It is a rare sight: the head of the world’s most powerful consultancy walking alone, without any handlers, into a newspaper headquarters for his first media interview.
This could be an overt display of self-confidence by Kevin Sneader, the newly elected boss of McKinsey, or a move calculated to show he is not quite the conventional choice his initial critics presumed. Mr Sneader is McKinsey’s first Scottish, and its first Jewish, leader. He speaks at warp speed, with a self-deprecating and disarmingly frank humour, joking about his Glaswegian accent, his hero Billy McNeill, the former Celtic football player and manager, and the deal with his wife never to discuss Donald Trump.
Mr Sneader, 51, is just a week away from officially starting his role as McKinsey’s global managing partner. From July 1 he will be in charge of the world’s biggest partnership — a sprawling business with 2,000 partners and 28,000 staff across 65 countries that has registered breakneck growth over the past decade, doubling revenues to $10bn. Leading McKinsey, which advises the world’s biggest corporations and governments around the world, is a job requiring Olympic stamina and top class communication skills. In the next week alone, Mr Sneader will travel from London to Frankfurt, Tokyo, Dallas, San Francisco and back home to Hong Kong, where he lives with his wife, Amy, and their two daughters. “I’m five foot five, so I fit in an aeroplane seat,” he quips, “So for me, it’s actually quite easy.”
He has spent his entire career at the consultancy, which he joined as a business analyst straight from Glasgow university. As the new boss, Mr Sneader is anxious to show he is not just “another white, middle-aged dude”, as a former partner commented after his election. “The reality is I’m a traditionalist when it comes to our values . . . but I’m an innovator when it comes to what we’re going to do,” he says. “We’re not broken, we’re in good shape, and I see myself as an innovator, not a consolidator.” His first big shift has been to overhaul McKinsey’s leadership team to ensure a better gender and geographical balance. The new team of 15 McKinsey partners includes five women, whereas it previously had one.
It is also less heavily skewed towards partners from the western hemisphere, and includes the heads of six regions: Europe, Latin America, China, Asia ex-China, North America, and eastern Europe, the Middle East and Africa. This is the first time China has been treated as a standalone region — a strong indication of where Mr Sneader sees growth potential for the firm. McKinsey executives usually practise a Trappist-like silence when it comes to discussing the inner workings of their organisation. Mr Sneader wants to break tradition.
“It’s not a state secret,” he says of the new management structure.
“The days when we can hide from the outside world are over. When it comes to our clients we absolutely will continue to respect their confidentiality. When it comes to ourselves, I think we can be more open.” McKinsey’s conversion to glasnost has been partly forced by an embarrassing scandal in South Africa, where the firm, along with other international companies, became entangled in government corruption linked to the controversial Gupta family. Initially, McKinsey was aloof and unapologetic.
750,000
The number of people who have applied to work for McKinsey in 2017
Mr Sneader acknowledges this was a mistake. “One of the things we are now very aware of is we failed to engage with civil society in a way that showed we took this as seriously as we do take it, and we failed to say sorry for the mistakes that we clearly made,” he says. The South Africa problems are far from over for the firm, and the affair raises serious questions about supervision of its local business — as it did with KPMG, the Big Four accounting firm. The episode also points to the risks inherent in pursuing breakneck growth.
Under Dominic Barton, his Canadian predecessor, McKinsey doubled revenues and the number of partners. The firm continues to be viewed as one of the most prestigious companies in the world to work for. Last year about 750,000 individuals applied to work there. Fewer than 1 per cent were successful. But Mr Sneader, a gym addict known for firing off emails from his iPad while on the treadmill at 6am, says there is no room for complacency. McKinsey needs to adapt further.
McKinsey is ranked as the best consulting firm to work for in North America, Europe and Asia-Pacific (2018)
Mr Sneader has no intention of retrenching, but is recalibrating. “I joined a firm that had about 100 partners, and that was in 1989. There were lots of advantages to that — everybody knew everybody, and it was a very intimate group. “On the other hand, when you’ve got this number of partners, there’s a lot more that you can do. It’s a far more interesting place in terms of the backgrounds of those people. And it might be nostalgic to turn the clock back, but I don’t believe that scale is the enemy of partnership. I just don’t buy that.”
Mr Sneader intends to continue the firm’s acquisition spree (it made 14 under Mr Barton) and is considering a “long list of opportunities” — largely in the area of data analytics, digital and the internet of things. But he intends to manage that growth differently. First, there are certain sectors he has ruled out, including headhunting, outsourcing and mainstream advertising. Second, he plans to forge more research partnerships with clients, and is particularly animated about the potential for teaming up with the world’s largest technology companies.
Another priority is to reshape the firm’s workforce so that it becomes less dependent on business school graduates and more diverse. Of current employees, 37 per cent have MBAs — a proportion that will fall to “less than a third” as McKinsey increasingly hires from the creative industries, according to Mr Sneader. He also wants to encourage greater interaction within McKinsey’s workforce and its network of almost 34,000 alumni — “a hugely important group”. Finally, there is the delicate question of governance. He has already experienced the power of the partners, who decided to reduce the maximum term he can serve from nine years to six. “It makes a tonne of sense,” he says.
McKinsey’s 2,000 partners vote every 18 months or so on important decisions. A subcommittee of 30 senior partners, named the shareholders’ council, meets more frequently to vote on more routine matters such as a recent office opening in Sri Lanka. Mr Sneader believes the entire partnership should be consulted more often. Technology has transformed McKinsey’s ability to communicate with current and former employees, and he plans to fully utilise that potential. “I’m very excited by what lies ahead, but I also feel there are some things that we need to adjust,” he says. “The way we participate in the running of the firm needs to change.”
Madison Marriage and Lionel Barber, FT
