McKinsey & Company, founded in 1926, is one of the oldest and largest management consulting firms. Known for its financial and operational focus, McKinsey has a competitive hiring process and recruits top talent from various backgrounds. The firm has expanded globally and introduced innovative business practices, but has also faced criticism for its involvement in controversial projects.
The Sherman Antitrust Act was a regulatory effort by the federal government in the late nineteenth century to curb the power of big business and prevent corporations from colluding to fix prices.
The Clayton Act of 1914 was another regulatory measure aimed at preventing anti-competitive practices and promoting fair competition in the market.
James O. McKinsey introduced the concept of budget planning as a management framework in his fifth book Budgetary Control in 1922.
In the mid-1920s, McKinsey started operating as James O. McKinsey and Company, Accountants and Management Engineers. The exact founding date is uncertain, with sources suggesting either 1924 or 1925. Despite the ambiguity, McKinsey's establishment coincided with a prosperous economy and a high demand for consulting services.
McKinsey & Company, Inc. was founded in 1925 by James O. McKinsey, an accounting professor at the University of Chicago. Initially started as a consulting firm offering accounting and management services, it later evolved into a top international management consulting firm.
McKinsey & Company is a renowned global management consulting firm established in 1926. They provide services to corporations worldwide to enhance efficiency and make strategic decisions.
In 1930, despite the Great Depression, McKinsey's professional staff grew to fifteen members, showcasing the firm's resilience and growth during challenging economic times.
In 1931, McKinsey & Company drafted the General Survey Outline, and the following year, they opened a New York outpost at 52 Wall Street. This marked the expansion of the company to the East Coast.
In 1932, McKinsey opened a New York outpost at 52 Wall Street, marking the firm's expansion to a new location and further establishing its presence in the consulting industry.
In 1933, Marvin Bower joined McKinsey & Company, introducing a new approach to hiring consultants by recruiting recent graduates of top business schools, contrary to the prevailing view that experience was more important than education.
In 1934, McKinsey's Chicago office moved to the forty-first floor of the new Field Building on 135 South LaSalle, indicating the firm's growth and success in different regions.
After the Wagner Act in 1935, McKinsey started consulting corporations on employee relations.
Marvin Bower, credited with establishing McKinsey's values and principles in 1937, introduced key policies such as the 'up or out' policy and the principle of only working with CEOs. These principles shaped the firm's culture and approach to client engagements.
Following the death of James O. McKinsey in 1937, McKinsey, Wellington & Company was divided in 1939. This led to the formation of separate entities, including McKinsey & Company, each with its own focus and leadership.
In 1950, Marvin Bower became the managing director of McKinsey & Company, Inc. Under his leadership, the company shifted its direction and grew significantly, becoming a world-class management consulting firm.
In 1951, McKinsey formed profit-sharing, executive and planning committees, which helped expand the organization's client base among governments, defense contractors, blue-chip companies, and military organizations in the post-World War II era.
In 1953, McKinsey hired its first Harvard M.B.A., marking the beginning of a trend where the company continued to select top graduates from Harvard Business School for its consulting roles.
In 1955, McKinsey & Company founded the Foundation for Management Research.
In 1956, McKinsey transitioned into a private corporation with shares owned exclusively by McKinsey employees, marking a significant shift in its ownership structure.
In 1958, McKinsey helped organize NASA into an organization that heavily relied on contractors.
In 1959, McKinsey & Company opened its first overseas office in London, led by Hugh Parker, marking the beginning of its global expansion and the spread of American business practices abroad.
In 1963, Bruce Henderson left Arthur D. Little to establish the Boston Consulting Group (BCG) as a strategy firm. BCG introduced strategic frameworks like the Boston Box and Growth Share Matrix, which revolutionized strategy consulting.
In 1964, McKinsey & Company began publishing a business magazine called The McKinsey Quarterly.
Marvin Bower, a disciple of James O. McKinsey, led McKinsey & Company to consulting success over the next 30 years. He emphasized professionalism in appearance, tone, and conduct within the firm.
In Hal Higdon's 1970 history of consulting, one associate recalled McKinsey's tough love approach towards his colleagues.
In 1971, McKinsey established the Commission on Firm Aims and Goals, which highlighted the need for the company to slow its growth and develop industry specialties, shifting its focus from geographic expansion.
In 1973, McKinsey & Company led a project to create the barcode for a consortium of grocery chains.
In 1975, McKinsey's John L. Neuman introduced the business practice of 'overhead value analysis,' which contributed to a downsizing trend in corporate management. This approach led to the elimination of many middle management positions.
