On my first day at the firm," says one distinguished McKinsey alumnus, "I was shown up to my new office, which already had my name on the door. There on my desk were all my business cards, and credit cards, ready to sign for and use. There was personalised stationery - 'from the desk of' - and an agenda for my first two weeks, with every hour and lunchtime accounted for.
"I had two meetings with the senior partner in those first two weeks, during which he asked me to tell him everything I thought about the firm, good and bad. And remember, I was just a young business school graduate. It was a remarkable way to start a career."
The elite management consultancies were one of the great business success stories of the post-second world war years. Through professionalism, hard work and skilful marketing, they succeeded in creating an enduring mystique. The best firms inculcated an impressive seriousness in their staff.
Their advice did not come cheap, and not every assignment ended well. But firms such as Boston Consulting Group (BCG), Booz Allen & Hamilton, Bain & Co, AT Kearney and Arthur D Little became high-quality brands, offering corporate leadership teams a kind of luxury insurance policy and a deep well of ideas.
News this month that two of these firms, Kearney and the group now known as Booz & Co, have been in talks aimed at a merger is seen by some as a symbolic development, a sign that the industry has lost much of its former mystique and dominance. Merging would be an act of consolidation, not one of strength, offering confirmation that consultancies need to justify their existence.
These are two of the longest established names in the business - Kearney and Booz trace their origins back to 1926 and 1914 respectively - but now they are merely "legacy brands", according to one analyst, and resemble, in the words of another acerbic industry expert, "two drunks propping each other up".
That is over the top. Consultancy in its broadest definition is a business that by 2007 was worth $300bn worldwide, according to Kennedy Research, the leading industry analyst. The subsequent recession will have curbed but hardly eliminated demand for those services. Nonetheless, the lack of surprise or excitement evident in the response to the Booz/Kearney talks confirms that some of the glamour of the past has gone.
Hans-Paul Bürkner, chief executive of BCG, says that since the industry is so large and fragmented, most of the generalisations that are made about it are likely to be wrong. "There are tens of thousands of players working in many different market segments," he says. "New players are constantly emerging. And many are vanishing every year by being taken over, merging or simply going out of business."
But is consultancy as we have known it done for? Are firms still able to convince potential clients that they are worth hiring? In many countries the public sector, until recently a keen consumer of consultancy services, now finds its budgets under pressure. Will it abandon its use of consultancies? Is it time for management consultants to consider pursuing another career?
It is true that the term "consultancy" can cover an extremely wide range of activity - from high-powered strategising (how to approach China or India, or redefine the future of financial services), to practical advice on information technology and outsourcing. Larger all-purpose businesses, such as Accenture, can offer services at both ends of the advice spectrum, including the implementation of IT projects. Niche and boutique outfits might specialise in one aspect of management alone, be it pricing, marketing or human resources. As Mr Bürkner emphasises, each segment looks different. Not all players compete everywhere.
Economic downturn has hit consultants' prospects. "This is a pro-cyclical, not a counter-cyclical business" according to one consultancy boss. For potential clients, advice falls under the heading of discretionary spending. Nice-to-have projects are delayed or cancelled at times like this. In 2009 the market fell by anything between 10-15 per cent - although even then, the strongest top-tier strategy consultancies - McKinsey, BCG and Bain - kept growing.
Longer-term trends that have taken the spring out of some consultants' steps are a little more complicated. When consultancy was still something new and mysterious - in the period up to the 1980s - it was easier to dazzle and occasionally bamboozle potential clients. Many corporations had not used consultants before: they were naive first-time buyers. They wanted to find out what this business was about and were prepared to pay for it. Early adopters in Europe - Shell, ICI, Dunlop - lent credibility to the firms.
The consultancies recruited masters in business administration, populating their firms with an impressive, fast-tracked elite. On the client side of the table, not so many MBAs were in evidence. Attitudes, practices, even use of language differed.
