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McKinsey to pay $573M to settle claims over opioid crisis role: source

reuters.com

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Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#21

Post by MisterTea »

alexpetralia wrote: post #7
tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

I know it's fashionable to hate on MBAs, but I am not entirely convinced engineers are any better equipped with skills such as: requirements gathering, scoping, presenting, project management, competitive research, financial modeling, memo writing, and strategic planning. I don't believe these are truly vacuous activities, and - loathe as I am to say - MBAs may be the best trained to do this. (Disclosure: I do not ha…

Its a people problem. Actually solving problems takes a particular kind of mind. A degree is just a piece of paper which certifies the fact that you sat through lectures on subjects and you successfully regurgitated said lecture material on another piece of paper from memory.

The issue with the MBA field is that it tends to attract power hungry narcissists/psychopaths who enjoy holding power over others. Engineers like to tinker with stuff and be left alone.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#22

Post by ath92 »

olsonjeffery wrote: post #16
alexpetralia wrote: post #7

Earlier quoted context omitted.

I know it's fashionable to hate on MBAs, but I am not entirely convinced engineers are any better equipped with skills such as: requirements gathering, scoping, presenting, project management, competitive research, financial modeling, memo writing, and strategic planning. I don't believe these are truly vacuous activities, and - loathe as I am to say - MBAs may be the best trained to do this. (Disclosure: I do not ha…

I'm fine stating that engineers from non-elite schools are just as well equipped for the tasks you describe, but that wasn't the GP's contention. The point is that McKinsey make bad recommendations that have demonstrably bad outcomes. Their fingerprints are all over numerous bad decisions in business and government in the past few decades[0]. These are the bare minimum, because there are quite likely many negative ou…

McKinsey has 27,000 employees. That's the population of an entire town. I'm not saying that the things described in the links you posted here aren't bad, but I think it's important to remember with this many employees, there will always be someone doing something that you don't agree with.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#23

Post by curiousllama »

sharkweek wrote: post #10

The absolutely most fascinating part of this is learning how McKinsey has long argued that making recommendations that businesses may or may not act on does not create legal liability (until this). I’m trying to see that argument applied in any other instance and it becomes totally ridiculous. “You see, your honor, I merely suggested to my client that he kill his neighbor in order to take his land, I didn’t think he’…

Note that the only other place it works like this law. Lawyers are always "providing advice" about complex legal matters, with no actual responsibility for the outcome (with limited exceptions). So the idea that lawyers would apply similar logic to a reasonably-similar circumstance (in terms of complexity, difficulty, potential liability, etc.) is not unreasonable.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#24

Post by xerxesaa »

tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

This sounds rather dismissive. The company (and others like it) has been around for decades. Most of Fortune 500 has leaned on their advice multiple times, and their advice doesn't come cheap. So your implication is that these companies are being scammed into repeatedly wasting their money and are apparently not smart enough to figure this out. To me, that feels hard to believe.

It's conceivable McK and other actually do offer some value. A 26 year-old may not have tons of real world experience, but working at McK would allow him/her to have exposure to a global team that has worked across many companies in the industry. Having an understanding of best practices across multiple companies in the industry is valuable. It's also valuable to come in with a fresh perspective that is not heavily influenced by working at the same company for decades.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#25

Post by raesene9 »

samizdis wrote: post #14
onetimemanytime wrote: post #3

Earlier quoted context omitted.

Well, considering the damage they caused this is nothing. They advised on /got and got paid for how to "turbocharge" opioid sales and that tuned out to be an illegal and immoral thing.

I'd be keen to see the specifics wrt advice given on how to "turbocharge" said sales. Reuters article doesn't give any examples/detail.

Articles like https://www.nytimes.com/2020/11/27/business/mckinsey-purdue-... have some details.

A quote from that shows some details :-

" In a 2017 presentation, according to the records, which were filed in court on behalf of multiple state attorneys general, McKinsey laid out several options to shore up sales. One was to give Purdue’s distributors a rebate for every OxyContin overdose attributable to pills they sold.

