(Off to dig my tongue out of the deep hole in my cheek.)
[EDIT] Well, and also it's not kept within the host country, but exports those ideas & methods globally.
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.
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.
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.
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.
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.
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...
Because of this, it is now irrefutable that this takes place and this is your response?
"I can only speak to my own experience..".. Well.. Have you considered your experience may be severely limited?
Perhaps in the future don't be so fast to pull the "conspiracy" card?
I'm not legally literate enough to understand the court opinion you attached. Regardless, of course there will be cases of bad players in any large company - that goes without saying. But its tiresome always hearing the same "McKinsey is the root of all evil and secretly influences governments and companies".
The opinion that most engineers have of MBB is often based on conjecture as they typically have only ever hard arms length exposure to such consulting firms. As a software engineer myself, working at both startups and FAANG before McKinsey, I was of the exact same opinion about McKinsey and these types of companies. The truth is much more mundane and boring though.
That's the best strategy to prevent the masses from investigating further. You shouldn't label something like you did if you haven't done your research.
> legally literate enough to understand the court opinion you attached
I think you are literate enough to read and understand the key part I included in quotes for you, from the ruling which completely refutes your prior position, and attitude, with hard evidence. It's as clear as day!!!
> McKinsey is the root of all evil and secretly influences governments and companies
Well they've had a lot of bad looks, especially with their role with Purdue Pharma and OxyContin. Their former alumni was CEO of Enron which they consulted for 15 years. "But up until the very end, it was promoting Enron’s business model, especially its off-balance sheet accounting practice, and encouraging others to follow suit." They "recommended ICE save money on food served to the detainees or send the migrants to facilities in rural areas to cut back on expenditure" They agreed to pay $100M to South African government in a corruption scandal [1]
Last year, one of their private investment funds agreed to pay $18M to settle an SEC issue regarding insider information gleaned from the corporate consulting business. [2] They have a hedge fund which makes bets on the advice they sell.
Here's another one regarding McKinsey & their investment office (MIO) and Valeant Pharmaceuticals which buys out other drugmakers and jacks up prices. "Four top Valeant officials, including Mr. Pearson, were McKinsey veterans, and the firm was advising Valeant on drug prices and acquisitions." Later in the article, "a federal judge in Virginia last month reopened a coal-company bankruptcy case after learning that McKinsey had not disclosed, as required by law, that it was also among the company’s secured creditors, through MIO". Further down: "An investigation requested by the oversight board found that MIO had five direct and indirect investments in Puerto Rico’s debt while McKinsey advised the island". [3]
So you start to look at all these big corporate consulting firms and if you are being unbiased, you can see it's systemic. They wield a lot of power and influence. They get their alumni and friends placed in government and huge companies and then make deals and institute their strategies to make a ton of money.
> The truth is much more mundane and boring though.
Yes from your position it would be. You aren't the one placing CEOs, making kick back deals, getting involved with foreign governments and corruption, writing strategy for Encron, ICE or OxyContin, investing in company government debt on one side and advising on it the other. The system isn't designed for people like you to be included in that part of the business.
In my opinion, people fall into one of these buckets - pawn, shill, or informed. In an information age, isn't it remarkable that most STILL fall into the pawn category?
[1] https://www.trtworld.com/magazine/the-many-times-mckinsey-ha...
[2] https://www.nbcnews.com/business/corporations/investment-fun...
[3] New York Times - https://archive.ph/ZSDBH
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?
I think we need to be more critical of what it means to see things "first hand". MBB are typically operating at the executive level and the motivations between executives decisions typically don't reach the "rank and file" of the organization (forgive the wording). In my response I mentioned that the cost of engaging McKinsey is so extremely high that there will need to be some type of rational justification for bringing them in (beyond just covering my ass).
That being said, I worked on a few projects where I wasn't sure whether the cost justifies the benefits but this was largely due to incompetence or overselling - never "pure graft".
I think everyone needs to be more critical of "Shill" accounts such as yours.
You are fast to assume that i did not see it "first hand", slow to realize that this does take place and when provided new information (the lawsuit post) unwilling/unable to incorporate new information into your position.
What value do you feel you are adding to the conversation? You seem to be wearing your McKinsey hat "they never do anything wrong, it is all justified just not at your level"..
I'm trying to offer a unique opinion of a software engineer who spent a short time working in this industry. If you're not buying it then no problem.
Personally, I would never invite McKinsey or any of these companies into my own company. But then again I don't run a 100k person company.
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.
At the micro level, I would agree that in some cases there was a tendency of some to make things more complex than necessary. The implicit intent here was generally to demonstrate some type of credential to lay people.
That being said, at least in my personal experience, most of the actual recommendations were backed by as much data as possible. In the projects I worked on, I don't think a single slide went by without hours of debate and critique by the partners. It was a given that any recommendation should be supported by data.
That being said, there are also lots of cases where there is no right/wrong answer - especially given the timeframe (typically 4-8 weeks). Companies basically pay consultants to come in, analyse as much data as feasible and just make some type of informed decision. In most cases the company is either unwilling to make that decision themselves or does not have the ability to do so (i.e. organisation is too complex to tackle this problem within so just get an outsider to cut across the company and get it sorted as best as possible).
