<p>I checked out their website but I have no idea what open/closed thing they are talking about! And they have so many exceptions. Can a kind soul please explain that?</p>
<p>
</p>
<p>I don’t think the last part is always true. I’ve known several people in my career in consulting who started with no college degree and were technicians. The reason they became somewhat successful in finance and consulting is because they wanted those careers, and kept on working toward that goal. I think you sometimes place too much emphasis on the degree. If you spend 4 years in college, another 4 years getting a PhD, that’s 8 years total, most people’s entire career is about 30-40 years, there’s plenty of things happening after those degrees.</p>
<p>
</p>
<p>When I say ‘consulting’, I am actually talking about the top management consulting firms such as McKinsey. I think it would be most rare for somebody with no degree at all to get an offer from firms of that caliber. Heck, most people with degrees can’t get offers. </p>
<p>Now, if you’re talking about more general forms of consulting, then I certainly agree that you don’t need college degrees. I know quite a few IT consultants who are extremely well paid but who never graduated from college, but just happen to know certain computer skills such as configuring Cisco routers or setting up Oracle databases. Heck, I know a few people who didn’t even graduate from high school, yet make well over 6 figures as IT consultants. </p>
<p>
</p>
<p>Actually, it is not I who places such a strong emphasis on degrees. In fact, I often times think that many people shouldn’t even bother going to college at all, but rather just learn computer/IT skills. For example, with just 6-12 months of studying how to configure Cisco routers and other networking equipment, you can get a quite decent IT job. Frankly speaking, you may be able to get a job that actually pays better than many newly minted engineers who have actual engineering degrees. </p>
<p>What I’m simply saying is that, given that a lot of people do go to college, it is fair to examine what happens to their career paths are afterwards.</p>
<p>sakky,</p>
<p>it just gets old. you write the same thing… in every thread. people have legitimate questions that they want the answers to. you need to respect that they want their questions answered, not to hear your rants… which are always the same. if you pick any engineering thread with over 6 pages, chances are that it has something about “people leave engineering and go to investment banking and…”</p>
<p>ExplorerCY,</p>
<p>It just gets old. You write the same thing, always complaining about my posts. Like I said before, if you don’t like them, then don’t read them. It’s really that simple. </p>
<p>
</p>
<p>And the OP’s question did get answered. This entire discussion has been a highly detailed examination of all of the sub-issues that were raised. Hence, the OP is free to read all of these posts and come to a highly informed decision. Or, the OP can just read a few of the posts. But at least he has the choice. Nobody is forcing the OP to read everything. It all depends on how much detail he wants. Contrast that with the numerous questions on CC that don’t even get a single response, or if they do, get perhaps only a handful. </p>
<p>The bottom line is this. I can hardly see what is bad about having a long thread. It just means that there is more information available about the topic at hand. That simply gives the OP more information that he may choose to read. If he doesn’t have use for all of that information, then he can simply choose not to read it. But he has the choice. What you are saying is that people shouldn’t even have that choice. In other words, you want to deny information to people, and you want to deny my right to free speech. What gives you the right to do that? </p>
<p>
</p>
<p>People want to talk about investment banking, and so I do. Note that I may only bring up Ibanking once, and any later responses about it are due to the fact that others continue to bring it up. Seems to me that the topic of Ibanking is highly interesting to a lot of people, and if so, why shouldn’t we be allowed to talk about it.</p>
<p>Furthermore, the general point is that engineers switch to many different career paths, of which Ibanking is just one example, although one that has apparently caught your attention (otherwise, you wouldn’t have brought it up).</p>
<p>But the bottom line is this, ExplorerCY. If you don’t like the conversation at hand, fine. Don’t participate in it. If other people want to talk about something, let them do so. Why do you care so much about what others are talking about? This is not your thread anyway.</p>
<p>ExplorerCY, one working definition of insanity is doing the same thing over and over again and expecting different results. It’s not an infallible definition, but I think in this case it fits the situation perfectly.</p>
<p>Like sakky says in his or her last post, just ignore his or her posts if you don’t like them. I’m very close to labeling you as insane if you continue to put up posts asking sakky to stop his or her rants because in all honesty, you know deep down that he or she will never willingly stop posting his or her thoughts. Keyword is never. Try to stay sane my friend; it’s just not worth losing your sanity over.</p>
<p>Im NoT rEaDiNg ThIs ****
YOu’re SCHool DePEndS on Who You ARe
MiT if U R MAsoChistIc LikE ME - Or TaKE Ez coUrSez anD CoASt oN PresTige</p>
<p>GeTTinG AccePted IVy puTs You AmOng oTheR ToP StuDenTs, OpPS
NOt PutS yoU As BiG Fish LittLe PoNd, Ez GraD SkooL AdmiSS
All ElSE Can bE MoOt</p>
<p>That’s my take on things so
<b> grain of salt </b>
Opps = opportunities</p>
<p>joewhiz… dont talk down to me. you may be used to being the smartest person in the room, but you should not expect that here. oh, and very cliche. “insane is doing the same thing while…” — we know.</p>
<p>sakky, i am certainly not trying to attack you personally. i just want you to see that many engineering threads get bended into talking about the same couple topics. you are by no means that only one who does this.
