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McKinsey

Back in our finance days, the firm we worked for wanted to do a client survey.  The goal was to get feedback on what they were doing well and areas where they could improve.  Despite one of our founders being deeply skeptical of consulting firms, some unwitting middle manager suggested that we have McKinsey pitch the project.  Perhaps unsurprisingly, the pitch meeting proved to be quite memorable, particularly after it was revealed that McKinsey was asking to be paid one million dollars (plus expenses) to interview our top clients and put together a summary benchmarking report.

Our founder asked why he should pay one million dollars for McKinsey to talk to his best clients about his performance and his firm.  His point, aside from the monetary expense, was that it was a missed opportunity to make meaningful connections and deepen relationships with its most important clients.  Why wouldn’t we just do it ourselves?  He also expressed skepticism about benchmarking.  The firm had built an impressive and differentiated growth strategy by following its own instincts and doing precisely the opposite of what its peers were doing.  Why on earth would they want to start mimicking their peers now that they had achieved scale?

Needless to say, the project didn’t move forward.  However, we learned a lot in that meeting.  To create something meaningful, you can’t outsource the work, even to a blue-chip name-brand company.  Yes, it might be easier to hire a consultant, but value comes from getting involved, forming an opinion, and doing the creative work yourself.  Yes, it’s much harder this way.  It takes more time and it might even cost you more money in the end.  But, if you constantly outsource and benchmark, you cannot create something special.  This is important at Chenmark because our goal is to create something special. 

Along these lines, earlier this week, we stumbled across a 2017 Harvard Business Review interview with Jerry Seinfeld:

HBR: You and Larry David wrote Seinfeld together, without a traditional writers’ room, and burnout was one reason you stopped. Was there a more sustainable way to do it? Could McKinsey or someone have helped you find a better model?

Seinfeld: Who’s McKinsey?

HBR: It’s a consulting firm.

Seinfeld: Are they funny?

HBR: No.

Seinfeld: Then I don’t need them. If you’re efficient, you’re doing it the wrong way. The right way is the hard way. The show was successful because I micromanaged it—every word, every line, every take, every edit, every casting. That’s my way of life.

Of course, there is a balance between being involved enough to create something special and micromanaging your work product to the point of burnout.  But honestly, it’s a fine line.  Sometimes delegation and outsourcing are critical.  Sometimes you need to roll up your sleeves and micromanage the shit out of a situation.  The elite skill is knowing when to make the switch.  That said, we can’t wait until we’re big enough for somebody to suggest bringing in McKinsey to pitch us.  That will be a fun meeting. 

Have a great week,

Your Chenmark Team

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