Management consulting can be a very lucrative position, with thousands of young professionals joining the profession from top B-Schools and colleges. The very top of the hierarchy in consulting is the Partner position.
Let’s find out how partners are compensated in consulting:
Overall salary compensation
In India, a new McKinsey/BCG/Bain partner makes around ₹ 1.5 Crores a year. This is the starting figure that almost every partner is guaranteed to make. This is unsurprising, given these are highly polished professionals with ~10 years of expertise and stellar track records.
In other top consulting companies, like Kearney, Monitor and Strategy&, this number will still hold true, as the economics of the companies are usually similar in management consulting. For companies with large non-consulting businesses (Accenture, PwC, KPMG), this number would not hold and would have significant variances.
As they spend more years in the partner position, the partner compensation can increase dramatically.
Salary differences
BUT, the actual total compensation varies a lot from partner-to-partner. Here’s why:
- Tenure: Typically, a more senior partner is paid better. E.g. A junior partner would make ~2 Cr for the first couple of years, but Senior Partner compensation has been known to easily cross 5 Cr.
- Number of cases: More work = more money. The severity of this policy varies between MBB, but is broadly followed everywhere. Partners can do more work by either selling or serving:
- Sell: A partner gets credit for bringing in business for the firm by selling new cases for the firm. This could mean more work with an existing client, or a new client relationship altogether – But the partner need to make this happen to get credit, by holding the relationship.
- Serve: A partner can run the cases for the firm, through their industry expertise and competence. This could mean being the lead partner on the case, or an expert who occasionally pops in. The time charged on the case varies as per the intensity of work.
- Case Revenue: Not all cases are equally priced. If their industry has clients who only buy discounted cases, partners might have lower compensation.
- Profit share: Apart from their own work, partners also benefit from the overall profits of the firm. Some firms restrict office profits locally, industry-wise, or tenure-wise (only senior partners), but if the firm’s had a great year, partners are going to make a lot more that year.
- Other roles played: Firms also attach a part of the bonus to the roles a partner plays in the firm – E.g. India lead for Energy, Recruitment Head for the office etc. This ensures that the time spent on long-term capability building is also appropriately compensated.
Other benefits and perquisites
Apart from these direct cash benefits, there are also several other perks that partners enjoy, which have a high monetary value:
- Business-class travel for all work trips
- Partner retreats (with spouse) every year, typically to exotic locations
- Fully paid healthcare with very discounted family plans
- Lakhs of points at top hotels and airlines each year (accumulated through travel)
- Membership in top health clubs, exclusive schools for kids
- Highest membership level at most hotel membership programs
- Amazing exit opportunities (CXO level at top companies)
Other thoughts
Overall, partner compensation at the top consulting firms in India is pretty comfortable. Of course this compensation comes with some stress, hard work and grind. Given the number of hours I’ve seen partners work/travel/slog, a more interesting question to ask would be – What is the hourly salary of a partner?
Even with these high numbers, there’s enormous ambition even within this layer to do better, sell more and earn higher.
