The up-or-out principle is something that surprises many people when they first hear about it but it's essential to how consulting firms operate. The idea is that consultants cannot simply stay in their position forever, they need to climb the hierarchy. If they don't, they'll be fired – or more politely: they're asked to resign. There are many nuances to this principle, and we've described it in this post in detail. 

The practical implication is that you're not just fired for severe underperformance or gross misconduct – but you're also asked to leave simply because the firm doesn't see enough potential in you to perform on the next level. That's closely linked to the strong performance culture of consulting, pushing people to the edge of their comfort zone and sometimes beyond. And it's also why the reasons for getting fired listed below often seem minor. Definitely not something you'd be fired for in other places. In consulting, however, you're not just measured against your current job description, but you're also asked to perform beyond that level, proving that you have what it takes for a more senior role. If your plan is to just duck down and disappear in the herd, it won't fly. Sooner or later your performance reviews will suffer. And a series of bad performance reviews will result in you being let go. 

But now that we’ve summarized the up-or-out principle, what are the reasons why you might get bad performance reviews?

As a junior, it’s all about your consulting toolkit. That starts from how organized and reliable you are. Can I trust that you apply yourself, get things done, ask for help if you need it, and give me the output within the deadlines in an acceptable quality? That’s what a project manager is asking him- or herself. On top of these fundamentals, a junior needs concrete skills to live up to the role of business analyst or associate.

On the one hand, we’re talking about hard-skills: Do you deliver a clean Excel model or are there errors in key formulas throughout key steps of the analysis? Do you create nice PowerPoint presentations with good storytelling or are there typos, logical breaks, and inconsistent formatting all over the place? Is the research you’ve done sound or is it illogical and overlooking key areas? On the other hand, we’re talking about soft-skills: Can you build a positive relationship with your team, your leadership and your key clients? Or are you the odd one out who’s alienating clients? Can you deal with stress and tough out an uncomfortable situation? Or do you get flustered or start crying when you get direct feedback from your project manager or pushback from a client?

All of these things are key skills and characteristics that you expect from a team member, and obviously a prerequisite for anyone looking to become a project manager and beyond. Whether the job is suitable for you is something that becomes apparent very quickly. We’ve seen extremely talented and intelligent people that left consulting after 6 months. They went on to become successful in other careers, but consulting wasn’t for them. It does require a certain type and you’ll feel quite uncomfortable if that isn’t you. The logical result is a mutual termination.

The further up the ranks you climb, the more important is the backing of senior leaders within the firm. If you don’t have sufficient partners or senior partners supporting you, it’s hard to even make project manager, and anything beyond that is impossible. Conversely, a senior partner who absolutely supports you can single-handedly endorse you all the way to junior partner.

Why is it so important to have the backing of (senior) partners? The main reason is that they are the ones filling the project pipeline and maintain personal relationships with corporate executives. That means, they also need to send a team of consultants with which they feel comfortable to execute these projects. Over time, every partner will have a followership of junior partners, project managers, and even associates that they trust in. They know that these people are reliable, bring the right skills to the table, delivered strong in the past, and can collaborate well with the partner personally (i.e., the working styles match). In fact, it’s a criterion by which senior leaders like partners (but starting already at project manager) are evaluated: Have you built a strong followership of more junior consultants that want to work with you? Or are you the junior partner that no one wants to work with and pushes associates towards a burnout? So it actually goes both ways: being supported by leaders, but also by followers.

A strong consultant will garner the support from senior leaders and will be pulled onto interesting projects, a not-so-strong consultant is left on the bench and forced to fight for scraps and the projects no one wants. All this is amplified in a situation in which business is slow and the consulting firm is struggling. That’s why it’s key to build strong relationships. Otherwise, if you don’t have that support, you’re the first out the door if the going gets tough or your performance lags.

This is again a point that becomes relevant the higher you climb on the consulting career ladder. Up until project manager you get away with delivering strong performances on projects, without having a specialty. But sooner or later you need to carve out your own niche and develop a unique value proposition. Something that you’re known for within the firm, and later on maybe even in the industry. That could mean that you’re, for example, the expert for mobile banking in Africa, or the expert for drug development and approval in the EU.

If you can bring something unique to the table, or a really sharp profile, it’s much easier to explain why you should continue to be part of the firm. If you can be replaced by anyone, you will be replaced. Sooner or later (at the latest once you’re partner) you need to win projects for the consulting firm. That’s when you need to show your expertise. Simply leveraging a personal relationship with a CEO typically won’t cut it. Also, the senior partners will be more likely to support you if you have unique expertise. Even if there’s a senior partner specialized in pharmaceuticals, for example, she still can’t and won’t have expertise in all the areas of the industry. But if there’s one partner who’s an expert in drug manufacturing, one partner who’s an expert in the approval process, and one partner that is the expert for the science behind drug development, she truly has a dream team that can win and deliver any project.

