Industry-Specific Consulting
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An Industry-Specific Consulting firm, as the name suggests, is a firm that advises clients from a specific industry. Furthermore, these consultants are industry experts and are well suited to help their clients’ solve their niche problems. Examples of industries that have specialized consulting firms are:
- Healthcare & Life Sciences
- Real Estate
- Public Sector/Government
- Transportation
- Non-Profit
- Energy, Resources & Industrial
- Financial Services
Keep on reading below to understand Industry-Specific Consulting within minutes.
What is the purpose of an Industry-Specific Consulting firm?
When a client needs to solve a problem, they use consultants to help them out. However, if a company needs the help of experts in a specific industry, it is useful to hire industry-specialized consults. To clarify this further, below is a quote from a healthcare & life sciences consulting firm called ClearView Healthcare Partners:
"ClearView was founded based on the belief that companies driving innovation in the life sciences need a partner that can combine deep scientific expertise, robust analytic approaches, and sound business instincts to create actionable and impactful results".
Why do companies need a Consultant?
Aren’t these companies, governments, etc. very large? Why can’t they solve their own problems?
Yes, they have a lot of resources, but solving these problems can be difficult and expensive and require subject matter expertise:
- When consultants work on projects that take many months, allocating the company’s resources can be more costly than paying consultants.
- Furthermore, using a consultant allows the company to focus on their own business while the team of consultants solve the problem at hand.
How Do Consulting Firms Get Paid For Their Services?
When a consulting firm and a client agree to work together it is called an “engagement”. Within these engagements, there are three main ways they receive a fee:
- Fixed Fee – Before working on a project together, the consulting team and the client agree on a flat fee, which usually includes an upfront down payment. Additionally, they will agree on specific “deliverables” or tasks that the consulting firm should complete within the given time frame.
- Milestone Based – The client and consulting team map out a list of milestones and how much the consultants will be paid for accomplishing each.
- Time plus material – The consulting team and client agree on a price per “billable hour”. Essentially, this means when a member of the consulting team does relevant work, they bill the client for the hour of work at a predetermined rate.
The specific payment price depends on:
- The firm – more “premium” firms tend to charge a bit more for their “premium services”.
- Size of the consulting team – bigger teams (with more consultants), require more of the consulting firm’s resources and thus cost more.
- Length of the case – If a project will take more time, it will cost more to provide this service.
Industry-Specific Project Example
Healthcare and Life Science Consulting
While there are many types of projects healthcare consults work on, one is where they “assess the opportunity” for a product. Below is an example of a service provided to a pharmaceutical (pharma) client:
- The client wants to know the potential opportunity of a product, like a drug. In other words, potential opportunity usually means: how much product they expect to sell in the future.
- Phase one of the project is to research the disease space that the product targets. Moreover, some common questions to look into are:
- How do you currently diagnose/test patients?
- How common or rare is the disease?
- What’s the disease like?
- How is it currently treated?
- What developments already exist for this product? Similar products? Are any of the products promising?
- How do you typically price products in this disease space?
- How easy is it to sell this product? (aka what is the “Market Access”)?
- Next, consultants focus on the product and create the product profile (which explains how the product works, clinical trial design, etc).
- This product profile is often formed by talking to physicians. Typically, physicians are the leaders in studying the disease and have a lot of research/have experience with clinical trials.
- Then, consultants speak with payers (aka people that buy the product, like pharmacies) to understand how to price the product and how to sell it (aka market research).
- Using their research, consultants try to predict future revenues gained from selling the product.
- In the last phase, they create a strategy for the next steps, including how to best create/sell the product.
Average day of an industry-specific consultant:
Days are spent:
- On PowerPoint – to make slides for clients.
- Research calls – with experts and payers (aka people that buy the product, like pharmacies).
- Read science papers/use special tools – to find scientific information you’re looking for.
- Excel – for anything technical or data related.
- Internal meetings with team members – to collaborate and track progress.
- Frequent meetings with clients – usually over the phone
Throughout the project, consultants meet weekly with the client to show their progress and make sure both sides agree on the approach and analysis. These meetings and all the work the consultant does, builds up to a final meeting (usually with senior members of the client company). At this final meeting, consultants summarize findings and plan for the next steps. Overall, a typical project lasts about 6 – 8 weeks. However, this varies from task to task.
Typical Hierarchy at a Consulting Firm:
While this can vary depending on the type of company, a typical company structure can look similar to the diagram below:
Some tools they use:
- Customer Relationship Management (CRM) – Such as Salesforce, helps manage customer activity and information.
- Market Research Tools – For research on consumer needs and/or the broader industry.
- Documents – for taking notes during the research/when you speak with experts about a subject.
- Industry-Related papers – used to gain Industry-related insights
- Data Tools – Such as Excel and Tableau
- PowerPoint/Slide Building – For client presentations.
Necessary skills for a successful Industry-Specific Consultant:
- Ability to take in and make use of information from multiple sources
- Organized and efficient – Often need to complete a project within a time frame, so it’s important to working efficiently.
- Communication skills – need to communicate with your team and your client(s) constantly throughout projects.
- Team Player – collaborating effectively with team members and clients is essential to completing necessary tasks.
- Background experience relevant to the industry your firm specializes in – for example, healthcare consultants often have medical or science backgrounds.
Some challenges of Industry-Specific Consulting:
- If you work on a project where the lifestyle is intense, you often find yourself working very long hours (15+ hour days at times)
- A lot of pressure to get things done on a strict deadline (client usually needs things done within a predetermined time frame)
- Working with clients inherently means dealing with good and bad clients. For example, if a client is a poor communicator, it’s often difficult to work with them consistently.
- Industry-Specific firms, by nature, are niche and more of a narrow focus. As a result, if you are not interested in that industry, work often is hard and boring.
Some benefits of Industry-Specific Consulting?
- Get exposure to companies and help them solve their business problems.
- Quick promotions – consultants often get their first promotion 1-2 years after entry-level.
- Build a strong network of people – with many clients (often major corporations) and colleagues.
- Always learning and experiencing something new – work with different companies to solve unique problems.
- Work with smart people – who often have strong backgrounds and are very knowledgeable about the specific industry.
- Good compensation – Paid well for their premium advice and services.
Typical Salary?
Pay for this career varies greatly depending on the firm. A rough estimate of total compensation over the different seniority levels is listed below:
- Analyst/Associate – 60k-105k. Spend 2-3 years at this level.
- Consultant – 150k-200k. Spend 1-3 years at this level.
- Project Leader – 200-300k. Spend 1-3 years at this level.
- Principal/Manager – 250-350k. Spend 2-3 years at this level.
- Partner – 450k+
Should I go into Industry-Specific Consulting?
If you have an interest or a strength in a specific industry you should consider looking further into industry-specific consulting. It is an alternative to working directly in that industry but allows you to gain exposure to trends in the industry, different types of problems, and many experts in the field. Furthermore, the work is more focused than generalist management consulting, so the work often feels more relevant and interesting to those with backgrounds and interests in the industry.
However, since the role is more niche and industry-focused, the exit opportunities are a bit narrower. Common career paths/next steps for one in industry-specific consulting are:
- Switch to other industry-specific firms
- Work at a big consulting firm
- Work at a company in the industry (i.e. pharmaceuticals company for healthcare & life science industry)
- Investment companies (like venture capital, private equity, hedge funds) that specialize in investing in your specific industry, etc.
Common Careers Before & After Industry-Specific Consulting
Related Careers:
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