[HN Gopher] When McKinsey comes to town
___________________________________________________________________
When McKinsey comes to town
Author : mitchbob
Score : 179 points
Date : 2022-12-05 18:40 UTC (4 hours ago)
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| waylandsmithers wrote:
| As a former (briefly, due to an acqui-hire) consultant at one of
| the big companies mentioned, this was a really interesting read.
|
| I never thought anything the company did was morally wrong per
| se, it was just a different business model that I didn't really
| want to be a part of. The role of most people in the U.S. was
| landing the big deal, talking the client down when things went
| wrong, and then winning an extension for additional services at
| the end. Actual implementation was just a cost to be minimized
| and handled somewhere at one of the company's offshore sites.
| Somehow it all worked out (usually) even for some truly massive
| projects.
| mattewong wrote:
| > One gets the sense that [the authors] think the consultants
| they write about are rotten apples, but [they are wrong]
|
| OK I paraphrased the rest of the sentence into the last 3 words
| but if you bothered to read to the end, you see that the reviewer
| completely lost her way by the end. Purporting to review a book,
| she concluded by the end that its authors are misguided because
| the real culprit is not the consultants, but rather, every
| pursuit of efficiency, including all "software development".
|
| > software development [is] in fact focused on enabling
| capitalists to enrich themselves further without the inconvenient
| interference of workers, taxpayers or regulation
| mathattack wrote:
| My observation is that clients hire BigName consultants for one
| of two reasons:
|
| 1 - They need external validation/blame.
|
| 2 - They don't trust their own people to execute.
|
| In reality I've found it's more efficient to just hire the ex-
| consultants and not pay the markup.
| jmtucu wrote:
| I had the chance to work after this boys were hired by the
| client, they are good in consulting and strategy but at tech
| level they are really bad and always delegated to teams in India
| for pennies.
| tequila_shot wrote:
| I've been in one of the "Big 4" Consulting firms, and I can vouch
| for the article. As a "Senior" the Customer is charged
| 150-160$/hour and on top of that 25% for travel. The work that we
| did for these customers was lackluster. We used to come in as
| "experts", get all the technical work done from body shops in
| India and offshore. I was shocked to see that Customers just keep
| paying for these expensive services, and have no clue they are
| getting hoodwinked.
| kyawzazaw wrote:
| Just saw a hrly rate in my country Myanmar where they are
| charging an Associate rate as USD180/hr in 2022.
| oneoff786 wrote:
| I'm mckinsey. All I'll care to say here is that we don't
| outsource any technical work
| indigodaddy wrote:
| Same with Deloitte? Don't they have a ton of directly employed
| engineers?
| runnerup wrote:
| I've heard that curing internal myopia is a top priority for
| McKinsey this decade. Focus is on broadening
| gender/age/economic background and also broadening professional
| experience backgrounds.
|
| They're hiring and developing a lot of top talent in "hard
| skills" (e.g., _not_ MBA 's) across different industries. From
| what I've been able to tell, it's paying off a lot with
| strategies that are grounded in reality and catching things
| that non-technical people would miss.
|
| Really depends on the team you get assigned to your project
| though, as with any contracting/consultant situation.
| SQueeeeeL wrote:
| Oh, glad McKinsey is going to ruin the psychology of a bunch
| of LGBTQ people with 80 hour work weeks while they union bust
| foreign nations. You aren't developing shit when every single
| person you hire leaves after 2 years, don't astroturf this
| garbage here.
|
| What kind of weak political literacy do we have in America
| where agencies who literally aligned themselves with
| tyrannical oppressive dictators who behead rivals and loot
| the wealth of their own population get an ounce of room to
| "change" and represent "more diverse opinions". (Spoiler
| warning, it's one where everyone in power secretly agrees
| that profit triumphs over any other possible motivation)
| factsarelolz wrote:
| > McKinsey is going to ruin the psychology of a bunch of
| LGBTQ people with 80 hour work weeks while they union bust
| foreign nations.
|
| Do the 80 hour work weeks not ruin the psychology of non-
| LGBTQ folxs?
| TheNorthman wrote:
| It's a tongue-in-cheek comment, not a serious statement
| regarding psychological resilience.
| cjbgkagh wrote:
| It was sarcasm, and yes.
| nightpool wrote:
| Right, that's why the GP is sarcastically saying how
| awesome it that they're now going to expand that ruinous
| treatment to more people by hiring more minorities.
| sharadov wrote:
| Used to work as a sub-contractor for Deloitte, all the work was
| done by us, the Deloitte folk would spend 12 hrs a day at work
| - looking super busy, attending meetings, schmoozing with the
| client, go for lunches and dinners and building reports and
| spreadsheets. They hired impressionable good looking young
| people who were good at selling, period.
| harvey9 wrote:
| In some cases the customer is just looking to put a veneer on a
| decision they already made. The big 4 name is what they're
| deliberately paying for.
| yamtaddle wrote:
| Another role they play is a kind of out-in-the-open corporate
| espionage. You pay them to come in and tell you what the
| "best practices" are in your industry (i.e. effective new
| things your competitors have been doing since the last time
| they came to visit you--and they'll learn some new ones from
| you to tell your competitors, next time)
| kennend3 wrote:
| AS someone who has both read the book and interacted with
| "big 4" names a few times this is going to be one of those
| "underrated" comments you sometimes see here.
|
| At my previous place of employ they made some really terrible
| decisions which ended up costing a LOT of money later.
|
| Their response was classic "the design was vetted by
| McKinsey"..
|
| No.. you sent them what you wanted to do, they told you what
| you wanted/needed to hear and now you are deflecting your
| decisions.
| azemetre wrote:
| I worked for a health insurance provider that paid BCG
| $1mil to confirm that we should be using agile in our org.
| It took BCG a month to do their "study."
