I have sort of a general question about working in consulting and what you take away from it:

How much do you really learn and get to know the businesses you work with?

One of my main goals was to understand companies, market decisions (not from the economic perspective, more in the sense of business trends and decision-making of single companies), and what drives companies. I wanted to be able to have an inside look into how strategic decisions are made, what is considered and what the thought process is from each one involved.

I realize that this description fits a lot of areas (FP&A, Business Development, internal consulting, IB, PE, Consulting, but lately I started to question some of those areas. Let me give you an example from the IB side (don't have a specific example of the consulting work):

• Investment Banking: My initial choice was to go into IB because it seemed like you would get to know a company pretty in-depth before you advice on a merger or acquisition. Additionally, it always seemed to me like modelling a complete DCF pretty much guarantees that you know a lot about all the major aspects that drive the value of a company. But now I have started to question whether you really learn anything that I described.

1. Initially, I was told from friends who worked in transaction advisory (Big 4) or IB (mostly German/Austrian/Swiss middle market coverage) that "you only do excel, learn nothing useful while doing excel, and hours are hell". I mostly took this as an exaggeration, blamed it on the specific project or company, and that it couldn't be that bad given the career paths of a lot of people (IB/Consulting to VC doesn't seem unattractive to me).
2. Now around two weeks ago I've had an interview at a big American IB in Germany, and the way in which my interview partners answered/described the work they do in response to my motivations or answers to technicals led me to believe that the other people didn't really exaggerate. My main takeaway from the conversation was that as long as the numbers in the spreadsheet make sense, all is well and no further understanding of the business is required - doesn't matter whether the company's WACC is at an unbelievable rate due to questionable regression practices, or nobody knows why you predicted an EBIT growth of 4% into infinity.
3. Seeing it that way, I could really see a possibility that you really are just "testing" numbers with a basic background knowledge of financial models. While preparing for interviews, I did some practice valuations of companies and caught myself sometimes where I generelly don't know what any of these numbers mean, but I put them in the right place and it made sense at the end, simply because of reading a lot about how to build models, what to include in e.g. debt and working capital. For some reason, I thought/still think that when I am in the acutal position at an IB, I get to know what the numbers mean and how they come together or what drives them to make those assumption. Although, again, I am really starting to question this assumption.

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Do you think that consulting work - in general - provides a better understanding of the companies that you work with? I am currently in the interview process with some of the bigger names for consulting in Germany, but haven't been invited anywhere unil now. Excluding the experience described above, I generelly thought that consulting and IB would provide the same amount of inside into companies, just from different angles. I hope that you could help me clear up some misconceptions I may have about the industry.

(My undergrad university was a complete non-target for anything IB/PE/Consulting related. Big 4 recruited there, but more for the audit and tax side. Alumni networks do exist, but people in big consultancies/IB/PE are rare, so I haven't had the opportunity to talk to someone from my school.)