The call for specialization and expertise tends to start earlier and earlier. At the latest, project managers will start hearing about it in performance reviews. Lack of a value proposition or an area of deep expertise is typically not something you get fired for. It is, however, something that will eventually hold you back. And if you can’t build a convincing value proposition by the time you’re junior partner, you hit a glass ceiling and will be out eventually.

Once you’re nearing the partner ranks it’s important that you help win projects. It’s the lifeblood of any consulting firm. Once you stop securing new projects, the party is over. But how do you get new projects? Well, there is always the possibility that a corporate launches a tender process and requests proposals. Then all the consulting firms will submit a proposal, outlining how they’d deliver the project. The consultants might even be asked to present the proposal in a pitch meeting. And if all goes well, you win the project. That, however, only works out for one firm. For all the other consulting firms, it’s a lot of wasted time and energy.

You see that it’s super tedious to win projects this way. The much better way is if you have a strong relationship with a client and you keep delivering projects for them. You may even skip the tender and proposal process and get engaged for a project directly. And even if corporate governance or legal rules require a bidding process, it’s often the consultant that helps write the request for proposal. This request for proposal is then obviously tailored so that this consultant will easily be in the best position to win it. It’s also in the best interest of the clients. A CEO doesn’t want to hire new consultants for each project, especially if they’re still unfamiliar with the CEO’s and the company’s situation. He or she’d much rather hire the consultants they trust directly, as long as they feel like they have the right capabilities. This is how virtually every successful career in consulting is made. Build a strong relationship with 2 or 3 clients for which you keep delivering projects, securing a constant flow of new projects. 

These consultant-client relationship are often very strong and last decades. Many (senior) partners work with an executive over his whole career. To give you an example:

This is not some fantasy we came up with but the reality of a client-consultant relationship. Often associates first work with a client who is then a middle manger and if everything goes well, they will still be working together when the client is CEO and the associate is senior partner. We have seen this happen many times. And you can imagine, that the client has little incentive to engage a different consulting firm, if she has been working with her, by now friend, consultant X for 15 years.

If you want to ascend in the consulting hierarchy, evaluation committees will critically evaluate whether you have a strong client base. If you bounce around a lot but never build a strong relationship with larger clients, it’s much harder to get ahead. Once you reach junior partner level, your utilization becomes a factor as well. If you haven’t ingratiated yourself with the right (senior) partners, the right teams, or the right clients, it’s impossible to maintain a high utilization. That’s why sooner or later you’re evaluated on the client base you’ve built.

Of course, you can always be unlucky and one of your core clients breaks away. Maybe they switched to another consulting firm, or they have a tight budget restriction. Whatever the reason is, and irrespective of whether you had anything to do with it, that’s your problem. Especially for junior partners that are up for partners, it can become a major problem. Now, if you have 1 or 2 other strong clients, you can survive that. But if you don’t, that might be the reason you don’t make partner. Clearly, that’s not a dealbreaker for your career right away, and the strong ones bounce back next year. But if your client base is always shaky, it’s unlikely you’ll make it to the top before you’re asked to leave.

Lastly, we have a category of reasons that have nothing to do with performance issues. And that is, all the things where a consultant crosses a line he or she shouldn’t cross. Obviously, if you’re doing something illegal, you’re out the door. Hitting a client in the face doesn’t work, even if you wish you could. But it doesn’t even need to be a broken law. If you behave inappropriately, either by general standards or the firm’s code of conduct, you might be out the door as well. For example, harassing or bullying a junior colleague, inappropriate sexual advances or comments towards a team member, or insulting a client – all of these could be reasons to be fired. We’ve seen people being let go for jumping into a pool naked at a company retreat.

There are 2 factors that moderate ethical violations. First, the state of the consulting firm or the economy. If business is booming and they need all hands on deck, you’re less likely to get the boot. On the other hand, if business is slow, consulting firms are much quicker in dishing out terminations. McKinsey fired way more people for violations of the McKinsey values in 2022 than in prior years. That might be a coincidence, but the fact that it was also the first time in years that business slowed down is interesting to say the least. 

The second moderating factor is your personal performance. This is not only true for consulting firms but for virtually any setting. No matter if you’re a famous movie producer, an artist, a manager, or a powerful politician. If you’re a star you get away with a lot more – which also applies to consultants. You’ll have a lot more support by partners who’ll protect you, or make your case be viewed in a more favorable light. That’s the unfortunate truth. High performers have a longer leash.

Consulting has a high personnel turnover. Partly that's due to the high demands of the job and changing personal or professional ambitions – but partly it's for not keeping up with the strong performance culture. Younger consultants tend to get fired for not building a technical toolkit, more senior consultants because they fail to establish themselves as leader and knowledge professional inside and outside the firm. But whatever the reason, getting fired is not the end of the world and wouldn't prevent anyone from having a successful career. The brand name of a prestigious consulting firm in your CV goes a long way, and the things you learned in those formative years of your career are invaluable.