BY THE STAFF OF VAULT 2004 Vault Inc.EMPLOYPROFILEVAULT EMPLOYER PROFILE:MCKINSEY& COMPANYCopyright 2004 by Vault Inc.All rights reserved.All information in this book is subject to change without notice.Vault makes no claims as tothe accuracy and reliability of the information contained within and disclaims all warranties.No part of this book may be reproduced or transmitted in any form or by any means,electronic or mechanical, for any purpose, without the express written permission of VaultInc. Vault, the Vault logo, and the most trusted name in career informationTM are trademarks ofVault Inc.For information about permission to reproduce selections from this book, contact Vault Inc.,150 W 22nd Street, New York, New York 10011, (212) 3664212.Library of Congress CIP Data is available.ISBN1581313357Printed in the United States of America.INTRODUCTION 1Overview. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1McKinsey & Company at a Glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2THE SCOOP 3ORGANIZATION 15Managing Director: Ian Davis. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15Practice Areas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16Locations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16Structure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19Key Competitors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19VAULT NEWSWIRE 21OUR SURVEY SAYS 25GETTING HIRED 31Interviewing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31Questions to Expect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37Questions to Ask . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40Table of ContentsMcKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting withinsider firm profiles, message boards, the Finance Job Board and more. iiiC A R E E RL I B R A R YON THE JOB 41A Day in the Life. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41Job Descriptions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44Career Path . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .46FINAL ANALYSIS 49RECOMMENDED READING 51 2003 Vault Inc. ivC A R E E RL I B R A R YOverviewIntheindustryandamongitsemployees,McKinsey&Companyisknownsimply as "The Firm" need we say more?With 82 offices and around 7,000consultants worldwide, McKinsey serves more than two thirds of the Fortune1000, or 85 of the world's top 100 companies. McKinsey's founder, James O. McKinsey, pioneered the idea of managementconsulting when he launched the firm in 1926.But it's Marvin Bower, withMcKinseysince1933,whoiscreditedwithshapingthefirm'svalues,includingarelentlessdriveforexcellence,amandateofputtingtheclients'needs before the firm's, and an insistence on discretion in financial matters.Indeed, the notoriously tightlipped company rarely publishes the names ofits clients, which include huge global companies, innovative startups, wealthycommercialbanks,leadingventurecapitalfirmsandvasttechnologycompanies.McKinseyalsoprovidesprobonoassistancetoeducational,social, environmental and cultural organizations.McKinseyemergedfromtheInternetgoldrushdaysrelativelyunscathedcompared to competitors, though it suffered its own PR challenges as it founditsnamelinkedwithscandalplaguedcompanieslikeEnronandGlobalCrossing.Inrecentyears,thefirmhasturneditsattentiontowardtheITsectorandoutsourcing,inanattempttorespondtotheshiftingtrendintheconsultingmarkettowardmore"tangible"services,suchassystemsintegration.On the pure strategy side, McKinsey also has faced a competitivethreat from rivals like Bain and Boston Consulting Group. McKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 1C A R E E RL I B R A R YIntroduction55 East 52nd StreetNew York, NY 10022Phone: (212) 4467000Fax: (212) 4468575www.mckinsey.comTHE STATSEmployer Type: Private Company Managing Director: Ian Davis2003 Employees: 11,0002002 Employees: 11,0002001 Employees: 13,000PRACTICE AREAS Automotive & Assembly Banking & Securities Business Technology Office Chemicals Consumer/Packaged Goods Corporate Finance & Strategy Electric Power/Natural Gas High Tech Insurance Marketing Media & Entertainment Metals and Mining Nonprofit Organization and Leadership Operations Strategy & Effectiveness Payor/Provider Petroleum Pharmaceuticals and Medical Products Private Equity Pulp and Paper Retail Strategy Telecommunications Travel and Logistics UPPERS Extensive alumni network Global reach Researchdriven projectsDOWNERS Strict "up or out" system Ongoing, frequent review process Limited mobility without advanceddegreeMcKinsey & Company at a Glance 2004 Vault Inc. 2C A R E E RL I B R A R YShaping management theoryIn1926,lawyer,CPA andUniversityofChicagomanagementprofessorJames Oscar "Mac" McKinsey founded the firm that still bears his name.Inthoseearlydaysofconsulting,McKinseywasfascinatedbytheemergingscienceofmanagement,andsoughttogivebothmanagementandfinancialadvicetohighrankingpersonnelataccountingandothercorporations.McKinseyenvisionedbringing"managementengineers"tonotonlyrescuefaltering companies, but also to help thriving companies do even better. Hisfive partners included A.T. Kearney and protege Marvin Bower, who wouldgo on to shape the McKinsey firm we know today. A fewyearsaftersettingupshop,McKinseyacceptedatemporaryoffertorun and restructure the Chicago department store Marshall Field's.Bower rantheconsultingpartnershipuntilMcKinsey'sdeathin1937. A quarreloverleadership between Bower and Kearney led to a split, and the two went theirseparate ways in 1939, with Kearney retaining the Chicago office and namingitafterhimself,andBowernamingtheNewYorkbranchMcKinsey&Company.,inhonorofhismentor.Asfortheotherpartner,Kearney,hisname is now associated with another strategy consulting firm, A.T. Kearney,still numbered among McKinsey's competitors. Learning the rules"TheFirm"derivesmuchofitsmysteriousprestigefromitspowerfulfivepartcodeofconduct,institutedbyBowerandstillfollowedtoday.BowerdirectedMcKinseyemployeestoputclientinterestsaheadoffirminterests,servetheclientinasuperiormanner,adheretohighethicalstandards, preserve the confidence of clients, and be ready to differ with clientmanagersandtellthemthetruth,howeverpainful.Overtime,Boweralsobegan directing his recruiting efforts toward graduate students the firm couldmold into broadbased consultants, instead of experts who had built up yearsof experience in a single industry.McKinsey & Company thus became thefirst consulting firm to hire directly from business schools. AnothertraditionsetbyBowerwasareticencetodiscussfinancialmattersopenly,whichpersiststothisday.Maintainingthatthefirmwouldmakemoremoneyifitdidn'tconcernitselfwithprofits,Bowerneverchargedclients performancebased or resultsbased fees.Ensuring that this decorumregarding all things financial would stick for the long haul, Bower declinedMcKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 3C A R E E RL I B R A R YThe ScoopMcKinsey & CompanyThe Scooptotakethecompanypublic(atwhatwouldhavebeenanenormousprofit)when he retired in 1963, instead selling his shares back to the firm for bookvalue.Future partners have continued this practice. Bower shaped McKinsey culture in other, more subtle ways.All executiveswere required to wear hats and long socks (to avoid displaying "raw flesh") thoughtheremaybemorebareheadsandbareskinondisplaythesedays,many McKinseyites still prefer long socks. Like many of its peers, McKinsey really took off during the postwar period,when companies turned their attention to expanding profits.The 1950s sawMcKinseyaddinganexpandingnumberofbluechipcompaniestoitsclientele, as well as adding engagements with major government and militaryorganizations, defense contractors.In 1959, the firm went international withanofficeinLondon,andopenedofficesinMelbourne,Amsterdam,Dsseldorf, Paris, Zurich and Milan shortly thereafter. The lure of the newThe firm started to face fiercer competition and lose market share in the1970s, a time of corporate buzzwords, such as the Boston Consulting Group's"growthsharematrix."Rejectingtrendymarketingtheoriesonprinciple,McKinsey lost business to BCG and other upstarts.These lessstodgy firmssoonbeganluringawaytopbschoolgrads,theenginedrivingmuchofMcKinsey's success. But the firm created another tradition of its own when,in1986,itbegananMBA summerinternshipprograminresponsetotheextravagantsigningbonusescompetitorslikeBainandBCGwereusingtowoo top candidates like Harvard's Baker Scholars.The program was soon tobecome a norm across the industry, as well as among others like investmentbanks. In1989,thefirm'sacquisitionoftheInformationConsultingGroupprovedsomewhatawkwardwhenacultureclashbetweenthecompaniescausedmany former ICG employees to jump ship.The firm righted itself later in the1980sastheglobaleconomybeganboomingagain,andthe1990swereasuccessstory. Todate,therevenuehasmorethandoubledsince1993,andthe firm doubled its professional staff and opened a total of 20 offices in the1990s.In 1999 alone, the firm opened offices in Antwerp, Belgium; Athens;Dubai, United Arab Emirates; Manila, Philippines; and Rio de Janeiro. 2004 Vault Inc. 4C A R E E RL I B R A R YMcKinsey & CompanyThe ScoopConsultants without bordersInfact,McKinseyhasbeendescribedbymanagingpartnerIanDavis,inaJune 2004 interview with the Financial Times of London, as "a truly globalfirm."Itsconsultantsarecitizensof95countries.McKinsey'sgoverningshareholder committee is controlled by a nonAmerican majority, and about60percentofrevenuescomefromoverseas,withfurthergrowthexpectedfromnewmarketsinRussia,EasternEuropeandChina.ThefirmhassolidifieditsAsianpresenceinrecentyears,conductingmorethan500engagementsinChinaoverthelastdecade.InOctober2003,thefirmestablished its AsiaPacific regional headquarters in Shanghai, and the officehasworkedwithsomeofthatnation'smostprominentclients,includingSingaporeAirlinesandthechewinggumaversenationalgovernment.InMarch 2000, McKinsey opened a new office in Tel Aviv, from which it hasofferedassistancetoIsraelicorporations,startupsandgovernmententitiessuchastheMinistryofCommunicationsandthePostalAuthority.Thenewest office on McKinsey's list is in Zagreb, Croatia, opened in early 2003. It's in IndiaIndia is also big on the firm's radar, especially as the trend toward offshoring(a term Davis argues is misleading) continues. In February 2000, McKinseyenhanced its presence in India with the launch of India Venture 2000, whichwascreatedtohelpIndianentrepreneursestablishandgrownewIT orecommerce businesses.The firm's office in New Delhi is one of its fastestgrowing sites, and in India, the firm helped the State Bank of India reengineeritsbusinessprocessesinMay2003;advisedliquorcompanyShaw WallaceonopeningnewbreweriesinSeptember2003;consultedwithengineeringandconstructionfirmLarsen&Toubroonstrategymatters;andadvisedPrimeMinisterAtalBehariVajpayeeonforeigninvestmentissues.McKinsey maintains one office in Delhi staffed 24/7 