July 2006 – Stephen Shu, PhD

Let me preface this by saying that I’m not really qualified to write on this subject, but a reader has asked if I would share my thoughts on the subject of PhDs in management consulting (sorry for the late reply but I have not checked my personal email for more than 2 weeks, and there were a few thousand to sift through [not counting having to read any!]).

One firm comes to mind immediately when I think about the subject of PhDs in management consulting … it is McKinsey. I recall that McKinsey actively recruits on campus for PhDs. I know very little about their formal programs for PhDs, so if anyone would like to share their thoughts, please feel free to do so.

The handful of McKinsey PhDs I have known were slotted into typical team structures as either individual contributors or engagement managers (I don’t think this is necessarily representative of the career tracks for PhDs for reasons I will elaborate on below). The individuals that I knew shared no common trait other than they were brilliant and structured thinkers. One had a strong propensity to actually lead people. Another had a very strong quantitative and statistics background.

When I was at PRTM, the PhDs I knew tended to be grounded in both an industry sector (e.g., biotechnology) and functional speciality (e.g., product development) from the get-go as compared to other, non-PhD consultants that would specialize later down the road. In my opinion, PhDs can get slotted this way because PhDs are considered true "experts" in a particular field, they have invested more time in both schooling and focus on a particular industry, and they can command better premiums for their personal investments when they leverage this background.

I also know a lot of PhDs through my wife’s affiliation with the business school community as a PhD and professor. It is common for professors, who do a lot of management consulting on the side, to provide consulting in their specialized (research) area of expertise, e.g., corporate tax, venture finance/valuation, antitrust. This is in contrast to non-PhD consultants that come down a similar path that I have, e.g., the MBA path where consulting may be of a more general nature but derive specialization over time through greater industry focus (e.g., telecom), functional focus (e.g., sales operations) , situation focus (e.g., growth business) and problem-type focus (e.g., virtual network operator) as part of client projects.

Some successful traits I have seen in PhDs that pursue management consulting are as follows (and the requirements are probably more intense for strategy and research-type consulting firms as compared to firms that get more involved with execution or implementation):

structured thinkers
ability to apply quantitative methods (e.g., statistics, triangulation, valuation) to seemingly impossible problem areas
fact-based researchers and consultants
clear communicators
industry experts or experts in their ability to translate the language of other PhD experts that cannot communicate in business terms
experts that can provide due diligence, e.g., on a complex engineering or science subject

Some traits where I have seen PhDs fail in management consulting situations:

Cannot communicate in business terms
Too academic in their approach to solving problems
Not ready to move at a very fast pace (as often required in consulting)

Now a lot of the successful/unsuccessful traits I’ve mentioned above can also apply to non-PhD consultants too. That said, I think I would stress stuctured thinking, communication skills, and leadership skills as being most important for non-PhD/MBA types.

I originally wanted to write a post for Father’s Day earlier this year but missed my opportunity. But being on an engagement in Northern Spain, I have had some time to reflect upon being a dad and being a businessperson. And recent crossings in cyberspace with an old PRTM friend have given me pause to reflect upon life because of his tremendous integrity in both life and business.

I personally think there are a lot of things that one can work on in both being a dad and being a businessperson.

Being supportive plays an important role in business. In the past I wrote about how I think having a supportive manager swamps all other factors in terms of career advancement. Apparently I’m not alone in this view, at least when it comes to management positions. When 363 finance executives were asked by CFO magazine what were the top three factors that helped them to achieve their position, having a supportive boss was either #1 or #2 depending on whether the executive was male or female (see bar chart about a third down the page).

Being supportive as a parent is also key. Paying attention to what type of environment one’s kids thrive in is very important to helping them advance in life. Although "politics" may play less of a role in the family environment compared to a business environment, kids enter into environments where they may be subjected to greater numbers of groups, cliques, social settings, etc. in their personal lives than many adults even face in a normal workday. One needs to help kids to develop social skills, tools, confidence, etc. much like one needs in business.

For me, being supportive takes focus. It takes the kind of focus that one needs when trying to bench press heavy weights on a weight machine – no other distractions allowed. Sometimes it’s hard to be focused during a busy workday. Sometimes it’s hard to do that after a busy workday. But being supportive may be one of the most important things one can do as a parent and as a manager.

Communication also plays an important role. Think about how often and how you communicate with your boss or subordinates? How does the quality of communications compare with your personal life? Is the balance right? Do you need to develop better skills in one environment or the other? At one point this year, I found myself asking my boss more about how things were going than I asked my kids or wife. That was one indicator that things had gotten somewhat out of whack, and so I have started to refocus things.

There are lots of things that can be adopted between being a business person and being a dad. I’ve only cited two that come to top of mind. I used to have a few books on my bookshelf that influenced my thinking in these areas including, "The Road Less Travelled", "Venture Capital Dad", and the "Seven Habits of Highly Effective Families". While there are clearly differences and pitfalls in directly applying methods from the business world to the personal environment (e.g., stemming from the fact that a boss-worker relationship is different from parent-child), the fact that people learn so much in one environment or the other … well the power of leveraging those learnings more consciously has helped me.

Month: July 2006

Thoughts On PhDs in Consulting

Being A Dad And A Business Person