Mckinsey Quotes

Being classy is my teenage rebellion.

I'd rather be a little weird than all boring.

One thing you have to realize from now on is that it doesn't matter if this is a dream or not. Survival depends on what you do, not what you think.

Well, here’s the shocker,” said Kirby. “Majors Miller and McKinsey believe our former Captain Paul Remmich is acting as a spy for the Iraqi government.

The ones who hate me the most are the ones who don't scare me.

Perfect sanity is a myth propagated by straitjacket salesmen.

A 2011 McKinsey report noted that men are promoted based on potential, while women are promoted based on past accomplishments.

When you feel like throwing rocks, make sure they're ones no one can throw back.

Never make the mistake of thinking you are alone — or inconsequential. Ignorance is voluntary and confusion is temporary. You see the world as-is, which is more than can be said for the vast populace.

When you don't change, history repeats itself. Then you have to decide if changing is for the best, or you keep seeing repeats because you're doing something right.

There seem to be two main types of people in the world, crosswords and sudokus.

Work like an angel, dress like a demon, live like a ghost, and dream like a human.

A 2011 McKinsey report noted that men are promoted based on potential, while women are promoted based on past accomplishments.

I respect you as my king, and I respect you as my father, but I do not respect you as a man!

Stories start in all sorts of places. Where they begin often tells the reader of what to expect as they progress. Castles often lead to dragons, country estates to deeds of deepest love (or of hate), and ambiguously presented settings usually lead to equally as ambiguous characters and plot, leaving a reader with an ambiguous feeling of disappointment. That's one of the worst kinds.

An apple cannot not become an orange simply because a McKinsey report concluded it would be beneficial for it to do so.

Part One describes how McKinsey thinks about business problems. It shows what it means to be fact-based, structured, and hypothesis-driven.

As an associate at McKinsey & Company, my first assignment was on a team that consisted of a male senior engagement manager (SEM) and two other male associates, Abe Wu and Derek Holley. When the SEM wanted to talk to Abe or Derek, he would walk over to their desks. When he wanted to talk to me, he would sit at his desk and shout, "Sandberg, get over here!" with the tone one might use to call a child or, even worse, a dog. It made me cringe every time. I never said anything, but one day Abe and Derek started calling each other "Sandberg" in that same loud voice. The self-absorbed SEM never seemed to notice. They kept it up. When having too many Sandbergs got confusing, they decided we needed to differentiate. Abe started calling himself "Asian Sandberg," Derek dubbed himself "good-looking Sandberg," and I became "Sandberg Sandberg." My colleagues turned an awful situation into one where I felt protected. They stood up for me and made me laugh. They were the best mentors I could have had.

Larry said he could understand the complaint, but what he did not understand was that all the people who quit - every single one - had unused vacation time. Up until the day they left, they did everything McKinsey asked of them before deciding that it was too much. Larry implored us to exert more control over our careers. He said McKinsey would never stop making demands on our time, so it was up to us to decide what we were willing to do. It was our responsibility to draw the line.

That kind of imagination is why we're not dead.

I'd rather be a little weird than all boring.” ― Rebecca McKinsey

It is a good idea to start the year by writing down exactly what you want to accomplish, and end the year by measuring how much you have accomplished. McKinsey imposes this discipline on its partners and pays them according to how many of the things on their lists they accomplish. Leadership

McKinsey partners tend to be designers of ditches, not diggers of ditches. When it comes to executing their lofty theories, well, consultants lean toward leaving those messy realities to the companies themselves.

My point is this — you don't know. When I was first here, people looked at my hair, noticed apples on my tray, and thought 'hippie.' Then, from 'hippie' they thought 'druggie.' From there it went to 'will get me in trouble' and 'not worth my time,' and then they stopped thinking at all. No one bothered to find out if what they thought about me was true. No one wanted to hear what I thought. No one cared what I believed in. No one cared about talking to me or asking what my plans were for the day or night. And then came you. Don't let what you think you know make him into what I could have been. Don't become someone who doesn't think, just because you don't like him for some reason. Because, quite frankly, I like how you think. Except for now, of course.

McKinsey & Company advised AT&T not to enter the mobile telephone business, predicting there would be fewer than one million cellular phones in use by 2000. In fact, by 2000, there were one hundred million mobile phones.

