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Because that's how much strategy firms have to pay to retain folks with an MBA from top 10 schools.
Not going through this again.... Think about relationship b/w bill rates, client price and margins and you'll get there eventually
Can you clarify the discrepancy? Haven't seen it
OP tech consulting certainly does not have higher engagement margins. And we have a completely different comp package and salary curve
SM1 SDC is an offshore delivery center.
Please elaborate
Top tier manager bonus for Strategy Consulting is 52%!!! For Tech, it is around 35%. Same for SA, Associates, and Directors.
P3, not sure I'm convinced if such a huge discrepancy is justified. Bonuses have nothing to do with bill rates. Bill rates might be lower but margins are much higher is Tech Consulting.
But aren't pwc bonuses bad?!?
The strategy bonuses are intended to make total comp competitive with other strategy firms
SM1 - Economies of scale. Tech consulting makes up margins with SDC.
I certainly can't speak to total profit, but on a project by project basis obviously our rates are significantly higher... An associate in s& has a rack rate that is at least 30-40% higher than in tech consulting (source: I've seen the rates that we both charge on a couple of projects)
By same, I mean similar discrepancy.
Also engagement margins
Following
Also, to clarify, the strategy bonus levels haven't changed since they were set pre-integration
How are margins higher if bill rates are lower?
Oh. You mean total profit not profit margins. Generally when people say "Margins are better" they mean profit as a percentage of revenue is higher.
I also have no idea what SDC is. Is that an IT consulting thing?