what is management consulting and how do they make so much money?
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I’ll try to give an actual ELI5 version: They get so much money because (1) the consultants are branded as smart and (2) the company is branded as experts across any field, industry, problem area so you’re paying a premium so them
* **Profile of management consultants: Really smart people** who graduated from the top colleges/MBAs and/or are at the top of their class
* They are touted to have a wealth of knowledge and skills that are “transferable”, meaning they don’t necessarily need to have experience in a particular field or industry because their smarts and ability to think outside the box and across boxes can get good results
* **Prima****ry use o****f management consultants: (1) Expertise and (2) outside opinion**
* **Presumed expertise, they know what to do** because the consultants are smart and because the firm (whether someone from the team or their records) has the experience which can be utilized by these “smart” people
* **Outside opinion, often hired by company’s management to do the (dirty) work they or the company can’t do**. Whether to give credence to a particular strategy (“back them up”) or as a scapegoat to do something or anything
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