And an insurmountable barrier to then declare it was a waste of money.
ie once these initiatives start - they are inevitably declared successes because too much has been invested ( literally ).
So the consultants always leave with success declared, whether it works out in the long run I suspect the consultants will hardly ever know - just moving on from one declared success to another.
There are obviously lots of hacks and shenanigans around defining and negotiating these success metrics with various "levels" [1] of impact being defined and fees being released only when some stage is crossed.
[1] https://www.mckinsey.com/capabilities/rts/our-insights/keepi...
There was a genuine and optimistic belief in agile among programmers and management. They tried and failed refusing to admit the mistake and doubling down on all the BS.
It works perfectly fine to hire consults to do welding courses for the employees. If agile was a good idea "agile consultants" would do fine to.
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.
"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.
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.
How do I get some of the drugs you're on? Sounds like a truly magical journey.
One team had no clear leadership, and there was an important milestone coming up that the team didn't seem to be orienting around. I started kicking up a fuss in meetings by constantly asking "Is this important for our April launch?". I know I upset at least one person, but with some help from management we ended up collectively getting the launch back on track.
At another company my perspective was relayed through my consulting company to the client's upper management, and that ended up being used to fire someone. It doesn't feel good - he was a nice guy. But he was genuinely useless. He spent about 90% of his attention brown nosing to upper management. Once or twice he even actively sabotaged the team in small ways so he could be seen stepping in and fixing the problem. I think they wanted to get rid of him anyway but they didn't have legal cover.
There's absolutely value for companies in having outside consultants sit amongst a team. But its a subtle kind of value. I thought I was brought in to write code. Hah!
Certainly though if all they're doing is parroting back conclusions backed by "research" that the exec who hired them wants to hear then they aren't providing much value, other than perhaps providing air cover when some decision, any decision, is better than no decision and gridlock.
In my experience, hope has always been a terribly poor and ineffective strategy.
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.
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).
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.
This highly-paid factory efficiency expert was enthusiastically explaining how he works. "You just listen to the workers. They know where the inefficiencies are"
It worked but was a very expensive way to about fixing social problems.
Just come to provide the results the boss wants to have for him to rubber stamp and justify the cost cutting.
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.
- when things go well, they can take the credit, or
- when things go bad, they can blame the consulting company.
Grubby business if you ask me.
The other half haven't figured it out and think they're getting top-tier stuff and end up with life destroying garbage like your employee performance system or a citywide trash crisis? [1]
Do you need to spend millions to justify an inevitable decision but blame the hired guns for it? Hire McKinsey.
Do you need to spend millions for severely overworked junior grade consultants and offshored "experts" to provide you with objectively terrible advice and create an opioid epidemic? Also hire McKinsey! [2]
1 - https://www.nytimes.com/2022/10/07/nyregion/new-york-city-tr... 2 - https://www.mckinsey.com/about-us/opioidfacts
Everyone knew that one of 'big 4' was hired to make the prospects of going public legit and credible. That consulting firm made things look right in exchange of big bucks.
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.
- Client is a legacy bank
- Client wants to be a fancy new cool digital bank like Revolut
- Client brings in McKinsey to help get them there
- McKinsey (traditional side) does a strategy engagement first (4-8 weeks) to define priorities, budget, etc
- McKinsey Digital + traditional consultants come in to do the implementation. This includes architecture, actual tech building (more on this below), assisting with hiring and HR, coaching, financials, integration/de-integration with rest of business. Essentially everything involved with starting a "new" business.
If you want a single company to come in and literally do everything to build and run a new business I do think you would need an MBB-type company as they can bring in all these different skills (business, people, tech, process etc). I'm very reluctant to praise my former employer.
On the actual tech building side, McKinsey would typically bring only 1-3 technical people as it's cost prohibitive for the client (I was one of those people). McKinsey would help the client hire new people or bring in contractors (i.e. Nagarro and the likes).
I suspect probably not unless they were following/copying some very tried and true path of an upstart.
'New Models' have so many dynamic aspects, you need 'good people and leadership' to do it, and generally it's hard for them to be truly copied.
Some smart consultants and a well-lead offshore team could make a run at it ... but it's a bit risky I think.
I can see how people might think that would work but I'm skeptical.
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.
I would be impressed by them if I wasn't so disgusted.
Top tier consulting firms are: McKinsey, BCG, Bain
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?
I am not nor have I ever been an Accenture consultant.
Big 4 = https://en.wikipedia.org/wiki/Big_Four_accounting_firms
Big Three / MBB = https://en.wikipedia.org/wiki/Big_Three_%28management_consul...
Managers charge 400-600(mind you 25% on top of this is for travel).
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.
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.
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)
Do the 80 hour work weeks not ruin the psychology of non-LGBTQ folxs?
What if you have a grocery store that makes $50,000 an hour? and you need to update the payroll software to deal with the latest tax law changes.
in a situation like that, does $150/hr matter?
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.