with 300 workers whoprovidethefirmwithsupportforvisualpresentationsandgraphics,andanothernearDelhiemploying12highlyeducatedstafferswhoperformstatisticalresearchforMcKinseyconsultants.But,asDavisarguedtotheFinancialTimes,"FromMcKinsey'spointofview,offshoringdoesn'tmeananythingforus.Offshorefromweretowhere?"Headded,"Wehave40different nationalities working in the London office.So offshoring to Indiawouldn't mean anything because you could argue we are as much Indian asanything else." And it isn't all about outsourcing, offshoring, or whatever else you might callit.In fact, McKinsey has approximately 130 consultants on the subcontinentVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 5C A R E E RL I B R A R YMcKinsey & CompanyThe Scoopasof2004,andthefirm'seffortsinIndiahaveestablisheditasoneofthatnation'smostprestigiousemployers.ManyIndianconsultantshavegraduatedMcKinseytoleadmajorcorporationsandprojectsoftheirown(exdirector Ashok AlexanderwentontoheadtheBillandMelindaGatesFoundation in India, and fellow alumnus Pulak Prasad is a leader at WarburgPincus, to name just a couple)."We are a breeding ground for leaders and westartworkingonpeoplefromDayOne,"PramathSinha,anIndiabasedMcKinsey principal, told The Economic Times of India. Alongwithitsconsultingpeers,McKinseytookahitfromthedotcombubble and the effects of September 11.The dotcom boom was good to thefirmforawhile,andittookonmorethan1,000webrelatedengagementsduring 1999 and 2000, reaping record revenues of $3.4 billion in 2000.Thefirmwassomewhatshieldedwhenthebubbleburstasithadlimitedthepracticeofacceptingequitystakesfromclientsinlieuofstartupfees,acommonpracticeamongcompetitors.ButMcKinseystillsufferedwhenitwasstuckwithsomeoftheseworthlessshares,andincomefrommanypreviously highflying ecommerce clients quickly dried up.Jumping shipThe firm's Internet troubles actually started before the bubble burst, as manyofMcKinsey'sbestconsultantsjumpedshiptolatchontoalluringwebrelatedventures.In1999,thefirm'sSanFranciscoofficesawathird(150members)ofitsstaffwalkoutthedoor.Oneyearlater,though,McKinseyhadmoreemployeesthanitknewwhattodowith.Outofthe3,100MBAswhowereextendedoffersin2000,McKinseyexpected2,000acceptances, but the firm received more than 2,700."We honored every offeranddidn'tpushpeopleout,"thenmanagingpartnerRajatGuptatoldBusinessWeek inJuly2002,"andwehadnoprofessionallayoffsotherthanour traditional uporout stuff." This "stuff" was reportedly on the rise as of2001, when 9 percent of all analysts and associates were shown the way out,compared with just 3 percent a year earlier, the New York Times reported.ThepostSeptember11recessionledtosomebelttighteningamongnonconsulting McKinseyites; in November 2001, the firm announced that itwouldcut5to7percentofits3,000supportstaffintheUnitedStatesandCanada.Other costtrimming measures, the Times reported, include cutbackson travel, training retreats, and "even the Reese's Peanut Butter Cups at thefirm's New York reception desk." 2004 Vault Inc. 6C A R E E RL I B R A R YMcKinsey & CompanyThe ScoopBankruptcy bluesMcKinsey rarely publicizes the names of its clients, but its association withsome troubled companies has put the firm in the headlines. In recent years,McKinsey'sassociationwithbankruptentitiesincludingEnron,Swissair,GlobalCrossingandKmartoccasionedsomegrumblingamongoutsideobservers about the value of the highpriced advice it provides.InMay2003,McKinsey'sserviceswerecalledintoquestionduringbankruptcy hearings for client United Airlines.Bankruptcy lawyers chargedthatthefirm'srestructuringadvicefees,whichincludeda$1millionamonth flat fee for McKinsey, were unwarranted for a company thatcouldn't manage to pay its debts.UAL dismissed the concerns and retainedMcKinsey. McKinsey was also caught up in a client's bad luck when it madeheadlines for failing to predict an $800 million takeover bid of client OceanSpraybyrivalNorthlandCranberriesInc.inearly2003.McKinseyhadadvised Ocean Spray since late 2002 and, against the wishes of the company'sstrugglinggrowers,hadadvisedthecooperative'smanagementtoavoidselling any of its businesses.The collective rejected Northland's overture inFebruary 2003, but the prosale growers won a vote to replace Ocean Spray'sboard of governors with a new, smaller panel, and the company cut 58 of itsexecutives the following month.The sinking "E"But Enron provided the firm's biggest PR headache in recent years, especiallysincedisgracedCEOJeffSkillingjoinedthedoomedenterprisefromMcKinsey,wherehe'dworkedwiththefledglingcompanytodevelopatransactionandservicesbased,minimalassetapproachtocorporateoperations.Tomakemattersworse,thefirmtoutedtheEnronmodelasasuccess story after Skilling left to head the corporation.As it transpired, thetransactionsandservicesonwhichEnrongrewitsnumberswerelargelyillusory, the result of exchanges between Enron subsidiaries. When the modelcould no longer sustain itself and the word got out, Enron collapsed, takingmuchofthestockmarketwithit.McKinseyconsultantsworkingoutofEnron's Houston offices had racked up millions in fees topping out at morethan $10 million during one year for dispensing strategy advice.None ofits work for Enron, however, had anything to do with the shady dealings thatled to the Tilting E's ruin.Looking back, Ian Davis told the Financial Times,"I think our reputation was dented" by the Enron affair, though "People knowwe had nothing to do with any wrongdoing." Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 7C A R E E RL I B R A R YMcKinsey & CompanyThe ScoopGrowing painsAsidefromitsassociationwithtroubledclientsinaturbulenteconomy,McKinsey's struggles in recent years have come from internal growing pains,as well.The firm's obsession with excellence reflects the company mantra,"100percenttothethirdpower,"meaningthatthefirmseekstobring100percent of firm capabilities to bear on 100 percent of McKinsey clients, 100percent of the time.However, an internal report from 2001, quoted in a May2002 WallStreetJournalarticle,showsthisthoroughapproachtobeapossible weakness. The article, "Growth at McKinsey Hindered Use of Data,"citesaninternalstudy,referredtoasProjectCoolkat,whichconcludedthatrapidexpansionhadhinderedthefirm'sabilitytokeeptrackofitsowninformation, leading to poor client performance."It takes much too long tofindtherightknowledge,"thereportstates,"andinmanycases,thebestexisting knowledge is not identified and brought to the client."Furthermore,thereportcallstheworksatisfactionandprofessionaldevelopmentofMcKinseyresearchstaff"unsatisfactory...Movingforward,thisisnotacceptable."The firm notes that "most of our most important knowledge isintheheadsofourmostseniorpeople,exchangedprimarilythroughconversations not through knowledge workers or electronically.At no pointover the last decade has McKinsey ever been anything but the best consultingfirm in delivering business knowledge to clients."Shortly thereafter, the firmlaunched a new initiative to improve researcher training and a major budgetincreaseforMcKinsey's"knowledgemanagement"processesandsystems,$35.8 million in 2002 versus just $8.3 million in 1999. But a senior partnerquotedintheWSJarticlewasquicktopointoutthattherewas"nodemonstrable link in fact there's no link whatsoever between our decisionto invest in upgrading our knowledgemanagement systems and any specificclient."Where the elite meetThere'snodoubtthatMcKinsey'sobsessionwithexcellenceandclientprivacy have given the firm a sheen of prestige and even elitism.McKinsey,whichrarelyrevealsthenamesofclientsandissuesfewpressreleasesdetailing its activities, is sometimes characterized as a "secret society."ButMcKinseytakesissuewiththis:"Onlyaftermanyyearshavepassedandifour clients themselves publicly refer to our involvement, do we acknowledgethat we have served a company," the firm contends."This policy is not theresultofsomecultivatedsecrecyormystique.Itiswhatwebelieveisprofessionalbehaviorandtheappropriateposturegivenourconvictionthatwesupplementourclients'leadership,butneverreplaceit."Ofcourse, 2004 Vault Inc. 8C A R E E RL I B R A R YMcKinsey & CompanyThe ScoopMcKinseyconsultantsoftenendupheadingtheirclients'firms.ItsstaffrosterofPhDsandRhodesscholarsisalsocloselyguarded,thoughsomepersonalitiesaretoowellknowntokeepunderwraps.InFebruary2003,news was leaked that former First Daughter Chelsea Clinton got a $100,000offertojoinMcKinseyasananalystintheLondonoffice.ButClinton,agraduate of the Oxford international relations masters program, held out foran assignment in New York in order to be closer to her parents.She got the$120,000ayearjobinMarch2003,andhasreportedlybeenpulling80hour weeks as she works on projects dealing with health care.McKinsey's intelligence arsenal is bolstered by a global network of more than900 knowledge professionals, most of whom are aligned to specific industry,functionalorgeographicknowledgedomains.Theseprofessionalsdoresearchontopicsrelatedtospecificclientengagements,allowingconsultantstofocusontheclientproprietarydimensionsofastudy.Inaddition to business research, this group also plays a lead role in the creation,codification,organizationanddisseminationofMcKinsey'svastknowledgebaseandspearheadsthedesign,developmentanddeploymentofallknowledgerelatedtechnologies.Recentenhancementsincludenewsearchtechnology applied across its vast document collection and a unique expertiselocation approach that enables consultants to identify colleagues from aroundthe world who might be able to help them with a specific problem.Indeed, this group may be tapped at any point during their careers, even afterleaving the firm.Like the Hotel California, McKinsey is a place from whichalumni can check out any time they like, but they can never leave.The firmpublishes a volume listing every living person who has ever worked for thefirm, where they live, and their current occupation.Its cover cautions:"Thisdirectoryistobeusedexclusivelybyalumniofthefirm."Thereareapproximately10,000McKinseyalumniallovertheworld,andeachyearthey're invited to a party where they can mingle with current consultants. Thisalumni network is likely to become ever more far reachingthe firm currentlyemploys6,000consultantsfrom90countries.McKinseyalumni,aspreviously noted, have often left the firm to take on more visibly prestigiousroles in addition to the infamous Jeff Skilling, more successful careers havebeen forged by alumni such as Bruce Henderson, a former McKinseyite whowasnamedCEOofImationCorp.inMay2004,andJ.D.Hickey,a33yearoldMcKinseyalumwhowasappointedtolead Tennessee'shealthcare program, TennCare, after having advised the program with the firm forthree years. ThecomplexwebofcurrentandformerMcKinseyitesformsauniquedecentralizedstructureforsuchalargecorporation.OperatingasaVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 9C A R E E RL I B R A R YMcKinsey & CompanyThe Scooppartnership,McKinseyisrunthroughanetworkofofficesthatrunsasaunified