There’s a difference between a mistake and a regret. Everything up to this moment has made this moment. If you can change a mistake, then go out and do what you can to change it. If you can’t change it, there’s no use regretting it because it will just make you miserable. Live right now, even if that involves dealing with the consequences of your actions. Time travel always ends badly.

People are fascinating. Especially the ones who hate me.

One former McKinsey consultant wrote anonymously, ¨To those convinced that a secretive cabal controls the world, the usual suspect are Illuminati, Lizard People, or ´globalists.' They are wrong, naturally. There is no secret society shaping every major decision and determining the direction of human history. There is, however, McKinsey & Company.

The essence of the initial hypothesis is “Figure out the solution to the problem before you start.” This seems counterintuitive, yet you do it all the time.

Life is not a true or false question.

Hiring McKinsey was a sign of affluence.

For example, how much do you think a senior vice president of Microsoft who came from McKinsey knows about starting a company?

The consulting firm McKinsey & Co. estimates that in the United States, only 30 percent of job growth now comes from algorithmic work, while 70 percent comes from heuristic work.9

Money is very seductive…However much you say that you will not fall into the trap of it, you do fall into the trap of it. —Rajat Gupta, former worldwide managing director, McKinsey

Bower had three unwritten principles: the client is everything; think the unthinkable; and it’s not about money, but influence and reputation. He applied these principles on a daily basis at McKinsey.

The construction industry is the world’s second largest (after agriculture), worth $8 trillion a year. But it’s remarkably inefficient. The typical commercial construction project runs 80% over budget and 20 months behind schedule, according to McKinsey.

When a client asks the question “How do I boost my profits?” the first thing McKinsey does is take a step back and ask the question “Where do your profits come from?” The answer to this is not always obvious, even to people who have been in their particular business for years.

The Effects of Personal Bias and Hiring Urgency There are other types of cognitive biases that affect the hiring process. Another harmful one is personal bias, the basic human instinct to surround yourself with people who are like you. People have a natural desire to hire those with similar characteristics: educational background, professional experience, functional expertise, and similar life experiences. The middle-aged manager who holds a degree from the University of Michigan, worked at McKinsey, lives in the suburbs with a partner and kids, and plays golf will tend to be attracted to candidates with similar attributes.

Men have an easier time finding the mentors and sponsors who are invaluable for career progression. Plus, women have to prove themselves to a far greater extent than men do. And this is not just in our heads. A 2011 McKinsey report noted that men are promoted based on potential, while women are promoted based on past accomplishments.

I refuse to hold the coats of this generation.

If all you have is a hammer, then every problem looks like a nail.

Why is something done this way? Is this the best way it can be done?” You have to be fundamentally skeptical about everything.

Is each one a separate and distinct issue? If so, then your issue list is mutually exclusive.

The desire to do so rarely feels small to people who cannot.

When prioritizing, it is common to use a two-by-two matrix –

In our business, it is helpful to get to the one or two really important numbers that need to be considered. There isn’t time for more." We concur.

it is amazing what you can accomplish when you do it in a "take no prisoners" manner.

the most compelling business presentations are a form of strategic storytelling leading listeners down a controlled path.

Keeping Christ in Christmas" is like showing up at someone's house every year, insisting on a party they never planned and never agreed to.

In 1980, AT&T hired McKinsey & Co—one of the most prestigious management consulting firms in the world—to predict how many cell phone users there would be in the U.S. in 2000. Based on the large study they conducted, they predicted there would be around 900,000. There were actually about 100 million. So close! Only off by ninety nine million one hundred thousand—a factor of 120.14

Historically, noted James Manyika, one of the authors of the McKinsey report, companies kept their eyes on competitors “who looked like them, were in their sector and in their geography.” Not anymore. Google started as a search engine and is now also becoming a car company and a home energy management system. Apple is a computer manufacturer that is now the biggest music seller and is also going into the car business, but in the meantime, with Apple Pay, it’s also becoming a bank. Amazon, a retailer, came out of nowhere to steal a march on both IBM and HP in cloud computing. Ten years ago neither company would have listed Amazon as a competitor. But Amazon needed more cloud computing power to run its own business and then decided that cloud computing was a business! And now Amazon is also a Hollywood studio.

