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Up or Out Policy in Consulting – 6 Insights to Help You Get Promoted

Do you want to discover how to navigate the up or out policy in management consulting? When I started my journey in consulting, my answer to this question would have been, “Yes, a million times yes!”.

Michael asked me to write about my experiences at consulting firms, how I navigated the up or out policy and managed to get promoted so quickly, well ahead of the normal schedule in both consulting and banking.

Up or out policy in management consulting

As I was embarking on my management consulting journey, I was quite concerned hearing so many stories of my acquaintances getting managed out after less than 2 years in consulting. I was determined to go up, not out. After all, I did my second undegraduate degree just so I could get into consulting. I studied like crazy to get all As, while working multiple jobs, and there were rivers of blood and sweat leading to that very desired consulting offer.

So there was no chance in hell I was going to be one of those people to be labeled a “hiring mistake”. Not on my watch!

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If you are not very familiar with consulting jargon you may be wondering, “what is exactly up or out policy?”. It is an HR policy consulting firms have which refers to predetermined time frames within which consultants either get promoted or managed out. You cannot stay at the same level for too long.

The implementation of the up or out policy is simple. If you are perceived as good enough to one day make partner, you will progress to the next level. If you are not perceived as good enough, they will ask you to leave.

I actually found the consulting environment to be similar to that of my MBA program. Although, in consulting people pretend to be a little less competitive, since everyone is required to act in a collegial way toward their coworkers.

You have to be friendly and helpful towards peer consultants on your engagement team. However, at the end of each engagement and at the end of each year you will be ranked against them to see who is more valuable to the consulting firm.

People compete with their colleagues in many other jobs outside of management consulting, of course. However, in most other jobs there is no up or out policy, so people are less competitive.

For example, in manufacturing there is generally no up or out policy in place. In fact, people rarely get managed out. You typically work with 5-6 people on a daily basis and none of them will be at your level. So there is less competition.

Comparatively, in management consulting you are often staffed on an engagement with another 2-3 people at your level. During the engagement you will need to be a good team player, helping each of them to succeed. At the end of the engagement and at the end of the year, you and your peers will be ranked to see who is more valuable to the firm.

You may even be counseled to leave. It happens very often.

Navigating up or out policy: 6 insights

My determination to figure out how to manage the up or out policy paid off. Although, to be frank, I almost killed myself in the process of figuring out what it took to stand out in the consulting environment.

I was promoted repeatedly, each time well ahead of schedule. The same happened when I did my stint in banking, so the ideas I am about to share with you are applicable beyond management consulting.

Implementing these ideas does not guarantee a promotion, of course. But it certainly will take you a step closer to it.

As promised, below are 6 insights which helped me the most in navigating the up or out policy:

1. Craft your personal brand by actively managing what you say and do
I leaned that you have to really filter what you say. Don’t say things that can hurt your profile if repeated by others. For example, don’t say that you realized consulting is not for you or that a particular partner is incompetent, even if those things are true beyond any reasonable doubt. Instead, say things that will raise your profile and worth to the firm.

You have to present to the world a very smart, organized, healthy, credible, committed and collegial person. A strong personal brand really matters in management consulting. If you are a disorganized, unprepared, uncommitted and sloppy mess people will not want to be associated with you.

Management consulting career is a unique beast. While in other jobs people are forced to work with you, in consulting you have to prove your worth every day to stay wanted for projects, and to keep your job at the next performance evaluation when up or out decisions will be made.

The trick I used to train myself to say things that helped me progress in my management consulting career was to pretend everything I say will be published on the cover of the New York Times, and everyone will read it. My friend recommended it to me when I was just a business analyst and it worked very well when I made an effort to apply it. It puts you in the right mindset as you engage with your colleagues.

Also, as much as you can, ensure your actions don’t leave room for any negative interpretation. Always observe yourself from the third person perspective. Consider what negative assumptions people may make about your behavior and adjust accordingly.

For example, lets say you are attending a weekend getaway, one of the perks of management consulting career. You are expected to play games and bond with your colleagues. Instead, you have to vigilantly work on unexpected deliverable a client requested that morning, out of the blue. Your first impulse may be to go and work in the dining hall so you can at least be close to all the fun and games. Don’t do it.

You obviously cannot announce to all leaders at the getaway event why you are not participating in team activities. Therefore, to avoid people making assumptions that you are not a team player, get permission to prioritize client work from the most senior person at the event or from your project leader, and go work in your room far away from anyone else.

