Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

mattstoller.substack.com

Post reply on HN
Print view View original

31–40 of 328 posts

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#31

Post by tootie »

hwbehrens wrote: post #5

The IFF referenced in the article seems like a great example of how good-intentioned changes to incentive structures can have very warped outcomes, potentially years later. These kinds of effects keep popping up for me, even in industry contexts (e.g. stack ranking). Are there accepted mechanisms for systematically identifying these knock-on effects, and if so, what are they and how can they be more broadly applied?…

The piece I don't get is why the agencies didn't revolt. I get how it's a warped incentive for the GSA but isn't the GSA working at the behest of agencies like ICE? Shouldn't ICE be up in arms that their budget is being squandered?

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#33

Post by Icathian »

z3ugma wrote: post #21

I was a technical project management consultant for a long time. The value that most orgs get from a consultant isn't really in the advice the consultant gives them, it's the political cover to make changes they knew they should make all along, but didn't have the social capital or the focus to make those changes until they had a person in a chair across from them.

Absolutely this. It baffles me how many people can understand and repeat ad nauseum "nobody ever got fired for buying IBM" but don't get the role a consultant plays in corporate strategy.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#34

Post by zaptheimpaler »

xvector wrote: post #23

From the linked article[1]: I find it absolutely INSANE that highly specialized organizations like the NSA rely on McKinsey to direct their future operations. These people have intimate knowledge of their organization and culture, shaped and hardened by years of challenges and learned experiences. What can they possibly think bringing an outsider in to do a complete overhaul will solve!? Why can they not apply their…

> In the immigration story, MacDougall shows that the consulting firm encouraged ICE to give less food and medical care to detainees.

I guess this is one big reason companies hire consulting firms - a consultant can act as a mouthpiece to say things you want people to hear, but not say yourself. A kind of moral laundry, absolving insiders from blame. Similarly they could recommend a risky business plan that someone believes in but doesn't want to stick their neck out for - if it fails, blame the consultants and move on.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#35

Post by austinhutch »

riazrizvi wrote: post #25

I'm sorry but no case is made to support the idea that taxpayers are buying generic advice. Let's agree that the service buys a fresh college grad assigned full time. The grad might be a customer contact collecting and organizing customer issues before presenting them to internal subject matter experts, and then presenting those findings back to the client. I'd like to hear evidence to support how the service is fres…

> The grad might be a customer contact collecting and organizing customer issues before presenting them to internal subject matter experts, and then presenting those findings back to the client

This might describe how technical consulting is done at big firms where the output is a product, but when the output is strategic documents... this is grunt work done by the front line analysts with a generic playbook. There is no "behind the scenes" strategy work like there is for dev. Maybe there is a lower analyst or intern that doesn't interface with the customer.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#36

Post by braythwayt »

z3ugma wrote: post #21

I was a technical project management consultant for a long time. The value that most orgs get from a consultant isn't really in the advice the consultant gives them, it's the political cover to make changes they knew they should make all along, but didn't have the social capital or the focus to make those changes until they had a person in a chair across from them.

This.

I have done lots and lots and lots of enterprise sales and consulting, and a big part of bringing in outsiders is to provide the illusion of social proof.

"Well, we had the experts in, and they found..."

That sounds really, really terrible when put so cynically, but the flip side of that is to view it as insurance. If you bring the consultants in, hoping that they will recommend Plan A, and Plan A is truly terrible, a reputable consultant will find a way to sell you on Plan B, by couching it as "A few adjustments to Plan A."

So in effect, yes, it is about making changes management wanted all along, but in addition to providing the illusion of social proof, you can also get an extra set of eyes to make sure that you don't completely footgun yourself.

Sometimes. Maybe. If the consultants are good at both analysis and selling management on adjusting their plans...

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#37

Post by CharlesColeman »

z3ugma wrote: post #21

I was a technical project management consultant for a long time. The value that most orgs get from a consultant isn't really in the advice the consultant gives them, it's the political cover to make changes they knew they should make all along, but didn't have the social capital or the focus to make those changes until they had a person in a chair across from them.

> it's the political cover to make changes they knew they should make all along

Or the political cover to make the changes they wanted to make all along.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#38

Post by xenocyon »

It's not just governments. Large corporations too frequently use McKinsey to make recommendations for things they want to do anyway (e.g. layoffs or restructuring). From the client executive's point of view, the money spent on a McKinsey contract effectively purchases credibility for these decisions.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#39

Post by mumblemumble »

Vaslo wrote: post #20

Had a lot of experience with McKinsey doing projects at my company at different levels I’ve been in throughout it the years. When it’s highly technical things like implementing a new technology you know nothing about or a new manufacturing footprint that is tangible to perform, they do good work. Anything “Strategic” or fluffy I find a waste of time. They are excellent salespeople and do a lot to calm the C-suite but…

Doesn't seem surprising. If it's implementing a specific technical process, there are measurable outcomes that must be met, and your client will know whether or not you met them.

Senior leadership contracting an outsider to tell them how their own industry works and explain their place in it, though, is right up there with asking the Psychic Friends Network for career advice. They're just begging to be taken for a ride.

Re: Why Taxpayers Pay McKinsey $3M a Year for a Recent College Graduate Contractor

#40

Post by txcwpalpha »

xvector wrote: post #23

From the linked article[1]: I find it absolutely INSANE that highly specialized organizations like the NSA rely on McKinsey to direct their future operations. These people have intimate knowledge of their organization and culture, shaped and hardened by years of challenges and learned experiences. What can they possibly think bringing an outsider in to do a complete overhaul will solve!? Why can they not apply their…

>It seems like you’re just paying people for critical thinking.

That's exactly what it is. Unfortunately most organizations, probably even ones like the NSA, really struggle with doing any kind of critical thinking on their own. This is especially true when trying to decide on a future direction for the org: the org itself is most likely biased to just doing things the way it's always been done. In that regard, having an outsider's perspective, especially one that has also done work at other similar organizations and has taken note of all the various ways other orgs do things and knows what works and what doesn't, can be quite beneficial.

Post reply on HN