Complaints: McKinsey and Company found: • customers who have major problems but don’t complain about them have a purchase intention rate of about 9% • those who do complain, regardless of the outcome, have a repurchase rate of about 19% • customers who have their complain resolved have a repurchase intention rate of 54% • customers who have complaints quickly resolved have a repurchase intention rate of 82%

If you are going to complain, blame, or criticize, then do something about it... Feeling sorry for yourself, and your present condition, is not only a waste of energy but the worst habit you could possibly have.

Sydney tried — sometimes he really tried — but his default mindset didn’t have those kinds of manners. What he really meant was more like “Jacob, get over here or I’ll freeze your underwear.” Something like that.

Seinfeld asked if McKinsey is funny. No, the magazine said. “Then I don’t need them,” he said. “If you’re efficient, you’re doing it the wrong way. The right way is the hard way. The show was successful because I micromanaged it—every word, every line, every take, every edit, every casting.” If you’re efficient, you’re doing it the wrong way. That is so counterintuitive. But I think it perfectly highlights the danger of shortcuts.

What have they fixed?” asked former McKinsey consultant Michael Lanning. “What have they changed? Did they take any voice in the way banking has evolved in the past thirty years? They did study after study at GM, and that place needed the most radical kind of change you can imagine. The place was dead, and it was just going to take a long time for the body to die unless they changed how they operated. McKinsey was in there with huge teams, charging huge fees, for several decades. And look where GM came out.”13 In the end, all the GM work did was provide a revenue stream to enrich a group of McKinsey partners, especially those working with the automaker. The last time McKinsey was influential at Apple Computer was when John Sculley was there, and that’s because he’d had a brand-marketing heritage from Pepsi. And Sculley was a disaster. Did McKinsey do anything to help the great companies of today become what they are? Amazon, Microsoft, Google? In short, no.

Perhaps the most widely read piece of research that McKinsey has published in the past decade showed that companies that rapidly re-allocate capital to new growth businesses outperform those that take a steady-state approach.21 Yet, the social side of strategy is such that companies still tend to take what is known as a “peanut butter” approach—spreading a thin layer of resources smoothly across the whole enterprise, even though it’s clear that opportunities are far greater in some areas than in others.

But given that the children are products of the same biological stock, a much more plausible explanation for the differences in performance has to do with differences in parents' rearing and expectations of their first child compared with their younger children.

As an organization, McKinsey is extremely good at figuring out how much a team can do over the length of a typical study. The best EDs can balance the competing demands of client and team to a nicety; they tell the client, “We’re going to do X and Y. We could do Z, but it would kill the team,” while telling the team, “Look, we’ve already promised the client that we would do Z, so we’ve got to deliver.” They then work the team to its limit while simultaneously making the client feel that he is getting value for money and exceeding his expectations.

Smart clients say that the best way to use McKinsey is not to let them insinuate themselves—to prohibit walking the halls of the client’s offices looking for new business. Jamie Dimon of JPMorgan Chase, for example, will hire McKinsey, but for one-off projects in which the entire body of knowledge generated is transferred to JPMorgan Chase at the end of the project. The firm’s operating committee has to approve any consulting engagement, and the JPMorgan Chase executives don’t take just any consultants; they pick and choose the specific people they want on the project.

Digital educators Salman Khan and Shantanu Sinha contend the world is on the verge of another “printing press moment,” which will break the elite’s grip on the essentials of education, making available to millions of aspiring learners online knowledge and ideas once restricted to the lecture halls of Harvard or Stanford.

Larry implored us to exert more control over our careers. He said McKinsey would never stop making demands on our time, so it was up to us to decide what we were willing to do. It was our responsibility to draw the line. We needed to determine how many hours we were willing to work in a day and how many nights we were willing to travel. If later on, the job did not work out, we would know that we had tried on our own terms. Counterintuitively, long-term success at work often depends on not trying to meet every demand placed on us. The best way to make room for both life and career is to make choices deliberately—to set limits and stick to them.