By working while everyone else is bonding you are doing something against the group norm. If you have to do this, make sure as few people as possible have an opportunity to notice it.

This is important because, unfortunately, some people will make negative assumptions about why you are not participating in team activities. I am actually describing to you a real life example from my own career.

I was almost rejected to be a part of an important engagement because a principal leading the project was convinced I was not a team player. I asked why he thought I was not a team player, given we never worked together. His reply was, “Well, yes we never worked together but I observed you during our getaway weekend few months ago and you were the only person checking emails while everyone else were involved in team activities”.

This is an example of how you have to really protect your reputation at all times because by the time you can correct someone’s incorrect perception of you, if you are lucky enough to get a chance to correct it at all, they may already take away some opportunities from you.

It is important to remember that everything we say to the client and to the team members, and every action we take, enhances or damages our personal brand and can be used to evaluate us during formal or informal performance evaluations and in other situations. I know that managing your personal brand is a lot of work, but it is what it takes to get promoted.

2. Consulting is harsh for friendships
It is important to give some thought to how you will manage relationship with your colleagues. In consulting, more so than in most other careers, you are directly compared to your peers. The same peers you work with on a daily basis. So becoming friends with your colleagues may make your work life quite challenging and distracting since, during performance evaluations, you and your friends will be competing for the same promotion spot.

If you ever have been an MBA student, you will be better prepared for what you are getting yourself into with management consulting. MBA schools expect people to work in teams and build relationship with classmates and yet, while there is no up or out policy, you are ranked on a curve for each course.

For you to succeed and be above average, many of your classmates will have to “fail” by ranking below average. Given the importance of grades for recruitment and options after your first job post-MBA, it is not surprising it is hard to be too helpful to your classmates since aiding their success will mean taking away from yours.

In management consulting we have to deal with a similar situation. Helping our peers to succeed will often mean taking away from our own success. Not only in a direct sense in terms of an opportunity cost of time and effort, but also in an indirect sense. If your colleagues will be rated higher, you, quite possibly, will be rated lower. And those that are rated lower are often casualties of the up or out policy.

After much consideration and many disappointing experiences, I decided to stay away from friendships at work. Of course, there is no right or wrong way to manage this. You will have to make this decision for yourself.

In my opinion, the management consulting environment is not very different from boxing. You engage in a contest of mental strength, speed, endurance and creativity. The goal is to get one of the coveted promotion spots, which will mean knocking down the opponents (getting you promoted which means getting some of your peers managed out of the firm). If you befriend your opponents, it will make it harder for you to compete with them since you will have conflicting incentives. The friend in you will want them to succeed while the ambitious up and coming professional in you will want you to knock them down (get the promotion spot).

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Also, if your colleague does something that takes credit away from you or deliberately makes you look bad, you need to stop trusting this person and never give this person a second chance. Good people tend to expect the best from people around them, and that is a wonderful quality to have. However, if someone signals to you that they are a jerk, believe them the first time. They are once and for all in a “don’t trust” category. You, of course, have to continue to play a role of a great team member but watch your back and don’t let this person hurt you again.

I usually have given people too many chances. That is my weakness. Someone will do something bad towards me, and then will become very nice towards me and I would give him or her a 2nd, 3rd or even 4th chance, only to be used and disappointed again. Learn from my mistakes, not from yours.

There are a lot more people on this earth than we will ever meet. Over 7 Billion of them! Why invest in relationships with people who already showed us that they likely not worth the effort? There are so many other people out there who are considerably more worthy of our time and friendship.

I must stress that I am a great team member. I have been consistently cited for this. I always help team members, even late at night. I merely aware of what can go wrong and strive to avoid be taken advantage of.

3. Strategically select key deliverables
It is important to exercise control over which pieces of work you will take responsibility for, when you can. This gives you a greater chance to develop a reputation for doing high quality work and obtain a higher performance rating on engagements.

In the beginning of each consulting engagement I look through the project plan and decide in advance which deliverables or work streams I want to volunteer for. I pick work items which are important and which I know I can do well. I wait for the opportunity to volunteer and, more often than not, I am able to get the piece of work I want to take responsibility for.

