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Don’t do it. It’s not worth it.
Is olive the next theranos or what?
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For the existing behemoths, the outlook is good. I think the only consideration there is the number of partners made will continue to be tightly managed - certainly when the market is lean, so the path to get there will extend.
To the conversations above, almost all have restructured their pensions in the last decade or so. Larger portions of pensions are no longer tied to future firm performance and therefore rely on newer partners, and for many traditional partner pensions have been/are being phased out - the benefit is still attractive but not as good as it used to be.
Very true. Especially with a new focus on NEP type arrangements similar to BigLaw.
There is also much more partner movement than in prior decades and a bigger focus on current comp vs a pension that I may or may not stay long enough to vest in.
B4s are operating with ~2500-4500 partners each, of out the US, so it’s hardly far from dead or on life support. The model is changing but has been changing for years now.
E1 is wrong in that they might as well go corporate. There’s a reason Everest failed. Anyone can look at what’s happening to ACN stock right now or see the outcome of IBM / PWC, EY Capgemini transactions to see how poor of a decision those were.
The phrase I used is “might as well” - my point was not that they will go corporate, but rather they’ve already acted like it with quarterly layoffs and similar mentality. I first was in Big 4 consulting in the 1990s when they actually “acted” like partnerships. Right now the consulting model at the traditional audit firms is simply not attractive for prospective employees. Why would you even go to a PwC and face all of those SOX independence restrictions when you could have the same (or better) job at Accenture and not have that baggage?
It's dead and that's not a bad thing imo
Because the firm and newer partners basically exist to pay the retired partners’ benefits. That burden is enormous at some firms.
Define traditional
TBH, I don’t think any of us really know. Today, yes, there’s a lot more PE and alternative structures… but the PE model is not to hold for the long term. I don’t know who the buyers will be when PE decides to realize their profit and sell.
The partnership model will continue for the audit & tax, traditional Big 4 rolls. For consulting, they might as well go the corporate model like Accenture & IBM. This was what was behind EY’s failed attempt at Everest. They were planning to spell off consulting into a publicly traded corporation.
I’ll post here exactly what I posted in the partners only bowl on this topic:
The Big4 consulting firms will all look very different 2 years from now. Traditional delivery models fully disrupted. Rates compressing. Best people leaving for higher pay / faster growth. Pyramid collapsing in on itself.
Slow to adapt to the new reality and slow to change their staffing / hiring models, headcount and legacy retirement costs will drag on their profitability. Mediocre partners will cling to their old ways of working. It won’t be sustainable and they’ll be forced to restructure one way or another.
The best partners have already seen the writing on the wall and have left or are leaving.
ah yes PE ops/PE portcos, that flavor of the week/month/year.