incorporated partnership industry management consulting founded 1926 ; 90 years ago 1926 founder james o. mckinsey founder of james o. mckinsey & company in 1926 marvin bower founder of modern day mckinsey in 1939 headquarters none 1 number of locations 110 offices 2 area served all sovereign nations key people dominic barton managing director revenue 8.3 billion 2014 3 number of employees 11 000 3 website www.mckinsey.com mckinsey & company is a worldwide management consulting firm . it conducts qualitative and quantitative analysis in order to evaluate management decisions across the public and private sectors . widely considered the most prestigious management consultancy 4 mckinsey s clientele includes 80 % of the world s largest corporations and an extensive list of governments and non profit organisations . more current and former fortune 500 c.e.o.s are alumni of mckinsey than of any other company a list including google c.e.o. sundar pichai facebook c.o.o. sheryl sandberg morgan stanley c.e.o. james p. gorman and many more . mckinsey publishes the mckinsey quarterly funds the mckinsey global institute research organization publishes reports on management topics and has authored many influential books on management . its practices of confidentiality influence on business practices and corporate culture have experienced a polarizing reception . mckinsey was founded in 1926 by james o. mckinsey in order to apply accounting principles to management . mckinsey died in 1937 and the firm was restructured several times with the modern day mckinsey & company emerging in 1939 . marvin bower is credited with establishing mckinsey s culture and practices in the 1930s based on the principles he experienced as a lawyer . the firm developed an up or out policy where consultants who are not promoted are asked to leave . mckinsey was the first management consultancy to hire recent college graduates rather than experienced managers . in the 1980s and 1990s the firm expanded internationally and established new practice areas . it had 88 staff in 1951 and 7 700 by the early 2000s . mckinsey s consulting has helped to establish many of the norms in business and contributed to many of the major successes and failures in business in the modern era . contents 1 history 1.1 early history 1.2 establishment 1.3 recent history 1.3.1 further expansion 1.3.2 galleon insider trading scandal 2 organization 2.1 structure 2.2 culture 2.3 influence 3 consulting services 3.1 environmental consulting 4 recruiting and compensation 5 research and publishing 6 consulting projects 6.1 history 7 see also 8 notes 9 references 10 external links 11 references history edit early history edit mckinsey founder james o. mckinsey mckinsey & company was founded under the name james o. mckinsey & company in 1926 by james mckinsey a professor of accounting at the university of chicago . 5 6 he conceived the idea after witnessing inefficiencies in military suppliers while working for the u.s. army ordnance department . 7 4 the firm called itself an accounting and management firm and started out giving consulting on using accounting principles as a management tool . 8 3 mr. mckinsey s first partners were tom kearney hired in 1929 9 a and marvin bower hired in 1933 . 11 12 133 b in its first few years the firm grew quickly and began developing rapport among corporations ; 7 4 its second office was opened in new york city in 1932 . 8 20 in 1935 mr. mckinsey left the firm temporarily to serve as the chairman and ceo of client marshall field s as it implemented the restructuring plan created by his firm . 7 5 12 133 mckinsey was merged with accounting firm scovell wellington & company that same year creating the new york based mckinsey wellington & co. and splitting off the accounting practice into chicago based wellington & company . 7 5 a wellington project that accounted for 55 percent of mckinsey wellington & company s billings was about to expire 13 and kearney and bower had disagreements about how to run the firm . bower wanted to expand nationally and hire young business school graduates whereas kearney wanted to stay in chicago and hire experienced accountants . 12 134 additionally in 1937 james o. mckinsey died after catching pneumonia . 8 10 this led to the division of mckinsey wellington & company in 1939 . the accounting practice returned to scovell wellington & company while the management engineering practice was split into mckinsey & company and mckinsey kearney & company . 9 13 bower had partnered with guy crockett from scovell wellington who invested in the new mckinsey & company and became managing partner while marvin bower is credited with founding the firm s principles and strategy as his deputy . 13 14 the new york office purchased exclusive rights to the mckinsey name in 1946 . 15 25 establishment edit mckinsey & company grew quickly in the 1940s and 50s especially in europe . 7 12 13 15 25 16 it had 88 staff in 1951 17 and more than 200 by the 1960s 15 including 37 in london by 1966 . 17 in the same year mckinsey had six offices in major us cities like san francisco los angeles and washington d.c. as well as six abroad . these foreign offices were primarily in europe such as in london paris amsterdam as well as in melbourne . 7 12 13 by this time one third of the company s revenues originated from its european offices . 15 guy crockett stepped down as managing director in 1950 and marvin bower was elected in his place . 13 18 61 mckinsey s profit sharing executive and planning committees were formed in 1951 . 13 the organization s client base expanded especially among governments defense contractors bluechip companies and military organizations in the post world war ii era . 