R. Ronald Daniel took over as the managing director of McKinsey & Company in 1976. During his 12-year tenure, he oversaw significant growth in the professional staff and revenues of the company.
In 1982, McKinsey consultants Tom Peters and Robert Waterman published the influential book 'In Search of Excellence,' which popularized the concept of 'corporate culture' and became a bestseller with 6 million copies sold.
In June 1988, there was a notable leadership change at McKinsey & Company. The company saw a shift in its helm, which garnered attention and interest.
In late 1989, McKinsey purchased Information Consulting Group, a 250-person information technology firm based in Washington, D.C., to enhance its capabilities in response to the growing importance of information technology for its clients.
The McKinsey Global Institute, which studies global economic trends, was founded in 1990.
In 1992, McKinsey conducted a study for the University of Texas business school, involving a team of fourteen consultants who spent significant hours to revamp the M.B.A. program. The study aimed to enhance competitiveness and relevance to the real-world business environment.
A profile story in Fortune magazine in November 1993 described McKinsey & Company as the most prestigious and successful management consulting firm, highlighting its secretive nature and unique culture.
In 1994, Rajat Gupta made history by becoming the first non-American-born partner to be elected as the managing director of McKinsey & Company. His appointment brought diversity to the leadership of the firm.
In 1997, authors James O'Shea and Charles Madigan compared McKinsey's culture to religion due to the influence and loyalty of its members.
Ethan Rasiel's 1999 book described a culture at McKinsey where members were not supposed to 'sell' their services.
McKinsey provided troubleshooting services to the Police and Fire Departments' responses to the 9/11 terrorist attacks. They offered their services for free during this critical time.
A 2002 article in BusinessWeek mentioned a series of bankruptcies of McKinsey clients in the 1990s, raising questions about McKinsey's responsibility.
In 2003, Ian Davis was elected as managing director of McKinsey, emphasizing a return to core values after a period of rapid expansion, and establishing a headquarters for the Asia-Pacific region in Shanghai.
In 2005, McKinsey was still trying to maintain a very low profile public image.
McKinsey promoted securitization of mortgage assets and encouraged banks to fund balance sheets with debt, contributing to the 2008 financial crisis.
Anil Kumar, described as Gupta's protégé, left McKinsey after allegations in 2009 and pleaded guilty in January 2010 for sharing insider information with Raj Rajaratnam.
McKinsey surveyed US private-sector employers on their response to the Affordable Care Act, with 30% anticipating they would stop offering employer-sponsored health coverage. The survey results sparked debate and criticism from both critics and defenders of the ACA.
Rajat Gupta, along with another McKinsey executive, Anil Kumar, were convicted in a government investigation into insider trading for sharing inside information with Galleon Group hedge fund owner Raj Rajaratnam. Gupta was convicted of four counts of conspiracy and securities fraud in June 2012.
Duff McDonald's 2013 book described how McKinsey's consultants were expected to recruit clients from various community involvements.
In 2015, McKinsey & Company was closely associated with the Valeant scandal.
McKinsey partner Navdeep Arora was convicted for illegally depleting State Farm of over $500,000 in collaboration with a State Farm employee.
McKinsey allegedly involved in corruption with the Gupta family in South Africa, obtaining consulting contracts from state-owned enterprises and paying Trillian Capital Partners for facilitating business. Investigations revealed violations of professional standards but denied bribery and corruption.
McKinsey concluded a transparent process to return the R1 billion payment to Eskom in South Africa. Eskom confirmed receiving R99.5M in interest from McKinsey on July 23, 2018.
In February 2020, Daniel Markovits argued in The Atlantic that McKinsey promotes intellect and elite credentials over directly relevant experience.
In 2021, McKinsey discontinued its investment banking advisory unit, citing 'personnel matters' as the reason.
Vyaire, with support from Spirit AeroSystems and McKinsey, achieved record production levels during COVID-19.
Vistra Corp. partners with McKinsey to utilize AI for improving efficiency and reducing emissions in the energy sector.
On June 1, 2022, McKinsey announced the acquisition of Caserta, a data engineering firm.
South Africa's National Prosecuting Authority charged McKinsey South Africa and former partner Vikas Sagar with fraud, corruption, and theft related to a contract with Transnet for advising on buying new locomotives.
Canadian opposition parties demanded a parliamentary inquiry into federal contracts awarded to McKinsey, urging the government to disclose all related information since taking office.
After audits, the Treasury Board announced that while there were questions about fairness and transparency in awarding contracts to McKinsey, no evidence of political direction was found.
On February 15, 2024, an update was made to the McKinsey Firm Overview. The overview provides an in-depth profile of the firm from an insider's point of view.