Mckinsey Essays - Organizational Theory, McKinsey Company

Mckinsey Over the decades, McKinsey's success and its reputation have been determined by the quality of its clients not just the institutions, but the individuals. The firm was founded in 1926, when the Universiry of Chicago professor James Mc Kinsey began recruiting experienced executives and trained them to be accounting and engineering advisors. When James O. McKinsey died in the late 1930's Marvin Bower, graduate of Harvard Law as well as Harvard Business School became the leader of his small consulting firm. He believed that management consultants should be professionals and initiated the upgrade of the firms image and broaden associates expertise. He placed client interests first, accepted only those assignments that we are fully qualified to perform and maintained independence and objectivity, even if it means declining or withdrawing from an assignment. The next decade the global economic environment changed drastically but the firm did not respond to those changes accordingly. That lead to a stall in the firms growth. The newly assigned Commission on firm aims and goals researched the problem thoroughly and concluded that the focus on expansion has diluted the professionalism. The recommendations included an increased number of MGM and utilization of narrow-specialized consultants. When Ron Daniel took over the company the Commissions recommendations still were not met. Even worse, the company was feeling pressure from strong and innovative competition. Their local office based model was inadequate to the rising need of information and knowledge sharing. The first important step Daniel did was to emphasize on the training and developing process, creating the first Director of training position. Second step was to initiate structural changes creating cross-geographic Clientele Sectors and encouraging the development of functional ex pertise in the general areas. The concern was that the fine line between the new direction and product driven approach shouldnt be crossed because of the established business relationships in the local offices. Also he attracted well known experts to form a group that will develop and share the existing knowledge of the company. The open minded Fred Gluck contributed much to the innovation starting with the brainstorm strategizing during the Super Group session. He also brought his ideas about the knowledge as a core firms activity and asset. The creation of the 15 virtual Centers of Competence was a revolutionary step towards the functional expertise. That was a very costly project with unspecified budget but he was aiming high. It was actually a long-term blue skying for the practice leaders with one single purpose to collect as much new ideas as possible. Gluck supported the practice development and defended it with Judging by the evidence of the three mini cases, we see that the firm has been somewhat effective iin it's two decade long change process. However, it's not as simple to decipher whther or not it has been successful since each of the three case pointed out some strengths and weaknesses that have resulted from the over two decades of change. The Sydney office case for example, actually proves that the last two decades of management change have had varying differences.. The client on the project was very impressed with the value added in their acces to knowledge, which was one of management's objectives. Also the amount of resources that Stuckey had available was quite large. He was able to organize a team with such diverse members. However, it was a very complex and difficult process finding associates that to complete the team. Stuckey also felt that even though the customer was satisfied, that the company had become very introverted in it'sway of looking at and handling of client challenges. He felt that even though the knowledge systems were helpful, it is also important for the company to focus on new fresh ideas that were not part of the knowledge base. A similar theme was seen in the European Telecom case where the consultants working for McKinsey wanted to implement a new innovative way of sharing information in the telecom industry, which was outside of the traditional inter company knowledge base. Telecom was growing so rapidly that it was difficult for Soderstrom working as the sole intelligent switch, to maintain all of the info coming in about telecom. But their proposals for an