Book – The Firm

Steve Taylor-Bryant tries to work out how the world of big business works by learning about the consultants as he reads The Firm: The Story of McKinsey and Its Secret Influence on American Business by Duff McDonald...

The Firm: The Story of McKinsey and Its Secret Influence on American Business was a strange book for me to choose. I love reading about big business but normally those companies whose impact has been failure. Wall Street thuggish traders or Enron are my normal pick and rarely do I pick up a book about something or someone I've never heard of, I like to learn but I'm not as adventurous as maybe I should be, so the story of McKinsey was brand new to me. And what a story!

There's a reason many of us haven't heard of McKinsey: they don't actually produce anything. McKinsey's stock is in themselves. McKinsey sells McKinsey. McKinsey are a consultancy firm with their fingers in every pie you can imagine. McKinsey rule the world... Sort of.

James McKinsey started his company in the 1920’s when he was an accountant that could see that people’s accounts often told a tale. He could look at your books and tell you how to grow as a company, what budgets you could set for expansion. He could run your company for you without ever having the responsibility of running your company for you and the American businesses lapped this up. McKinsey being hired was almost a rite of passage for CEO’s everywhere and if their generalist opinions, no one at McKinsey was a specialist in anything, weren’t good for your firm? Well, you were CEO so you’d never admit you have done anything wrong by hiring McKinsey and would hire McKinsey to dig you out of the hole you had put yourself in. McKinsey had a great hiring policy, one I have used myself in my own businesses in the past… they hired kids. Not like child slavery kids you understand. They hired straight from school, intelligent young minds that weren’t yet corrupted by one company’s particular way of doing things. You could mould their working practices as they gained experience and as McKinsey you didn’t need to worry if it went wrong as someone was always going to hire you.

McKinsey is a strange breed of company. They are pretty much responsible for President Eisenhower creating the position of White House Chief of Staff, they are the reason that you’ll find barcodes on everything you buy, some of these restructuring ideas are actually quite brilliant and, as you read, you’ll find your own one or two that speak to you like ‘White House’ and ‘Barcodes’ did to me. However you’ll also see how they throw someone under a bus when it goes wrong. They helped General Motors carry out a business restructure that almost single handily destroyed the American automobile market, they were consultants to Arthur Anderson and to Enron (you’ll see my thoughts on them in a different review of a different book) and if you ever wondered who started the trend of mass redundancies as the first stage of any companies budget tightening – McKinsey.

What Duff McDonald has done well with The Firm is introduce the history of consultancy as we know it, talk eloquently about all the characters throughout the company’s time at the top and show both bad and good sides with equal measure, all whilst not losing the reader in baffling nonsense. He shows the glamourous side of being the fixer and shows the rough side and fallout when the advice is working and tells quite an enthralling tale of big business in the process.

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