Management consulting – where did it begin?

EXECUTIVES often rely on the advice of expert management consultants. Was it always this way? Where did it all begin?

The very first management consulting firm was Arthur D. Little, founded all the way back in 1886 by a professor at MIT whose name was (funnily enough) Arthur D. Little.

Almost 30 years later, Booz Allen Hamilton was founded in 1914. Booz was the first management consultancy to serve both industry and government clients.

Interestingly, McKinsey & Company was the world’s first pure management and strategy consulting company. Founded in 1926, McKinsey is is now the world’s most prestigious consulting firm.  The culture of the firm was heavily influenced by a man named Marvin Bower, who served as managing director from 1950 to 1967. Bower believed that management consultancies should adhere to the same high professional standards as lawyers and doctors. To this day, the core guiding principle at McKinsey is professionalism.

Boston Consulting Group, arguably the world’s second most presigious consulting firm, was founded in 1963 by Bruce Henderson. It all began when Henderson left Arthur D. Little to accept a challenge from the CEO of the Boston Safe Deposit and Trust Company to start a consulting arm for the bank.

Ten years later, in 1973, Bill Bain and others left the Boston Consulting Group to form Bain & Company, which is also one of the world’s leading consulting firms.

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2 Replies to “Management consulting – where did it begin?”

  1. Hi Tom,

    I believe it all started when executives at large companies decided that they needed some external scape-goats to blame if and when costly new business ventures failed.

    Over the years this symbiotic relationship has developed enabling the consultants to charge huge sums for sometimes superficial but well “powerpointed” presentations in return for the Company Executives right to take full credit for any successful outcomes while shifting the spotlight of blame comfortably away from themselves in case of failure. “Failure is a bastard but success has many executive fathers”.

    A jaundiced view but one with a degree of truth attached.

    Peter S

  2. More than a degree of truth there. But consider that most entrepeuners would procrastinate in taking simple decisions in a fast-paced economy. A management consulting firm could better advise and exploit a market condition based on its professional understanding.

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