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Case Study: Mckinsey & Co.

Decent Essays

Short Answer
Question 1
McKinsey & Co. – I don’t believe this company has been discussed in class, but, in the event that it was, these concepts could easily be applied to any major professional services firm.
(a) The firm’s sources of sustainable competitive advantage are (1) its ability to recruit and retain the best talent, (2) its ability to add value to that talent while with the firm, and (3) its ability to develop and maintain relationships with top industry executives.
With respect to the first, insofar as the firm is able to maintain a solid brand in the marketplace such that high-achieving students from top universities throughout the world desire to work there, it will maintain its competitive advantage over rival firms and continue to retain its position as the leader in that field. However, if top students view the costs of working at such a firm as outweighing the benefits and consequently choose to enter another industry, or, perhaps worse, if students view the work environment as more amiable at another competing firm and choose to work at this firm instead, the company will slowly begin to bleed its intellectual capital and erode its position at the top of the market. Such measures are likely to play out over the period of several years and are difficult to measure in the short-run, but nevertheless have a lasting impact on the …show more content…

While there were other management consulting firms at the time, when Marvin Bower began working for McKinsey and company in the early part of the 20th century, the industry was in its infancy and there were relatively few competitors of significance. This allowed the company to build its client base without much competitive pressure and lock in the network advantages that naturally develop from working one-on-one with key managers and helping them solve difficult problems. Over time, the firm began to develop a reputation for doing quality work, and the network benefits were essentially locked-in for that

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