i am simply advocating for a more well organized platform to talk about these issues that come up time after time. someone always asks a question and people pervert it with generalities until we are talking about the same couple topics. lets consciously try to avoid that.</p>
<p>example: “hey is harvard better than gatech?” - “yes, ivies are better” - “no, people just think that because of prestige” - “people who go to ivies dont tend to actually do engineering” - “yeah, they go into jobs like consulting and ibanking” - “thats a shame, its the money” - “i know, engineering loses good people to ibanking” - “some people dont just follow the money!” - “yeah, but a lot do and that’s not good” - “i know” - “rabble, rabble, rabble, rabble, rabble”</p>
<p>
</p>
<p>So you’re telling us not to feed the ■■■■■(s)?</p>
<p>my bad, joe. sorry i attacked you like that.</p>
<p>
</p>
<p>I am simply saying that I am participating in a conversation, which by definition, includes more than one person. If people want to have a conversation about a subject, why is that a problem? If you don’t want to be a part of the conversation, you don’t have to participate. You don’t have to read the posts.</p>
<p>
</p>
<p>Come on, ExplorerCY, you know what the problem is: people keep asking questions about the same old concerns. </p>
<p>For example, you complain that I talk about Ibanking. Well, notice that I was not the one who brought it up first. Others brought it up first. And even then, I tried to put the issue to bed. But people kept bringing it up. That indicates to me that people want to talk about that. If so, I am happy to oblige. </p>
<p>Look, at the end of the day, I think people should be allowed to talk about whatever they want. You complain that this thread veered off its original path, but the fact is, that happens in many threads, as posters find some sub-topic to be more interesting than the main topic. I don’t see why that’s a problem. The OP has a wealth of information regarding his question, including offshoot topics derived from the the answers to his question, available to him, and is free to read or not read whatever he wants. I don’t see why that’s a bad thing. That’s certainly a lot better than what happens in those other threads where hardly anybody replies.</p>
<p>
</p>
<p>At one point, perhaps using internal consultants would have been acceptable (to investors, provided that they would have come up with ideas that boosted profits). IMO, that time has come and gone. Yahoo! has not been successful in the areas in which they claimed they would have success, particularly with regards to competing with Google in search popularity and (search) advertising ROI. Thus, they promote internal consultants to fix their problems at their own peril.</p>
<p>
</p>
<p>But that credibility has to be rooted in some kind of success, which has not manifested itself (in business terms).</p>
<p>
</p>
<p>And they also hire outside consultants at their own peril. I can’t tell you the countless numbers of strategy consulting projects designed by outsiders that have failed. But heck, I don’t have to tell you, as entire books have been written about their failures. {For example, consider the book: ‘Consulting Demons: Inside the Unscrupulous World of Global Corporate Consulting’ by Pinault.} As a case in point, McKinsey once infamously advised AT&T not to invest heavily in cellular technology because it would supposedly be only a “niche” market. Oops. McKinsey was also a key strategic advisor for Enron. Heck, Jeff Skilling was himself a former McKinsey partner. </p>
<p>*In 1980, the company whose Bell Labs invented cellphones listened to McKinsey, the consulting company they’d hired. Its estimate of the market in the year 2000 was off by a factor of 120 – not even 1 percent of the real number. Based on that, AT&T decided there wasn’t much future to these toys. Not coincidentally, in 2005, it was swallowed up by SBC Communications Inc., originally a Baby Bell. *</p>
<p>[Our</a> Cells, Ourselves - washingtonpost.com](<a href=“http://www.washingtonpost.com/wp-dyn/content/article/2008/02/22/AR2008022202283_2.html?sid=ST2008022202336]Our”>http://www.washingtonpost.com/wp-dyn/content/article/2008/02/22/AR2008022202283_2.html?sid=ST2008022202336)</p>
<p>Now, to be fair, obviously McKinsey and the other consulting firms have had their successes too. But my point simply is that we shouldn’t pretend that outside consultants always know what they’re doing. There are plenty of failed projects designed by outsiders - in some cases, spectacular failures. </p>
<p>I agree that inside consultants may fail too. But at least it would be a cheap failure. Outside consultants are egregiously expensive. </p>
<p>
</p>
