MC kinsey Company

1. McKinsey & Company

2. INTRODUCTION
 The McKinsey Way is a book authored by Ethan M. Raisel which was published in
the year 1999 (Rasiel).
 The book has offered timeless insights about the consulting firm that is relevant
even after 24 years.
 In this presentation, we will look into the McKinsey Way and how they have
managed to be the best in the field of management.

3. WHO IS MCKISNEY
 McKinsey & Co. is a global management consulting firm that offers services to
organizations and government.
 It was founded in 1926 by James O. McKinsey who was a professor of the
university of Chicago.
 It is the largest of the Big Three management consultancies
 Its core work includes finance and operations

4. HOW HAS THE COMPANY EVOLVED?
 The firm started as a partnership but they restructured as a private entity.
 A unique strategy is that they follow the structure of the partnership and the
employees are considered as partners.
 The various scandals in McKinsey has been an eye opener for the orgnaisation
and they aim to adopt sustainable approaches keeping in mind the employee
welfare

5. DOMAIN OF MCKINSEY
 The firm focuses on marketing through magazines, books and scholarly articles.
 They try to create informal contacts with organizations who could be potential
clients.
 They handle projects who has a full team of consultants appointed
 They spend a major portion of their time in preparing presentations, charts and
exhibits

6. SWOT ANALYSIS
 Strengths: Mckinsey has a strong reputation to boast. They offer high quality
services and ensures maximum client satisfaction
 Weakness: They are highly dependent on consultation. They also have a high
employee turnover
 Opportunities: They can opt for acquisitions and mergers to increase their base all
over the world.
 Threats: They face cutthroat competition from BCG and other consulting
companies. Their ongoing controversies put a dent in their global image.

7. SWOT ANALYSIS

8. WHY IS MCKINSEY ONE OF THE MOST
POWERFUL?
 In 1970, McKinsey helped create the barcode (Rasiel).
 They are always at the forefront when it comes to solve the most pressing global
issues.
 They have a unparalleled alumni network
 The McKinsey clients are all conglomerates that are satisfied with the services
offered.
 The various scandals like Enron Collapse and linkage of McKinsey with an alleged
insider trader Rajat Gupta has not been able to create a dent in its image

9. PORTERS FIVE FORCES
 Threat of New Entrants: Its not easy to achieve economies of scale in consulting
industry. Hence the threat of new entrants is less.
 Bargaining Power of suppliers: There are a huge number of suppliers in this
industry. This makes the bargaining power of suppliers less.

10.  Bargaining Power of Buyers: Similarly to the previous force, due to a huge number
of buyers, the buyers are less price sensitive and hence the bargaining power is
less (Compete to Win)
 Threat of Substitute: The substitute of consulting is less. To achieve a high level of
deliverables, the consumers opt for the best and hence the threat of substitute is
less
 Competition: The competitors are comparatively high these days as high
performers in this industry has increased. This makes the rivalry high

11. PESTLE ANALYSIS
 Political factors: Political factors like high level of taxation, intellectual property
rights infringements may be integral.
 Economic Factors: The efficiency of the financial markets should be analysed
before the company expands. The revenue growth of McKinsey can be directly
affected if the country has a low economic growth rate
 Social factors: McKinsey should analyse the consumption pattern of their
consumers along with degree of ethnocentrism.

12.  Technological Factors: McKinsey should consider the technological environment.
Countries with a knack for technological innovation will be a fruitful opportunity for
the company to expand.
 Environmental factors: Adopting responsible strategies to ensure full compliance
with the national and international standards would be required.
 Legal factors: Big firms like McKinsey are always on the radar of social and
political activism. They should ensure that their workplace is non-discriminatory
and that all the data protection compliance are being done.

13. DIGITAL TRANSFORMATION
 McKinsey has developed a digital transformation framework known as 4Ds
 The first stage involves the companies to discover optimum strategy
 The second stage is all about designing the customer experience (Compete to
Win)
 The third stage involves the network partners and delivering the experience
 The fourth stage calculates risk and eliminates them.

14. COMPETITORS
 The top Competitors of McKinsey are as follows:
 Deloitte
 Accenture
 PwC
 Ernst and young
 Boston Consulting Group
 KPMG
 Bain & Company
 Oliver Wyman
 Goldman Sachs

15. COMPARISON
 When it comes to product quality, consumers tend to gravitate towards Bain & Co
more than McKinsey.
 The pricing point of McKinsey is quite high and competitors like Oliver Wyman,
BCG offers similar services at lesser price.
 The consumer service of other competitors like BCG, Oliver Wyman, Bain & Co is
better than McKinsey.

16. COMPETITIVE ANALYSIS
 The management consultancies experience intense rivalry.
 McKinsey faced stiff competition from Boston Consulting Group and to counter the
same, they followed the 2X2 matrix developed by BCG
 They developed a 3X3 matrix to analyse the strategy of the business.
 They combine the attractiveness of the industry with the competitiveness .