The flood of money from Amway’s founders failed, though, to quash an investigation by the Canadian government into a tax-fraud scheme in which both DeVos and Van Andel were criminally charged in 1982. The scandal exploded when Kitty McKinsey and Paul Magnusson, then reporters for the Detroit Free Press, shocked readers accustomed to DeVos and Van Andel’s professions of patriotism and religiosity with an exposé tracing an elaborate, thirteen-year-long tax scam directly to the bosses’ offices. At its highest levels, they revealed, Amway had secretly authorized a scheme creating dummy invoices to deceive Canadian customs officials into accepting falsely low valuations on products the company imported into Canada. Amway had thus fraudulently lowered its tax bills by $26.4 million from 1965 until 1978. Amway

A 2011 McKinsey report noted that men are promoted based on potential, while women are promoted based on past accomplishments.14 In addition to the external barriers erected by society, women are hindered by barriers that exist within ourselves. We hold ourselves back in ways both big and small, by lacking self-confidence, by not raising our hands, and by pulling back when we should be leaning in. We internalize the negative messages we get throughout our lives—the messages that say it’s wrong to be outspoken, aggressive, more powerful than men. We lower our own expectations of what we can achieve. We continue to do the majority of the housework and child care. We compromise our career goals to make room for partners and children who may not even exist yet. Compared to our male colleagues, fewer of us aspire to senior positions.

The same thing, notes Brynjolfsson, happened 120 years ago, in the Second Industrial Revolution, when electrification—the supernova of its day—was introduced. Old factories did not just have to be electrified to achieve the productivity boosts; they had to be redesigned, along with all business processes. It took thirty years for one generation of managers and workers to retire and for a new generation to emerge to get the full productivity benefits of that new power source. A December 2015 study by the McKinsey Global Institute on American industry found a “considerable gap between the most digitized sectors and the rest of the economy over time and [found] that despite a massive rush of adoption, most sectors have barely closed that gap over the past decade … Because the less digitized sectors are some of the largest in terms of GDP contribution and employment, we [found] that the US economy as a whole is only reaching 18 percent of its digital potential … The United States will need to adapt its institutions and training pathways to help workers acquire relevant skills and navigate this period of transition and churn.” The supernova is a new power source, and it will take some time for society to reconfigure itself to absorb its full potential. As that happens, I believe that Brynjolfsson will be proved right and we will start to see the benefits—a broad range of new discoveries around health, learning, urban planning, transportation, innovation, and commerce—that will drive growth. That debate is for economists, though, and beyond the scope of this book, but I will be eager to see how it plays out. What is absolutely clear right now is that while the supernova may not have made our economies measurably more productive yet, it is clearly making all forms of technology, and therefore individuals, companies, ideas, machines, and groups, more powerful—more able to shape the world around them in unprecedented ways with less effort than ever before. If you want to be a maker, a starter-upper, an inventor, or an innovator, this is your time. By leveraging the supernova you can do so much more now with so little. As Tom Goodwin, senior vice president of strategy and innovation at Havas Media, observed in a March 3, 2015, essay on TechCrunch.com: “Uber, the world’s largest taxi company, owns no vehicles. Facebook, the world’s most popular media owner, creates no content. Alibaba, the most valuable retailer, has no inventory. And Airbnb, the world’s largest accommodation provider, owns no real estate. Something interesting is happening.

The need for managers with data-analytic skills The consulting firm McKinsey and Company estimates that “there will be a shortage of talent necessary for organizations to take advantage of big data. By 2018, the United States alone could face a shortage of 140,000 to 190,000 people with deep analytical skills as well as 1.5 million managers and analysts with the know-how to use the analysis of big data to make effective decisions.” (Manyika, 2011). Why 10 times as many managers and analysts than those with deep analytical skills? Surely data scientists aren’t so difficult to manage that they need 10 managers! The reason is that a business can get leverage from a data science team for making better decisions in multiple areas of the business. However, as McKinsey is pointing out, the managers in those areas need to understand the fundamentals of data science to effectively get that leverage.

Ethan, it’s eleven o’clock. The client will love this. No one will be able to absorb more than you have here. Call it a day. Don’t boil the ocean.” We shared a cab home. “Don’t boil the ocean” means don’t try to analyze everything. Be selective; figure out the priorities of what you are doing. Know when you have done enough, then stop. Otherwise, you will spend a lot of time and effort for very little return, like boiling the ocean to get a handful of salt.