<p>That success can be derived simply from stellar work that those employees (who are now to become internal consultants) had done before. In other words, you identify your best employees - i.e. those who have clearly outperformed their job descriptions - and use them to form an elite task force of internal consultants. Their credibility is derived from their track record of top performance on previous tasks. </p>
<p>Besides, think of it this way. By hiring outside consultants, think of the message you are sending your employees. You are basically saying “We don’t think anybody here is smart enough to figure this problem out, so we’re going to bring in outsiders to solve it for us.” It’s a rather sad commentary on your own workforce, particularly given the fact that outside consultants don’t always do good work (again, think about what happened with McKinsey and Enron). It begs the question: why don’t you simply hire smarter people in the first place? </p>
<p>There’s an even more poignantly sad aspect to this story. Yahoo is not doing well financially, and so they’ve hired consultants. But think about what that means. Right now, there is a hiring freeze at Yahoo. Yahoo employees are probably not getting good raises or bonuses. Lots of discretionary spending, i.e. corporate travel, paid dinners/drinks for sales reps who are on calls to potential customers, employee training/education, etc. are being reduced in order to save money. Basically, Yahoo employees are all being told that they have to tighten the belts. Yet Yahoo nevertheless will pay millions to bring in outside consultants. Think about how that looks: think about a Yahoo employee who is being told that he won’t get a good bonus, that the company won’t pay to send him to training to learn new skills, because the company needs to reduce its spending, and then have that employee hear that Yahoo can pay millions for outside consultants. Not only that, but to add insult to injury, in return for those millions of dollars in fees, those consultants advise Yahoo to eliminate up to 3000 employees. How do you think that looks? Yet that’s what happened.</p>
<p>But at least Yahoo is still profitable. They’re not doing as well as they would like, but at least they’re still profitable. I think the most egregious examples would be those firms that are incurring giant losses, yet are still hiring outside consultants. The Big 3 Detroit auto companies immediately come to mind. They’re all losing billions. At least 1 will probably go bankrupt, and soon. Maybe all 3 will go bankrupt soon. Yet they can somehow pay for consultants anyway, and have been doing so for years. One of my friends works for Booz Allen Hamilton, and his client is a Big 3 auto company. {He couldn’t tell me which one, but it doesn’t really matter as they’re all in serious trouble.} These companies are laying people off left and right, and posting the largest losses in their companies’ histories, and yet they can still afford to pay for strategy consultants? How’s that? And if that strategy advice was so good, then why are they in so much trouble now? {Remember, they had been hiring consultants for many years now.} </p>
<p>To be fair, I have nothing against the strategy consulting industry per se. They often times do good work. But they’re certainly far from perfect. More importantly, they tend to hire from the same pool of top college and grad-school students that the engineering firms do (or could). Hence, the raw human capital is the same. Hence, you have to wonder why consulting firms can apparently provide better job opportunities than engineering firms can. Lots of top engineering grads say they prefer consulting because it pays better, allows them to try out different tasks, and provides them with a fast path to advancement. Why can’t engineering firms provide that?</p>
<p>there aren’t many pure strategy firms left, and even they don’t do 100% strategy work. Firms hire consulting firms because they need the expertise to solve their problems, sometimes they know exactly what they want, sometimes they can’t. And consulting firms can help them figure this out. </p>
<p>Just because the people at X firm is smart in terms of IQ, doesn’t make them the best people at handling the job. Consulting firms have very specialized expertise in some areas, for example, let’s say optimization and simulation. Consulting firms do this stuff for many companies over many years, and are very good at it. The firm X can’t hire people to figure out how to solve every problem and then fire them after the solution is implemented, thus the need to bring in consultants to work on it for a few months. Of course if the company always end up needing the same resources, they will find a way to establish an internal consulting department, and many companies have done this, but it’s not very frequent that you have the same problem/question to answer all the time.</p>
<p>
</p>