The presentation estimated how many customers of companies including CVS and Anthem might overdose. It projected that in 2019, for example, 2,484 CVS customers would either have an overdose or develop an opioid use disorder. A rebate of $14,810 per “event” meant that Purdue would pay CVS $36.8 million that year. "

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#26

Post by andi999 »

tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

And some fast food chains sell crappy food. So what? Nobody is forced to hire a (bad) consulting firm. Also if management accepts and implements the bad advise of a consulting firm, that management is even worse, isn't it.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#27

Post by IMTDb »

alexpetralia wrote: post #7
tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

I know it's fashionable to hate on MBAs, but I am not entirely convinced engineers are any better equipped with skills such as: requirements gathering, scoping, presenting, project management, competitive research, financial modeling, memo writing, and strategic planning. I don't believe these are truly vacuous activities, and - loathe as I am to say - MBAs may be the best trained to do this. (Disclosure: I do not ha…

The problem are not MBA's. The problem is that the incentive of consulting companies are not aligned with the incentive of their clients.

Take a big construction project. In the like of the Berlin airport. What do you think is more profitable for the consulting companies :

a) A well thought project, done in budget and in time. Where the consulting company gets the whole contract + all the bonuses associated with it.

b) A poorly managed project, that gets refinanced multiple times and that ends up being pushed back decades.

It's actually B. Consulting companies love long projects, because this allows them to place consultant for extended periods of time. And any consultant working for a client is a profitable consultant event without bonuses. Consulting companies hate projects that end up shorter than expected, because any bonus they might get from that project ends up being spent on consultant that are waiting for their next assignment.

The main KPI of any consulting company is "the %age of time you consultant are spending 'on assignment' vs 'on the bench'". And long projects where consultant are busy for years are the best way to bring that KPI to 100%, even when the underlying project is a complete mess. The only thing they get from shorter and better managed projects is a better image, which is easier and less expensive to get using marketing technique and PR.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#28

Post by Terretta »

tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

Once you realize the game is “management” in collusion on both (a) outsourcing the reading of the HBR articles so they don’t have to, and (b) what I call “decision insurance” (“but our consultants confirmed this made sense!”) so decision accountability is laundered, everything makes much more sense.

In mega enterprises the CEO matters a lot, but the next 3 or 4 layers often exist primarily to filter and spin bad news, diffuse accountability, and occasionally get burned at the stake as a witch in league with evil spirits when nobody wants to acknowledge the cholera water making the whole village ill.

Given that, the easiest witch to lay hands on is the consultant, which is why they bill hazardous duty pay levels.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#29

Post by esotericimpl »

tharne wrote: post #4

Too bad they can't be sued for ruining countless businesses with mindless self-serving "advice" meant to do nothing more than get their contracts re-upped. The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR.

I mean the entire point is to hire outside consultants to provide "proof" that what the executive team wants to do is what the organization should do.

McKinsey is hired to provide cover for execs when they make terrible decisions. So they can step back and say well it wasn't my idea, McKinsey said so as well.

It's just another example of terrible management failing upwards.

Re: McKinsey to pay $573M to settle claims over opioid crisis role: source

#30

Post by frostburg »

asjldkfin wrote: post #20
frostburg wrote: post #18

Earlier quoted context omitted.

You don't need to do much to be wrong, especially in the context of selling highly addictive drugs.

That's not the point; you can't say their advice is ineffective, while also condemning them for being effective. The top comment derisively states: "The whole business is a scam built around sending in some 26 year-old with an Ivy League degree and $100 haircut to regurgitate snippets from articles in HBR" In the context of fining the company $500MM for being too effective. At least in the US, where the punishment is…

You don't need groundbreaking innovation in sales from your consultants to keep selling too much opioids, a product that mostly sells itself. Better consultants should probably try to stop you, however.
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