One of the key criteria I use when I pick the deliverables or work streams I want to be responsible for is whether I am able to find exceptional examples of similar work that I could learn from. Within consulting firms we have access to prior deliverables. We cannot use the content, of course. However, we often can use design, use prior work to brainstorm for ideas and model the structure of past deliverables. This saves a considerable amount of time and helps you stay on the right path.

In other words, I use past work as a template to determine the benchmark for “excellent”. If I did not have this benchmark, I would be flying blind and not sure how well I was doing.

Another important criteria I always use is selecting deliverables or work streams which are most crucial for success of the engagement. Firstly, this ensures that my effort is worthwhile since the work really matters to the team. Secondly, this makes certain that senior leaders will be spending a lot of time reviewing my work and, therefore, will be familiar with the tremendous effort, creativity and attention to detail I tend to display in my work.

4. Ensure you are perceived as a great team player
It is important to always be on the look out for opportunities to help your engagement team to excel. However, try to ensure that what you do in this regard is noticeable to your superiors. This is not about making others look bad or showing off. It is about transparency and fairness.

Also, try to get on engagements with good leaders who are known for giving credit where it is due. This will allow you to focus 100% on your work and not on ensuring that your work will be recognized.

We also need to remember that anything we do has an opportunity cost. As you probably know, the opportunity cost is the best alternative thing we could use our time and other resources for, instead of what we are doing. Therefore, we just cannot afford to do things for which we will not get credit.

5. Perform at the next level
I think it is important to try to play a role of one level up as well as your own role. For example, if you are an engagement manager, try to play a role of a senior engagement manager but also of an associate principal.

Obviously, it is important to do so in a respectful manner. Don’t step on toes of your colleagues who are one level up. However, you need to display qualities that show that you are ready for a promotion, so when your performance is discussed and an up or out decision is made, you are concluded to be the “up” material.

6. Use information to your advantage
Some information is not required to be shared and should be kept for one’s own advantage. We all dealt different cards in life. Those cards are assets that we need to leverage to achieve what we want. Some people have good looks, others parents’ with good connections and family money, or extraordinary intelligence. Information you become aware of is part of your cards in life, so keep it close to your chest.

There are only few promotion spots available for each level and all your peers want your spot. It’s a competition for talent and not a game where everyone gets a medal for participation.

Why the up or out policy is good news

Don’t be disappointed that the environment is so competitive in management consulting. There are more pluses than minuses in this situation.

You get to work with ambitious, strong and like-minded individuals. Some say, you are an average of 5 people you spend the most time with. You spend a lot of time with your colleagues so it is great you get to work with people who will challenge you so you will develop further and faster.

Moreover, because of the up or out policy, if you play your cards right you will be promoted within, on average, 2 years after joining the firm. If you are very good, it can happen in 6 months. Whereas in many other careers it is easy to get stuck in certain level for several years, in consulting the options are up or out. So if you are good, the up or out policy is actually good news.

Final remarks

In conclusion, even though management consulting firms have an up or out policy, I think overall we should be friendly to peer consultants, be good team members and bring to the team as much value as we can. After all, we have to always try to be our best self – the most amazing person we can be. Most my advice about being careful applies if you have a weak team. If you have a great team, you can simply focus on the work and that is the best part.

However, we should remember that we need to do visible and important pieces of work, don’t say things that can take us down if repeated, always think how can we make an engagement more successful, and ensure our actions and efforts are well known to the directors.

Most importantly, we should not allow our job to define our identity.

You know you are one of a kind and have a lot to offer to the world, and if as a result of some very unfortunate chain of events you will be pushed out of the firm, don’t let it take you down.

You were born to matter, to make a huge difference and make this world a better place. I know this because you are part of the Firmsconsulting community – a community of people who are hungry and bold, and strive for more. And if the firm could not recognize it, it is their loss and your gain. It means you were knocking on the wrong door, in which case it is best to leave the firm before you invested years of your life. It will allow you to find the right path while you still have plenty of time on this earth. Find something that brings you joy and where you can make a real difference.

As Steve Jobs once said, “We don’t get a chance to do that many things and every one should be excellent. Life is brief and then you die… And we have all chosen to do this with our lives. So it better be damn good. It better be worth it”.

QUESTION(S) OF THE DAY: What is your advice on navigating up or out policy in management consulting firms? Please share in the comments.

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Image from Anirudh Koul under cc.
Image from Matthew Faltz under cc, cropped with added text.
Image from Brett Jordan under cc, cropped with added text.

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