|
| We were already using agile in our org, but nice to know
| some incesteral relationship between directors/VPs were
| able to make a nice pay day.
| throwaway202212 wrote:
| Running agile in a small team is one thing, having a
| company do "agile at scale" is quite another (yes I
| realise the contradiction in terms). As someone who
| worked at McKinsey, on several large scale "agile"
| rollouts the bulk of the work was on re-organising the
| company (this is not an easy thing to do in companies
| with thousands of employees - hence bring in the
| consultants). The driver behind these projects was almost
| always cost cutting or increasing efficiency. The agile
| part was mostly window dressing.
| azemetre wrote:
| No not at all; this org had existed for two years
| already, was already using agile for said two years, and
| successfully delivered a multitude of projects using
| agile.
|
| The driver to me seems to clearly increase complexity for
| the sake of it in order to push for more billable hours.
|
| This was pure graft.
|
| Honest Q since you're a throwaway but is this how
| consultants typically act? Justify simple things to be
| more complex to lay people and charge them out the wazoo?
|
| I think I'm slowly starting to understand why some of my
| friends are creating their own dev agencies. This racket
| is rife with stupid money.
| kennend3 wrote:
| > nice to know some incesteral relationship between
| directors/VPs were able to make a nice pay day.
|
| you should read the book.. The industry is rife with this
| type of behaviour.
|
| There are always stories about how "senior manager" X is
| basically a shadow employee. While they work for company
| "Y" their real job is to send business to the consulting
| mother ship.
| throwaway202212 wrote:
| This really sounds like a conspiracy theory. That being
| said, McKinsey (and presumably BCG and Bain) very much
| embrace their employees leaving to join their clients. It
| creates a good "referral" network if you will. But more
| than that, I don't buy it.
| kennend3 wrote:
| I'm obviously not using a throwaway account like you and
| so i am not willing to disclose details.
|
| But lets say that in my industry this sort of "kickback
| scheme" is well known.
|
| I saw it first hand, and have had friends tell me other
| instances of it as well. And i am NOT singling out
| "McKinsey" but consultants in general.
|
| As for McKinsey, read the book, they provide examples of
| this.
| exclusiv wrote:
| The throwaways are likely shills (or charitably -
| ignorant employees that don't wish to dive into any
| claims about their employer?). There are actual cases
| involving big four and kickbacks/bonuses and corporate
| sabotage.
|
| One example in the last few years: BCG and NCR
| Corporation.
|
| "It is undisputed that Mr. Benjamin, as an officer of
| NCR, owed NCR a fiduciary duty that includes a duty of
| loyalty. The Counterclaims allege sufficient facts to
| show that Mr. Benjamin breached that duty by entering
| into a secret agreement with BCG to promote and expedite
| his candidacy for CEO. The Counterclaims further allege
| sufficient facts to show that BCG worked with Mr.
| Benjamin to negotiate a one-sided contract, and remove
| and replace employees who opposed adoption of the
| contract, and that BCG advocated for Mr. Benjamin's
| promotion to CEO in hopes that he would award BCG with a
| _discretionary bonus_. " [1]
|
| [1] https://law.justia.com/cases/federal/district-
| courts/new-yor...
| doctor_eval wrote:
| I saw it happen with my own eyes.
| kennend3 wrote:
| PS - as a former McKinsey employee.. Would it be fair to
| say your view is biased?
|
| Look at your response on the "agile" comment. They feel
| it was "pure graft" and you defended it without knowing
| any details?
|
| Now look at the other response on this thread, where
| someone stated they saw it first hand as well.
|
| Are they in on the "conspiracy theory" as well, or
| perhaps there is truth to it?
| azemetre wrote:
| I think I will now.
|
| I can't find the comment now, but there was a similar
| conspiracy about ex-Amazon Managers being paid to force
| their new employers to adopt AWS on one of the
| programming subreddits.
| toyg wrote:
| There is usually no forcing: they are typically hired
| because of their AWS knowledge - the business has already
| decided to go AWS, the new hire is doing what he's
| expected to do.
| schnable wrote:
| It's not always so formal or sinister. I've seen
| consultants build relationships with younger managers and
| "rising stars" by buying them lunch and drinks, and even
| doing some free work that makes them look good. Then the
| consultant is an easy connection when there's some
| dollars to hire consultants.
| mbesto wrote:
| Furthermore, they're trying to convince someone else (usually
| a boss) of a theory/idea/strategy that they might have but
| don't have the resources/rapport/etc. to demonstrate it's
| effectiveness.
| tequila_shot wrote:
| This. They are just a rubber stamp on some of the shitty
| decisions that management makes.
| AlexandrB wrote:
| I had an Econ prof who described his consulting business as:
|
| 1. Coming into the company and gathering information from the
| low-level staff.
|
| 2. Presenting the information to management.
|
| 3. Collecting $1000/hr or more for his trouble.
|
| Basically information washing to get execs to accept
| information that they would normally ignore. I wonder how
| much of this kind of thing goes on in industry.
| LAC-Tech wrote:
| IMO that's what a good consultant does! I mean that's much
| more useful than the big 4.
| acdha wrote:
| Where I saw that work it was effectively routing around the
| middle layer: the guy bucking for a promotion based on some
| project isn't going to let any report mention that the
| users hate it, but they'll certainly tell the consultants
| that.
|
| It worked but was a very expensive way to about fixing
| social problems.
| Firmwarrior wrote:
| haha, I definitely saw some of that at Amazon
|
| This highly-paid factory efficiency expert was
| enthusiastically explaining how he works. "You just listen
| to the workers. They know where the inefficiencies are"
| UK-Al05 wrote:
| That's lean.
| globalise83 wrote:
| Not really, lean would be listening to the workers
| pempem wrote:
| No matter how many times you recommend managers do this
| very thing, they do not.
