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<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0><TBODY><TR>Ex-bankers and graduates heading to consulting firms
</TR><!-- headline one : end --><TR>Management consulting is taking up the slack as the investment banking sector shrinks, reports Robin Chan </TR><!-- show image if available --><TR vAlign=bottom><TD width=330>
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<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->EXIT Goldman Sach and Morgan Stanley, enter McKinsey, Bain and the Boston Consulting Group (BCG).
Instead of 'M&As' and 'deal flow', it's now all about 'value creation' and the 'five forces'.
The shocking decline of investment banking is well documented. Banks have been slashing their workforce and turning away resume-toting, well- dressed finance and MBA graduates by the dozens.
Where are many of these former or potential bankers heading?
Management consulting.
Ms Sandra Schwarzer, Insead's director of career services in France, told The Straits Times that the total number of MBA graduates who joined consulting firms last July had risen 6 per cent from the previous year to 44 per cent. At the same time, investment banking hires had fallen 8 per cent.
'When banks started saying things were not looking so good, there was a big shift immediately from investment banks to consulting firms,' she said.
Now, retrenched investment bankers are also seeking shelter from the financial storm in consulting firms.
Mr Gary Lai, manager for financial services at global search firm Robert Walters, said there are more people looking for management consulting jobs in the big three firms of McKinsey, Bain and BCG. Many have investment banking on their resume.
While there is a concern that companies looking to streamline their business will cut down on consulting services, the good news, he said, is that consulting firms are still looking to hire.
'With some banks and companies going through restructuring, they are requiring more consulting services.'
But is it simply more people vying for the same number of positions?
One former banker in his 20s said that he has so far been unsuccessful in getting a consulting job. 'If that doesn't work out I guess I'll go to business school,' he said.
However, Ms Schwarzer is optimistic. Going by regional recruitment numbers from Insead's most recently graduated class, there is a growing demand for consultants in the Middle East.
That bankers are going to consulting is not surprising. Traditionally, top consulting firms and banks compete for the cream of the crop at business schools, offering high salaries and elite brand names.
Mr Lai said that management consulting is easily among the top four or five most sought after jobs here after investment banking, trading or structuring derivatives.
Mr Tong Junjie, 24, a final-year accountancy and economics student at the Singapore Management University, was offered a job at both a top investment bank and consulting firm.
He chose consulting due to the greater exposure and broad skill-set it offers.
'More so now, there is less deal flow in investment banking. So consulting would allow me to learn more,' he said.
While he may want to try his hand at investment banking or private equity in the future, he said it is a chance for him to 'sit on the sidelines to see which firms emerge strongest before going in'.
For MBA students, too, what has traditionally been three distinct career choices of banking, consulting or a specific industry, is narrowing with the crisis.
'More people are placing their eggs in the consulting basket,' said final-year MBA student Bala Ganesan. 'In the finance industry, jobs are diminishing real quick. Even if they're looking to hire, they're looking for people with a specific background, so that discourages people from applying.'
Mr Ganesan, 32, worked for a big-three consulting firm in Los Angeles for four years before deciding to do his MBA at Insead in Singapore.
'Consulting is a good career for someone like me who came in with a technical engineering background because it builds business fundamentals. Professionally, I think it's the best career to ramp up your skills and knowledge of business,' he said.
Top consulting firms promise exposure to chief executives and other senior level management of Fortune 500 firms. There's also the chance to work across industries from energy to health care, and functions from marketing to supply chain management.
'It prepares you for senior management positions. It's definitely good for people who are not sure which industries they want to get into,' Mr Ganesan added.
The pay is not shabby either.
While the bonuses could never compare with investment banks, Mr Lai said a first year consultant could take home $90,000 to $130,000 a year. Someone in his mid-30s could be making upwards of $250,000, depending on his industry experience.
But consulting may not be for everyone and certainly not just anyone can get a good consulting job.
First, expect to work 70 to 90 hours a week. And be prepared to travel - a lot.
Consultants will often spend more of their time in another city than in their home office.
'It's fast-paced and you need to be adaptable. One week you could be working on energy, and the next you are dealing with health care,' MrGanesan said.
Second, it is highly selective.
Ms Joan Tay, National University of Singapore's career services director said students who apply for management consulting are not only the top academically, but also have a good record of achievements, and are 'highly analytical, problem solvers and possess excellent written and verbal communication skills'.
Candidates go through several rounds of special case- style interviews which simulate actual client problems.
But while more people are choosing consulting over banking, analysts say the balance is not shifting permanently.
Mr Lai said: 'As a career, recognition for consulting will grow over time, but it's not going to overtake investment banking any time soon.'
Ms Schwarzer said: 'We still have investment banks recruiting for summer internships. There's still the same interest, but the ones who will make it are those who are really motivated, are really hungry for the job.
