Transnational Mgt. Case Analysis
Essay by review • November 27, 2010 • Case Study • 1,486 Words (6 Pages) • 2,562 Views
Problem Statement
McKinsey & Company is a highly successful consulting firm worth over 1.8 billion dollars. However, its leader Rajat Gupta wondered if the company could better utilize the knowledge of its employees to better serve its worldwide clients. It was obvious that McKinsey
& Company had a strong base of core competencies among its employees, but Gupta was unsure if knowledge development was meeting its clients' needs in an information and knowledge
driven age. Clients hired McKinsey & Company expecting leading edge information from to
assist them in their decision-making processes. Gupta felt a process was needed to develop,
capture, and leverage this information which he considered an asset to the company. So,
the task lay before them on how to accumulate and store the information quickly and make it
readily available to consultants on a global scale.
List of Symptoms
* McKinsey & Company desired to provide state-of-the-art knowledge to its clients but
currently had no means of measuring exactly how well they were doing in developing their knowledge.
* Employees were not being properly developed for the new direction of the McKinsey & Company. McKinsey & Company still had the ability to provide excellent advice to its Clients. However, they were not as prepared as their competitors for dealing with the upcoming technologies of the future.
* McKinsey & Company had experienced rapid growth. McKinsey & Company had 3,800
consultants in 69 offices worldwide. In its present state, the large number of employees
and offices it managed actually hindered McKinsey from effectively performing its
operations worldwide. Essentially, McKinsey & Company had become too large for itself under its current architecture.
Alternative Solutions
McKinsey & Company did not desire to rest on its laurels and remain content with the
status quo, rather they aggressively sought out to find answers to their dilemmas. They
realized that being a 1.8 billion dollar company did not come easily and also that without
modifications they would not remain in their top position in consulting.
* (1) McKinsey & Company must implement a system of knowledge management in which
the entire organization is able to benefit from the sharing of knowledge between employees.
This will allow the company to benefit internally.
Alternative Solution One: (2) In order to measure the results McKinsey & Company must revisit their goals to develop, capture, and leverage their knowledge to better serve their clients.
Alternative Solution Two: Know the audience to be measured and what benefits they seek from their relationship with McKinsey & Company.
Alternative Solution Three: Define exactly what is to be measured and the approaches that will be used. All measurements must be valid, actionable and reliable.
Alternative Solution Four: Decide what data will be collected and how it will be collected. Focus on the most pertinent information.
Alternative Solution Five: Refer back to the original goals and the audience in the
presentation of the results.
Alternative Solution Six: Monitor and evaluate how the measures are working.
Using the steps mentioned above will provide quantitative results for measurement.
* McKinsey & Company must implement procedures that modify their hiring practices.
McKinsey & Company currently hires employees who have specialized skills. Their hires excel
in their specific area of expertise. However, they know little about areas outside their areas of
specialization. This does not add value to McKinsey & Company nor does it ready the company
for change. The goal is for McKinsey & Company to be prepared for imminent changes in an
information and knowledge-driven age. McKinsey must hire multi-faceted employees who will
increase the value of the company through their additional competencies while allowing
McKinsey to respond to the marketplace before its competition does. McKinsey & Company
must actively seek employees who not only display the current competencies McKinsey
currently desires, but they must also actively seek out employees who are also fundamentally
sound in the various technologies. The hiring of multi-faceted employees will allow McKinsey
to better grasp changes and will also maintain their competitive advantage as their employees are
better prepared to observe and implement changes.
* Executives must implement structural change through the managers at McKinsey &
Company. (Bartlett, Pg.346) Managers must be reoriented to reshape the decision-making
systems that are now centralized. The hub must remain centralized and the sub units both locally
and globally must be decentralized. This will allow for more on the spot decision-making and
less dependence upon the hub, which slows down the entire operation. McKinsey must develop
a transnational mindset.
Advantages of each Alternative
Alternative
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