| KineticLensman wrote:
| I have worked as a consultant, but not for the one of the big
| 4. We understood that we were often being used to develop an
| 'independent' perspective that would support a decision that
| had essentially already been made or disprove a rival
| decision.
|
| We also were fully aware of the old joke that a consultant is
| someone who borrows your watch and then tells you the time.
| We sometimes deployed this ourselves with customers, and
| extended it to say that unlike our rivals, we would actually
| point out how late you were and how to get back on track.
|
| [Edit] We sometimes found ourselves supporting one of the big
| 4 companies (as domain experts). We were often amazed by the
| quality of the A team that they would deploy to win the work,
| compared with the B or C team that would then actually
| execute it (often bright but junior staff).
| xapata wrote:
| I'd extend the joke with, "You're wearing it upside-down."
| It's never ceased to amaze me how incompetent large
| organizations can be.
| kriro wrote:
| That's exactly my experience in Europe. We want to fire 50
| people/close a factory/whatever without blowback...let's hire
| McK to tell us to do exactly that.
|
| I've also had some experience working for a smallish company
| with very big clients and they sometimes insisted on having
| an IT-Consulting company like Capgemini as a middleman.
| That's the biggest nightmare because they were always a net-
| negative from my POV...integrating them was just extra work
| and they provided no value except for their brand name to
| make the client feel at ease.
| kneebonian wrote:
| This was one of those big eye opening moments for me.
| Consultants are hired mercenaries in coporate warfare, they
| don't care about you, they don't care about your company or
| the rivalries or the squabbaling. You pay them a bunch of
| money to come run roughshod over your enemies by producing
| reams of analysis and Powerpoints, to fling the arrows of
| jargon, and lay siege to your enemies employees by endlessly
| trapping them in meetings and then they depart.
|
| Consultants are brought in to secure your flank, to provide
| air cover and to act as disposable pawns in interoffice
| combat.
|
| They are not brought in to solve problems, to find solutions,
| or because of their incredibly acumen. It's because they have
| no loyalty or love but money.
| moffkalast wrote:
| Amazing, I'll have to save this quote.
| luckylion wrote:
| So everyone pays them and whoever pays them the least ends
| up with them wreaking havoc on their company by "helping"
| them to "improve" things?
| tjs8rj wrote:
| Based on what? I'm close with a few higher levels at
| different strategy consulting firms, and most of their work
| at these firms we've talked about has been serious: how to
| respond to a firm you've heard of receiving backlash over a
| botched vaccine, balancing a pivot in their product line
| with their existing customer base, etc
|
| Problems that will screw you royally (speaking of the firm
| here) if you get them wrong, so you bring in outside
| perspective that can pattern match your problem to real
| world examples (and get in the room with others who've
| navigated a similar problem) to make sure you take the best
| trajectory.
|
| At worst, consulting is exactly what you say. Large firms,
| being so large, cover the gamut in their services (and so
| surely get some exposure to these more flippant projects).
| The bread and butter of consulting though is solving real
| problems.
|
| From here, this perspective you have about consulting looks
| a lot like the mindset some people have around VC: "they
| just come in to pump companies and dump them in the public
| market / make an exit before the music stops and everyone
| realizes it's bullshit". Of course there's some of that in
| VC, but by and large it's legitimate and serious work,
| focused on legitimate outcomes, and done all around by
| genuine people looking to do a good job - all while
| creating real value for everyone involved.
| freetinker wrote:
| Brilliant. Permission to reuse, please!
| bps4484 wrote:
| "Consultants are hired mercenaries in coporate warfare,
| they don't care about you, they don't care about your
| company or the rivalries or the squabbaling."
|
| "They are not brought in to solve problems"
|
| I've known people that worked for consultancies and the
| biggest value add they think they have brought is when the
| problem is the rivalries, politics, and squabbaling has led
| to inaction and they've needed outside support to come in
| who don't care about these things.
|
| Perhaps we should hope for companies to have leadership
| teams where they are able to cut through this
| intransigence, but unfortunately all too often with old
| companies stuck in their ways this isn't the case.
| freetinker wrote:
| They might see their role as brilliant mediators
| facilitating action by settling feuds using 2x2 matrices,
| but I think that's naive at best, disingenuous at worst.
|
| They care about the agenda of the person they've been
| hired by. Usually a C-level agenda-setter or someone
| influential in the org, and often a McK "alum".
|
| And speaking of action, they have zero stake in the
| actual implementation of what they proselytize.
|
| All this isn't to say that they don't provide value.
| Exchange of money is usually is a reasonable signal of
| providing value, and these firms and its employees do
| reliably well in that area. However, the narratives
| around what value strategy consultants provide I find to
| be truthy, but not actually true.
| not_enoch_wise wrote:
| "Exchange of money is usually is a reasonable signal of
| providing value"
|
| How do I get some of the drugs you're on? Sounds like a
| truly magical journey.
| Loic wrote:
| In fact they have a name for it internally: "Cover my ass
| assignment".
|
| Just come to provide the results the boss wants to have for
| him to rubber stamp and justify the cost cutting.
| SoftTalker wrote:
| Yep. The ability to say "the design was vetted by McKinsey"
| is exactly the cover that they were being paid to provide.
| tyingq wrote:
| _" scapegoat as a service"_ is another common nickname for
| it.
| markhlady wrote:
| Big 4 not really comparable to McKinsey. Completely different
| game and set of projects clients ask you to work on.
| raincom wrote:
| BIG 4 = EY, Deloitte, KPMG, PwC?
|
| Top tier consulting firms are: McKinsey, BCG, Bain
| curiousllama wrote:
| This is the correct answer, btw. Accenture isn't usually
| included in Big 3 or Big 4. It's its own deal, but more
| comparable to Big 4 than Big 3
| tequila_shot wrote:
| the BIG 4 I'm referring to are Accenture, McKinsey, BCG and
| Bain.
