firms.
Consulting projects often consist of multiple phases. The first phase might be the “strategy” phase followed by additional phases to provide greater clarity on key elements of the strategy or to implement recommendations. Although management consultants can handle most of the work, highly specialized tasks like technology consulting or leadership effectiveness may require experts from specialized firms.
For example, let’s say Rest Easy, a hotel chain, hires a consulting firm to help determine its 5-year plan. The project might involve multiple phases:
- Phase 1: Define a 5-year strategy (6 weeks) for example, how many countries should a we aim to be in within 5 years and which customers should we target?
- Phase 2: Various projects to further the Phase 1 work (1-6 months); examples include: which locations within a country should we target, how do we obtain the proper licenses to operate, and how do we hire local talent while keeping our corporate culture?
- Phase 3: Implementation of project recommendations (12+ months) which involves, for example, hiring staff, training staff, and marketing our launch.
As you can see from the example above, a strategy consultant would work on Phase 1 while a non-strategy management consultant might work on Phases 2 and 3.
Ultimately, what matters most when considering a career in consulting is finding a firm that aligns with your interests, strengths, and career goals. For example, if you want to be involved in strategy work such as becoming COO and CEO of a large company, aiming for a firm that has strategy projects will help with your career development. If you aim to remain in operations, then a non-strategy management consulting role such as being on the implementation side might be a better fit for you.
Example of a Consultant’s Career
When starting in consulting, it’s common to work on both strategy and non-strategy management consulting projects. This is one of the many reasons consulting is a coveted career. Consultants enjoy exposure to a diverse range of industries and problems.
For example, one of our My Consulting Offer coaches worked on a variety of projects spanning both strategy and management topics in her first 3 years at Bain, including:
“Strategy”
- Developing a 5-year strategic plan for a consumer goods conglomerate
- Redefining a non-profit’s fundraising strategy to increase donations
- Helping a technology company determine how to enter a new product segment
“Management”
- Supporting a hospitality group to organize their operational teams
- Performing due diligence on acquisition targets for an oil and gas company looking to expand services
While these cases might seem different, the firm did not differentiate between strategy and management consulting work. The same internal talent pool worked on both types of projects and clients expected the same skillset from consultants.
So, whether you’re working on a strategy project, a management project, or a mix of both, what matters most is your ability to deliver impactful results for your clients.
How To Decide If You Want To Be a Management or Strategy Consultant
When choosing between management consulting vs strategy consulting, the recruitment process is almost identical.
It’s more helpful to focus on how people in the industry talk about consulting firms, as they tend to group certain firms based on their areas of expertise rather than splitting hairs over management consulting vs strategy consulting.
The types of work that firms focus on are part of what drives this segmentation. To determine which type of consulting firm is the best fit for you, ask yourself important questions such as:
- Are there specific industries that interest me (e.g., healthcare)?
- What type of work-life balance do I want to achieve?
- What career path do I want to pursue?
- What are my salary expectations?
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How Top Firms Define Themselves
There are generally 3 types of firms in the consulting industry: MBB (McKinsey, Boston Consulting Group, and Bain), Big Four, and Boutique firms.
MBB firms typically focus on high-stakes business problems and shaping their clients’ futures. They are often referred to as “management consulting firms” and are renowned for their strategy work. However, they also take on management consulting projects outside of pure strategy.
The Big Four, including Deloitte, KPMG, PwC, and Ernst & Young, are known for their audit and financial advisory practices. Each of them has a consulting arm that was formed by merging with other consulting firms. While they do some high-level strategy work, they also focus on more targeted problems such as human capital, enterprise technology, performance improvement, and digital transformation. They are also the leaders in financial, tax, and regulatory consulting and advisory services.
Boutique firms, such as Oliver Wyman, L.E.K., and ZS Associates, specialize in an area of focus, industry, or locality. Some boutique firms position themselves as management consultants, while others may call out their expertise in serving a particular industry by calling themselves healthcare strategy consultants, for example.
If you’re interested in learning more about the different types of consulting firms, check out our article on it and the summary below:
We have a lot of resources to help you deep dive into these categories of consulting firms: MBB Firms, Big Four, and Boutique Firms.
Top 4 Tips on Figuring Out What Firm is Right For You
1. Research the Firms
Start by visiting the firms’ websites to learn about their values, culture, and areas of expertise. Look for information on their projects, industries, and clients. This will help you determine if the firm aligns with your interests and career goals. You should also stay updated on the latest consulting trends by reading their industry publications and thought leadership (Example: The McKinsey Quarterly).
2. Network and Meet People
Connect with alums, attend events, and engage in cold outreach to meet people who work at the firms you’re interested in. Many firms host career fairs and events on university campuses for current students to meet firm representatives.
Ask about their work experience, valuable skills, and career development. These informational interviews with consultants will help you gain deeper insights than what is publicly available on their websites. If you want ideas, we have a list of 10 Questions to Ask During a Consulting Informational Interview.
3. Figure Out Your “Why?”
Before applying to a consulting firm, it’s important to understand your motivations and interests. What do you hope to achieve in your career? What types of problems do you enjoy solving? Which industries are you passionate about?
Reflecting on the answers to these questions will help you identify the types of consulting firms and projects that best fit you.
4. Start Preparing Your Applications
Polish your resume and cover letter to highlight relevant experiences, skills, and achievements that demonstrate your fit for the consulting role. Tailor your application to each firm, emphasizing the skills and experiences that are most relevant to their work. Articulating your reasons for wanting to work for the firm will help you better understand what firm fits you best.
To learn how to prepare a good application, we have guides on writing your consulting resume and consulting cover letter to increase your chances of landing an interview.
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In this article, we’ve covered:
- The difference between management consulting vs strategy consulting
- Examples of consulting projects that a consultant may work on throughout their career
- The various types of consulting firms and differences in their work
- Our 4 tips to help you decide which consulting path is right for you
Still have questions?
If you have more questions about management consulting vs strategy consulting, leave them in the comments below. One of My Consulting Offer’s case coaches will answer them.
Other people researching management vs. strategy consulting found the following pages helpful:
Help with Your Consulting Application
Thanks for turning to My Consulting Offer for advice on case interview prep. My Consulting Offer has helped 89.6% of the people we’ve worked with to get a job in management consulting. We want you to be successful in your consulting interviews too. For example, here is how Prafulla was able to get his offer from BCG.