All of this has changed. Consulting has matured. There are very few first-time buyers of their services out there. Generations of MBA graduates have meanwhile built careers in the corporate world - and they are not unduly impressed by their peers in consulting firms who speak a similar language to them. "If you had never seen a two-by-two matrix before, they might have seemed clever", one former consultant says, "but not to a business school graduate".
On top of this is the phenomenon of the consultant turned executive - as well as the slightly rarer phenomenon of the executive turned consultant. In short: on both sides of the table are now to be found people who have had a similar training and background. The mystery has gone.
Yet the need for advice still exists. While some middle-ranking consultancy firms may be struggling, overall there is still a lot of business to be done. Steve Ellis, global managing partner for Bain & Co, says his firm is on target to achieve 30 per cent growth in revenue this year, taking Bain over the $2bn mark in sales. He sees his business, along with McKinsey and BCG, pulling away from the rest of the market, at least in terms of top-level strategic advice for global companies. "The pace of change and the volatility of business is leading some clients to make some quite big bets strategically," he says.
That can lead to multi-million dollar assignments such as post-merger integration. Not many consultancies are geared up to work on that sort of deal globally. But there has to be a very clear, and often speedy, return on investment for the client, he says. "There is a huge management challenge for us in making sure our people have the right capabilities, so we can offer a consistently high quality service around the world." Big businesses in the Brics countries expect the same level of service that might be available in New York or London.
At McKinsey, managing partner Dominic Barton agrees that the increasing sophistication and heightened expectations of global clients require his firm to offer greater specialism. "If I think about the work I was doing when I joined 25 years ago compared to what it is now, it has changed a lot," he says. "A lot of what I was doing before was basic market information: how big is it, what are the trends? But you can get a lot of that on Google now."
Like Bain, McKinsey is hiring PhDs, doctors and lawyers, as well as MBAs, to make sure it has the expertise on tap that clients expect. Even in these bad economic times, the top three have also been increasingly working with governments around the world - in healthcare, for example, and helping to support struggling and restructuring industries (BCG has been an important adviser on the US automotive rescue). All three and McKinsey in particular - are well plugged into government and trusted to bring insights to the toughest policy areas.
But not everything in consulting is quite so significant, grand or big-picture. Pure strategic advice might form as little as 20 per cent of what the elite firms do, estimates Walter Kiechel, author of the recently published The Lords of Strategy , a history of the top firms.
Private sector clients are unlikely to want to outsource strategy formulation. As Mr Kiechel says, not many quoted companies are likely to advertise the fact that they are struggling to devise a strategy and need help. Bain's Mr Ellis does not even describe his business as a strategy firm. "We are focused on results," he says. "It's about strategy and execution."
Whatever the causes, the top firms have had to show ingenuity in order to reinvent themselves and remain relevant. They have developed expertise in areas, such as IT, that in the past they would have left to others or seen as being beneath them.
As an example of the sort of diversification the consultancies have to consider nowadays, McKinsey last week announced a joint venture with Nielsen, the research business, and its social media monitoring service BuzzMetrics, to form NM Incite, a unit that will advise companies on their use of social media. Once again, the grandest old name in consulting has latched on to the new, new thing.
As clients reassess their spending on consultants, some budgets will inevitably be cut. At times this will lead to quite abrupt terminations of relationships. One consultancy head was concerned to hear that one of his top teams had been axed by a long-standing client. The word was that all spending on consultants had to be stopped at once.
He rang the chief executive of the client business to find out what was going on. There must have been some mistake, the CEO replied. Yes, he had wanted all those other teams out. "But your people aren't consultants - they are integral to the way we do business." The industry will be hoping that this perception continues to be widely held.
Consultantspeak
Data collection The process by which consultants try to uncover crucial information about a business. At times invaluable but has also led to the classic jibe: a consultant is someone who borrows your watch, then tells you the time ... for a fee.
Point of view The claim that a consultancy has a special or unique insight. (Also "blue-skies thinking", "thought leadership" - original thought, allegedly).
Warm bodies Substitution of senior partners (who sell the work) with graduate trainees (who do it).
Fad surfing Cynical adoption of the latest phrase or management fashion by second-rate consultants.