<p>But that is the crux of the matter. The people who’ve outperformed their job descriptions have not “moved the needle” - their contributions don’t translate into the stellar types of profits that Wall Street wants. There are certainly people who’ve done outstanding engineering work, but it has not brought Yahoo! anywhere close to parity in profitability with Google. If executive management’s message to shareholders was something other than how it intended to compete with and even beat Google (at search and search ads, at least), it might be valued relative to other types of companies. But it is judged against Google’s arguably superior financial performance, and found lacking.</p>
<p>I’ll just submit this little thought experiment. How many of you use Google? What would it take for you to switch to Yahoo!? For quite a few people, Google is Search. And thus, for advertisers, Google is the place to advertise. This, IMO, is the reality that Yahoo! executive management is unwilling to face (at least in their public statements). Furthermore, they missed the boat on social networking, something that arguably, their top (software) engineers could have made a serious contribution to when it was a nascent industry.</p>
<p>
</p>
<p>First of all, define “smart” in such a way that it would immediately translate to profitability (or at least the promise of such). Secondly, by now, Yahoo!'s workforce has pretty much figured out what message its executive management is sending. They have:</p>
<p>[ul]
[<em>]already quit
[</em>]will quit when they get a better offer
[<em>]can’t find anything else (or are restricted from doing so, e.g. on visa)
[</em>]are hoping someone will buy them who has a better clue of how to make money
[/ul]</p>
<p>Yeah, there are a few who “bleed purple” and really want to stay there, but out of those folks, there’s no one who’s yet to figure out how to make money for the company to the tune that Wall Street wants.</p>
<p>
</p>
<p>Yahoo! is marginally profitable, based on vastly reduced Wall Street expectations. In general, like I wrote before, Yahoo! is a poor example of a company that should use internal consultants. Basically, it won’t matter.</p>
<p>
</p>
<p>Keefer, you seem to have a very high opinion of consulting firms - so much so that perhaps you should consider taking a job as a marketer for that industry!</p>
<p>Unfortunately, what you have described is what the consulting firms would like you to believe that they do, but is not what they actually do. Let me provide a fact check that compares the marketing of consulting vs. the reality of consulting. Note, to be clear, when I say “consulting”, I am really talking about the large management/strategy consulting firms such as McKinsey and BCG. I am specifically not talking about any of the small boutiques.</p>
<p>Assertion: Management consultants bring years of industry-relevant experience to the table.</p>
<p>Reality: The vast majority of employees at management consulting firms have been out of school for only a few years (either undergrad or MBA). Many of them, especially the ones right out of undergrad, have never held an actual job in any industry before in their lives, and certainly not in the industry for which they are now consulting. {For example, I referenced my friend at Booz Allen who is assigned on a project with the auto industry, yet the fact is, he’s never worked in the auto industry for a single day in his life, and frankly, he doesn’t even really like cars very much.} Even many of the partners at the consulting firms have only limited true industry experience, but rather have spent most of their time in consulting. For example, many of the partners at McKinsey have basically spent their whole careers as consultants, and hence have never held jobs in the industries for which they consult. </p>
<p>Assertion: It doesn’t really matter whether consultants have actually worked in the industries for which they consult, because they have developed years of expertise in solving specific problems for that industry.</p>
<p>Reality: This is not really true either, for most consultants. In fact, it cannot be true. Like I said, most consultants are hired fresh out of school (either undergrad or MBA). Much of the reason why consulting is so appealing to people fresh out of school is that consulting allows you to see different industries and different job functions. For example, you might work on a HR project for a few months, and then work on a operations management project for another few months. In that sense, it’s very interesting for the consultants because it allows them to try on different tasks and find out what they really like to do.</p>
<p>But think about what that actually means. It means that most consultants never actually do build deep expertise in any one area. When one project is done, they move on to another task which may be completely different. {In fact, they hope it’s completely different because the whole point is to try different things.} Hence, they never actually become experts in any one topic. </p>