| turing_complete wrote:
| One of those four is not like the others.
| hallqv wrote:
| Accenture is not even close to MBB in terms on hourly rates
| (~1/5) & "status". They are a 3rd tier firm.
| curiousllama wrote:
| Keep in mind that Accenture has a lot more variability
| than MBB or Big 4. I've seen McKinsey undercut Accenture
| on price for strategy projects
| throwaway202212 wrote:
| Accenture aren't even in the Vault Consulting Top 50
| rankings. I don't know how this list is calculated but
| people in consulting tend to refer to this (I used to
| work at MBB).
| mbesto wrote:
| That's not the Big 4. There is "Big 4" and "MBB", that's
| it.
|
| Big 4 =
| https://en.wikipedia.org/wiki/Big_Four_accounting_firms
|
| Big Three / MBB = https://en.wikipedia.org/wiki/Big_Three_%
| 28management_consul...
| kabes wrote:
| Accenture is neither in the big 3, nor the big 4.
| luma wrote:
| How do you know an Accenture consultant? They change "Big
| 3" to "Big 4".
| HelloMcFly wrote:
| Accenture has over 700,000 employees. Pretty easy to see
| how they'd get lumped in given they are everywhere,
| working for everyone.
|
| I am not nor have I ever been an Accenture consultant.
| mitt_romney_12 wrote:
| The Big 3 distinction isn't based on firm size (McKinsey,
| Bain, and BCG only have 38k, 25k, and 15k employees
| respectively) but rather on prestige and type of work
| done.
| ThisIsTheWay wrote:
| Is this distinction why they are often called the Top 3,
| not the Big 3?
| mitt_romney_12 wrote:
| I haven't really heard Top 3 so I can't say, usually it's
| Big 3 or MBB. The Big part refers more to prestige and
| influence rather than actually size.
| wheelinsupial wrote:
| Accenture is a new one to me. I've seen MBBD(eloitte)
| used a fair bit, but figured it was just a reddit meme.
| xapata wrote:
| It used to be Arthur Anderson, but they changed their
| name after Enron.
| wheelinsupial wrote:
| Sorry, I should have been more clear. The acronym is MBB
| (McKinsey, Bain, and BCG) that I'm familiar with when
| referring to the top consulting companies. MBBD
| (McKinsey, Bain, BCG, and Deloitte) is a reddit joke that
| I've seen a bunch. The original commenter was using
| McKinsey, Bain, BCG, and Accenture to refer to the "big
| 4" consulting firms. I've worked with Accenture before,
| but I've never heard anyone group Accenture with those
| other consulting firms.
| SargeDebian wrote:
| If you redefine common terms as you go, you should at least
| give the reader a heads up. Nobody uses "big 4" for MBB and
| Accenture. Those are not the same type of companies.
| fphhotchips wrote:
| There's nothing quite so "tell me you worked for
| Accenture without telling me you worked for Accenture" as
| referring to MBB and Accenture as "Big 4".
|
| It's like Deloitte consultants referring to MBBD.
| operatingthetan wrote:
| >It's like Deloitte consultants referring to MBBD.
|
| I'm pretty sure that's just a reddit meme, but I guess
| it's funny someone took it seriously?
| eastbound wrote:
| The whole thread is debating who's sitting in the BIG4
| and all I see is companies trying to belong on musical
| chairs. What's strangest to me is we're not in an early-
| Schumpeter cycle, seats should be well-established by
| now, it's been half a century.
| rr888 wrote:
| Yes https://en.wikipedia.org/wiki/Big_Four_accounting_firms
| blue039 wrote:
| I have worked with the big 4, and also been on the receiving
| end of their "work". I can vouch for this comment personally.
| I've never seen less effort put into something worth so much
| money. Reams and reams of documents, jargon, and other bullshit
| and some cheap, obviously outsourced, incredibly shitty,
| "wireframe" sold as an MVP of a product.
|
| I would be impressed by them if I wasn't so disgusted.
| exclusiv wrote:
| I've also seen some of these expensive "strategic" documents.
| And they looked like they were written by a high schooler
| (not a top of the class student either).
| Foobar8568 wrote:
| Only $150/hour as a Senior in a big4?
| makestuff wrote:
| Since "senior" is in quotes, I am guessing you probably come
| out of undergrad with a senior title or get it after 1-2
| years.
| tequila_shot wrote:
| I'm talking about a fresh out of college grad/undergrad.
|
| Managers charge 400-600(mind you 25% on top of this is for
| travel).
| makestuff wrote:
| How much does each level take home? Like if I bill out at
| $500 an hour are they paying me around 250/hr ~500k/yr?
| ericmay wrote:
| Not exactly. The thing to keep in mind here though is
| that billable rate isn't necessarily 40 hours/week and
| you likely have some sort of salary component that
| requires you to hit a base amount of billable hours.
|
| So something like (just making up numbers here)
|
| $120,000/year $170/hr for each billable hour over 20
| hours/month Sales/delivery bonuses, etc.
| mgkimsal wrote:
| That still seems low for any big4. Those were numbers I
| remember seeing 25 years ago for large consultancies
| personnel.
| Foobar8568 wrote:
| Big4 I used to work are fairly clear about who they call
| senior (consultant / senior consultant / manager / senior
| manager/etc) and I can rarely fault them. Now for
| consultancies (Accenture and the like), the term is a bit
| more loose indeed.
| [deleted]
| fudged71 wrote:
| How common is outsourcing tasks in the big 4? I thought it was
| just things like powerpoint slide layout
| wheelinsupial wrote:
| In my experience, Accenture is the big body shop. I've worked
| at companies that outsource tech strategy, new system
| requirements / scoping, delivery and development, and post
| deployment support and maintenance 100% to Accenture.
