IT Consulting Companies
Big consulting firms play an essential role in the strategic management of companies. But exactly how did they themselves design strategies of their very own? During a seminar in the Ecole de Paris, Christopher McKenna looked back on the history of an industry characterized by a somewhat ambiguous relationship to innovation. The first strategic consultancy company was created in 1886 by Arthur Dehon Little, a chemist from MIT. Other individuals came in afterward and progressively institutionalized the field of management consulting. Even though Arthur D. Little opened the way, he refused to follow the general trend when the field he’d created began to grow according to his opinion on much too homogenous standards.
His consulting company declined from then on. The pioneer’s dilemma – Arthur D. Little wanted to cope with the complex problems confronted by companies, those other consultants couldn’t solve. He was thoroughly opposed to any type of systematization when it came to sharing of ideas and tending to come up, in each case, with a distinctive solution. He’d always refused to enter the professional association of management consulting. Eventually, his strategy didn’t work out very well: you cannot commit to solving matters which are unknown. Other consultants took far fewer risks, by dealing with well-known situations and transposing ideas from one organization to another.
During a lengthy amount of time, DuPont held the monopoly on explosives in the U.S., And World War I meant a significant increase in the company’s assets. After the war had ended, they’d to think of other items to sell. That’s when they realized that their technology might be used for other purposes, for example, for chemical products like nylon, paint, or varnish. DuPont also possessed General Motors, so that they supplied the automotive giant with top quality paints, in different colors.
How did they organize these new activities? DuPont seized an opportunity to take deal with a problem that consulting firms had been unable to solve. That’s when the departmental structure was born. They reshaped their organization according to the different products: explosives, stains, and paints); opposed to the former structure based on functions: sales, production, R&D. Later on, this kind of structure extended to other great firms, like GM and Standard Oil. Consulting such as McKinsey or Booz Allen Hamilton took interest in this increasingly successful model. From the 30s and onwards, the major part of their activity was dedicated to its transposition from one firm to another. At a start, McKinsey wasn’t among the leaders. But James McKinsey, who led the firm in the 30s, came up with numerous very bright ideas. He launched the General Survey, an interview with company managers by the means of a questionnaire solution.