When McKinsey Comes to Town
As an expose of McKinsey, this book focuses on the most questionable and problematic aspects of the company's work. Selection bias aside, the authors (Walt Bogdanich & Michel Forsythe) document a company seeking profits by any means: improving tobacco sales while knowledge the harmful effects, improving opioid sales amidst a peak of overdose deaths, human rights abuses, clear issues of conflict of interest, corruption cases (for which payouts have been made but no acknowledgement of guilt), finding ways to cut healthcare benefits and rolling back staffing, the latter contributing to many cases of death and injury at workplaces...
"The most shocking revelation, however, was McKinsey's decision to help companies sell more opioids when the abuse of those drugs had already killed thousands of Americans. Two senior partners discussed possibly purging records, apparently to hide their involvement. McKinsey agreed to pay more than $600 million to settle investigations by dozens of state attorneys general into the firm's role in fanning the opioid epidemic. the firm also issued a rare apology, and fired the two employees, but said it did nothing illegal." (p.26)
"McKinsey & Company watched this rising tide of condemnation, knowing full well that for decades the firm's consultants had been helping the biggest tobacco companies sell more cigarettes. it had been handled in typical McKinsey fashion-in secret. McKinsey's name did not figure in the congressional hearings on tobacco, or in two major books totaling fourteen hundred pages, or in media investigations of the industry. Secrecy benefited both McKinsey and its tobacco clients. Cigarette makers did not want consultants sharing marketing strategy, and McKinsey did not want its reputation sullied as an enabler of companies that sold a deadly product...The story of McKinsey's extensive work for Big Tobacco has never been told, the details buried deep in fourteen million pages of industry documents. That relationship can be traced back to at least 1956, when McKinsey did a wall-to-wall examination of Phillip Morris's operation..." (p.112)
"In one slide McKinsey old Allstate to try to settle 90 percent of its claims as quickly and as cheaply as possible. For the other 10 percent, policyholders or third party claimants who didn't take the Allstate offer, even worse, hired a lawyer, the "boxing gloves" treatment was in order. They would fight in courts, for years if necessary, wearing down everyone who dared to sue." (p.194)
"Forty percent of Regiments' share of the airline contract-6.2 million rand, or roughly $420,000- went to a shell company that laundered payments to the Gupta family. McKinsey said it didn't know that the contract was secured through a bribe. The second tainted McKinsey contact was with Transnet, where Regiments diverted millions of dollars to front companies controlled by the Guptas. McKinsey again took the position that it knew nothing about these payments." (p.239-240)
"Abdulaziz, a Saudi national who had been living in Montreal for almost a decade, replied he was fine but the person had good reason to be worried. He told Abdulaziz that he had been working with McKinsey on a project for MBS. McKinsey had prepared a report about how the kingdom's subjects were reacting to government policies. The report identified Abdulaziz, along with some other Saudis, as being highly influential in shaping the public's opinion, and not in a good way. "I thought, 'oh that's great,' ' Abdulaziz recalled more than two years later. "In the beginning I didn't know that it would be such an important thing. So I thought Nothing would happen." (p. 252)
"Faced with a huge budget shortfall, the government turned to McKinsey to trim the NHS budget. In March 2009, McKinsey delivered its plan in a 123-slide PowerPoint presentation. The proposal outlined a pathway to save an NHS as much as £20 billion by cutting 10 percent of its workforce, or almost 140,000 jobs, in the midst of the sharpest economic downturn in decades. The people who remained would have to work harder..." (p. 265)
