Whats missing from your resume is a focus on the results I see all your recommendations and the projects you worked on, but I dont see what happened as a result of your work.

-McKinsey Recruiter to Me, 3 Years Ago

Some of you have asked about consulting (as in management consulting, not IT consulting who in their right mind would do that?) vs. investment banking and which is better to pursue.

So heres why investment bankers dominate management consultants, and why you should do banking.

The Myth: Bankers vs. Consultants Video

On the day the infamous Leveraged Sellout video was released, I received about 10 forwards from readers and friends, so Im guessing almost everyone has seen it by now.

But just in case you havent, here it is again for good measure:

Although its fiction, the video does a surprisingly good job of summarizing the bankers vs. consultants debate.

Be a Burnout Banker, Teaching Math at My Prep School

Theres a lot of burnout in both fields.  My management consultant friend almost quit after he had to work 14 hours on his birthday once.  True, consultants get uninterrupted weekends sometimes but regardless of whether youre a banker or consultant, youre going to work a lot.

To imagine the schedule of a consultant, just take my Week in the Life series and add traveling to Idaho at the beginning of the week and coming back at the end of the week.  Also delete all references to quantitative work and replace them with finger-painting .

Nothing but Grunt Work

Not quite.

Theres a lot of grunt work in both industries.  In banking, its more quantitative and no one cares about offering strategic insight and putting things in quadrants they just care what the Pro Forma EPS is.

Make a Really Significant Impact and Get Home by 7:15

I know of no consultants who get home by 7:15.  One of my friends is an IT Consultant and even he doesnt get home by 7:15.

So far, banking and consulting might seem similar but lets take a look at the first part of this claim Make a Really Significant Impact.

Despite what the consultant argues, bankers typically make far more of an impact than consultants.  True, some transactions fall apart, but when they happen you get a new public company or a new conglomerate.

By contrast, you never know if the recommendations consultants make will be implemented.

Got results?

Mining for Gold out in Saskatchewan

Business travel sounds cool to people who havent traveled much before, but its less appealing when youre flying to Saskatchewan every week in February.  Consultants are always on the road, and while bankers do travel occasionally, it is much less of a burden.

Its fun to live in another country for an extended period. but its much less fun to travel back and forth every single week.

Plus, even if you are stationed in Saskatchewan you probably wont discover any gold.

You Try to Add Value I Straight Create It

At the junior level, no banker or consultant creates value and they rarely even add value.  Senior bankers who negotiate on their clients behalf can sometimes add value by getting the buyer to pay more, but even that is rare.

Both banks and consulting firms are in the business of giving advice: advice on what to do financially and what to do operationally.  Companies actually create value.

House in the Hamptons and a Penthouse Loft

Even at the market peak in mid-2007, 1st Year Analysts made only $150K ($60K base + $90K bonus).  While thats a lot of money for someone fresh out of school, its certainly not enough for a house in the Hamptons and a penthouse loft especially after taxes.

Bankers do make more than consultants, but it will take quite some time to turn yourself into Gordon Gekko.

But You Still Cant Buy Bottles with Starwood Points

True.

Consultants make a fraction of bankers bonuses firms are notoriously secretive about exact numbers, but even in good times a $10K bonus isnt unreasonable for consultants.

You could argue that they work a lot less and therefore make about the same hourly wage. but Im not convinced.  Sure, you wont pull consistent 100-hour weeks in consulting, but its a lot more than 9-5, especially when you take into account the travel.

And even if it is more per hour, good luck having enough for bottles, let alone models.

Take This Mouse and Get Back to Making $60K a Year

Most consultants make more than $60K, but not by much.

However, they definitely dont know how to use Excel properly just ask that consultant we hired after I unplugged his mouse and he almost fainted.

The Consultant Formerly Known as Banker

One year, we hired a summer intern who was pretty good as far as investment banking interns go.  He didnt do anything stupid. he always smiled. and he even bought us drinks.  But he couldnt take the hours and he went to consulting full-time instead, in search of that elusive work-life balance.

I spoke with him the other day and he said the hours were pretty bad and he was being dragged around between 3 continents on clients whims in other words, it was actually worse than banking, and he was getting paid less.

Damn, It Feels Good to Be a Consultant?!

I didnt continue with consulting because:

1. I hated constant travel.

If youre a consultant who now feels angered, feel free to write in with a rebuttal and Ill publish some of the most entertaining responses.  Make sure you also enclose some of those Starwood points.