<p>Now, I do agree that often times the project leader (who is often times a partner) will indeed bring years of specialized expertise to the table. Nevertheless, the vast majority of the consultants on the project team will not have such expertise. You’re going to be paying millions upon millions of dollars for that team. </p>
<p>Assertion:Consulting firms are brought in to perform one highly specific task.</p>
<p>Reality: This is almost certainly false for most for consulting relationships. The fact is, for obvious reasons, most of the major consulting firms are not interested in one-off projects, but want to establish a long-standing relationship where they can work on numerous projects over a long period of time (and hence earn a continuous stream of fees). Heck, if you become a consulting partner, much of your job consists of building this sort of long-term business relationship with clients. </p>
<p>But think about what that means. It means that clients have to have a lot of problems that they need to solve. It also means that specific consulting expertise in one particular area is not very important, as each problem that one client has is going to be a different problem requiring a different solution (for example, a client may have a HR problem, a operations problem, a marketing problem, etc.) </p>
<p>The bottom line is this: while I can certainly agree that some outside consulting is valuable, the truth is, a lot of it probably is not, or at least, is probably no more valuable than are inside consultants (and certainly far more expensive). Just think of it this way. I’ve been studying the consulting industry for years now, and to this day, it still baffles me how they will hire so many people fresh out of undergrad who have never held a real job in their lives and have them working on important consulting projects for major companies. What baffles me even more is that these major companies will keep giving projects to the consulting firms, knowing full well that much of the work will be done by undergrads right out of school who have never held a real job before. </p>
<p>Just think of the message that this sends to company employees who have worked in the industry for years. It basically says: “We think you’re not very smart, and your industry experience is not valuable, such that we think that a bunch of guys right out of undergrad who have never worked in the industry before and have no special expertise will nevertheless do a better job of fixing our problems than you would.” That’s the message that is being sent to the employees.</p>
<p>
</p>
<p>But neither have most consultants. Like I said before, the vast vast majority of consultants at firms like McKinsey, BCG, Bain, etc. don’t have a track record of producing stellar profits either, simply because they were hired fresh out of school (either undergrad or MBA). Heck, the guys who were hired fresh out of undergrad, simply by definition, obviously don’t have a track record of producing any results. In fact, they’ve never even held a real full-time job ever before in their whole lives. Yet the fact is, they comprise the bulk of a consulting team.</p>
<p>Even the MBA consultants usually don’t have a highly stellar record of strong industry results. Granted, they probably had a good enough of a prior work history in order to get into a top B-school (although there continue to be a few people who get into top MBA programs right out of undergrad). They then got good grades in the MBA program, and did well in their case interviews, such that they got the consulting offer. But that doesn’t mean that they actually have a track record of producing, as you say, the stellar types of profits that Wall Street wants. Just because you can get into a top MBA program, get good grades there, and do well in case interviews doesn’t mean that you can produce outsize Wall Street profits. Yet those are the people who are hired by the major consulting firms. </p>
<p>
</p>
<p>So let’s explore this further. Let’s use the auto industry as an example. The Big 3 auto firms have been major clients for the top consulting firms for many years now. General Motors, in particular, has been one of the keystone clients for McKinsey for a very long time now. Yet I think we can all agree that GM has been performing abysmally, both on an absolute level and certainly relative to Toyota. Whatever you want to say about Yahoo, at least they have been far far more successful than GM has. Think of it this way. As of today, Yahoo’s market cap is more than 5x that of GM’s. More than 5x! Yahoo may not be doing well, but at least they’re still profitable. General Motors lost a whopping $39 billion just last year - the largest loss ever for an auto company, and one of the largest losses in US history. </p>
