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Why do firms have up or out business model?

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You need to push people through the ranks to make sure the ones below can grow. Otherwise everyone is stuck and no one can progress. With no progression, the good ones leave and the bad ones stay.


Why would good employees want to stagnate at their current level?


S& is forced up or out while PwC doesn't have it...it's actually a great practice - there are plenty of people at PwC that will never be promoted to Manager due to poor performance but will never be let go


Accenture MC & Strategy are up or out. There is an "expert" path where you don't sale but create thought leadership. Other parts of ACN don't have it.


Some have a specialist path which allows people to just maintain in a field they are knowledgeable about with no sales or utilization pressure. Pay is lower though.

It let's them get good talent relatively cheaply, while only providing the big dollars to a few. Consulting is basically a sustainable pyramid scheme

All of them. Anyone who says otherwise is lying.

Because they are stupid. It's antiquated as the model T

If you do the math, Senior Managers and Partners actually cost more than whatever billable hours they might have, so unless they're bringing in revenue and leading large chunks of revenue generation, they are an economic burden thus the "up or out" model.

Focus on profits.

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