firm.In fact, the firm is reluctant to admit it has a global headquartersatall(thoughitrunsmuchofitsbackboneadministrativeworkfromNewYork City).The ownership and management of the firm is vested entirely inabout 800 active directors and principals (which roughly correspond to seniorandjuniorpartners).McKinsey'smanagingdirectoriselectedeverythreeyears by these directors, in a process some compare to the election of a newpope.InMarch2003,IanDavis,whoheadedthefirm'sBritishofficeforeightyears,wastappedtoreplaceRajatGupta,whoservedthecompany'smaximumofthreethreeyearterms.Davis,aholderofundergraduatedegreesinpolicy,philosophyandeconomicsfromOxfordUniversity,hasbeen with McKinsey since 1979.The Davis eraDavis'electionwasseenasheraldingchangesforthefirm.Gupta,whopresidedoverMcKinseyduringitsandtheeconomy'speriodofdizzyinglyrapidexpansion,becameassociatedwiththataggressivegrowthstrategy.ButobserverssayDavis,whopubliclyemphasizesMcKinsey's"core mission and values," such as a clientcentered, meritocratic approach,mayusherinacalmereraattheconsultancy.Consultantssaythatheisputting the recommitment to McKinsey's core values in action.In June 2004,the company held a special day of workshops to discuss the core values of thefirmandcommitmentstoservingclients.InJuly2004,DavistoldtheFinancialTimesofLondonthattheheadyyearsofthedotcomboom"didput severe strain on our basic values.In the kerfuffle, I think some of themgotlost. Wedidn'tknowinglymoveawayfromthem,butmysenseisthatafter this period we need to affirm our basic approach and values." (Anotherof those values privacy and lack of personal statusseeking is illustratedbythefactthatDavisdidn'tgivehisfirstinterviewtothepressuntilmorethan a year after his election as managing partner.) Though the firm guards its staff rolls as closely as its client list, it's clear thatthecompanyhastakenpainstoretainitsbestandbrightestduringtheweakened postSeptember 2001 economy.Now that the economy is on therebound, so are invitations to join McKinsey.In 2003, the firm significantlyexpandeditscampusrecruitingactivitiesonMBA,law,MD,PhDandundergraduatecampuses.Inthe20032004campusrecruitingseason,thefirmhiredover1,600consultants,abouta60percentincreaseoverthepreviousyear.Inaddition,McKinseyhashiredseveralhundredsummerassociatesgraduatestudentswhoaregoingintotheirlastyearofschool.TheNorthAmericanofficeshavescheduledaconferenceforallofthier 2004 Vault Inc. 10C A R E E RL I B R A R YMcKinsey & CompanyThe Scoopsummer associates in ski paradise (though probably not during the summer)Vail, Colorado.Natural selectionDespite its reputation as an "up or out" firm when it comes to advancement,McKinseyconsidersitspromotionpoliciestobebasedonthenaturalprogression of consultants at the firm, with advancement and compensationbasedonafairreviewsystem.Onaverage,onlyoneinfourorfiveconsultants who starts at McKinsey finishes the vaunted journey to principal."It'saprettycompetitiveprocess,"saysaninsider,"thoughlotsofpeopledon'twanttomakepartner,sotheyleave."VOX(visibility,options,expressionofpreference),asystemimplementedinearly2000,givesconsultants greater influence over the engagements they work on.McKinseyis also eager to get even more out of the best and brightest that it hires.Forincoming associate hires without a financial or business background, the firmoffers the Mini MBA, a threeweek program that provides an opportunity tolearncorebusinessskills.Inaddition,allassociatesandbusinessanalystsattend Basic Consulting Readiness, a curriculum that prepares them for clientengagements.Inaddition,onetotwoweekrolechangecoursesareprovidedateachcareermilestone.McKinseyalsoprovidesanarrayofworkshopsandlearningopportunitiesinarangeoftopics,includingcommunications,functionalskills,coachingandteamleadership,andnegotiating skills.Publish or perishMcKinsey has built a solid reputation as a publisher of managementrelatedbooklets,documents,papersandmagazines,includingthewellregardedMcKinseyQuarterly.McKinseypartnersalsooftenwritebooksindependentlyofthefirm.InadditiontoTomPetersandBobWaterman'sbestsellingInSearchofExcellence,bookspennedbyMcKinseyalumsinclude2000'sMeasuringandManagingtheValueofCompanies byTomCopeland, Tim Koller and Jack Murrin, and 2001's The War for Talent by EdMichaels,HelenHandfieldJonesandBethAxelrod;20/20Foresight:CraftingStrategyinanUncertainWorld, byHughCourtney;andCreativeDestruction,byRichardFosterandSarahKaplan(whichunfortunatelyhighlightsEnronasashiningcorporateexampleinpassageswrittenbeforethecompany'scollapse).Thebigbookin2002wasDangerousMarkets:ManaginginFinancialCrises, byDominicBarton,RobertoNewellandGregory Wilson.2003 saw the publication of Banking in Asia: Acquiring aVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 11C A R E E RL I B R A R YMcKinsey & CompanyThe ScoopProfit Mindset, by Tab Bowers, Greg Gibb and Jeffrey Wong.The McKinseyQuarterly,nowavailableinanonlineversion,hasmorethan300,000subscribersandrunsarticlesonecommerce,telecommunications,strategyand other fields.McKinsey also analyzes its own business approach, hopingto understand the difference between change that is fundamental and changethatisfundamentallyfaddish.Forexample,thefirmacknowledgedthatMcKinseyitselfhadputclientserviceaheadofwealthcreationforclientsduring the recent Internet euphoria, but now applies the principles of strategicthinking,industryandfunctionalknowledge,andanalyticalrigortotoday'senvironment.Thanksinparttothevastamountsofresearchproducedbythefirm,McKinseyisknownasapreeminentinformationsourceonglobalization,governance,organizationalperformanceandcorporatestrategy.TheMcKinseyGlobalInstitute(MGI),establishedin1990,operatesasanindependent economics think tank within McKinsey, conducting research anddevelopingpositionsonissuesaffectingbusinessesandgovernmentsworldwide.TheInstitute'sapproach"combinestherigorofacademiawiththerealworldexperienceofbusiness,"accordingtothefirm.Throughitsresearch,MGIhasamassedafactbasethatcoversmorethan15countries,four continents and more than 28 sectors.Located just steps from the WhiteHouse in Washington, D.C., the Institute been estimated to spend more than$100millionayearonitsinformationgatheringandinternalresearch.Reportsreleasedin2003includeastudyofmultinationalcompanyinvestment in developing economies; an analysis of the benefits and impactofoffshoringworldwide;andreportsonimprovingproductivityandcompetitiveness in Europe.Going nonprofitAnother of McKinsey's specialty areas, the nonprofit world, got a jumpstartin2001whenthefirmlaunchedtheMcKinseyInstituteontheNonprofitSector,appointingSenatorBillBradleyaschairmanofitsadvisoryboard.The practice coordinates the firm's community and pro bono activities. Eachoffice devotes 5 to 10 percent of its consultants' time to work for nonprofits,and more than half of its North American partners are on the boards of at leastone nonprofit organization.The firm served more than 200 nonprofit and/orpublicsectorclientsin2003,representinganinkindcontributionofwellover $100 million.These clients include museums, theaters operas, festivals,multinational NGOs and development agencies, philanthropic organizations,schools,conservationorganizations,landtrusts,zoosandmore.FollowingtheeventsofSeptember11,theNewYorkofficedevoteditselftonine 2004 Vault Inc. 12C A R E E RL I B R A R YMcKinsey & CompanyThe Scoopseparateprobonoprojects.TheseincludedservingtheLowerManhattanDevelopment Corporation, overseeing the development of a victim databaseforNew YorkState AttorneyGeneralElliotSpitzerandstudyinghowNewYorkPoliceDepartmentandFireDepartmentmembersreactedduringtheWorld Trade Center attacks.The Big Apple office has also done work for theUnited Way, the World Economic Forum and the New York City Opera.On the tech trackInahypercompetitiveconsultingarena,McKinsey'seffortsatgoinghightech in response to more ITcentric rivals like Accenture has gotten offto a rocky start.The firm admits that previous attempts to build a major ITconsulting capability, through acquisition and then through the creation of anIT practice, "could not achieve sufficient scale to ensure longterm success."As a result, the firm formed the Business Technology Office (BTO),in 1997,theonlyMcKinseyofficenottiedtoonespecificgeographiclocation.TheofficehelpscompaniesimplementIT strategies,improvetheiroperations,strengthenthevalueoftheircustomerrelationshipsandcraftinnovativeapproachestoIT architectureandIT managementinareassuchaspostmerger integration, prioritization of IT investments and strengthening oftheIT organization.Thestrategyseemedtopayoffthenumberofconsultants in the BTO grew by 30 percent in 2003.Still, word on the streetindicates that McKinsey, along with many of its highpowered peers, may befacingcompetitioninthehightecharenafromnewerconsultancieswithITcenteredbackgrounds,especiallythosespunofffromhightechcompanies themselves, such as IBM's Global Business Services unit.PrivateequityisanothernewareaforMcKinsey,anditoffersadviceinstrategy/organization,opportunitiesforgrowth,dealassessmentandduediligence, and crossportfolio support.The firm's recent projects have beenglobal in scale: In 2004, as in previous years, a group of McKinsey delegatesjoined the World Economic Forum in Davos, Switzerland, addressing topicssuch as the benefits and challenges of offshoring, business opportunities andtrendsinChina,andthebalancebetweenriskandcontrolinmanagingcorporations.In May 2003, the firm took on the role of investment advisorfor the privatization of the oil group Unipetrol in the Czech Republic.In July2003,thefirmissuedareportontheuseoftheEnglishlanguageinSouthKorea.Also in 2003, McKinsey began conducting a comprehensive analysisof the global coffee industry on a pro bono basis, in addition to advising theColombian Coffee Federation on a new retail strategy.In May 2004, the firmwastappedbytheConfederationofIndianIndustrytostudyandsuggestchangestothelawsgoverningminingoperationsinIndia.AtU.N.Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 13C A R E E RL I B R A R YMcKinsey & CompanyThe Scoopheadquarters in June 2004, McKinsey issued a report on the Global Compactwiththebusinesscommunity,whichU.N.SecretaryGeneralKoffiAnnanhad proposed five years earlier (the compact, aimed at summoning corporateresponsibility for issues such as human rights, labor, and the environment indeveloping nations, is working, the report concluded). Closer to home, Tennessee's largest insurer, TennCare now run by a formerMcKinseyite has paid the firm more than $4 million as it works to reformthetroubledhealthcaresystem,witha$1.8milliontwomonthcontractrenewalsignedinJune2004.McKinseyalsohasbeenundercontracttoproduce a report suggesting ways to improve the city government in Dallas. 