17. MCKINSEY 7S MODEL
 The McKinsey 7S model combines Soft Ss and Hard Ss revolving around shared
values.
 This framework suggests that there are 7 internal factors that should be aligned
 The seven factors are :
 Strategy
 Structure
 Systems
 Shared Values
 Skills
 Style
 Staff

18. HOW IS THE 7S MODEL IMPLEMENTED
 To implement the 7s model, it is essential to brainstorm the present scenario by
analysing the 7 elements
 The organisations need to set goals and action plan
 Any misalignments should be identified and hence the action plan should
incorporate the realignment strategy
 The action plan is then executed with constant review

19. CLIENTS
 The clients of McKinsey are often Fortune 1000 Companies.
 At present, the clients of McKinsey include Coca Cola, Microsoft, US Department
of Energy, Bill and Melinda Gates Foundation to name a few.
 Coca Cola underwent a massive change by adopting McKinsey strategy under
their guidance (Belluz and Buissonniere).
 They established a digital academy so as to provide an upgradation of skills to
their managers.

20.  Since 2020, Microsoft has collaborated with McKinsey to de-risk the clients
 Microsoft has utilised the digital transformation of McKinsey to redesign their entire
business process (Belluz and Buissonniere).
 The technology transformation has been at the forefront especially during Covid-19
pandemic

21.  The Bill & Melinda Gates foundation aimed to eradicate poverty worldwide.
 McKinsey has conducted investigations for the foundation to analyse the situation
worldwide (Channon et al).
 The firm has been at the forefront in devising a response to outbreaks like Zika,
Ebola, Mers.

22.  McKinsey has worked with public sectors like WHO, Vaccine Alliance to expand
the access of healthcare worldwide.
 The other clients of McKinsey includes:
 Blue Cross Shield of Michigan
 Loblaws
 Best Buy
 National Resources Defense

23. USE CASE-1
 Beautify is a global company that sells its products only in high end shops like
Harrods and through online retailer Sephora.
 The company hire beauty consultants who connect with consumers in order to
provide world class services.
 They were faced with a problem of managing the consultants as they had not paid
much attention on the training.

24.  Beautify engaged McKinsey to help evaluate whether any training would be helpful
or not
 Their real problem lied in the amalgamation of those consultants for their in-store
experience and also virtually
 McKinsey helped Beautify to strategize some factors that would help them
overcome this problem

25.  As per McKinsey, the retailer response should be recorded to assess the majority
of the consumers who would prefer buying from the website and not from the
store.
 An analysis of competitors in terms of adoption of virtual assisstants were also
done.
 The current skill set of their beauty consultants were assessed. Consultants who
already had a social media presence were asked to retain

26.  The action was effective as Beautify retained most of the consultants having
experience in social media thereby reducing training costs.
 McKinsey suggested the best possible strategy so that the costs are managed as
well the outcomes are maximised.
 Beautify learnt that its essential to analyse the present situation before option for a
strategy that can cause considerable costs

27. USE CASE-2
 The Bill & Melinda Gates foundation works for rural regions to counter the poverty
 They had approached McKinsey to design them a financial service plan for the
residents at Mexico
 The problem here was that they didn’t know how to get it done.

28.  McKinsey researched and discovered that Diconsa is a government operated
chain that distributes neccesities to its people.
 These stores have a central and regional supply chain management that has a
seamless distribution system
 McKinsey conducted research on the viability of the Diconsa chain for providing
financial services by analysing the risks and other factors

29.  McKinsey suggested the Foundation to go ahead with Diconsa and they launched
their program across 22,500 stores (Bill & Melinda Gates Foundation).
 The action plan was proven effective as it was able to improve the quality of life in
Mexico
 The strategy was useful and they learnt that management consultancy goes a long
way in formulating suggestions

30. CONCLUSION
 McKinsey has a global footprint and is continuously expanding
 The most powerful of the initiatives by the companies are the brainchild of
McKinsey (Bill & Melinda Gates Foundation).
 By analysing the strengths of McKinsey and its various use cases we have been
able to conduct an in-depth research.

31. REFERENCES
 Belluz, Julia, and Marine Buissonniere. “How Mckinsey Infiltrated the World of Global
Public Health.” Vox, Vox, 13 Dec. 2019, https://www.vox.com/science-and-
health/2019/12/13/21004456/bill-gates-mckinsey-global-public-health-bcg.
 Channon, Derek F., and Adrián A. Caldart. "McKinsey 7S model." Wiley encyclopedia of
management (2015): 1-1.
 “Diconsa to Offer Financial Services in Rural Mexico.” Bill & Melinda Gates Foundation,
https://www.gatesfoundation.org/ideas/media-center/press-releases/2009/09/diconsa-
to-offer-financial-services-in-rural-mexico.
 “McKinsey Matrix: Compete to Win.” Compete to Win | World Class Know How, 11 June
2020, http://www.competetowin.co.uk/know-how/strategic-planning/mckinsey-matrix/.
 Rasiel, Ethan M. The McKinsey Way. New York: McGraw-Hill, 1999.