|
| There are regional hubs they have (I've worked with
| Philippines and India and heard of Eastern Europe) for the
| support and maintenance.
|
| There are some back office financial shared services (e.g.,
| AP / AR / cutting POs) that they also support. I wouldn't be
| surprised if there was more.
|
| Accenture can give you everything from the PowerPoint slides
| up to the people that will be seconded or placed in your
| organization as contingent workers / contractors.
| yamtaddle wrote:
| That's Big 3 like McKinsey, and yes, notes sent to India,
| India turns them into powerpoints, team on the engagement has
| the powerpoints by the next morning (apparently execs don't
| even _read_ something that 's not in a powerpoint--they'll do
| this with stuff that's only ever going to be emailed, never
| presented)
| carabiner wrote:
| You were Accenture. Just say it.
| wolverine876 wrote:
| What year is that? $150-160/hr is the cost of a local small
| business IT consultant.
| jasmer wrote:
| So that's actually not 'hoodwinked'.
|
| Paying $1B for a site that should cost $50M is 'hoodwinked'.
|
| $150/hr is really not that much money, depending on the
| importance of the project, and having devs from India is fine.
|
| Almost the entirety of the question in any given situation is
| 'Did it work out?'
|
| Because if it did, it was worth it.
|
| Companies are not interested in making 'great products' like a
| startup would, for some secondary thing.
|
| Mostly, it's like construction: they need something built. That
| works. Not some kind of innovative thing.
|
| They don't have a year to find 'top talent' and go through
| interesting architectures, or dynamic processes. They wouldn't
| even know how to do that.
|
| You might be very well downplaying your input: if you are
| competent, know what you are doing, show up, and can solve the
| problem, you're probably worth every penny and much more. Now
| maybe that is or is not the case! Or maybe 'it depends' or
| maybe, some projects kind of necessarily require 'proper
| engineering'.
|
| Now, all of what I just said would apply to normal
| circumstances. In Africa, it's so complicated. McKinsey is also
| very different office by office. Corruption is harder than we
| understand, because when it's a random event we can say 'oh,
| corrupt!' - but when it's normal trade practice aka 5% kickback
| for the buyer, well, it takes on a different characteristic.
| the_cat_kittles wrote:
| your comment just establishes a spectrum- on one extreme, you
| have what is essentially a helpful project manager, on the
| other extreme you have a worse than useless middle man. I
| think the point might be that Mckinsey is more towards the
| bad extreme than people think.
| jasmer wrote:
| For starters - 'McKinsey' actually doesn't do
| implementations. So you're not going to hire them to build
| something. Second, it's hard to fathom their value because
| it's very secretive. There's nary any real objective data.
| paulcole wrote:
| > Paying $1B for a site that should cost $50M is
| 'hoodwinked'.
|
| That's not being hoodwinked either. If you're happy to pay
| $1B for something and get that thing, then that's your fault
| for not shopping around for a better deal.
|
| Bernie Madoff and SBF hoodwinked people. Somebody charging a
| premium for their services and getting willing customers
| isn't.
| photochemsyn wrote:
| Very reminiscent of Chas T Main (bought by Parsons in 1985) as
| described in John Perkin's "Confessions of an Economic Hitman".
|
| https://en.wikipedia.org/wiki/Chas._T._Main
|
| The chapter in Perkin's book on the post-oil shock economic
| entanglements with Saudi Arabia is very relevant. It's
| fundamentally about the establishment of the petrodollar
| recycling scheme that was intended to solve the balance-of-
| payments crisis - i.e. dollars flowing into Gulf Arab
| dictatorships represented a current account imbalance on the
| US/Europe side, which in turned required a capital account
| imbalance on the Saudi side. Thus, buying Saudi oil with dollars
| required the Saudis to invest those dollars back into the USA and
| Europe, and in exchange for agreeing to this scheme the House of
| Saud got military protection, engineering assitance, etc., with
| outfits like Chas T Main and McKinsey and Vinnell serving as the
| glue that held it all together (along with extensive arms sales).
| While many have forgotten, the Shah of Iran was also a key player
| in that system before the Islamic Revolution.
|
| Notably, the vast majority of Saudi citizens live in near-Third
| World conditions, particularly the Shias in the east and the
| tribal groups in the south, not that this gets widely reported,
| while the 15,000+ members of the House of Saud and their hangers-
| on (the bin Ladens, bin Mahfouzes, etc.) collect the vast
| majority of the wealth that isn't re-invested back into the USA.
|
| Understanding current world events really requires an
| understanding of this balance-of-payments dynamic, because that
| was essentially the same deal that was offered to Russia in the
| 1990s under Yeltsin, via the same entities, and which Putin
| eventually rejected after 2003 in favor of using Russian oil
| money to rebuild the Russian military and generally increase the
| general standard of living inside Russia. Prior to that, Putin
| was regularly praised in the US media (much like Syria's Assad
| before his 2009 deals with Iran and Russia).
|
| This also accounts for the differential treatment of various
| authoritarian government leaders by the USA and its economic
| partners like Britain, i.e. Saudi Arabia is not treated like Iran
| or Russia. For example, if Putin had taken that deal, then
| today's war in Ukraine would likely be called 'a fight against
| neo-Nazi terrorist elements' in corporate media, much as the
| Saudi assault on Yemen is protrayed as a struggle against Al
| Qaeda and so on.
|
| This is certainly no defense of Putin, who has held onto power
| for decades now - but there aren't really any 'good guys' in this
| storyline, the 'democratic norms and humanitarian values' claims
| are all nonsense. It's more like how the New York City mafia
| organizations or the Mexican drug cartels fought each other over
| access to territory and profits than anything else.
| hammock wrote:
| What are your thoughts on Biden's efforts to force a move away
| from oil for much of the US energy needs.. will this/is this
| intended or related to an effort to eliminate or replace the
| petrodollar system in any way?
