The latest McKinsey Quarterly warns: “Addressing information overload requires enormous self-discipline.” It appears that not all McKinsey consultants take their own advice. In fact, a distinct lack of self-discipline is behind a hit to the reputation of the world’s most prestigious management consultancy; three former partners are now implicated in the Galleon insider trading case.
The consulting group has put on a brave face. After all, the case against Rajat Gupta, McKinsey’s former global chief who insists he is innocent, is based on information he acquired in 2008, the year after he left the consultancy. Furthermore, insider trading by employees has occurred at many companies in many industries. Once the individual has been ejected, the company usually carries on with few injuries.
But management consulting is different. First, it is a client’s information, rather than its own, that risks being used inappropriately. Second, consultants are hired to do more than just synthesise value, frame problems, and monetise strategies with customer-centric processes. In spite of this image for “big picture” thinking, the bread and butter of consulting is mostly coming to grips with insane levels of detail, allowing the likes of McKinsey to amass (and leverage) huge amounts of information on their clients. And compared with those doing similar analysis at investment banks, consultants are much less well paid.