2004 Vault Inc. 14C A R E E RL I B R A R YManaging Director: Ian DavisAppointed managing director in March 2003, Davis, 52, had already spent 23yearsatthefirm.BasedinLondon,heisMcKinsey'stenthmanagingdirector.Heholdsadegreeinpolitics,philosophyandeconomicsfromOxford,andjoinedMcKinseyin1979afterasevenyearstintatpapermanufacturer Bowater.His work for the consultancy has been wideranging,butmostlyhasfallenwithintheconsumerandretailindustries.Davisgotgoodpracticeinleadershipheadingthefirm'sU.K.operations,amongthefirm's larger offices, for eight years.Before that, he ran the firm's consumerindustries practice in Europe. UnlikemanyofMcKinsey'sdirectors,whoareknownasalittlebitdull,Davisissaidtobeoutgoing,charmingandhighlyvisible,especiallyinhisnative Britain.Oddly, too, for a McKinsey man, he doesn't have a graduatedegree.He'salsoveddyBritishagain,adepartureforMcKinsey,whereeachmanagingdirectorbeforeDavis'predecessor,RajitGupta,wasAmerican.Davis'grandfatherwasaprofessoratOxford,hisdaughterisafifthgenerationOxfordstudentandhisthreebrothersareall"highlydistinguished," as a BusinessWeek article described them one's the CEO ofpublisher Reed Elsevier, one's a judge and the other, a lawyer.And fittingly,Davis is a "keen sportsman," fond of cricket, rugby and tennis. Though Davis had some big shoes to fill Gupta presided over a period ofunprecedentedgrowthatthefirmhisfirstyearatthefirmwasmetwithfavorable reviews.The Financial Times of London, in the first interview withDavis (published a year after his appointment, in July 2004), describes him as"fluent" and "approachable," "happier talking about the future than the past,"butnotaversetoanalyzingthemistakesthefirmmadeduringtheInternetboom.According to the article, Davis' spare, unlivedin London office is atestamenttohishandsonmanagementstyle,whichinvolvestravelingtheglobe and visiting 25 countries during his first 12 months. McKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 15C A R E E RL I B R A R YOrganizationMcKinsey & CompanyOrganizationPractice areasIndustry Practices Automotive & Assembly Banking & Securities Chemicals Consumer/Packaged Goods Corporate Finance & Strategy Electric Power & Natural Gas High Tech Insurance Marketing Media & Entertainment Metals & Mining Nonprofit Operations Strategy & Effectiveness Organization & Leadership Payor/Provider Petroleum Pharmaceuticals & Medical Products Private Equity Pulp & Paper Retail Telecommunications Travel & LogisticsLocationsU.S. locations: Atlanta, GA Boston, MA Charlotte, NC Chicago, IL Cleveland, OH Dallas, TX 2004 Vault Inc. 16C A R E E RL I B R A R YMcKinsey & CompanyOrganization Detroit, MI Florham Park, NJ Houston, TX Los Angeles, CA Miami, FL Minneapolis, MN New York, NY Palo Alto, CA Pittsburgh, PA San Francisco, CA Seattle, WA Stamford, CT Washington, DCInternationallocations: Amsterdam, The Netherlands Antwerp, Belgium Athens, Greece Auckland, New Zealand Bangkok, Thailand Barcelona, Spain Beijing, China Berlin, Germany Bogota, Colombia Brussels, Belgium Budapest, Hungary Buenos Aires, Argentina Caracas, Venezuela Cologne, Germany Copenhagen, Denmark Delhi, India Dubai, United Arab Emirates Dublin, Ireland Dusseldorf, Germany Frankfurt, Germany Geneva, SwitzerlandVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 17C A R E E RL I B R A R YMcKinsey & CompanyOrganization Gothenburg, Sweden Hamburg, Germany Helsinki, Finland Hong Kong, China Istanbul, Turkey Jakarta, Indonesia Johannesburg, South Africa Kuala Lumpur, Malaysia Lisbon, Portugal London, England Madrid, Spain Manila, Philippines Melbourne, Australia Mexico City, Mexico Milan, Italy Monterrey, Mexico Montreal, Quebec Moscow, Russia Mumbai, India Munich, Germany Oslo, Norway Paris, France Prague, Czech Republic Rio de Janeiro, Brazil Rome, Italy Santiago, Chile So Paulo, Brazil Seoul, Korea Shanghai, China Singapore Stockholm, Sweden Stuttgart, Germany Sydney, Australia Taipei, Taiwan Tel Aviv, Israel Tokyo, Japan 2004 Vault Inc. 18C A R E E RL I B R A R YMcKinsey & CompanyOrganization Toronto, Ontario Verona, Italy Vienna, Austria Warsaw, Poland Zagreb, Croatia Zurich, SwitzerlandStructureMcKinsey is privately held.Managing Director: Ian DavisKey CompetitorsBain & Co.: Among the world's leaders in international strategy consulting,Bain,whichsplitofffromtheBostonConsultingGroupin1973,boastsaconsulting staff of more than 2,100.The firm's client base consists primarilyofdiversified,internationalcorporationsinallsectorsofbusinessandindustry,suchasfinancialservices,ecommerce,retail,healthcare,consumerproductsandtechnology.Accordingtothecompany,itsclientshave historically outperformed the stock market by three to one. Booz AllenHamilton: Booz Allenrackedup$2.7billioninsalesin2004,and is a powerhouse in governmentside consulting, landing major contractswiththeDepartmentofHealthandHumanServices,NASA andotheragencies.Booz Allen garners 80 percent of its revenue from previous clients.Notapurestrategyfirm,itputsanemphasisontransformingbusinessesrather than merely prescribing change.The firm reports spending onethirdto onehalf of its time helping clients implement its recommendations. Booz'sindustry practices compete with McKinsey.BostonConsultingGroup: BCGinsistsit'sMcKinsey'smaincompetition,andMcKinseyreluctantlyagrees.BCG,aglobalpowerhouseemployingmore than 2,600 consultants in 60 offices in 37 countries.Founded in 1963byBruceD.HendersonasthemanagementandconsultingdivisionoftheBostonSafeDepositandTrustCompany,BCGhasbeenthedrivingforcebehind a number of major management consulting innovations and conceptsinits39years,including"timebasedcompetition,""deconstruction,"and"capabilitydriven competitive strategies."Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 19C A R E E RL I B R A R YMcKinsey & CompanyOrganizationMercer Management Consulting: Formed in 1990 by the merger of Temple,Barker&SloaneandStrategicPlanningAssociates,andownedbyprofessionalservicesgiantMarsh&McLennan,Mercerhasgrownrapidly,opening offices in Europe, the Pacific Rim and Latin America, and acquiringa number of boutique consultancies.Today, Mercer Management Consultinghasapproximately1,400consultantsandsupportpersonnelin22officesworldwide.Thoughitwasinitiallyconsideredabrazenstartupinafielddominatedbygiant,establishedfirmssuchasMcKinsey,Mercerhasexpanded its practice quickly by aggressively pursuing clients and rooting itswork in a series of wellpublicized books.It has developed special industryexpertise in communications, energy, financial services and manufacturing.Monitor Group: ThoughmuchsmallerthanMcKinsey,thisheavilystrategyoriented consultancy sees itself as a strong competitor.Founded in1983byagroupofprofessorsandconsultants,includingMichaelPorter(aconsultingguruandcreatorofpopularcaseinterviewframeworkPorter'sFiveForces),Monitortriestobridgethegapbetweenacademicideasandbusinessrealities.Thefirmhasdevelopedanumberofpracticesandexpanded its client list to include everything from Fortune 500 companies andinternationalfirmstogovernmentagenciesandmajornonprofitorganizations.Throughits28officesin23countries,itoffersadvisoryservicesinareasincludingprivateequityandventurecapital,ecommerceincubation, and mergers and acquisitionrelated transactions. 2004 Vault Inc. 20C A R E E RL I B R A R YJuly 2004ManagingdirectorIanDavisgiveshisfirstinterviewtothemedia,forLondon's Financial Times. July 2004McKinseyalumnusJ.D.Hickey,whoadvisedtheTennCareprogramwhilewith the firm, is appointed by Tennessee's governor to lead the state's healthcare system as director. June 2004Tennesseehealthinsurer TennCaresignsacontractextensionwiththefirmfor an additional $1.8 million.June 2004McKinseyissuesareporttotheUnitedNationsonKofiAnnan'sGlobalCompact with the world's business community. May 2004The Confederation of Indian Industry hires McKinsey to review the nation'smining laws. August 2003TheCzechgovernmentapprovesMcKinsey'sroleinadvisingtheprivatization sale of Unipetrol.August 2003ThegovernorofTennesseeannouncesMcKinseywillreviewthestate'shealthcare program.May 2003A newspaperreportsMcKinseyisadvisingtheStateBankofIndiaonrestructuring.McKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 21C A R E E RL I B R A R YVault NewswireMcKinsey & CompanyVault NewswireMay 2003In bankruptcy court, lawyers argue that the $1 millionpermonth flat fee forconsultingservicesthatbankruptcarrierUnited AirlinespaysMcKinseyisunwarrantedforacompanythatcouldn'tpayitsdebts.Rejectingtheargument, United continues to retain McKinsey during its restructuring. April 2003For the seventh year in a row, McKinsey tops the list of where MBAstudentswould most like to work, according to a Universum study.March 2003ItisannouncedIanDaviswillsucceedRajatGuptaasmanagingpartnerofthe firm.February 2003ThepressreportsthatformerFirstDaughterChelseaClintonwilljointhefirm.October 2002McKinseybeginstoperformanassessmentoftheNewYorkCityschoolsystem for chancellor Joel Klein.September 2002It'srevealedthatMcKinseyishelpingtheWestBengalgovernmenttoencourage investment in local industries.September 2002McKinsey releases a controversial report detailing what New York's fire andpolice departments did right and wrong in response to the September 11,2001, attacks.2001McKinsey clients Enron, Swissair and Kmart file for bankruptcy. 2004 Vault Inc. 22C A R E E RL I B R A R YMcKinsey & CompanyVault NewswireAugust 2001Brandingstrategyhas,historically,beenacloselyguardedfacetoftheadvertising business.Not anymore.In a move that may be the beginning ofaturfwarbetweentheadvertisingandconsultingindustries,McKinseypurchases Chicagobased branding consultancy Envision.March 2001In an interview with the Financial Times, McKinsey managing director GuptafretsthattheattritionrateatMcKinseyhasfallento12percentperyear,5percentbelowthe"equilibriumlevel"of17percent.Guptaalsonotesthatduring the height of dotcom fever, turnover rose to 21 percent at the firm.May 2000McKinseysignsonasthestrategicadvisorto Apollis AG,anewcompanyfoundedbyGeneralAtlanticPartnersthatwillcreateandsupportwirelessapplications in Germany and soon, throughout Europe. This alliance signalsMcKinsey's increasing efforts to expand into the trendy wireless space.March 2000McKinsey says it will raise associates' pay. Crain's New York Business reportsthatthetotalcompensationpackageforincomingMBAswillbeinthe$150,000 range.February 2000In a hotly contested battle, managing partner Rajat Gupta is reelected for histhirdthreeyearterm.A reportthefollowingmonthinTheEconomistmaintainsthatGuptawithstoodinternalchallengestothethronefromIanDavis, manager of McKinsey's London office; Clay Deutsch, former head oftheCleveland/Pittsburghoffice;andMichaelPatsalosFox,theNewJerseyoffice manager, among others.Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 23C A R E E RL I B R A R YMcKinsey & CompanyVault NewswireJanuary 2000A McKinseystudyoftheIndiantechnologyindustryconcludesthattheindustry could grow to $87 billion by 2008 if the government can improve itstelecommunicationsinfrastructure.Inaddition,McKinseysaysthattheITindustry has the potential to provide India with 2.2 million new jobs, attractforeign investment totaling $5 billion and account for more than 7.5 percentof India's GDP by 2008.November 1999In an effort to recruit and retain the best bschool grads and ward off growingcompetitionfromdotcomcompanies,McKinseydecidestoofferitsassociatestheopportunitytoinvestinInternetstartups.Juniorconsultantscanalso,forthefirsttime,buystakesininvestmentfundsthatwouldnotnormally be open to them.September 1999McKinsey puts Ogilvy & Mather, the venerable agency known for its workwith IBM, American Express and Ford, in charge of its firstever advertisingcampaign.August 1999PresidentClintonannounceshisintentionthismonthtonameDr.MartinBaily to chair the Council of Economic Advisers (CEA).Baily is a principalat McKinsey, based at the McKinsey Global Institute in Washington, D.C. 2004 Vault Inc. 24C A R E E RL I B R A R YThe chosen fewA lifewith TheFirmis"crazyandexhilarating,"sourcessay."Itisaplacewhere you meet tons of people who are extremely smart, but unique in a verydiverse fashion," says an insider.Your colleagues might include a quantumphysicist,"toplawyers,"peoplewhohold"PhDstwiceoverininformationscience,"evenan"orchestradirector."Indeed,"Thereisanoverpoweringfeeling at McKinsey & Company that you are among the chosen few, that youarethebestandthebrightest.Havingsurvivedthegruelinginterviewprocess,youdoindeedfeelthatyouhavereachedsomesortofcareerpinnacle," a consultant relates.Others describe life at McKinsey more simplyas"arollercoaster."Andasyoumightexpect,"wheneveryoustickoverachievers together, it's competitive.But there's no backstabbing," says asource.Anotherinsidersays,"Tooutsiders,wemustlookextremelycompetitive. We'retoldweshouldneverfeelcomfortabledoingwhatwe'redoing,thatweshouldalwaysbereachingtodomore.Butthepeoplewhocome here thrive on challenge, and you're only competing with yourself."McKinsey gets kudos for its professional culture as well.Consultants say thefirm's "valuesdriven culture rewards people for doing the right thing, not theprofitablething."Anotherinsideragrees,"Youarealwaysencouragedtoimprove yourself.The work is stimulating, for you have the opportunity totacklecomplexissuesforbluechips. Theresourcesatourdisposalcanbeimpressive.""Youworkwiththebestpeopleandtheprojectsprovideyouwith opportunities to learn, present to executives and build a strong network,"says a colleague.Still, despite all the prestige and glamour, "All that glittersis not gold," remarks one consultant."You expect this place to be an Eden,but it's not.There are stains on the carpet.Sometimes you work on a projectanditwindsupbeingfairlyuninteresting.Sometimesaclientchangeshismind on a project plan and the result sucks."McKinsey's rigorous selectivity is wellknown.Insiders say it's "not easy" togetanofferfromMcKinsey,partlybecause"thejobmarkethaschanged,"and "the bar is set much higher now.""Relative to other consulting firms,"boasts one insider, "it is the most or among the most selective."This meansthat "when people get offers from us and from others, the vast majority endupcominghere."Butitisn'tenoughjusttobeanIvyleagueMBA withagleamingtranscript,insidersnote:"Giventwopeoplewiththesameanalytical skills, we always want someone who is fun," says one McKinseyrecruiter.McKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 25C A R E E RL I B R A R YOur Survey SaysMcKinsey & CompanyOur Survey SaysThe Firm's formalitiesTheMcKinseymystiquecomesinpartfromitsuniqueculture,reflectedinthewaysinwhichstaffersinteractwitheachotherandtheircompany."McKinsey employees are taught to refer to McKinsey as the 'Firm,' never asmerely a company.We were always guided by firm policy and procedures,"saysaninsider.Whilethefirmisdescribedas"nonhierarchicalfromaproblemsolvingstandpoint(i.e.,everyoneparticipatesfairlyequally),"it'sstill "very hierarchical when it comes to tactical issues (e.g., attending clientmeetings, putting together presentations, controlling your hours)."But don'tget the impression McKinsey limits its consultants in fact, says a source, "Ibelieve there are few places where you are more dared to take a challenge: itis the rule rather than the exception to be tasked with a chunk of work whichis bigger than you have previously handled."Asthepinnacleofconsulting(tomany,anyway),McKinseyalsoputsitsconsultantstothetestwithlatenightsandplentyofhoteltime."Workinghours are hard to control.My goal is to work between 55 hours and 60 hoursperweek,andIthinkImanagethatabout70percentofthetime,"saysasource. Anothersaysthatwhilethere'sa"prettygoodbalanceintermsofhours and keeping weekends free being out of town is always tough."Butacolleaguesuggeststhismaydependonwho'smanagingyourprojects:"Your time is almost entirely controlled by the EM, with late night conferencecallswiththepartners,whofrequentlyshowuplate.Getluckyenoughtohave an EM who cares about lifestyle (they're rare), and you might get out at8 p.m. regularly.Get the more typical EM in a busy office that's overscopingand understaffing projects, and the late nights are the usual."Another seniorconsultantsaysthatwhileincreasedworklifebalanceisnow"partoftheconversation" at McKinsey, a "sustainable life" is still a challenge. Of course, as one associate puts it, "If balance is important to you, consultingis not the place you want to be, and definitely not McKinsey."But, the sourceadds,"wetrytodo'sanitychecks'ontheworkload,becausealltheseoverachievers will kill themselves with the pace."Another insider notes thatthose sanity checks "are a matter of common sense.When you work 70 to 75hours per week for a while, you realize it just isn't sustainable."As for travel,insiders report that there's "a lot," "which does not add to the happiness."Fortheir troubles, however, consultants can expect plenty of "creature comfortsduring travel" like nice hotels and first class seats on long flights. 2004 Vault Inc. 26C A R E E RL I B R A R YMcKinsey & CompanyOur Survey SaysThe royal treatmentIndeed,consultantsatMcKinseygetthe"royaltreatment"asarewardfortheir travails, sources suggest.Salaries at the firms are reportedly among thehighest in the industry.One McKinsey insider notes, "Future increases in payare based on the previous year's pay, so you basically have to push for a largefirstyearpackagetomakethebiggestbuckslateron."OneMcKinseyitewarns:"YoucannotnegotiatewithMcKinsey.Yourpayeachyeargetsdecided."Payatthefirmisbasedonindividualperformance;McKinsey'sseniorpartnersreceivesalariesinexcessof$1millionayear.Inaddition,"The firm tosses a substantial amount into your 401(k) every year, based onperformanceofthefirmandyourownperformance. There'salsoaregularperformance bonus that starts at $10,000 and goes up beyond $25,000 in yearone," an insider reports.Others report receiving signing bonuses, a lowratehome loan, and an interestfree loan for "settling in." The company provides a choice of health plans, two of which offer fully paidpremiums,alongwith"fullypaiddental,life,STDandLTD,flexiblespending plans and opportunities for group discounts with car insurance andmortgages." Adoptionassistanceand"generous"maternityleavearealsoprovided,andofficeperksincludefreebeverages,freelunchesanddinnerswhen work is pressing, and free cab rides to and from work during early andlatehours.Thefirmalsooffers"monthlysocialevents(bowlingnights,creativeartgatherings)andlotsofopportunitiestopickupfreeticketstovarioussportingevents." Afterreachingtherankofengagementmanager,McKinseyites receive a personal assistant.The company is also generous tothosewhodecidethatMcKinseyjustisn'tforthem(estimatesofturnoverrange from 20 to 25 percent annually). When the time has come to part, oneinsider says, "The firm will continue to pay your salary until you find a jobyou like.Not just until you find a job, but one you like."No such thing as "good enough"For those who remain, the firm has a reputation for being, in the words of oneconsultant, "uporout, baby!" but it also helps ambitious consultants movevertically."McKinsey is all about the performance review, constantly givingevery consultant the next, very specific list of things to work on and 'upping'the bar each time you succeed.If you love to constantly be challenged to thenextlevel,you'llloveithere,"saysasource,whoadds,"Ifincessantevaluation will make you crazy as a loon, try somewhere else." One source,withpreviousexperienceatotherconsultingfirms,notes,"Amongallmycolleagues at other firms, I think McKinsey has the most focus on constantlyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 27C A R E E RL I B R A R YMcKinsey & CompanyOur Survey Saysevaluating you.'Meets expectations' is a failing grade around here you'realways supposed to do more, to add value that you weren't asked for."Thatleadstoalotofperformancepressure,whichisn'talwaysgood.Hecontinues,"Theexpectationsaresohigh,youneverfeelthatyourworkisgood enough. You want to be recognized a little, take a short breather, maybesay, 'That's good enough.'Management is so used to overachievers that theydon't remember the 'I care about you' human factor, the praise you need for ajob well done."A colleagueadds,"Sometimesyou'llwishtheydidn'tadvanceyousofast.Just when you begin to get confident at one position, they'll fling you into thenext."AnotherdescribesthecorporateladderatMcKinseyas"fairlyselfweeding,"notingthat"fewerthan10percentstartingatMcKinseyatentrylevelmoveuptopartner.Somepeoplethriveonthehardworkandcompetitiveness;manyothersfindgreenerpastures."A typicalpathforMcKinsey promotions is described as "about two years to manager, anothertwoyearstojuniorpartner(associateprincipal),andanothertwoyearstopartner."To help its consultants become ever more promotable, says a consultant, thefirminvestsinintensementoringandonthejoblearning.MBAlevelconsultants are able to take a training program called ILWafter two years onthe job."It is some of the best training in the world you lean about problemsolving and communication.It's done all over the world in groups of about20.In my group, we had people from 13 different countries." McKinseyiteslearn from the masters, too, as interaction with firm and client higherups isthe norm: "You can easily meet the partners," says a source.Another says that"I've interacted with around a dozen CEOs in my five years with McKinsey."Minority reportMcKinseyinsiderssaythatthefirm's"diversityisprettybroadfromtheperspectiveofbackground,butnotnearlyenoughfromagenderorracialperspective."A consultantnotesthat"womenarefairlynumerous(30percent) in the associate class, but dwindle quickly as you move up the ranks probably due to lifestyle issues as much as anything else."The companyreportedly has launched initiatives to encourage workplace diversity, thoughanothersourceobservesthat"newlymintedMBA consultantstendtobewhite and male.""AfricanAmericans are the most under represented of allminorities at McKinsey," says a colleague.As for gays and lesbians, the firm"offereddomesticpartnerbenefitsearlyon,"asourcereports.Anotherconsultanthas"workedwithgaysatalllevelsinthefirm(associateto 2004 Vault Inc. 28C A R E E RL I B R A R YMcKinsey & CompanyOur Survey Saysdirector)whowereverysuccessful,openabouttheirsexualorientationandopen to bringing their significant others to firm events."The firm is known for performing "a lot of community work."This includes"probonoconsulting,voluntarysupportofUnitedWay[and]variousinitiatives driven by individuals."Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 29C A R E E RL I B R A R YHow many consultingjob boards have youvisited lately?(Thought so.)Vault Consulting Job BoardThemostcomprehensiveandconvenientjobboardforconsultingprofessionals.Targetyoursearchbyareaofconsulting,functionandexperiencelevel,andfindthejobopenings that you want.No surfing required.VaultMatch Resume DatabaseVault takes matchmaking to the next level: post your resumeand customize your search by area of consulting, experienceandmore.Wellmatchjoblistingswithyourinterestsandcriteria and email them directly to your inbox.Use the Internets most targetedjob search tools for consultingprofessionals.Early birds onlyStudentswishingtojoinMcKinsey'shallowedranksshouldstartgatheringresources for the highly competitive process early.Both MBAand undergradscholars should check with their school campus career centers as early in theyear as possible to find out whether McKinsey recruits on their campuses.Ifso, sign up quickly for an interview the slots are likely to go fast!Thosewhoaren'tluckyenoughtobegracedbyanoncampusvisitshouldn'tfret.McKinseyacceptsapplicationsonlinefromstudentswhodon'tattendthefirm'stargetschools,aswellasfromworkingprofessionalsandnonMBAadvanced degree holders.ThecareersectionofMcKinsey'swebsiteincludeshelpfulinformationforjob candidates from undergraduate, MBA and advanced degree programs, aswell as experienced professionals.It also walks applicants through a samplecasestudy.Insiderstellusthereis"nointernshipprogramforanalysts,"though the firm, of course, offers MBAlevel internships.Undergrads whojointhefirmasanalystsare"retainedfor1824months,"accordingtosources;afterthat,theentireclassiscutloosetogobacktoschoolorseekemployment at another firm.Areturn trip to the mother ship is quite possible."Iftheylikeyouandwantyouback,theypayforgradschool,"saysonesource.Oneinsiderthinksthecompanycouldimproveby"adjustingthepromotionsystemtopromotehighperforminganalystswithoutanMBA."In the past, there have been instances of analysts being promoted straight intothe associate ranks, but more than one insider describes these as "extremelyrare."We are told "there are no promotions when times are bad."InterviewingDuring the interview process, the site says, McKinsey looks for people withstrengths in problem solving, influencing others, leading others and buildingrelationships,andachievinggoals.Prospectivecandidatescanfindinterviewingtipsandapracticecasestudyonline.McKinseyencouragescandidates to use its online application system.After the boom period of the late 1990s, the interview process has changed,insiders note."Now there's a much bigger structure cases, group interviewsandpresentations,"asourcereports. Anothersaysit's"veryrigorous." Athirdcallsthescreening"fairandobjective."Henotes,"You'lltakesomeMcKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 31C A R E E RL I B R A R YGetting HiredMcKinsey & CompanyGetting Hiredtests that are like part of the GMAT in fact, we used to use old GMAT examsas our tests." Patience is a virtueThosewhohavetheirheartssetonMcKinseyshouldcomeequippedwithpatiencetoburn."Thehiringprocessbeganoneyearpriorwithmyfirstyear in business school," a source relates."McKinsey held several formal andinformal information sessions on campus.They also helped with interviewpreparation,includingoneononeandoneonsixinterviewworkshops."Another describes a full two years of bravely trying to get a foot in the doorIn the first year, "McKinsey took me out to dinner over the summer, while Iwasatanothercompany.Secondyearincludedmoreinformationsessions,workshops and dinners.Again, I interviewed with the same office, this timeIwassuccessful." Thissourcecontinues,"Thecaseinterviewprocesswasimportant,butitbecamecleartomethatitwasn'tthemostimportant.Handlingconsultingcasesisn'tthathard,anditdoesn'thavetobedoneperfectly.Thekeywasgettingtoknowthemembersoftheoffice,andfinding a fit with their culture.By taking them up on nearly every offer fordinner or event, I got to know them well enough to get an offer."Applicantscanexpectatleasttworoundsofinterviews,withfivetosixinterviewsinthefinalround.Consensusamongallparticipatingpartieswhich may include senior associates, engagement managers and partners is required to seal the deal.Not to add any pressure, but if your heart is seton working at McKinsey, you should ace the interview and know where youwant to be stationed.An insider let us know about an informal hiring policy:"If you apply to one region, you can't apply to another for one year."OneBTOersaysthatcandidatesspecificallyinterestedinworkingforthetechnologypracticeshouldhavetechiebackgrounds,asonemightintuit.BTO is considered an "office," just like a geographic location."Continues theBTOconsultant,"Afteryougetpastthefirstround,youinterviewwithanoffice.Iftherearepeoplewhowouldbeagoodmatchforus,wetrytointerview them.In technology, there are some things that you just can't learnon the fly." One applicant's case studyAn applicant for a business analyst position in the U.K. reports his interviewexperience: "In the U.K., McKinsey screens resumes/CVs and invites peoplewho make that cut to take a 70minute test.[Out of hundreds of applicants 2004 Vault Inc. 32C A R E E RL I B R A R YMcKinsey & CompanyGetting Hiredfromeach,only90applicantsfromOxfordand90fromCambridgewereinvited to take the test.]The test counts as the firstround interview.Peoplewhopassareinvitedtoasecondround,reallifeinterviewatMcKinsey'sfantastically cool London offices.The test supposedly measures basic skillsthat McKinsey deems necessary for success in consulting.It had no questionsharderthananythingontheGRE,anditwasallmultiplechoice.Somequestionswerejustreadingcomprehension,someinvolvedmakingajudgment based on almost enough information and some were basically mathproblems."A weeklater,hecontinues,"Ihadtwooneonone,45minuteinterviews,backtoback,witha10minutebreakinbetweenwithtwodifferentassociates.Both interviews started with about five minutes of chat about mybackground and my current academic interests.The only personal questionin the first one was to describe something I'd worked on in the past six to 12months that had turned out well.In the second interview, the only personalquestion was to describe something that had turned out well in the past six to12 months on which I had worked with more than one other person.In eachinterview, the interviewer stopped me after every couple of sentences to askhow I had settled on the action I had just mentioned, or why I had decided tospeaktosomeonewhomIhadsaidIhadcontacted,orsomethingelsetodiscern what I had thought I was doing at the time.Though it was unnervingtobeinterruptedsofrequently,the'hows'and'whys'weresurelyrelevant.Plus,Ihadthechancetoshowoffmyabilitytofinishathoughtwhensomeone has cut me off in the middle.""Ineachinterviewthe15minuteish'walkmethroughwhatyoudidandhow' question was followed by a challenging case study of about 25 minutes.There were no brainteasers, but each case study had a marketsizing problem,a couple of simple math problems (i.e., 50,000 times 500) and a tiny dose ofalgebra (i.e., solving for x or figuring a percentage).I did not make it to thethird(final)round,whichwouldhavebeenadayofgroupandindividualexercises.MyoverallexperiencewithMcKinseywasgreat,though.Therecruitmentstaffwasunfailinglykindandextremelyhelpful.Mytravelexpenses to London were reimbursed, which was certainly to be expected, butstill appreciated.When I got the call to say I had not made it to the last round,the supernice recruitment lady gave me the interviewers' feedback.Hearingsoquicklywhatwasreallygood,whatwasmarginalandwherethingshadgone wrong was a real comfort.When I asked if it might be worth my whileto work on a couple of nothot things and reapply next year, the lady repliedwith an enthusiastic yes.Then she told me what had been compelling aboutmycoverlettersothatIwouldknowwhatnottochange.ThoughIwasVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 33C A R E E RL I B R A R YMcKinsey & CompanyGetting Hireddisappointed not to make it all the way, I got the distinct impression that thatIdidwelltogetasfarasIdidandthatIwasbeingtakenseriously.IalsogainedabetterunderstandingofMcKinsey'srecruitingphilosophyandprocesses, which should serve me well if I decide to try again."Round and roundThisapplicant'sprocesssoundsmoreorlesstypical,thoughMcKinseyisreportedly tinkering with its interview format.The first round of reviews atMcKinsey typically consists of two oncampus sessions, each lasting abouthalfanhour,althoughtheformatvariesfromcampustocampus. Thefirsthalfhourinterviewisintendedto"gettoknowyou."Youandyourinterviewer will discuss your experience, personality, whether you would bea good fit with the firm and what you want out of a career.