| selimthegrim wrote:
| Putin canned Serdyukov pretty quickly, so you can scratch the
| 'rebuild Russian military" off the list
| mjfl wrote:
| People who are paid to have credentials that are deffered to in
| courts of law.
| richardwhiuk wrote:
| Interesting to know to what extent McKinsey is liable under the
| Foreign Corrupt Practices Act here....
| xrayarx wrote:
| The article starts with an Indian dynasty in South Africa is
| cought with the most brazen corruption. Around 10% of the annual
| gdp where stolen, with the help of mckinsey.
|
| The rest is a history of consulting companies and their
| (criminal) endeavours
| newsclues wrote:
| When I think of McKinsey, I think of organized crime.
|
| It seems like gangsters in suits.
| cjbgkagh wrote:
| There is quite a lot of overlap. For a while I was neighbors
| with bottom tier Russian mafia members working at McKinsey at
| do nothing jobs. They would tell me about their yearly Mea-
| Culpa whenever McKinsey was caught in yet another scandal.
|
| Edit: corrected spelling, thanks
| SargeDebian wrote:
| Baker McKenzie is a law firm, that's not the same company.
| hackandthink wrote:
| Best friends with Purdue/Sackler.
|
| Wikipedia:
|
| "In February 2021, McKinsey paid $600 million to settle
| investigations into its role in promoting sales of OxyContin
| and fueling the greater opioid epidemic"
| aeschinder wrote:
| Previous company of mine wanted to make drastic reorganization
| changes and so they hired McKinsey to simply echo what they
| already wanted to happen. This is to provide cover for upper
| management (a.k.a. the "wooden desks") who can then use the
| official McKinsey report as a shield against any backlash. They
| can simply point at the report and shrug their shoulders in
| apparent helplessness in the face of the recommendations of the
| "experts". It was quite the Office Space moment.
| whatever1 wrote:
| Nobody trusts consulting companies, but they are like a notary
| service. The c suite wants a change, the big 4 will create a deck
| that supports that with their seal of approval. Then the c-execs
| can present it to the board and move on with their original plan.
| [deleted]
| occasionaldev wrote:
| This is only one part of it, but pay grades for government
| employees in the US are far lower than private industry when it
| comes to things like software developers. Just look at the GS
| rates [1], why would a good developer choose to make 50% or less
| of what they could make in the private sector? It'd be hard to
| convince the general public that we should be paying $100k+ for
| young devs working directly for the government, which is already
| more money than most senior level scheduled gov employees.
|
| So we then have this whole convoluted contracting process where
| consultancies run by people who know how to write and win bids,
| but know nothing about software engineering, end up being hired
| to write software systems. All because the government can't
| really build highly skilled teams on their own.
|
| Again, it's not all of the problem (not by a long shot), but it
| definitely contributes. Plus, the government employing people
| directly is socialism, but paying an incompetent consulting firm
| that plays middle-man to the system isn't.
|
| [1] https://www.federalpay.org/gs/2022
| alistairSH wrote:
| Make sure to drill into the pay scales by location... suburban
| DC gets a 30% bump. SV/Bay Area is >40% bump over base GS
| scale.
|
| Why would somebody take the .gov job? Same reason anybody would
| take a .gov job... Benefits (though that gap has closed).
|
| Work/life balance.
|
| Job security.
|
| Interesting work (agency-dependent).
|
| Inertia + location (many of my peers who are bureaucrats come
| from families of bureaucrats and are DC natives)
|
| Anyways, the government can't hire developers not because the
| salary is too low but because the electorate has decided the
| government should be "small" which forces outsourcing to the
| big name consulting/contracting shops.
| miguelazo wrote:
| Partly because private sector tech salaries were artificially
| inflated to an insane degree by cheap money that flooded VC
| coffers.
| demuxxed wrote:
| The money is real at some companies. We're less than 100
| people with more than 200m in yearly revenue. Market
| positioning is worth more than engineering excellence, but
| paying top salaries to reduce the execution risk is worth it.
|
| I would expect the leetcoding and system design interviews
| across the industry to get much tougher and juniors to get
| squeezed out before top salaries drop.
|
| Software has very high leverage in the right markets. It's
| comparable to pro euro football where the teams that already
| have eyeballs will pay huge sums for top players in order to
| keep the eyeballs. Software salaries will only become more
| bimodal as VC money tightens.
| Spooky23 wrote:
| I've worked for .gov, but not Federal. The appeal is:
|
| - Sense of purpose. You're working to perform some function
| with integrity and to the best of your ability. There's no
| profit driven pressure.
|
| - Career / Long Game. Typically you earn 50th percentile
| salary, but if you stay that doesn't tell the story. In some
| places benefits are 50% of salary. That usually means best in
| class health benefits and often a defined benefit pension.
|
| - PTO - the place where I was at I received 7 weeks of vacation
| and 3 weeks of sick time annually.
|
| Government is a good place to start. McKinsey is a good landing
| zone for apprentice MBA types.
| luckylion wrote:
| They'd make 50% or less of what they make in the private sector
| for the difference in job security and workload.
| ubermonkey wrote:
| I'm of the age where, as a fresh grad, I was kind of impressed by
| the Big Consultancies in general and by McKinsey in particular.
|
| Few of my viewpoints have changed more drastically in the last 30
| years. Now, when I see someone has one of those firms on their
| resume or business card, I just assume they're not someone I want
| to hire or work with. Or even have a beer with.
| neilv wrote:
| Both of the ex-McKinsey people I've worked with have been
| decent.
| college_physics wrote:
| the book that would factually describe the bizarro world of large
| corporations and the fungal ecosystems that have been structured
| around them has not been written yet and it won't be written for
| a while.