Thus, the top-management approach has these essential characteristics: 1. We make an overall diagnosis before we decide on the specific problems to be solved. 2. We determine the order in which problems should be solved. We try to persuade the client to let us put first things first. 3. In the solution of problems, we take an integrating approach and recognize that: (a) external factors are usually important in the solution of internal problems; (b) very few problems can be solved in any single department or section of the business or government agency.36

Making your boss look good means two things. Firstly, it means doing your job to the best of your ability. Clearly, if you produce high-quality work, it will make your boss’s job easier. Second, make sure your boss knows everything you know when she needs to know it. Keep the information flowing. Make sure your boss knows where you are, what you are doing, and what problems you may be having. At the same time, don’t overload her with information. Think about what your boss needs or wants to know. Use a well-structured e-mail or voice mail to convey the information.

Take your team’s temperature. Talk to your teammates. Make sure they are happy with what they are doing. Find out if they have questions about what they are doing or why they are doing it, and answer them. If they are unhappy, take remedial action quickly. Steer a steady course. If you change your mind all the time about the team’s priorities or the analyses you’re doing, your team will quickly become confused and demoralized. Know where you’re going and stay your course. If you need an extra day to figure it out, take it. If you need to make a big change, let your team know, explain why, and let people contribute to, or at least see, your thought process.

A 2011 McKinsey report noted that men are promoted based on potential, while women are promoted based on past accomplishments.14

Eric Spiegel, the head of Siemens’ US arm, laid out a vision not that far removed from Ms Huang’s when he spoke at a breakfast in Washington hosted by the McKinsey Global Institute, the consultancy’s think-tank. The German engineering company, he said, would soon begin delivering spare parts to customers via email and 3D printers, also avoiding physical borders and the usual logistical complexities of global trade. But the advances in business are also coming up against fundamental debates about privacy. The Edward Snowden revelations of US online snooping have sparked a worldwide debate about privacy and the internet. Receiving less attention is the way international trade negotiations are trying to deal with what limits, if any, ought to be set on the flow of data around the globe and how to prepare for a digital future that is already a reality in some sectors. The negotiation of a 12-country Transpacific trade partnership (TPP) has sparked debate in Australia and New Zealand over whether companies ought to be allowed to store personal banking and medical data in foreign countries, or if such sensitive information should even be allowed to cross borders freely.

In fact, during my research and interviews with McKinsey alumni, the Talk element of the model was consistently ranked the most important of all interpersonal elements. Why is it that the simple act of talking can cause so many problems in team problem solving? Generally, because we don't have specific Rules of Engagement; because we like to speak more often than we listen; and because we get personally attached to our own points of view.

If you’re good at data analytics but you don’t have this feel for the business, you’ll make naïve decisions.

If you’re comfortable with the feel of the business but you never use analytics, you’re just leaving a lot of money on the table that your competitors

The difference between politics and religion is that the first makes it legal to hate, and makes the love of the second illegal.

Develop your characters well enough that they do stupid things on their own.

In another case, a McKinsey team went in to evaluate expansion opportunities for a division of a manufacturing company. After a few weeks of gathering and analyzing data, the team realized that what the division needed was not expansion; it was closure or sell-off.

Critics of McKinsey (and management consulting in general) say that the Firm bases its solutions on the most current management fad—the favorite tool in its intellectual toolbox.

What analyses could prove or disprove that belief? You could break out the sales by customer type for each region. If penetration of superstores in the Northeast is higher than in any other region and higher than for the other types of retail outlets, find out why. When you talk to the Northeast sales reps, you might find that they have a better feel for superstores than any other sales team. What if they were put in charge of all superstores across the country and achieved the same penetration? What would that mean for widget sales? The end product of this exercise is what McKinsey calls the issue tree. In other words, you start with your initial hypothesis and branch out at each issue. The result looks like the figure below. When you’ve completed your issue tree, you have your problem-solving map. That’s the easy part. The difficult part will come when you have to dig deep to prove your hypothesis.

My experience at the Firm (and that of the many McKinsey alumni I interviewed for this book) taught me that IHs produced by teams are much stronger than those produced by individuals. Why? Most of us are poor critics of our own thinking.

