In this deep dive about BCG and Why MBAs favor the consulting giant, we cover
- History of BCG
- BCG’s Approach
- Why does BCG want MBAs?
- Where does BCG hire their MBAs from?
- Top 5 Full-time MBA Graduates Hired in Consulting
- Remuneration and Career Paths at BCG for MBAs
- Salary Growth at BCG
- Work-Life Balance at BCG
- BCG vs. Peer Consulting Companies
History of BCG
Bruce Henderson joined the Boston Company in 1963 and started a ‘one-man-one-telephone consulting unit’ called The Boston Consulting Group (BCG). Hired by the company to establish and expand the consulting wing, Bruce Henderson published newsletters called ‘Perspectives’ that discussed debatable and conflicting theories, opinions, and strategies, which engaged and compelled readers and conference attendees to turn into clients. In the 1960s, when established consultancies used growth and profit as the key metrics for determining the success of a firm, Bruce focussed on strategy as a core competency. This shift in approach paved the way for BCG to earn the title of one of the best consulting companies in the world. In April 2021, BCG’s global revenues touched $8.6 billion with underlying revenue growth of 8% (at constant exchange rates) supported by its 22,000 strong global workforce.
BCG’s Approach
The Pricing Paradox, product portfolio, profit center ethics drew much interest in the consulting world. BCG also started addressing more general topics such as trade policy, monetary policy, and organized labor. The number of consultants kept growing steadily. The Boston Consulting Group was acquiring and setting up new units in Tokyo, Milan, Paris, Munich, Zurich, and other parts of the world.
Through ‘Perspective,’ BCG forced companies to identify ‘Cash traps’ with larger investments and lesser profits. They also introduced means to measure success by the hour. BCG identified four common cash traps that firms commit to improving near-term shareholder value. As a result, large cash reserves and untapped debt capacity only further reduced the company’s ability to maneuver and increased its vulnerability for attacks. BCG offered solutions to manufacturing companies in Japan and, after years of study, backed the concept of time-based competition.
Why does BCG want MBAs?
Henderson, an alumnus of Harvard Business School, first disrupted the market by offering young and curious MBA recruits’ salaries higher than what was offered for bank executives in top business schools. He developed an internal marketplace for ideas where consultants competed to present the best solution for the client. The advisory service team that addressed novel problems began developing a framework to offer repeatable and superior consulting services. In time, the competition for ideas and strategy as a solution paid off. BCG values schools whose curriculum have an emphasis on developing strong logical and critical thinking skills in addition to building the foundation in accounting, economics, and forecasting. In recent years, Data Science and Business Analytics as tools for executive decisions have been favored, with extra points offered to schools that develop stakeholder-based perspectives.
Where does BCG hire their MBAs from?
INSEAD – a school known for its consulting placements (51% in Consulting), was the #1 destination for BCG, followed by Tuck School of Business (46% in Consulting), and Ross School of Business at third (42% in Consulting). In terms of remuneration – Tuck’s total consulting salary was $199,000, ahead of INSEAD ($157,500) and Ross ($190,000).
Top 5 Full-time MBA Graduates Hired in Consulting
On average, 4.7% of all recruits by MBB (McKinsey, Bain, and BCG collectively) are by BCG at the top 24 US schools, with the hires from the school doubling in the past 20 years. INSEAD (108, 28 returning to BCG), Chicago Booth (75), Wharton (56), Harvard (47), Kellogg (44) featured in the lion share of MBA graduates hired by BCG.
The table below shows the number of MBAs hired by BCG. However, since employment figures were not available for all the schools, it is worth noting that BCG was the topmost employer at London Business School, MIT Sloan, Dartmouth College Tuck, and IIM Ahmedabad.
| Rank | School | % in Consulting |
|---|---|---|
| 1 | INSEAD | 51% |
| 2 | Tuck School of Business | 46% |
| 3 | Ross School of Management | 42% |
| 4 | London Business School | 40% |
| 5 | NYU Stern | 39.9% |
| 5 | IIMA | 39.9% |
| School | BCG Total Hires (including Internship) |
|---|---|
| INSEAD | 108 |
| Chicago Booth | 75 |
| Wharton | 56 |
| Harvard | 47 |
| Kellogg | 44 |
| MIT Sloan | 36 |
| Michigan Ross | 33 |
| IIMA | 32 |
| London Business School | 31 |
| Columbia Business School | 30 |
| NYU Stern | 13 |
| Duke Fuqua | 19 |
| Stanford | 7 |
| Haas | 3 |
Remuneration and Career Paths at BCG for MBAs
The median total salary for MBAs across the top 20 MBA programs based on employment reports for consulting is $190,300. The top 10 schools from the same list have a median salary of $195,000. MIT and Tuck top the list with a total median salary of $199,000.
| School | Consulting (Total Median Salary) |
|---|---|
| MIT Sloan | $199,000 |
| Tuck School of Business | $199,000 |
| Stanford GSB | $195,000 |
| Wharton | $195,000 |
| Kellogg SOM | $195,000 |
| Chicago Booth | $195,000 |
| Yale SOM | $195,000 |
| Duke Fuqua | $191,233 |
| NYU Stern | $190,600 |
| Michigan Ross SOM | $190,000 |
| Columbia Business School | $190,000 |
| Haas School of Business | $188,917 |
| Harvard Business School | $180,000 |
| Darden School of Business | $165,000 |
| Cambridge Judge School of Business | $161,745 |
| INSEAD | $157,500 |
| HEC Paris | $137,693 |
| IMD | $120,000 |
| London Business School | $113,669 |
| IIMA | $30,000 |
Salary Growth at BCG
Career paths vary at BCG depending on educational qualification and skill, ranging from Associate at entry-level to Partner at the senior-most level.
An entry-level undergraduate or master’s graduate could expect a remuneration of $90,000 with a performance bonus of up to $18,000 and a sign-on bonus of $5,000.
After two or three years of experience, the Associate can progress to the role of a Consultant. Usually, MBA’s are hired directly at the position of a Consultant at an expected remuneration of $165,000 with a sign-on bonus of up to $30,000 and a performance bonus of $45,000.
After a few years as a Consultant, the next step on the career ladder is the managerial level role of a Project Leader with an expected base remuneration of $200,000 to $220,000 and a performance bonus of $90,000 to $130,000.
The role of the Principal is at the next stage by which the candidate needs 7 to 10 years of experience within the firm and can expect a remuneration of $250,000 to $320,000 with a performance bonus of $120,000 to $220,000.
Partners and Directors are expected to have more than 10 years of experience within the firm with varying levels of seniority within the two positions. The expected remuneration at this level varies between $350,000 to $650,000, with performance bonuses ranging from $320,000 to more than $500,000.
Work-Life Balance at BCG
BCG respects the need for consultants to have their personal space and break from work. Hence, it is possible to take a break between projects without the leave impacting the growth prospects. Also, the firm allows work arrangements such as part-time work, staying away from work for an extended period, or breaks for a few hours each day.
BCG vs. Peer Consulting Companies
BCG has always adopted a flatter hierarchy than Bain or McKinsey, leading in Corporate Development, Innovation, and Business consulting as compared to Bain that has a strong Private Equity record, whereas McKinsey leads in Strategy and Operations.
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