|
| it would have chapters laying out the Kafkaesque, extractive
| bureaucracy, the amoral shenanigans concocted between lawyers,
| accountants and consultant suits in the remote top floors of tall
| glass buildings, the endless financial engineering, the non-stop
| cut-and-paste acquisitions and disposals, the vacuity of
| management fads and the zero signal-to-noise ratio of inane
| powerpoints regurgitating platitudes (the high-art of saying
| nothing because reality is too gross to discuss).
|
| somehow we are supposed to believe that this is the pinnacle of
| successful private enterprise. the natural evolution of "best
| practice" as articulated in posh business schools
|
| in fact historians of the future, with the independence and
| clarity granted by the passage of time would be very brutal about
| the type of social pathology this is.
| Havoc wrote:
| They basically played the role of willing useful idiot. A side
| story really.
|
| The real story here is that it took a decade+ to arrest (not
| convict...arrest) the Guptas and the vast majority of the money
| is likely never to be recovered (disappeared into middle east).
| i.e. Functionally this was a successful heist of multi-
| generational wealth.
|
| Same story on government enablers size - Zuma clan is now
| wealthy.
|
| The will to go after players like this is simply not there - in
| SA or internationally. Good business breaking countries it seems
| stephc_int13 wrote:
| In case some you are not aware; McKinsey and similar companies
| have been progressively replacing public servants in government
| offices and administrations all over the world, for decades.
|
| There was a relatively big scandal in France before the last
| election, as they crossed some lines, but this is far from over.
| diogenescynic wrote:
| When I worked at PayPal, the Assistant Treasurer's husband worked
| at Deloitte and then the Assistant Treasurer greatly expanded the
| number of consultants used by Deloitte (from the same team as her
| husband and many of them actually reported to her husband). They
| were usually working on unaccountable projects and billing us for
| work we did ourselves. Many of the consultants were fresh college
| grads with no relevant experience. Hilariously, one lived in
| Berkeley but would get a hotel in San Jose during the week to
| avoid commuting. I was always flabbergasted no one cared about
| how the budget was being spent. The people pushing consultant
| budgets are usually the worst sort of managers and doing it
| because of some ulterior motive in my opinion.
| keepquestioning wrote:
| ahelwer wrote:
| There are plenty of non-old-white-boys at McKinsey doing
| heinous stuff. I wish fixing things was as simple as increasing
| diversity, I really really do. Improving diversity is laudable
| goal in itself; don't count on it to fix these sorts of
| problems.
| blahblah1234567 wrote:
| no offense, but "human nature" disregards all physical/mental
| characteristics.
| banannaise wrote:
| No it doesn't. It _should_ , if assessed accurately and
| without bias, but it doesn't, largely because those
| conditions are impossible.
| blahblah1234567 wrote:
| My personal, humble opinion: Recent political trends and
| the shaky, politicized conclusions they posit do not
| supersede human nature.
| curiousllama wrote:
| Everyone is saying that ChatGPT is going to make homework &
| internet forums irrelevant. How about consultants? They're just
| putting words on a page anyway - you think that can't be
| automated?
|
| Honestly, I think I might try...
| malthaus wrote:
| Every single consulting article brings out comments who make the
| same mistake:
|
| There's a difference between strategy consulting (e.g. McKinsey,
| BCG, Bain) and consultants that do large implementation projects
| (e.g. Accenture).
|
| Yes, it's not so black and white these days as both do a bit of
| both but the reasons they are hired are very different:
|
| Strategy: best practices, ass-covering, politics. Smaller teams,
| shorter timeframe, C-level. Think interviews & powerpoint slides.
|
| Implementation: body leasing, offloading large projects. Larger
| teams, IT-heavy, longer timeframes. Actual coding /
| documentation, etc.
|
| And no, your experience working on a 300-people core banking
| project at Accenture doesn't translate to a 5-people McKinsey
| project.
|
| And while both types are "expensive", they are needed in the
| corporate world. Because work in that environment is more than
| just writing code in a text editor, it's mostly politics at the
| top.
| mitt_romney_12 wrote:
| The big problem with talking about consulting is that there are
| so many different people doing so many different things that
| are all called just "consulting". Everyone has a different idea
| of what consulting is since they worked with different types of
| consultants but it all just gets called "consulting". Even in
| this article they talk about McKinsey's strategy work and their
| tech work basically interchangeably, even though the two are
| very different things.
| i_am_proteus wrote:
| Would you describe examples of negative impacts to businesses'
| performance from not hiring these firms?
| curiousllama wrote:
| It's not uncommon for firms that need to do big layoffs to
| not hire consulting firms, and then screw up the layoffs
| (multiple rounds, bad severance, etc.)
|
| There's a certain class of work that is (1) really critical
| to get right the first time and (2) only done once a decade.
| That's the type of stuff where it's good to hire an outside
| firm - the outside guys go from company to company, doing
| this one rare thing over and over.
|
| Other examples might include M&A (eg divestitures),
| offshoring (eg standing up a factory in Mexico), or new
| market entry (eg launching a product in a brand new country).
| bambax wrote:
| The article doesn't mention it, but McKinsey in France is
| currently under judicial inquiries for at least two reasons:
|
| - They worked on the presidential campaigns of Macron in 2017 and
| 2022, and were awarded huge government contracts with little or
| no bidding afterwards
|
| - They didn't pay any taxes in France since 2011, sending money
| to the mothership instead to reduce taxable profits to zero; and
| their managing partner, who is accused of having lied to
| parliament about it, resigned in the wake of that discovery.
|
| Here's one article (of many), in French:
|
| https://www.leparisien.fr/faits-divers/affaire-mckinsey-une-...
|
| (Disable javascript to bypass the firewall).
|
| So it's not just South Africa, UK and the US; it really is
| everywhere.