What do you do when you are convinced you are working on the wrong problem? When a doctor thinks that a patient’s minor symptoms mask something more serious, she will tell her patient, “Mr. Jones, I can treat your headache, but I think it’s a symptom of something more serious and I’d like to do further tests.” In the same way, you should go back to your client, or your boss—whoever it was that asked for your input in the first place—and say, “You asked me to look at problem X, but the real impact on our performance will come from solving problem Y. Now I can solve problem X, if that’s what you really want, but I think it’s in our interest to focus on Y.” If you have the data to back you up, the client can either accept your recommendation or tell you to stay on the original problem, but you will have fulfilled your responsibility to act in the client’s best interests.

The tools may be the same from problem to problem, but you have to apply them. For instance, in my experience, in 8 out of 10 pricing problems the answer turns out to be “raise your prices.” If you do the fact-based analysis—demand curves, breakeven calculations, budgets—enough times, you see almost invariably that firms should be raising their prices. But if you automatically say that’s the answer, you’ll get into trouble, because you’ll run into an instance where the answer is really “lower your prices.

As you gain experience in business, as you see and solve more and more problems, you will get a fair idea of what works in your industry and what doesn’t. Although your gut will often be right, take a hint from former President Reagan: “Trust and verify.” As a McKinsey alumnus who now works as a merchant banker put it: A sharp manager with a lot of business experience can often reach the same conclusions as McKinsey—and in a much shorter time—by gut instinct, but most executives aren’t that good. Because McKinsey focuses so intently on a problem, it often produces a more robust solution than even the best executive can. Most executives will miss a few things because they don’t take the time—they usually don’t have the time. So, even though your initial instinct may be—and probably is—right, take enough time to verify your gut with facts.

In the Acme Widgets problem, suppose your team decided that the key drivers were the sales force, the consumer marketing strategy, and production costs. You then came up with a list of actionable, top-line recommendations as your initial hypothesis: We can increase widget sales by: • Changing the way we sell our widgets to retail outlets. • Improving the way we market our widgets to consumers. • Reducing the unit cost of our widgets. Let’s begin with a closer look at the sales force. It’s organized geographically (Northeast, Mid-Atlantic, Southeast, etc.) and sells primarily to three types of retail outlets: superstores, department stores, and specialty stores. The team believes that the sales force ought to be organized by customer type—that’s one issue.

McKinsey, like every other consulting firm, has developed a number of problem-solving methods and given them fancy names: Analysis of Value Added, Business Process Redesign, Product-Market Scan, and so on. These techniques are immensely powerful. They allow McKinsey consultants very rapidly to fit the raw data that lands on their desks into a coherent framework and give them insights into the nature of the client’s problem. The consultants can then focus their thinking on the “drivers” of the problem and start working toward a solution.

We made frequent use of an analytical framework called Forces at Work. It proved especially valuable at the start of an engagement in helping us look at the likely external pressures on the client. The technique involves identifying the client’s suppliers, customers, competitors, and possible substitute products. We then list all the changes occurring in each of the four categories. What impact—positive or negative—could these have on our client? Also, what internal changes are affecting the client and the client’s industry? Which of these factors could actually cause major changes to the way the client designs, manufactures, distributes, sells, and services its products?

How do you avoid that trap? The McKinsey way is to take an occasional step back from the continual grind of fact gathering and analysis and to ask yourself what you have learned over the past week (or two weeks, or whatever). How does the new information fit into your initial hypothesis? If it doesn’t, how might it change that hypothesis? Doing these little reality checks now and then could save you from chasing down blind alleys. As a final

Don’t try to pound them into your framework like square pegs into round holes.

To structure your IH begin by breaking the problem into its components—the key drivers (see “Find the Key Drivers,” in Chapter 3). Next, make an actionable recommendation regarding each driver. This is extremely important. Suppose your business’s profits are greatly affected by the weather; in fact, it is the key determinant of profits in a given quarter. “We have to pray for good weather” is not an actionable recommendation. On the other hand, “We must reduce our vulnerability to changes in the weather” is an actionable, top-line recommendation.

took several years of gaining perspective before I understood the wisdom of the CEO’s words. There are three reasons he was right: • It’s impossible to do everything yourself all the time. • If you manage it once, you raise unrealistic expectations from those around you. • Once you fail to meet expectations, it is very difficult to regain credibility.

