McKinsey & Company buys design consultancy Lunar

18 May 2015

With a focus on carefully designed user experiences able to propel companies from underdogs to market leaders, recent years has seen large companies buy up or add design practices to stave off well designed competition. In a move to further improve McKinsey & Company’s design and digital capabilities for clients, the firm has acquired international design consultancy Lunar. Lunar will continue to work under its brand name from its offices. Roughly 80 employees transfer to McKinsey, the value of the deal has not been disclosed.

While function is one of the key elements of a product, recent decades have seen a surge in focus on design. When function can be mass produced – what sets products apart today is their ease of use and their aesthetic appeal. Recent years have shown a considerable move toward delivering carefully designed products, with Apple’s rise from David to Goliath as an example. After Apple’s momentous rise, others companies have taken stock – GE, IBM, Google and Facebook too investing heavily in buying up design firms to improve the design of user experiences and to spread their brand.

McKinsey Digital

On Friday McKinsey & Company – the globe’s largest and arguably most prestigious strategy consulting firm – unveiled that it has acquired Lunar. The design consulting firm, founded in 1984, offers clients advice in a wide range of design related areas, from improving product aesthetics to improving the user friendliness of products. With well-designed products improving customer engagement and therewith, brand strength, the firm helps clients compete through design excellence. The firm has worked with some of the most high profile clients in the market, including the likes of Apple, HP, Philips and SanDisk. The firm is headquartered in the San Francisco Bay Area, and has offices in Chicago, Hong Kong, and Munich. Lunar has approximately 80 employees on its payroll.

The move highlights the growing importance of design capabilities in the wider corporate landscape. The acquisition is designed to allow Lunar to keep its name and to continue to work out of its office globally, however, now offering new and old clients the combined perspectives of its design team as well as McKinsey’s strategic prowess.

For McKinsey the acquisition will see it able to offer clients access to a wide range of design capabilities that can provide solutions to client in a broad range of disciplines, including design in everything from products, branding, and business models to corporate strategy and structure. Lunar’s offerings will complement the service portfolio of among others McKinsey Digital, Marketing & Sales and Business Technology Office (BTO).

Lunar - Today we enter the next phase

John Edson, president of Lunar, says: “This news is only the latest evidence that design is an essential ingredient, approach, and result for businesses that regularly deliver outstanding products and services—not to mention lasting customer relationships. Superlative design and development talent is the bridge that links strategy to the real world—identifying, envisioning and delivering opportunities and impact with tangible solutions.”

McKinsey is not the first of the big consultancy firms to acquire design expertise – Accenture for instance poached Fjord in 2013, while the Digital practice of rival BCG – BCG Digital Ventures – bought Strategic & Creative (S&C), a digital design firm based in Sydney, Australia. Further back in time, in December 2012, Booz & Company, now Strategy& (rebranded following the sale to PwC), acquired Axon Advisory, which stood at the basis of Booz Digital.