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Have McKinsey and its consulting rivals got too big?

economist.com

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Re: Have McKinsey and its consulting rivals got too big?

#81

Post by lenerdenator »

jncfhnb wrote: post #9

Current McKinsey here. I don’t think anyone expects the current difficulties to last indefinitely. Its fairly well established that consulting struggles during times of economic uncertainty (but does fine when things are outright bad or good).

> Its fairly well established that consulting struggles during times of economic uncertainty (but does fine when things are outright bad or good).

The culture engendered into corporate America by businesses like McKinsey is exactly what causes economic uncertainty.

When the only thing that matters is the number at the bottom of the piece of paper being big enough for some analyst in lower Manhattan to be happy, humans will do all sorts of unpredictable things to make that number be that way.

Re: Have McKinsey and its consulting rivals got too big?

#82

Post by mentalgear »

It's not just that they're too big—it's that they're morally corrupt and largely unregulated. These firms have been involved in everything from tobacco lobbying to the 2008 financial crisis to pushing opioids, and that’s just scratching the surface. Despite their role in these crises, they’ve faced zero accountability and continue to rake in massive profits.

As for their supposed value (which comes directly from ex-employees): big consulting firms are essentially hired as a liability shield for the C-suite. Their main job is to back up whatever the CEO already wants to do (usually cost-cutting). This way, executives can claim: a) "McKinsey recommended it, so it must be right," and b) "If it goes wrong, it’s on McKinsey, not us."

Re: Have McKinsey and its consulting rivals got too big?

#83

Post by photochemsyn »

Don't all these consulting firms have a really bad record when it comes to large-scale infrastructure projects? Some of the worst examples are Ciudad Real International Airport (Spain/McKinsey), Karuma Hydroelectric Project (Uganda/Deloitte), Chongwe River Water Supply Project (Zambia/Boston Consulting Group), Isimba Dam Project (Uganda/McKinsey), Haramain High-Speed Rail Project (Saudi Arabia/Deloitte), and Shoreham Nuclear Power Plant on Long Island, New York (McKinsey).

In constrast, China's infrastructure projects are highly successful - high-speed rail now covers 42,000 km across 100 corridors, and the first one was only completed in 2008. Based on their example, the most efficient way to build modern infrastructure is to cut the consultancy firms out of the loop entirely.

Re: Have McKinsey and its consulting rivals got too big?

#84

Post by imperialdrive »

CPLX wrote: post #25
mschuster91 wrote: post #8

Of course they got too big, and especially they got too enmeshed with the auditing business. It's time to break them all up. The "firewall" that should be there from a legal perspective is a joke in practice, and when there are only three to four companies, there is no place for fresh blood and with it fresh ideas to enter the market.

The firewall is of course a fiction. The entire point of these consultancies is to allow collusion between competitors, which is otherwise illegal.

Interesting, I never considered that thought before.

Re: Have McKinsey and its consulting rivals got too big?

#86

Post by seabass-labrax »

js2 wrote: post #22
robertoandred wrote: post #19

Gotten* C'mon, The Economist

Pretty sure it's a US/UK thing.

Historically speaking, it's common to both UK and US English because it predates the European colonization of America:

http://www.miketodd.net/encyc/gotten.htm

Personally, for a situation like this I'd use the somewhat more formal 'become' instead!

Re: Have McKinsey and its consulting rivals got too big?

#87

Post by neilv »

crazygringo wrote: post #74
samdung wrote: post #58

I have a small story about McKinsey from friend of mine in the Indian Bureaucracy from about 10-12 years ago. McKinsey was doing some work for their dept. I asked him what they did. He said, "McKinsey asked us for lots of information. Then they put it into a dossier and gave it back to us."

To be fair, a lot of organizations can't do this on their own . Which is why they hire a consultancy. Information is siloed, teams compete rather than cooperate, any team's own dossier is going to be seen as biased and unobjective. There's real value in hiring a neutral, competent vendor to come in, assemble the relevant information using best practices, and present a "dossier" with common-sense conclusions. Then the…

> teams compete rather than cooperate [...] political cover for taking the necessary actions they wanted to in the first place

That looks like three deeper problems than the consultants were tasked to solve.

(Not only do you have counterproductive, misaligned culture; but even the CEO can't/won't fix it; and the CEO even has to play political games, just to work around the bad culture, for smaller goals.)

Re: Have McKinsey and its consulting rivals got too big?

#88

Post by openrisk »

> The quicker corporate clients become comfortable with chatbots, the faster they may simply go directly to their makers in Silicon Valley. If that happens, the great eight’s short-term gains from AI could lead them towards irrelevance. That is something for all the strategy brains to stew on.

The cloud divisions of "big tech" might be the catalysts for this upcoming disintermediation.

Re: Have McKinsey and its consulting rivals got too big?

#89

Post by 1123581321 »

ambicapter wrote: post #71
OptionOfT wrote: post #61

It was a really interesting place to work at a Software Engineer. It made me understand the business. It made me understand that doing the right thing isn't valued. You do the thing that has the shortest ROI. It also made me realize that it is horrible to build software with people who expect short term deliveries like the usual McKinsey engagement. People who expect that the automation of an Excel file takes the sam…

> What I miss the most is coming into contact with people with a huge variety of backgrounds. > Which surprisingly were the people with who I had to spent the most amount of time explaining how software works. How is this surprising? I read this as "huge variety of backgrounds", meaning, all kinds of backgrounds which are NOT software. It would make sense to me they don't understand how software works.

I took it to mean that you’d think it would have been annoying to have to repeatedly explain things, but he misses them.

Re: Have McKinsey and its consulting rivals got too big?

#90

Post by neilv »

samdung wrote: post #58

I have a small story about McKinsey from friend of mine in the Indian Bureaucracy from about 10-12 years ago. McKinsey was doing some work for their dept. I asked him what they did. He said, "McKinsey asked us for lots of information. Then they put it into a dossier and gave it back to us."

There've been variations on this saying/joke for at least as long as I've been working, not specific to McKinsey.

Example: "A consultant is someone who charges you $100K, to tell you at the end, what you told them at the beginning."

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