19 after seven years of consideration mckinsey became a private corporation with shares owned exclusively by mckinsey employees in 1956 . 7 12 13 after bower stepped down in 1967 the firm s revenues declined . new competitors like the boston consulting group and bain & company created increased competition for mckinsey by marketing specific branded products such as the growth share matrix and by selling their industry expertise . 16 20 21 in 1971 mckinsey created the commission on firm aims and goals which found that mckinsey had become too focused on geographic expansion and lacked adequate industry knowledge . the commission advised that mckinsey slow its growth and develop industry specialties . 7 14 16 in 1976 ron daniel was elected managing director serving until 1988 . 8 42 daniel and fred gluck helped shift the firm away from its generalist approach by developing 15 specialized working groups within mckinsey called centers of competence and by developing practice areas called strategy operations and organization . daniel also began mckinsey s knowledge management efforts in 1987 . 7 15 17 this led to the creation of an it system that tracked mckinsey engagements a process to centralize knowledge from each practice area and a resource directory of internal experts . 7 6 7 by the end of his tenure in 1988 the firm was growing again and had opened new offices in rome helsinki s o paulo and minneapolis . 7 15 17 16 fred gluck served as mckinsey s managing director from 1988 to 1994 . 22 the firm s revenues doubled during his tenure . 21 he organized mckinsey into 72 islands of activity that were organized under 7 sectors and 7 functional areas . 7 18 by 1997 mckinsey had grown eightfold over its size in 1977 . 23 in 1989 the firm attempted to make a talent acquisition in it services through a 10 million purchase of the information consulting group icg but a culture clash caused 151 out of the 254 icg staff members to leave by 1993 . 21 22 recent history edit further expansion edit in 1994 rajat gupta became the first non american born partner to be elected as the firm s managing director . 24 by the end of his tenure mckinsey had grown from 2 900 to 7 700 staff and 58 to 84 locations . 25 he opened new international offices in cities such as moscow beijing and bangkok . 7 20 continuing the structure developed by prior directors gupta also created 16 industry groups charged with understanding specific markets and instituted a three term limit for the managing director . 7 22 mckinsey created practice areas for manufacturing and business technology in the late 1990s . 7 21 23 mckinsey set up accelerators in the 1990s where the firm accepted stock based reimbursement to help internet startups ; 25 26 the company performed more than 1 000 e commerce projects from 1998 2000 alone . 7 24 the burst of the dot com bubble led to a reduction in utilization rates of mckinsey s consultants from 64 to 52 percent . though mckinsey avoided dismissing any personnel following the decline 25 the decline in revenues and losses from equity based payments as stock interests lost their value together with a recession in 2001 meant the company had to reduce its prices cut expenses and reduce hiring . 7 25 in 2001 mckinsey launched several practices that focused on the public and social sector . it took on many public sector or non profit clients on a pro bono basis . 19 by 2002 mckinsey had invested a 35.8 million budget on knowledge management up from 8.3 million in 1999 . 19 1 its revenues were 50 20 and 30 percent from strategy operations and technology consulting respectively . 7 20 in 2003 ian davis the head of the london uk office was elected to the position of managing director . 27 davis promised a return to the company s core values after a period in which the firm had expanded rapidly which some mckinsey consultants felt was a departure from the company s heritage . 28 also in 2003 the firm established a headquarters for the asia pacific region in shanghai china . by 2004 more than 60 percent of mckinsey s revenues were generated outside the u.s. 19 the company started a social sector office sso in 2008 which is divided into three practices global public health economic development and opportunity creation edhoc and philanthropy . mckinsey does much of its pro bono work through the sso whereas a business technology office bto founded in 1997 provides consulting on technology strategy . 29 by 2009 the firm consisted of 400 directors senior partners up from 151 in 1993 . 21 30 dominic barton was elected as managing director a role he was re elected for in 2012 and 2015 . 30 galleon insider trading scandal edit see also rajat gupta and anil kumar former mckinsey senior executives rajat gupta and anil kumar were among those convicted in a government investigation into insider trading for sharing inside information with galleon group hedge fund owner raj rajaratnam . 31 32 though mckinsey was not accused of any wrongdoing the convictions were embarrassing for the firm since it prides itself for integrity and client confidentiality . 33 34 35 following the initial allegations mckinsey no longer maintains a relationship with either senior partner 36 37 though the manner in which it severed ties attracted controversy . 38 senior partner anil kumar described as gupta s prot g 39 left the firm after the allegations in 2009 and pleaded guilty in january 2010 . 40 41 while he and other partners had been pitching mckinsey s consulting services to the galleon group kumar and rajaratnam reached a private consulting agreement violating mckinsey s policies on confidentiality . 42 gupta was convicted in june 2012 of four counts of conspiracy and securities fraud and acquitted on two counts . 43 in october 2011 he was arrested by the fbi on criminal charges of sharing insider information from