<p>Yet, why isn’t McKinsey blamed for GM’s lack of success? After all, McKinsey is the core strategy consultant for GM. Certainly, GM’s performance is lacking by any measure, whether relative to Toyota or an absolute scale. Hiring McKinsey clearly has not resulted in GM performing at the level of Toyota. Far from it, in fact, GM’s performance has probably gotten worse ever since they hired McKinsey. Yet McKinsey emerges apparently unscathed. Why? </p>
<p>Yet at the same time, you say that Yahoo’s top engineers don’t have any credibility in terms of successfully competing against Google, so those engineers should not be made to be consultants. However, I have shown that McKinsey has not shown any success in helping GM successfully compete against Toyota, yet plenty of companies will still gladly hire McKinsey anyway. What’s the difference?</p>
<p>Now, to be fair to McKinsey, I am not blaming McKinsey for the travails of GM. Indeed, it may well be true that GM may have performed *even worse<a href=“if%20that’s%20possible”>/i</a> had they not hired McKinsey. Nevertheless, the point is to simply show that plenty of consulting firms are associated with poorly-performing clients, yet nobody ever seems to have a problem with hiring those consulting firms again. </p>
<p>
</p>
<p>Well, like I said, is the ability to get into a top name-brand undergrad program (i.e. HYPSM), get good grades there, and then do well in case interviews necessarily equate to profitability? No, probably not. Yet that is exactly who consulting firms hire right out of undergrad. These people have no track record of producing profitability. Heck, they don’t even have a track record of even holding a full-time job. Yet the consulting firms hire them anyway. Why? </p>
<p>
</p>
<p>I agree, but hiring expensive outside consultants, when you are ostensibly having financial problems, is yet another insult to your existing employees. </p>
<p>
</p>
<p>Which gets back to what I said before: if the problem really is that your workforce is not competent, then the real answer is to hire better people. Paying millions to outside consultants is not going to solve the problem of an incompetent workforce, if that really is the problem.</p>
<p>However, I would argue that the problem is not an incompetent workforce, but rather incompetent management. For example, I think it’s trivially obvious that Yang should have taken the Microsoft buyout offer. Yahoo is now nearly 2/3 less valuable than Microsoft’s buyout price, so I would argue that that’s a no-brainer. But incompetent management is also not really a problem that outside consultants can solve. </p>
<p>
</p>
<p>The real question is not whether internal consultants will truly matter. The real question is whether internal consultants will matter relative to outside consultants. For the various reasons I have posted, I don’t see why outside consultants will do a better job with Yahoo than internal consultants would. </p>
<p>Let’s talk specifics. Yahoo has hired Bain. I know lots of people at Bain. Most people at Bain, like other major consulting firms, were hired fresh out of school (either undergrad or MBA). Most of them do not have significant experience in the Internet industry, nor do they really have much of a record of producing “stellar profits”. </p>
<p>Hence, it’s not clear to me that Bain is going to really do a better job for Yahoo than would a team of inside consultants. Yet Yahoo is apparently willing to pay millions for Bain. Again, why?</p>
<p>How do you respond to sakky, without wasting 2 hours or more of your life, should be an required course in any reputable MBA program. </p>
<p>I don’t think I can convince you of anything. I don’t work for a pure-strategy firm, so I don’t offer much of an insider info, but I think it’s clear that companies do find consulting firms in general very cost effective and practical ways of solving their business problems, otherwise they wouldn’t hire them and continue to do it on a long term basis. Most consulting groups I have been in contact with, usually have 15-30% PhD, another 40 or so percent have Master’s level degrees, and most experienced people have strong indepth industry knowledge. It’s true many MBAs start without industry knowledge, but they aren’t going to solve the problems alone, your engagement teams will have experts who can guide the project along.</p>
<p>i sometimes don’t think you really are sure what you are trying to say. You recommend engineering to students, but not engineering jobs, yet you often say engineering jobs are great compared to many out there. You insist that consulting jobs are better for the long term growth, yet you think they don’t know anything, so how does this make consulting careers appealing, a bunch of people who just suck money out of their clients and offer minimal service, and better yet, how do you think this is sustainable over the long term as a career? vs. engineering.</p>