Madame Tussauds in London has been around for about 200 years. Since then it has grown into a world famous attraction. Over 800 hours of work goes into completing one figure, from sculpting to moulding and casting, painting and costume. The process starts with precise measurements and photos of the celebrity being taken. Next they make a metal armature that the clay is sculpted onto. The sculpture is actual made at about 2% larger as the wax shrinks. Once finished the clay is moulded and cast out into wax the finishing touches are added like hair, which is punched individually and teeth and eyes. The skin is painted on in layers to gain a realistic effect and the correct colour.
This sculptors blog gives some information about the processes involved and is something was helpful to me.