McKinsey plans to eliminate regarding 2,000 jobsone of the biggest rounds of cuts in the consulting giant’s history.
The firm known for designing downsizing plans for its clients is eliminating some of its own, and the move is expected to target support staff in roles that do not have direct contact with customersaccording to people with knowledge of the subject.
Under a plan called Project Magnolia, the management team hopes the move will help preserve the compensation pool for its partnerssaid the people, who asked not to be identified because the information was not public. The company, which experienced rapid growth on your staff for the past decade, you’re looking to restructure the way you organize your support teams to centralize some of the functions.
The plan is expected to be finalized in the coming weeks, and the final number of roles to be cut from its workforce of 45,000 might still changesaid one of the people. That workforce is up from 28,000 just five years ago and 17,000 in 2012.
“We are redesigning the way our non-customer teams operate for the first time in more than a decade, so these teams can effectively support and scale with our companycompany representative DJ Carella said in an emailed statement. Carella said that the firm is still hiring professionals who deal directly with customers. The firm posted a record $15 billion in revenue in 2021 and surpassed that figure in 2022, one of the people said.
Companies in industries ranging from finance to technology to retail are cutting staff amid slowing demand and predictions of an impending recession. Tech giants including Amazon and Microsoft have announced plans to make deep cuts, and Goldman Sachs Group, Morgan Stanley and other major banks have been cutting thousands of jobs.
McKinsey’s move comes two years following Bob Sternfels took over as global managing partner following a vote by his roughly 650 senior partners to oust his predecessor, Kevin Sneader.
The change in management was the culmination of a tumultuous period for the company, which has drawn criticism for its role advising the makers of the pain reliever OxyContin. and faced scrutiny from various other business ties.
McKinsey consultants helped popularize the phrase “War for Talent” in the late 1990s, a catchphrase that has come back into vogue in recent years. as the post-pandemic boom led to a frenetic period of hiring and workforce expansion across industries.
With that growth now beginning to wane, companies struggling to preserve profits are resorting to job cuts on a scale not seen in more than a decade.
