Where will consulting firms find the talent they need to stay competitive? It's already out there—in the ranks of top-notch minority students and professionals who haven't traditionally considered consulting a viable career option. This untapped resource represents a new frontier—one the consulting profession must cultivate or risk being outpaced in the race for talent.
It's unlikely that anyone reading this article hasn't heard about, read about or experienced the talent shortage that is expected to last well into the 21st century. Global competition and an aging workforce has left companies in all industries wondering where they will find the talent to stay afloat. We have found that workers with many critical skills are already in short supply.
Consulting is no exception. This sector of professional services, perhaps more than any other, must staff its ranks with top performers to maintain a competitive edge. Due to globalization, technological advances and an increasingly stringent regulatory environment, professional services has experienced solid growth in recent years across most sectors—growth that is expected to continue. According to a June 2006 IDC research report, global business consulting is forecast to grow 4 percent (compound annual growth rate) through 2010. Similarly, an April 2006 IDC report forecasts global IT consulting to increase at 5.2 percent (CAGR) for 2006 to 2010, with slightly rising growth rates each year.
Where will the talent to support this growth come from? Previously untapped sources. Corporate America already has begun to diversify its talent pool and increase diversity at all levels, including its boards of directors and corporate officials. For instance, according to DiversityInc, diversity representation among Fortune 500 companies has been on the rise in recent years. Minority momentum also is building within local markets, with strong growth in minority-owned businesses as well as in minority MBA enrollment.
"It's imperative for the consulting profession—but also for the larger business community—to better understand and embrace diversity and inclusion," says Doug Lattner, chairman and CEO of Deloitte Consulting LLP.
Demographic statistics confirm why diversity is growing in importance in the marketplace overall. According to the Census Bureau, nonwhites will represent more than one-third of the U.S. population by 2010 and close to half of the it by 2050. That's also when the ethnic minority share of the workforce will likely reach 28 percent, up from 18 percent in 1980 and 22 percent in 1990. The Hispanic-American population is projected to be the largest minority group in the U.S. by 2010. Lattner says he believes that the most enlightened and fastest-growing companies in the future are going to be those that embrace diversity. And, he believes they will be looking for like-minded consultants, noting, "They're going to want to work with professional services firms that reflect that point of view—whose diversity matches theirs."
Victor Arias Jr., a senior client partner with executive search firm Korn/Ferry International, notes that the companies that really "get" diversity are those that have experienced a customer demographic shift. "That's why the leaders in diversity so far have been consumer products and services companies," he explains. "For most business-to-business companies, it's a concept that is still developing."
Giving Back vs. Getting Ahead
Developing, yes, but accelerating, too. Consulting firms are looking to recruit both qualified minority graduates and experienced personnel from industry. But even with the renewed recruitment and advancement efforts of the past few years, minorities, particularly African-Americans and Hispanics, remain under-represented within most consulting firms, according to our internal research. Why? Some believe that professional services—unlike medicine, law and engineering—were essentially closed to people of color until the late 1970s and that the profession is lagging behind because of its late start.
Karen Johns, executive director of the Diversity Pipeline Alliance, which helps minority students prepare for business careers, points to another reason why African-Americans and Hispanics may not be actively pursuing business-related professions. "A recent survey we conducted with undergraduate business students … revealed that minority students were not very keen on MBA degrees and business careers because they wanted to do jobs that mattered to their communities. While we all know there are valuable things that bankers or marketing professionals can do for their communities, these types of careers don't always directly translate into a perception of jobs that can give back."
Johns says this is an especially important issue for the Millennials, those born in 1982 and after. "The question becomes: How do we change the perception of consulting so that people understand it is a career where they can make an impact in the community and do good?"
Others believe that a lack of understanding about what consulting has to offer has led those who have degrees in business-related disciplines, such as accounting, business administration and information sciences, to seek careers in other industries. So what can professional services firms do to promote consulting as a rich career avenue?
1. Dispel the myths.
Consulting firms must proactively raise awareness among minority recruits about the opportunities the profession provides and dispel the notion that it is mainly self-serving. For example, Arias says he sees professional services as an area where minorities can "give back" the most. "Professional services is where a lot of the hidden money is as well as the hidden value. It's where we learn how to teach our communities to create wealth for their own benefit."
Diane Lee, an African-American principal and senior consultant with Mercer Human Resource Consulting, points out that those who wish to contribute to their communities and to causes they care about have many opportunities to do so within consulting. "I don't think you have to make a choice between giving back to the community and working in professional services," she notes, adding most consulting firms have very strong community and social programs.
2. Tout the benefits.
A consulting career offers exceptional benefits that can far outweigh the demands. Wealth creation, for individuals as well as their families and communities, is one of them. "All things being equal in terms of education and human capital, those in professional services make more money," says Dr. David A. Thomas, Harvard Business School professor and co-author of Breaking Through: The Making of Minority Executives in America.
There are other benefits, too. A unique work environment involving daily problem solving and client relations can be exhilarating. Consulting also offers some distinctive pluses in terms of advancement and compensation. Consulting, perhaps more than any other business career, provides exposure to an array of industries and disciplines, as well as to multiple levels of management within organizations, which can help consultants refine their own career objectives.
3. Reach out to allies to build the pipeline.
A number of organizations already are promoting the value of business careers to minorities. Building links with and supporting such organizations as Diversity Pipeline Alliance, National Hispanic MBA, National Black MBA, Hispanic Scholarship Fund, Reaching Out MBA, MBA JumpStart and Management Leadership for Tomorrow will help fuel the talent pipeline for the entire consulting profession. Consulting firms also can invest in scholarships and in organizations targeted at early identification and preparation for students to enter business and technical programs, such as College Summit, Junior Achievement and the GEM Consortium.
4. Focus on professional development and retention will follow.
Thomas stresses that landing that first consulting job is only the first step: Firms must pay equal, if not more, attention to retention, and junior consultants must learn what it takes to move up the career ladder within a professional services firm. In fact, Thomas says he believes that "having a trusted relationship" is "the secret sauce" for minorities who have excelled in a professional services career. Interestingly, the professionals we interviewed agreed that to be effective, mentors don't have to be minorities themselves.
To create a foundation for building these relationships, many consulting firms have instituted professional development programs that match minorities with both minority and non-minority mentors and provide coaching opportunities. Consulting firms also can institute development programs to help young professionals build competencies.
The Frontier Is Open
Jim Lowry, the first African-American consultant at McKinsey & Company and now a senior adviser with The Boston Consulting Group, is currently one of only four African-American senior partners across the major consulting firms nationwide. He says he believes that timing and demographic factors are combining to make it not only smart, but also imperative for professional services firms to embrace diversity and the new talent frontier it represents.
"Consulting is one of the most powerful professions in the world," he says. "If we don't figure out how to make it diverse, then we all lose."
E-mail Tonie Leatherberry at tleatherberry@deloitte.com. Kiran Uppuluri can be reached at kuppuluri@deloitte.com.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.