MARVIN BOWER--PERSPECTIVE ON MCKINSEY

MARVIN BOWER--PERSPECTIVE ON MCKINSEY--1979 Article by Herb Rubenstein CEO, Growth Strategies Inc. Introduction Marvin Bower worked for and led McKinsey & Company for 45 years. He succeeded Jim McKinsey’s untimely death. He wrote “Perspectives on McKinsey” for McKinsey employees. This writer was loaned the book by one of those employees. This review does not include any information contained in the book that I believe Marvin Bower would not want shared with the world. The Consulting Perspective To be consistently successful one must understand the reason for outstanding successors and for failures. The mission of McKinsey is to help institutions of all types improve their performance and thus, assist in bettering the human condition in many countries around the world. “Strengthen the managing of organizations. Theodore Levitt, professor of business administration, Harvard has stated is the primary engine of progress.” Marvin Bower, himself, specialized in studying made potential earnings power development of new capital structures. Bower believes the eleven key factors of success for McKinsey are: High standards of professionalism Independence Rigorous adherence to high standards of ethics Rigorous adherence to high standards of personnel selection, administration and development Rigorous adherence to high standards of performance and accountability Candor with clients A focus on serving leading organizations A take charge approach to client assignments A dedication to helping clients in ways they did not expect Expansion of the firms clientele through developing the firm’s reputation and public service activities Skillful use of the written document Bower stated there are three needs for success in consulting: Unquestioned respectability Professional exposure (by writing and speaking) Reputation for special competence in a key area of concern to management Creating Better Organization Jim McKinsey was President of the American Management Association. His major contribution was to change the focus of the accounting profession from one that was only concerned with documenting past financial transactions and results to a profession that produced information (financial data, budget projections) that were useful in helping institutions plan for their future and execute present and future strategies to make the institution more successful. Bower believed a company or non-profit must be: A “Vigorous organization” Have a substantial clientele Have competent, respected employees and strategic alliance partners Be led by a brilliant, dynamic and accomplished individual Develop an established reputation in one or more areas Nurture and develop a strong reputation The McKinsey Approach Consultants are problem solvers who use an analytical approach in their conversations and their writing. McKinsey developed an approach to attacking every consulting assessment. He created the “General Survey Outline”. The Outline was a checklist for making a strategic general survey of a business and a guide to the thinking and problem-solving approach of the company. General Survey Outline Main Sections: Industry Outlook Company competitive position Marketing Manufacturing Facilities Control Finance Personnel Each Section was divided into the following subjects: Goals Policies Organization structure Facilities Capital Procedures Personnel The McKinsey consulting assignment had three major components: Set study scope Define approach Set priorities Training is at the heart of McKinsey. Train the recruit, train the client. Three types of studies were common at McKinsey: Feasibility Studies Reorganization Studies Marketing Studies – Sound judgment in these consulting studies required weighing the “other person’s probable reaction” to any marketing move of the client. McKinsey Activities Unrequested and unexpected initiative is essential in doing superior work for clients. Report writing was a major way McKinsey personnel transferred knowledge to each other and their clients. A consultant’s highest value is INDEPENDENCE, followed closely integrity and ingenuity. The key to a successful consulting firm is written guidelines that generate a commitment to the goals, objectives, policies, and programs of the firm. The keys to improving quality in a consulting firm: Improving the caliber of clients Improve the importance of the problems studied Conclusion A key question asked at McKinsey is “What besides income do we get from this study?” McKinsey always sets a goal of giving a client a 10 to 1 return on each consulting dollar spent with McKinsey.