(Incidentally, theconsultants that interview oncampus come from McKinsey offices all overthecountryandtheworld;intervieweesinNewYork,forexample,canencounter consultants from Los Angeles and Caracas.)Thesecondinterviewofroundoneistypicallyacaseinterviewandimmediatelyfollowsthefirstinterview."MyNo.1onepieceofadviceforintervieweesis,it'sallaboutproblemsolvingpractice,practice,practiceyourcases!"exhortsaBTOinsider.Thecaseinterviewiswithoneconsultant, and lasts half an hour to 45 minutes.The consultant starts off byexplainingthegroundrules:she'llgiveyouacaseinterviewthatpresentsabusiness scenario for you to discuss.At McKinsey, the interview will almostalwaysinvolveanindustrytheinterviewerhasworkedinrecently.Youshould feel free (and are expected) to ask any questions if you need additionalinformation.Asyougoalong,theinterviewerwillthrowoutnewinformation and inquire how this additional data affects your conclusions.Anotepad and pen in this round, to take notes and make basic calculations, is amust!It is also vital is to ask the right sort of questions questions that willgive you the information you need to make a recommendation and not torushintoyouranswer.Failingtoaskthemostobviousquestionsbeforejumping to conclusions won't get you to the second round.Moving onInthesecondandthirdrounds,expectmorecasestudiesandpersonalinterviews.Insiders say interview rules aren't static, but recent case studieshave focused on theoretical client situations.A candidate might be asked todeterminetheprofitabilityofacomputermanufacturerortherevenueopportunities of a pen manufacturer in Cleveland.How you present yourself 2004 Vault Inc. 34C A R E E RL I B R A R YMcKinsey & CompanyGetting Hiredduring these case interviews is significant, too it's "not only how brilliantlyyou formulate a solution, but how well you can communicate that solution,"aninsidersays.Asinthefirstround,candidatesareencouragedtoaskquestions in order to ascertain specific information on the cases.While thefirsttworoundsofinterviewingareusuallyheldoncampusoratanestablishedrecruitingsite,thethirdroundismostalwaysattheMcKinseyofficewherethecandidateishopingtowork.Travelingexpensesare,ofcourse, on the company's tab.These days, two people may interview you simultaneously in the first round;youmaygothroughthreeorfourinterviewsthatday.Insuccessiveinterviews, you may be interviewed by up to five McKinseyites at the sametime.At all hiring levels, McKinsey has reportedly increased its use of caseinterviews and decreased its reliance on guesstimates.This emphasis on caseinterviews reflects McKinsey's newfound understanding that an answer to anabsurd and farfetched guesstimate isn't necessarily reflective of a candidate'sfullanalyticalcapacity.McKinseyreportedlyisalsoexperimentingwithgroup exercises.In these group cases, approximately six candidates solve acase jointly over a period of an hour.Use the group exercise to demonstrate"how you work with others, how you behave in a group"; it is an opportunityto"beopen,beforthrightandshowyourpersonality,"but"don'tbecompetitiveagainsteachother,"insidersadvise. Thesecasesarenowheldoncampus at some universities.After the final round of interviews, the candidate typically goes home and isnotified by phone the following day.To make the hiring decision, a campusteammeetsattheendofthefinalround."It'slikeatownhallmeeting,"declaresoneinsider."Wetalkveryopenly."ForthosewhoworrythatMcKinsey analyzes their every word and gesture, this report will do little toquell raw nerves.McKinsey recruitment teams do look atthe smallest detailsof each applicant, even employing "hightech screens" to examine "resume,""intelligence"and"whichevents"thepersonattended."Candidatesreallywillgetafairhearing,"proclaimsonezealousMcKinseyite,"[Atthefinalround] we presume that candidates are innocent until proven guilty."Inside infoIf McKinsey can't decide upon an applicant, even after the third interview, ittakesotheravenuesofopportunity:"[We]findoutmoreaboutthispersonfromthepeoplewehaveoncampus[formerbusinessanalysts]."ThoseenrolledinbusinessschoolclasseswithMcKinseyalumsshouldtakenote.Fortunately,thoseluckyenoughtopassMcKinsey'smafialikeinitiationVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 35C A R E E RL I B R A R YMcKinsey & CompanyGetting Hiredprocesseswillfindthemselveswelcomedwithopenarms."Weconsiderthem part of the McKinsey family," reveals another insider.About 75 to 80percentofMcKinseyjoboffersareaccepted.Disbelief,curiosityorafondnessforradarsurveillancepromptsMcKinseytokeeptrackofanycandidate who turns down a job offer.The firm is under the impression thatanyonewhoturnsdownanofferdoessobecauseofan"entrepreneurialsituation,likestartingabusiness.Otherpeoplejoinlargeandsmallconsulting firms or investment banking companies."Solving the casesThroughouttheinterviewprocess,candidateswillencounteramixtureofcase questions and resume with "no brainteasers or market sizings." Sourcesrecommendthatcandidates"prepareforandbecomfortablewiththecaseprocess."This is because "everyone has to be a great problem solver, so bereadytodemonstratethatthroughthecaseinterviewprocess."Also,"bepersonally comfortable."During the case sections, insiders advise candidatesto have "an open dialogue where we can see how people think."Don't searchonlyfor"arightanswerorrightframework."Theworstmethodis"forcefittingsomethingthatdoesn'tmakeanysensebecausetheythinkwe'relookingforit."McKinseyislookingforfourkeyqualitiesduringtheinterviewprocess:"problemsolvingability,leadership,personalimpact/presence,anddriveandaspiration."Thisapparentlymeansasking,"Is this person going to make a difference in the world?"General or particularMcKinseynewbiesgenerallytakeoneoftwopaths:Peoplewhowishtoincorporate their knowledge of a range of industries (or no industries at all)canjoinas"generalistconsultants!"whilethosewhohaveexpertiseinaspecific area come onboard as 'specialized consultants." Although the firm isveering more and more toward industryspecific expertise, it emphasizes thatboth career paths offer "continuous learning and a high degree of intellectualstimulation, as well as rapid advancement for successful performers."ABTOinsider describes the firm's "hourglass model" of specialization: "You start outas a broad generalist, then start to pull in and specialize, and then after you'vemade partner you're expected to broaden out again.Everyone, even the mosthighly specialized expert, is expected to excel in basic consulting skills." Althoughmanyanalystsstaytheindustrystandardoftwoyears,ahandfulstay for three.McKinsey says that an employee must "earn the right to stayathirdyear"andis"encouragedtobeinanotheroffice,usuallyanother 2004 Vault Inc. 36C A R E E RL I B R A R YMcKinsey & CompanyGetting Hiredcountry if possible.Of course, you must speak the language."Some officesare experimenting with having a thirdyear [employee] work at a company.Somedoprobonowork.SomewilldoanonconsultingjoblikeinMcKinsey corporate communications."AlthoughthemajorityofnewconsultantscometoMcKinseydirectlyfromcampusesorpostdoctoralresearchprograms,somecomefromsuccessfulcareersinsuchspecializedareasasbrandmanagement,corporatefinance,informationtechnology,lawandmedicine.MBA candidatescurrentlyattendingbusinessschoolshouldfollowtherecruitingproceduresoftheirplacementoffice.AllothercandidatescansubmitapplicationsviaMcKinsey's web site.Questions to expectTakeadvantageofMcKinsey'sthoroughonlinecasestudy,aselftestingprogramwhichwalksyouthrougharealcaseinterviewanditscomponentquestions, on the careers section of the web site.Here are some others youcan use for practice: 1.Case: Youaretheheadofalargecorporation. Your companymustbuildanewpaper plant.Youmustdecidewhichcountrytobuildtheplant in.What factors would you consider?Thepointofthecaseinterviewistoevaluateyouranalyticcapabilitiesandyour eloquence.You are expected to ask the interviewer questions to obtainadditionalinformationbeforeansweringthecase(asanygoodconsultantwoulddo).Somequestionstoaskforthiscasewouldbe:"WhatdoesthecorporationIheaddo?Whatdoesthecompanyplantodowiththepaperproduced by the plant?Use the paper in its own manufacturing process?Sellit to other companies?Do we even need to build the plant? Can we satisfythis need in another way?"Factors to consider in answering this case: eachcountry'slaborcosts,politicalstability,governmenttreatmentofforeigninvestments, price of raw materials, proximity to raw materials for the plant,relevantshippingcosts,taxlaws,skillandavailabilityoflocallaborforce,access to local capital markets, etc.As the interview goes on, the interviewerwilltypicallyaddinformationorconstraintstothecase(forexample,hecould tell you that you must decide only between Brazil and China as a paperplant location).Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 37C A R E E RL I B R A R YMcKinsey & CompanyGetting Hired2.Case:It's1982.You'reaconsultantsittingonaplanenexttoyourclient,whoistheCEOof American Airlines.TheclienttellsyouthatAmericancan'tseemtokeepmanyrepeatcustomersandwantstoinstitutesomethingcalleda"frequentflyer"programtorewardloyalpassengerswith"points"theycanredeemfor freeflights.Heturnstoyou and asks you to analyze the merits and faults of the program.3. What is it about consulting that interests you?Be honest, but try not to let the dollar signs in your eyes shine too brightly.4. Why would you be a good fit at McKinsey?Talk about your thirst for knowledge, addiction to problem solving and desireto be among the best of the best in your chosen field.5. Case: You are a manufacturer of laundry detergent and thinking aboutshifting into the dry cleaning business.Decide if this is a feasible and/orlucrative option.McKinsey wants to know if you fathom the many factors that go into makingsuch a momentous business decision.Here are a few crucial questions youneed to ask your interviewer: Can the assets be transferred from business tobusiness?Whatisthedeterminedlocationbothgeographicalandonanoperationallevelofthisnewdrycleaners?Willitbeaccessibletosubstantialnumberofcustomers?Isbuildinganewbrandindrycleaninggoing to be important or can we depend on an existing clientele?Obviously,there are dozens, if not hundreds, of other factors to take into consideration.McKinsey doesn't necessarily expect you to acknowledge all of them.6.Case:Youareagumballmanufacturer inCleveland.Businesshasdeclinedfor thelastfiveyears.Whataresomethingsyoucandotoimprove growth?Youneedtoassesswhathashaltedgrowthduringthepastfiveyears. Thetwo vital elements of profit, revenue and costs, also need to be evaluated.7. Case: You are an automobile manufacturer and you want to move intothe luxury sector.Do you build your own brand or buy an existing one? 2004 Vault Inc. 38C A R E E RL I B R A R YMcKinsey & CompanyGetting HiredQuestions to ask1.For prospectiveanalysts:WhatsortofassistancedoesMcKinseyprovide in preparing analysts for acceptance into business school? Howsolid is McKinsey's acceptance rate?Given McKinsey's fourstar reputation, an interviewer won't have any troubleexpounding the firm's impressive business school stats. However, by askingthese questions, a candidate opens up the floor for the interviewer to discussrelatedperks:exceptionalprestigewithinthefield,anincrediblypowerfulalumni list and tremendous connections.2.For prospectiveassociates:PleasedescribehowMcKinseyevaluatespromotion at the firm.McKinsey's"uporout"policyisapointofcontentionamongmany,including McKinsey staff.Any question concerning promotion implies thatyouareinterestedinlearningmoreaboutthefirm'ssupposed"cutthroatculture."3. What most distinguishes McKinsey from its competitors?Yourinterviewerwillwelcomethechancetobragabit,andyoucanlearnmore about The Firm's philosophies.4. How much responsibility will I be given in my first year?Both analysts and associates are given a considerable amount of independentwork their first year at McKinsey.Your interviewer will likely reiterate thisfactandcitethetaskstypicallycompletedbyincomingMcKinseyites.RememberthatMcKinseyislookingforemployeeswhoaremotivated,ambitious and ripe for workrelated conquest.There is no such thing as "toomuch responsibility."5. How does McKinsey apply some of the advice it gives clients to its ownpractice?Keep your interviewer on her toes.Not every consulting company actuallypractices what it preaches.6. Please tell me more about the training McKinsey provides.Flauntthefactthatyourequireconstantmentalstimulationandahighlearning curve.Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 39C A R E E RL I B R A R YMcKinsey & CompanyGetting Hired7. How would you describe McKinsey's culture?Employees of McKinsey swear that their corporate culture is unlike any otherin the industry.Find out what makes it so, and use the opportunity to see howyou might fit in. 8. What effect is McKinsey's increasing industry and IT emphasis havingon its commitment to strategy?CompensationThesalaryinformationreprintedbelowwassuppliedbysomeoftheMcKinsey&CompanyemployeeswhoparticipatedinVault's2004Management Consulting Survey.Engagement manager, four to five years experience: $125,000$40-$60,000 signing bonusAssociate principal,four to five years experience: $150,000$75,000 signing bonus 2004 Vault Inc. 40C A R E E RL I B R A R YMcKinsey & CompanyVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 41C A R E E RL I B R A R YOn the JobFor a (corporatesanctioned) peek into several McKinseyites' workdays, visitthe firm's web site, which features "Day in the Life" profiles from around theworld. A day in the lifeAssociate, BTO (a client site day)8:00a.m.:A bitjetlaggedfromtravelyesterday(Monday),sleepwalktoyour desk and start tackling voice mails and emails. 9:00a.m.: Allcaughtup,checkinwithcolleagueabouthowhisrecenttraining session went. 9:30 a.m.: You and your colleague head to your "team room" at the client site,whereyouholdameetingwiththefivemembersofyourteamplusafewrepresentatives from the client's office. 10:30 a.m.: After the client reps leave, continue the meeting in private withyourcolleagues,talkingabouthowyou'llapplytheMcKinseyproblemsolving model to this engagement. 11:30a.m.:Adjournthemeetingandbegintacklingthedevelopmentofa"hypothesistree,"whichyou'llapplytothisclient'sproject. Tobegin,youneed to gather knowledge from McKinsey's online resource, Knowledge Net,aswellasfromfirmpartnersandexperts.(Thisisneveranyprobleminfact,"I'mimpressedwithaccesstopartnersherethey'llalwayscallyouback and make time for you.")1:00 p.m.: Yikes! Was that your stomach growling? Time flies when you'redeep in thought! Run up to the client's cafeteria and grab a quick bite. 2:00 p.m.: Call a junior member of the team to ask about some factgatheringhe's doing for you. 3:00 p.m.: In another meeting with your team, start to compare notes on yourhypothesisbuilding process.You'll want to come to some consensus aboutthis before involving senior partners.McKinsey & CompanyOn the Job5:00p.m.: Meetwithseniorlevelstaffersattheclientsitetodiscussprogress."We'realwaysrunningthingsbytheclientsotherearenosurprises." 6:00p.m.:Backatyourcomputer,lookupalittlemorebackgroundinfoonline and respond to emails.7:30p.m.: Packupthelaptop(you'llneedtokeepworkingonthisafterdinner) and go to meet colleagues at a nice restaurant downtown, courtesy ofThe Firm.9:30 p.m.: At the hotel, fire up the laptop and prep for tomorrow's meetingwith clients. 11:30 p.m. Doze off in front of Letterman.Analyst (an office day)6:30 a.m.: Climb out of bed, pull on sweatpants and head to the gym.9:00a.m.: Getintotheofficeandeatbreakfast(sesamebagelsand"darngood" cream cheese provided by McKinsey).9:15 a.m.: Read The New York Times online; check voice mail and email.9:45a.m.: Spendremainderofmorningworkingindependentlyonclientrelated spreadsheets and phone interviews.1:00 p.m.: Eat lunch with a coworker at a local restaurant.2:00p.m.:Attendmeetingswithteammembers(oneseniorpartner,oneregular partner, one engagement manager [EM] and one associate) to discussa current client.6:00 p.m.: Eat on the run.7:00p.m.:GetcallaboutavolunteeractivityyoudothroughMcKinsey("There's usually one conversation unrelated to firm work per day").8:00 p.m.: Finish spreadsheets left over from the morning.8:45 p.m.: Leave to grab dinner and drinks with a friend.Analyst (a client site day)7:00a.m.:Haulyourtiredbodyoutofbed,showeranddowntwocupsofcoffee. 2004 Vault Inc. 42C A R E E RL I B R A R YMcKinsey & CompanyOn the Job8:00 a.m.: Arrive in the "team room" of the client site, greet other McKinseyteam members and client affiliates.8:30 a.m.: Discuss the agenda for the day9:45a.m.: GettoworkoncollectingdataandcreatingagraphforafuturepresentationNoon: Eat lunch with the team.1:15p.m.:Engageinimpromptugroupproblemsolvingcompletewithbrainstorming, flipchart scrawling and Q&A sessions.3:00p.m.: Conferencecallwithseveralpartnersfromasmallfinancialservices company.4:00 p.m.: Meet with team for a brief project update.7:45 p.m.: Leave with team for a swanky dinner at a swanky restaurant ("OnMcKinsey,thanks.McKinseyencouragescamaraderiebetweenitsconsultants, and will pay for it").9:30 p.m.: Open door to hotel room door and crash into bed.Flip channelsand check out the paucity of late night TV options.Settle on a payperviewmovie and fall asleep before the end.Associate7:30 a.m.: Alarm goes off.9:15 a.m.: Arrive at the office .9:30a.m.: Sitdownwithresearchprofessionalstofigureoutwhatdataisneeded for the day.10:00 a.m.: Call president of a division of a large media company to arrangea tour of his facility in order to perform industry research for a client.11:00 a.m.: Prep for team presentation.11:30 a.m.: Meet with team to go over presentation for the board of directorstomorrow.2:00 p.m.: Eat lunch in McKinsey cafeteria.3:30p.m.: Attendmeetingwithmidlevelmanageratclientsitetodiscussissues related to study.Visit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 43C A R E E RL I B R A R YMcKinsey & CompanyOn the Job5:30p.m.: Meetwithresearchprofessionaltoreviewdatashecompiled.Becomedisappointedafterhearingthatcriticalinternationaldatawasdifficult to obtain.Decide on alternative approach.6:30 p.m.: Work on slides to prepare for board of directors meeting8:00p.m.:Meetwithproductionstafftomakegraphsandslidesfortomorrow's meeting8:30 p.m.: Meet with the team to go over presentation materials for tomorrow10:30 p.m.: Leave for dinner with friend and then head homeJob descriptionsBusiness Analyst (or Fellow)Comingoutofundergrad,newbiesenterMcKinseyasbusinessanalystsor"fellows."HoldersofadvanceddegreesotherthanMBAsalsomaybeassigned this position.Analysts typically stay at McKinsey for two or threeyearsbeforeenteringgraduateschoolorpursuingotherjobopportunities.Placed on engagement teams of four to five consultants including a partner,Businessanalyststayonanengagementfulltime.Dutiesmayinclude"identifying issues, forming hypotheses, designing and conducting analyses,synthesizingconclusions,andhelpingtoimplementchange,"accordingtoMcKinsey.Theymayalsofrequentlymakepresentationsto,anddiscussissues with, senior management of the client company. Daily activities include:Interviewingwithindustryexperts,governmentofficialsandclient'scustomers and competitors.Meeting with research staff and gathering data to complete study.Creating financial models using Excel. Gatheringanalysisneededtopreparegraphs,chartsandslidesneededforclient report.Traveling to client to tour facilities and collect documents.Presenting information to clients. 2004 Vault Inc. 44C A R E E RL I B R A R YMcKinsey & CompanyOn the JobAssociateAssociates, who typically have earned an MBA or another advanced degree,arestaffedonteamsthatnormallyincludeapartner,aseniorassociateandonetofourotherassociates.Associatesareproblemsolversthattakeresponsibility for designing and carrying out the analyses needed to resolveissuesthattheteamhasidentified.Associatesoftenmeetwithclientexecutivesandcontacts,makepresentations,andwriteworkplansandreports. Astheygainexperience,associatesmayearnthetitleofengagementmanager,takingresponsibilityforthedaytodaymanagementandperformanceoftheteamandcoachotherteammembers. Associateswithlittle or no business experience may take a "miniMBA" course that coverskey finance concepts and consulting frameworks. BTOassociatesareexpectedtohave"workexperiencewithatechnologycompany, an IT consulting firm or highperforming corporate IT department,and in IT design or architecture or in managing large IT projects," along with"abroadunderstandingofcurrentIT trends,theirimpactonbusinessstrategies,andtheirimplicationsforseniormanagementincreatingandsustaining competitive advantage and transforming business processes."Daily activities include:Meetingwithkeyindustryexperts,governmentofficialsandclient'scustomers and competitors.Meeting with research staff and determining data needed to perform study.Creating financial models using Excel.Assigning graphs, charts and slides needed for client report to analysts.Traveling to client to meet with client team, plan strategy for study and assignneeded tasks among McKinsey and client teams.Attendingpresentationofstudyresultstoclient;leadingselectsectionsofpresentation.Specialists/expertsCandidates with deep knowledge of an industry or topic may enter the firmas specialists or experts.These professionals, with an advanced degree andtwotofouryearsofindustryexperience,workwithclientteamsaswellasVisit the Vault Consulting Career Channel at www.vault.com/Consulting with insider firm profiles, message boards, the Finance Job Board and more. 45C A R E E RL I B R A R YMcKinsey & CompanyOn the Jobspendingpartoftheirtimebuildingontheirexpertiseinthefield.Insiderssay specialists receive training in basic consulting skills it's not enough tobe a knowitall, you also have to "know how to bring ideas to the clients,"a source says. Summer associateMcKinsey's summer associate program is designed for students pursuing anMBAor another advanced degree.Typically, summer associates will work onan engagement team for 10 to 12 weeks. SummerassociatesatMcKinseyarereportedlytreated"justlikeregularassociates."The summer begins with a day and a half of orientation, whichmayincludesomecomputersoftwaretraining.Summerassociatesmaycontributetoreports,interviewmembersofclientcompaniesandmakepresentations.Contact with senior management is generally above average,depending on the office; such contact is apparently more difficult at overseasofficesthanintheUnitedStates.However,mostsummerassociatesreportthat "the attitudes of the consultants toward us are very receptive."Some summer associates spend as much as 60 percent of their time in teammeetingsandthebalanceindatagathering;othersmayworkmoreindependently on quantitative projects.The firm says that summer associatesmay be extended an offer to join the firm upon successful completion of theirduties;insidersputthepercentageofsuccessfulsummerassociatesatupto90percent.Summerassociatesrecommendthatinterns"takeinitiativeimmediately"and"getintoitfromdayone.Thesummerisveryshort."Other former McKinsey summer associates advise: "To increase your chancesofafulltimejoboffer,socializeoutsideofworkwithofficematesfrequently." Career pathFor undergraduatesMcKinsey says that over the past two years, successful analysts have joinedthefirmfromnearly300schoolsworldwide.Asyoumightexpect,McKinsey recruits at top colleges across the country, but hires most of its newanalysts from Ivy League, Stanfor