McKinsey and the capacity of business for evil
Interesting tweet thread about McKinsey here:
The claim is that McKinsey is being really smart and transforming itself. But I think that people come over all unnecessary when they talk about McKinsey — both as fanboys and as haters.
This isn’t (as Clayton Christensen talked about when on payroll) transforming consulting; this is good old-fashioned flogging of product to a captive audience.
It has a pay-off ($100m annual recurring revenue could pay one Oxycontin fine every six years), but it has a cost too; several costs.
Fundamentally, it undermines any pretence to neutral strategic or operational advice.
And it changes the business model; selling expertise is different from selling product. And obviously it corrupts any kind of independent analysis.
It’s also not a ‘lot’ of acquisitions — just ask Accenture!
If McKinsey had truly turned consulting into software, I’d be impressed; consultancy is about situational analysis in complexity, so that would require (at least) human-complete AGI.
No doubt there can be (and they will have) software that can supplement consultancy advice, particularly in the replicable, technical areas (industry analysis according to a specific pattern) that they would previously have used grunt-power of volumes of business school grads to do.
And, of course, that locks you into a herd strategy playbook because by definition it’s the same (set of) advice they’d give to any company.
‘Software will eat the world’ is fine and probably true (certainly in the environmental destruction sense, at the moment) but, while it’s digesting, we’ll still have structural challenges, logistics challenges, people challenges, strategic challenges, organisational challenges etc — and we will still need actual organisational consultancy for that.
There are two fundamental strategies:
- learn how to continuously adapt your strategy to reality, dealing with context and emergent outcomes: good consulting can help; this is #cybernetics in action
- gain enough power to dominate your environment, and force your model of understanding on the world, so you win: this is the Thanatosian urge, and is the route of evil; control
The FAANG companies and the VC-money-led software industry has, or aspires to, the latter. But the former will always create new spaces.