| 1vuio0pswjnm7 wrote:
| "The Department of Homeland Security and the Pentagon paid all
| three firms lavishly for `engaging human- centred design',
| developing a `culture of continuous improvement' and other
| meaningless bits of management-speak festooned with cryptic
| acronyms."
|
| As a younger person, I recall being informed that a culture of
| continuous improvement originated in the manufacturing centres of
| Japan after WWII. They told us the term for it was "kaizen". I do
| not know if any of that was true, but it sounded sensible then
| and I always carried the idea with me.
|
| Having used it in sports coaching and having seen the results on
| the playing field, I do not consider a "culture of continuous
| improvement" to be meaningless management-speak. Assuming one can
| get a team to buy-in, it works.
|
| IMHO, the alternative to continuously trying to improve,
| complacency, mediocrity, laziness, or whatever we choose to call
| it, is nothing to celebrate.
|
| Please note. Not intending to defend McKinsey here or clients who
| spend taxapayer revenue on vacuous consulting. But as a general
| principle, I would defend the idea of "creating a culture of
| continuous improvement". Same goes for the oft-used term "growth
| mindset". The terminology might sound silly, but the principles
| are sound, not to mention timeless, IMHO.
|
| Maybe I misread the sentence in the context of the article. If
| so, pay no mind.
|
| (I did peruse the book a while back and discussed it with a
| friend who used to work for a McKinsey competitor.)
| SoftTalker wrote:
| I think the difference is one of introducing all the jargon and
| acronyms and vocabulary for something like "culture of
| continuous improvement" vs. actually implementing it.
|
| It's easy to talk. It's easy to convice yourself that talking
| and ceremony == doing. But it's the doing that matters.
| mitchbob wrote:
| Archived: https://archive.ph/yC1YQ
| neonate wrote:
| http://web.archive.org/web/20221205184247/https://www.lrb.co...
| CrypticShift wrote:
| At least, this book will make amazon books search results for
| "McKinsey" a little more balanced...
|
| Does anybody know how much McKinsey services are used in the
| C-suite around silicon valley (Or big tech in general) ?
| throwaway202212 wrote:
| Former McKinsey employee here. They have a large office in
| Silicon Valley and serve most of the big tech companies
| (largely on boring non-tech topics).
| mck_throwaway wrote:
| I worked at McKinsey for three years. Here are a few thoughts.
| Sorry it's so long, didn't have time to make it more concise.
|
| - I'd guess >95% of people never run into anything morally
| questionable while there. My teams always tried to do their best
| and I never felt like we were helping achieve any sort of
| nefarious goal. Most of the time I think we were worth the money
| for our clients.
|
| - I do think the culture makes it more likely for individuals to
| take risks that may end up getting them in trouble. There's a lot
| of pressure to succeed, and a lot of money (and prestige) at
| stake. It's easy to imagine individuals cracking under that
| pressure and making bad choices, and that the rest of the team
| might fall in line so that they can also succeed. I'd put most of
| the blame here on McKinsey and some on the individuals involved -
| maybe 70/30.
|
| - I'd guess most other consultancies have bodies hidden somewhere
| that are similar to McKinsey's (questionable contracts, outright
| fraud, botched projects, moral failures, etc).
|
| - The closest I got to something morally questionable was a
| project where we had a huge contract to help the client cut
| costs, including firing people. You'd think our budget would have
| been on the chopping block too, but I guess not. Obviously this
| left a bad taste in most of our mouths. I feel we tried to do our
| best, but I doubt we were worth our fees in that instance. The
| company eventually merged with another, so even more people were
| fired in the end.
|
| - The 'internal firewalls' are real - if you've been on a project
| for one big company in an industry, they won't let you work for a
| project with another one. There were internal experts we couldn't
| talk to because of concerns in this area. I'm sure this hasn't
| been 100% true 100% of the time, but generally I think this is a
| real concern for McK (if they couldn't guarantee this they'd lose
| client trust) so they make a real effort to prevent it.
|
| - While I was there, projects with the tobacco companies were
| famous for having better work/life balance than almost any other
| project. They were hard to staff because so many junior
| consultants refused on ethical grounds, so I guess this was a
| carrot?
|
| - I can mostly only speak to the US. I heard some jawdropping
| stories about how reliant the Saudi government is on McKinsey and
| other consultants to get almost _any_ work done, even the most
| basic things. But that 's all secondhand gossip. In general, the
| sense I get is that the standard in the US offices doesn't carry
| over to every global location, but I don't have the personal
| experience to say that for sure.
| throwaway202212 wrote:
| I also worked at McKinsey. 5 years, with some of that time in
| the Johannesburg office. Agree with the above and don't have
| much to add. But AMA.
| makestuff wrote:
| What is the coolest project you worked on?
|
| Will the big3 be around in 15-20 years or is it a dying
| industry with many of the best people leaving for exist opps
| in tech/finance/etc.
| oscare wrote:
| Would it be fair to say that consulting firms could get the top
| (good) people in a developed country, but also is more likely
| to hire the smartest but corrupt people in a corrupt country?
| As that is the name of the game in those countries.
|
| And the HQ not caring as much because those other countries
| bring in the 'franchise fee'. At the risk of a story like this.
| mck_throwaway wrote:
| In my experience McKinsey (like most consultancies) does
| almost all its hiring directly out of college or grad school.
| Hiring outside those pipelines was becoming a little more
| common when I left, but I'd imagine it's still probably <10%
| of the total.
|
| I don't think there'd be much hiring of already 'corrupt'
| people, but it's pretty reasonable that when you have a very
| competitive and prestigious position, on average, you might
| find that more 'cutthroat' people are more willing to invest
| time and energy to getting hired.
| oneoff786 wrote:
| The folks that work on tobacco clients need to go to tobacco
| clients. They smoke ALL the time there. I've heard it's a
| terrible thing to get staffed on unless you're a big smoker
| yourself.
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