One of the largest layoffs ever planned by the multinational management consulting firm McKinsey & Co. could result in the loss of 2,000 jobs. The business, which is renowned for developing staff reduction plans for its customers, is currently letting go of some of its employees.
Under a plan dubbed Project Magnolia the McKinsey management team anticipates that this choice will contribute to safeguarding the incentive pool for the partners. The corporation is reportedly attempting to overhaul how it organises its support teams in order to centralise some of the responsibilities after experiencing a considerable growth in roles over the preceding ten years. For the first time in more than ten years, according to DJ Carella, a corporate representative, the organisation is “redesigning the way” its non-client-serving teams operate.
According to one of the people featured in the report, the plan to carry out its largest round of layoffs will be formalised in the upcoming weeks, and the final roles that will be removed may yet alter.McKinsey now has 45,000 employees worldwide, up from 17,000 in 2012 and 28,000 just five years ago.
The company, which was established in Chicago more than a century ago and is now present in more than 130 nations, generated a record $15 billion in revenue in 2021 and even more in 2022, according to a source. Following a vote by the roughly 650 senior partners of McKinsey to remove his predecessor, Kevin Sneader, Bob Sternfels was appointed global managing partner two years ago. The company had been through a trying time, receiving criticism for its part in advising the producers of the opioid OxyContin and coming under examination for a number of other business relationships. The management change marked the end of that phase.
With demand slowing and signs of an impending recession, businesses across a range of sectors—from finance to technology to retail—are cutting workers. This week, rumours said that due to a severe decline in the consulting industry, KPMG, a multinational consulting firm, was laying off 2% of its personnel. Over 700 US employees are anticipated to be affected by the layoff. KPMG was the first of the major four consulting firms — EY, Deloitte, and PwC — to announce job layoffs, according to US media sources. According to reports, the multinational financial firm Goldman Sachs let off more than 3,000 workers last month.
In the late 1990s, McKinsey consultants contributed to the resurgence of the expression “War for Talent.” The post-pandemic boom sparked a frenzy of hiring and headcount increases across industries. As that growth is now beginning to slow, businesses fighting to maintain their profits are cutting jobs at a rate that hasn’t been seen in more than ten years.
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