LOOK AT THE BIG PICTURE Every now and then, take a mental step back from whatever you’re doing. Ask yourself some basic questions: How does what you’re doing solve the problem? How does it advance your thinking? Is it the most important thing you could be doing right now? If it’s not helping, why are you doing it?

What’s more, a real premium began to be placed on being part of this knowledge oeuvre—not just in what McKinsey knew but in who at McKinsey knew these subject areas. An unstated understanding emerged that if you were a logistics expert in, say, the retail sector and you were called by a partner you had never met who mainly did work with pharmaceutical companies, you would nevertheless return the call. That reputation for contributing was your asset in the firm.

In many important ways the book really was an attack on McKinsey thinking, on the idea that the secrets of success could be found in an analytical framework or in a new corporate structure. It was an attack on the rationalist idea that businesses were machines that could be fine-tuned. The work of Peters and Waterman served to remind managers about first principles in business: If they didn’t listen to their customers or employees, then the rest was irrelevant. If the strategy revolution was forcing companies to look outward more than they ever had before, what Excellence did was force that gaze right back inside again. And it wasn’t talking only about financial management. It was also talking about how you treated the people who worked for you. It was, in short, the first great manifesto of the idea of corporate culture.

And McKinsey never really left the building. A decade later, when John Birt, then director-general of the BBC, stepped down from his job, McKinsey brought him on as a part-time consultant. In 2005 Birt severed all ties with the firm after critics suggested that working for 10 Downing Street in London and McKinsey posed a conflict of interest—as if hiring him shortly after extracting millions of pounds out of the BBC hadn’t been. Birt’s replacement at the BBC’s helm—Greg Dyke—immediately slashed spending on outside consultants by 75 percent.

Still, McKinsey’s high self-regard survives even in the face of evidence to the contrary. McKinsey consultant Tom Steiner recalled a strategy study done for the New York office by another partner, Chuck Farr. “He had two slides. The first was the top clients of the New York office, by billings—companies like AT&T, American Express, and Manufacturers Hanover. All the partners got up to talk about what special thing McKinsey had done to become so vital to those clients. Before we knew it, there were only fifteen minutes left of what was supposed to be a two-hour meeting. Someone said, ‘What’s on the second slide?’ It was Booz Allen’s top clients. And they were pretty much the same companies.”14 McKinsey may have been earning more than Booz at the time, but it was from a client base that was clearly willing to pay for advice from everyone. There’s nothing special about that kind of product.

These efforts could not be construed as selling, but they make sure that the right people know the Firm is there. That keeps the phones ringing.

HOW TO SELL WITHOUT SELLING Business problems are like mice. They go unnoticed until they start nibbling your cheese. Just building a better mousetrap will not make the world beat a path to your door. People who don’t have mice won’t be interested—until the mice show up; then they need to know you have the mousetrap. This might sound like the musings of a Zen monk (or perhaps a management consultant from California). But sometimes the right way to sell your product or service is not to barge into your customer’s home with a bunch of free samples. Just be there, at the right time, and make sure the right people know who you are.

Although a partner’s compensation depends in large part on the amount of business he brings to the Firm, no one goes out to knock on doors. The Firm waits for the phone to ring.

Although a partner’s compensation depends in large part on the amount of business he brings to the Firm, no one goes out to knock on doors. The Firm waits for the phone to ring. And ring it does, not because McKinsey sells, but because McKinsey markets. It does this in several different ways, all of them designed to make sure that on the day a senior executive decides she has a business problem, one of the first calls she makes is to the local office of McKinsey. The Firm produces a steady stream of books and articles, some of them extremely influential, such as the famous In Search of Excellence by Peters and Waterman.* McKinsey also publishes its own scholarly journal, The McKinsey Quarterly, which it sends gratis to its clients, as well as to its former consultants, many of whom now occupy senior positions at potential clients. The Firm invites (and gets) a lot of coverage by journalists. Many McKinsey partners and directors are internationally known as experts in their fields.