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McKinsey and American Business

Friday, September 13, 2013

Founded in 1926, McKinsey consultants have brought change to the nation’s best organizations, remapped the power structure within the White House, and even revo­lutionized business schools. Financial journalist Duff McDonald shows how McKinsey hasinfluenced the course of American capitalism. In The Firm: The Story of McKinsey and Its Secret Influence on American Business he looks at how McKinsey helped invent most of the tools of modern management, it's successes, and its failures.

Guests:

Duff McDonald

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Comments [8]

erg, I meant to say Bower was from Jones Day, of course.

Sep. 13 2013 01:02 PM

Ah, Jones Day, McKinsey's old employer, rears its ugly head again.

Though law firms were not themselves on trial, it was Jones Day and a few others that US Federal Judge Gladys Kessler had in mind when she wrote, in her 1700 page decision that found tobacco companies guilty of racketeering (recently upheld by SCOTUS):

"Finally, a word must be said about the role of lawyers in this fifty-year history of deceiving smokers, potential smokers, and the American public about the hazards of smoking and second hand smoke, and the addictiveness of nicotine. At every stage, lawyers played an absolutely central role in the creation and perpetuation of the Enterprise and the implementation of its fraudulent schemes.

"They devised and coordinated both national and international strategy; they directed scientists as to what research they should and should not undertake; they vetted scientific research papers and reports as well as public relations materials to ensure that the interests of the Enterprise would be protected; they identified “friendly” scientific witnesses, subsidized them with grants from the Center for Tobacco Research and the Center for Indoor Air Research, paid them enormous fees, and often hid the relationship between those witnesses and the industry; and they devised and carried out document destruction policies and took shelter behind baseless assertions of the attorney client privilege.

"What a sad and disquieting chapter in the history of an honorable and often courageous profession."

Sep. 13 2013 12:56 PM
LL from UWS

This interview is a KEEPER! Please rebroadcast! If possible, invite the author back for a follow up.

Sep. 13 2013 12:39 PM
David

Some of the brightest people I know started with McKinsey. The problem I always had when McKinsey was called in was while they may have given sound advice strategically, they didn't know the interoffice workings and/or personalities that would ultimately be the keys to successful implementation.

Sep. 13 2013 12:38 PM
LL from UWS

McKinsey? I was tangentially involved in one of their major corporate projects. No wonder CEOs love them--when called in to recommend drastic cost-cutting they didn't recommend cutting the top officers' luxury travel budget. First Class all the way.

McKinsey consultants kept private car service waiting all day while they worked at a satellite office which was a very,very short walk at each end of a ten minute train ride from main headquarters.

An engineer once told me that what is needed is a good housewife to advise management. I doubt that a housewife could strike fear in employees' hearts the way the news that McKinsey is coming does.

Sep. 13 2013 12:36 PM

Could Mr Macdonald comment on the role of McKinsey in the company Novartis who was advised to purchase the vaccine maker Chiron for $5 billion and subsequently hired ex-McKinsey employees to run the vaccine division. The division has never made money and in fact is consistently losing $250 million a year the last few years.

Sep. 13 2013 12:34 PM
Jenna

I worked for a company that was a significant user of McKinsey. I heard, by senior management, that since they usually have the ear of the CEO, they will use blackmail and threatening tactics to ensure agreement with their recommendations. How they do this is by telling the CEO that "someone is not on board". There are those who even used the term " mafia" to describe their methodology and influence.

If you use this comment on air, please do so confidentially.

Thanks.

Sep. 13 2013 12:31 PM
Tony from Canarsie

Please ask your guest about the connections between McKinsey & Company and Enron.

Sep. 13 2013 12:26 PM

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