Trusted adviser The goal for any serious consultant: moving beyond a mere transactional relationship to one that is integral to the client.
And finally (courtesy of John Kay):
Strategy Euphemism for expensive. "We are strategy consultants" means "Our fees are very high".
A passing cloud prompts introspection at McKinsey
When Anil Kumar, a former McKinsey director, pleaded guilty to charges of insider trading in January as part of the investigation into activities of the Galleon hedge fund, the shock was felt not only at his old firm but throughout the consulting industry. This sort of thing was just not supposed to happen. Consulting survives on the basis of client confidentiality.
Then in April, the Wall Street Journal claimed that Rajat Gupta, a former managing director of McKinsey who severed his links with the firm in 2007, was also under investigation for alleged misconduct, in connection with certain contacts with Galleon during his subsequent time as a director at Goldman Sachs.
Mr Gupta issued a categorical denial of wrongdoing and no charges have been brought. Indeed, it is understood he has neither been interviewed nor approached by investigators.
The juxtaposition of one confirmed case of malfeasance with unsubstantiated rumours of another was enough for some observers to question whether McKinsey had a serious problem.
The firm held a thorough review of its practices and drew on the experience of its vast alumni network to assess whether something really was wrong. No evidence of further wrongdoing has been found.
The market - clients - seems untroubled. Analysts estimate that in 2010 the firm has had its best ever start to a year.
In May Mr Kumar reached a $2.8m (£1.9m, €2.3m) settlement with the Securities and Exchange Commission after admitting receiving $1.75m for insider tips on businesses being advised by his old firm. He is co-operating with investigators on the Galleon case.
A market niche engineered
In 1932, when McKinsey was just six years old, it changed the wording on its letterhead from "certified public accountants" to "accountants and engineers", even though the firm had no licensed engineers on its staff.
This detail described by Christopher McKenna in his book The World's Newest Profession conjures up an era when, with the coming of the Glass-Steagall Act in 1933, the rules of American finance (and business) were changing radically.
Glass-Steagall not only forced the separation of bank lending from securities trading. It also prevented bankers, lawyers, engineers and accountants from offering business advice to their clients. Modern management consultancy emerged as a result of the legislation.
While their origins lay in straightforward "cost accounting", the new world offered consultants richer pickings. As Mr McKenna puts it, the numbers people "simply shifted their professional jurisdiction from monitoring costs as accountants to lowering costs as consultants". Efficiency savings and cost reduction remain core skills of the consultant's trade, even if such headings lack the glamour of "strategy".
Bruce Henderson at Boston Consulting Group, Bill Bain of the firm named after him, and McKinsey's Fred Gluck converted the more humdrum "planning" function of the postwar corporation into the recast concept of business strategy. The strategy firms were masters of marketing as well as of analysis.
In the 1960s BCG gave us the Experience Curve and the Boston (two-by-two) Matrix, ideas that dominated business thinking for two decades. This set a pattern. Business looked to the strategy firms for fresh and rarefied thinking.
Even as they have grown, the top firms have tried to raise the quality of their staff and what they do. Some consultants will inevitably be poached by clients, who may prefer to pay an annual salary than an hourly rate to someone they value.
Otherwise the consulting firms operate "up or out" performance management - also known as "grow or go". The message is: keep developing expertise and provide value to clients, or find something else to do.
But even these exits are usually handled well. The alumni network - McKinsey's in particular is formidable - continues to prove its worth long after the contract of employment ceases to be a relevant document.
Welcome, future mouseketeer
Customers of the US retailers are already using the phones not just to make online purchases but to check prices at other retailers, to look up information on potential purchases, and to receive digital money-off coupons that can be scanned at check-out. “Everyone needs to get past this idea of buying things on this small little screen,” says Mr Silverman. 
However, he predicts that rising incomes will disrupt family political franchises within as little as 12 years, and that ruling families will find potent challengers for their pocket boroughs. As the middle class grows, he says, these voters will want to see people more like themselves in the Lok Sabha, and not simply younger offspring of established families.
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