Does McKinsey consultants do anything?

[Anonymous]

Been at multiple companies over my career who have turned to McKinsey for 'ideas' to 'improve efficiency', etc. etc. You know how the whole schtick like Office Space goes with outside consultants. Does the advice from McKinsey actually ever affect outcomes over the long run. It almost always seems like consultants follow the same formulaic crap to implement change. Why do companies pay them so much for their 'advice'? Seems like a huge waste of money. The biggest inefficiencies seems to be wasting money on consultants in the first place. I seriously don't see the prestige for working for McKinsey et al. at all. Consulting has the be the most lucrative gig on the planet to do nothing except make some spiffy power point slides and to come up with new catch phrases/lingo.

[Anonymous]

Not really. They figure out what the company wants to hear and tells them that in a spiffy power point.

They are also very good at allowing companies to justify lay-offs by recommending those as a cost-cutting measure. Rather than, as you pointed out, not paying for ridiculously priced consultants.

[Anonymous]

I thought they provide cover for firing people.

[Anonymous]

Typical formula:

1) reorganize structure
2) implement x/y/z tools
3) layoff people
4) collect $2000/hr

[Anonymous]

Anonymous wrote:I thought they provide cover for firing people.

Why do you need cover to fire people?

Just cut costs. A CEO w/ any business sense shouldn't need to hire ridiculously overpriced consultants to figure out when to cut costs. The excuse that you need McKinesey to signoff on layoffs has never made sense to me.

Want to cut costs? Stop hiring consultants to tell you that you need to cut costs.

[Anonymous]

"Nobody gets fired for buying IBM."

You're a C-level executive who isn't meeting targets? Hire McKinsey. They generate ideas and/or tell you what you want to hear -- it doesn't really matter which -- and you do it. Either it works or it doesn't. But you don't get fired, because you used McKinsey. Either they helped, and you keep your job because you hired them, or they didn't, and you keep your job because hey, you tried the best in the business.

In all honesty, there are probably inflection points where that kind of consultant does make sense. Like, two airlines of equal size merge. In-house, neither airline is going to have people whose jobs are analyzing redundancies and comparing costs to decide which HQ to axe and which people to move around and which ones to let go of. So in that kind of case, hiring a bunch of consultants to come in and do it maybe makes some sense.

But the "idea generation" idea is silly.

[Anonymous]

Anonymous wrote:I thought they provide cover for firing people.

Exactly. DH had an experience where McKinsey came in during a merger and tried to get the senior staff to give details on areas to improve efficiency and nobody cooperated with them.

[Anonymous]

Also, they only recruit money-hungry Ivy jerks.

[Anonymous]

Q: What's a consultant?
A: Someone who borrows your watch and then tells you what time it is.

[Anonymous]

As someone who works at an MBB - honestly this assessment is fair.

[Anonymous]

MBB have amazing exits into PE, VC, Csuit.

I am jelly.

[Anonymous]

Can someone explain the concept of McKinsey consultants to me? I know a young lady who just started working for McKinsey as a business analyst. She is 22 years old and graduated from Notre Dame with a degree in Italian and Program of Liberal Studies (ie great books). How does this qualify her to "consult" with multinational companies? I mean, she's smart -- obviously -- but I've never quite understood this. (I'm not in a field that uses consultants)

[Anonymous]

I come from third tier consulting, we take a look at a company’s practice - such as tools, processes, control environments, and implement new functions as needed. For example, one process involves complicated computation and is prone to error, we will recommend a peer review step.

We also review the policy and procedures to determine if they are clear and precise.

We conduct financial due diligence for mergers or leveraged financing transactions.

[Anonymous]

Anonymous wrote:I come from third tier consulting, we take a look at a company’s practice - such as tools, processes, control environments, and implement new functions as needed. For example, one process involves complicated computation and is prone to error, we will recommend a peer review step.

We also review the policy and procedures to determine if they are clear and precise.

We conduct financial due diligence for mergers or leveraged financing transactions.

How would you know it better than the company themselves? Their market research is going to be much better than what you could do in a couple of weeks. Also, they understand the deficiencies but may be don't have the balls to tell the c-suite staff that consultants could do.

Companies that run well don't need outside consultants.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I come from third tier consulting, we take a look at a company’s practice - such as tools, processes, control environments, and implement new functions as needed. For example, one process involves complicated computation and is prone to error, we will recommend a peer review step.

We also review the policy and procedures to determine if they are clear and precise.

We conduct financial due diligence for mergers or leveraged financing transactions.

How would you know it better than the company themselves? Their market research is going to be much better than what you could do in a couple of weeks. Also, they understand the deficiencies but may be don't have the balls to tell the c-suite staff that consultants could do.

Companies that run well don't need outside consultants.

This is not quite right. Companies that are run well use consultants extensively. But they are used for tailored projects where the company does not have the time or people to think about. The idea that MBB only works for bad companies is nuts. They work for just about every large company public or private.