I always enjoy the year-end issue of "The Lives They Lived" in the New York Times Magazine. Unlike the daily NYTimes obituaries (which I almost always read immediately after the headlines), the year-end issue doesn't try to provide a comprehensive event-based recount of a person's lifee.g. where were they born, where they went to school, who they married, who they left behind. Instead, it highlights a single interesting facet or dimension. Roger Lowenstein's story on Marvin Bower, the founder of consulting giant McKinsey & Co. is especially relevant for my research. As one of the founder's of the consulting industry, Bower envisioned a firm that provided objective advice to its clients, much like the way doctors and lawyers are supposed to do. He envisioned consulting as an analogous profession, in which the consultant would put the interests of the client ahead of his own. Again, much like a doctor or lawyer takes an oath to do.
Like much of modern management, McKinsey's start and Bower's vision can be traced back to Scientific Management and Taylorism. At the time that consulting emerged, just after the first business schools were being constituted at the beginning of the twentieth century, “scientific management” was in the air, as Frederick Taylor’s application of scientific methods to the study of physical labor had begun to be extended to the organization of industry as well as to spheres such as higher education and government . Many firms, including Taylor's own, sought to model themselves as professional firms that could bring objective, scientific-based advice, the way medical doctors brough to bear science for improving their patient's health.
While Taylorism was quickly jettisoned as the core of the business school curriculum, it made scientific reasoning and method appear to be applicable to business, thus helping to legitimate the study of business as an activity within the university. Yet what exactly a “science” of management should study would be puzzled over and debated for a great many years.
In my own research, I've found that three curricular models emerged and competed with one another in the early decades of university business education. The first was a simple aggregation of courses taught elsewhere in the university and covering such obviously useful (if intellectually circumscribed) subjects as accounting and business law. The second model attempted to organize business education around specific industries such as banking, transportation, merchandising, mining, and lumber. The third model—increasingly adopted by the 1930s, and still the basis of the business school curriculum today—was the functional approach, as the grouping of courses began to mirror the differentiation of finance, administration, operations, and marketing as the major activities of the firm. Thus the curricular structure evolved as a pragmatic response to the challenge of turning out graduates who could perform the tasks that would be required of them by employers.
Lowenstein concludes the article by describing how far consultants and other supposed neutral providers of service have strayed from the original objective. He writes:
Few of Bower's peers agreed with him. As the complexity of business grew, corporations increasingly called on their auditors to give assistance outside the realm of accounting. By the postwar era, audit firms like Arthur Andersen were starting consulting wings. But Bower ignored the trends and kept his firm focused on its primary mission. When McKinsey ventured into executive search, he persuaded the firm to get out. Then, when some of the partners wanted to form a joint venture with an investment bank, Bower helped talk them out of it. ''He got very upset at some of the things McKinsey was talking about,'' says Jack Sweeney, editor of Consulting Magazine. Bower's influence was also felt in McKinsey's refusal to go public, though a sale would have netted the partners millions. Today, in an age when values often seem malleable, it is fair to wonder at the source of such Calvinist rectitude. You may as well wonder why Bower, a conservative Midwesterner, insisted that his consultants dress for work always in hats and long socks. Elizabeth Haas Edersheim, who is writing a biography of Bower, cites the role model of his father, a diligent expert in the field of land transfers, and also of his strait-laced mentor at Jones Day.
Today, McKinsey partners bristle at the suggestion that their ties to Enron, once a prized client, mean the firm strayed from Bower's principles. It may be more accurate to say that the entire business world has strayed. The news that Arthur Andersen accepted $27 million for consulting and related work from Enron while presuming to also be its ''independent'' auditor vindicated Bower's worst fears from the 1930's. And of course, Andersen was not alone; America's professions have become crassly commercial. Bower was in failing health by the time of the Enron revelations, but he was painfully aware of its McKinsey connection. Moreover, he was deeply saddened to see law firms behaving as crassly as commercial businesses, or to see accounting firms sponsoring golf tournaments. The battle for independence was never won; Bower fought it all his life.