'Its appeal won't drop, although right now there's so much uncertainty. In fact a lot of people want to participate in the change, in building new financial institutions.' [email protected]
</TR><!-- headline one : end --><TR>Management consulting is taking up the slack as the investment banking sector shrinks, reports Robin Chan </TR><!-- show image if available --><TR vAlign=bottom><TD width=330>
</TD><TD width=10>
<!-- START OF : div id="storytext"--><!-- more than 4 paragraphs -->EXIT Goldman Sach and Morgan Stanley, enter McKinsey, Bain and the Boston Consulting Group (BCG).
Instead of 'M&As' and 'deal flow', it's now all about 'value creation' and the 'five forces'.
The shocking decline of investment banking is well documented. Banks have been slashing their workforce and turning away resume-toting, well- dressed finance and MBA graduates by the dozens.
Where are many of these former or potential bankers heading?
Management consulting.
Ms Sandra Schwarzer, Insead's director of career services in France, told The Straits Times that the total number of MBA graduates who joined consulting firms last July had risen 6 per cent from the previous year to 44 per cent. At the same time, investment banking hires had fallen 8 per cent.
'When banks started saying things were not looking so good, there was a big shift immediately from investment banks to consulting firms,' she said.
Now, retrenched investment bankers are also seeking shelter from the financial storm in consulting firms.
Mr Gary Lai, manager for financial services at global search firm Robert Walters, said there are more people looking for management consulting jobs in the big three firms of McKinsey, Bain and BCG. Many have investment banking on their resume.
While there is a concern that companies looking to streamline their business will cut down on consulting services, the good news, he said, is that consulting firms are still looking to hire.
'With some banks and companies going through restructuring, they are requiring more consulting services.'
But is it simply more people vying for the same number of positions?
One former banker in his 20s said that he has so far been unsuccessful in getting a consulting job. 'If that doesn't work out I guess I'll go to business school,' he said.
However, Ms Schwarzer is optimistic. Going by regional recruitment numbers from Insead's most recently graduated class, there is a growing demand for consultants in the Middle East.
That bankers are going to consulting is not surprising. Traditionally, top consulting firms and banks compete for the cream of the crop at business schools, offering high salaries and elite brand names.
Mr Lai said that management consulting is easily among the top four or five most sought after jobs here after investment banking, trading or structuring derivatives.
Mr Tong Junjie, 24, a final-year accountancy and economics student at the Singapore Management University, was offered a job at both a top investment bank and consulting firm.
He chose consulting due to the greater exposure and broad skill-set it offers.
'More so now, there is less deal flow in investment banking. So consulting would allow me to learn more,' he said.
While he may want to try his hand at investment banking or private equity in the future, he said it is a chance for him to 'sit on the sidelines to see which firms emerge strongest before going in'.
For MBA students, too, what has traditionally been three distinct career choices of banking, consulting or a specific industry, is narrowing with the crisis.
'More people are placing their eggs in the consulting basket,' said final-year MBA student Bala Ganesan. 'In the finance industry, jobs are diminishing real quick. Even if they're looking to hire, they're looking for people with a specific background, so that discourages people from applying.'
Mr Ganesan, 32, worked for a big-three consulting firm in Los Angeles for four years before deciding to do his MBA at Insead in Singapore.
'Consulting is a good career for someone like me who came in with a technical engineering background because it builds business fundamentals. Professionally, I think it's the best career to ramp up your skills and knowledge of business,' he said.
Top consulting firms promise exposure to chief executives and other senior level management of Fortune 500 firms. There's also the chance to work across industries from energy to health care, and functions from marketing to supply chain management.
'It prepares you for senior management positions. It's definitely good for people who are not sure which industries they want to get into,' Mr Ganesan added.
The pay is not shabby either.
While the bonuses could never compare with investment banks, Mr Lai said a first year consultant could take home $90,000 to $130,000 a year. Someone in his mid-30s could be making upwards of $250,000, depending on his industry experience.
But consulting may not be for everyone and certainly not just anyone can get a good consulting job.
First, expect to work 70 to 90 hours a week. And be prepared to travel - a lot.
Consultants will often spend more of their time in another city than in their home office.
'It's fast-paced and you need to be adaptable. One week you could be working on energy, and the next you are dealing with health care,' MrGanesan said.
Second, it is highly selective.
Ms Joan Tay, National University of Singapore's career services director said students who apply for management consulting are not only the top academically, but also have a good record of achievements, and are 'highly analytical, problem solvers and possess excellent written and verbal communication skills'.
Candidates go through several rounds of special case- style interviews which simulate actual client problems.
But while more people are choosing consulting over banking, analysts say the balance is not shifting permanently.
Mr Lai said: 'As a career, recognition for consulting will grow over time, but it's not going to overtake investment banking any time soon.'
Ms Schwarzer said: 'We still have investment banks recruiting for summer internships. There's still the same interest, but the ones who will make it are those who are really motivated, are really hungry for the job.
'Its appeal won't drop, although right now there's so much uncertainty. In fact a lot of people want to participate in the change, in building new financial institutions.' [email protected]
