Consulting firm McKinsey launches new arm for design services

14 November 2018 Authored by Consultancy.uk

International strategy consulting heavyweight McKinsey & Company has formalised its entry into the world of design thinking, launching the new McKinsey Design brand. The firm’s new business unit builds on three acquisitions – Lunar, Carbon12 and Veryday – which has enabled it to reach a headcount of some 350 designers spread across ten international hubs.

Global spending on design services is at an all-time high, at $40.7 billion, with the market for offerings such as product design, model design, user interface and interaction design forecast to grow at a CAGR of 6.4% between 2017 and 2023.

As is the case with almost any professional services industry which provides a foot in the door of such a lucrative market, then, the consulting industry has predictably been making moves to buy its way into the design space. McKinsey & Company has been pushing into the design realm since as long ago as June 2015, when the global strategic consulting firm stunned the world of management consulting with the acquisition of industrial design firm Lunar, in a move that added saw 80 professionals join its ranks.

Lunar, founded in 1984, added offices and design studios in San Francisco, Chicago, Hong Kong and Munich to McKinsey’s footprint. Just 18 months later, Carbon12 followed suit, with the boutique design firm adding studios in Austin and Mumbai to McKinsey, while one month later Veryday, a Swedish design agency with 90-plus designers, researchers, engineers and consultants based in Stockholm and New York, joined the McKinsey family. Since launching in 1969, Veryday has won more than 240 awards, and new products the firm co-designed have been granted more than 300 patents.

Consulting firm McKinsey launches new arm for design services

Commenting at the time, Volker Grüntges, a Munich-based senior partner at McKinsey who led the acquisition, said, “We were searching for a design firm with an unquestionable reputation and world-class designers… Veryday is ahead of the curve because its work combines physical product design, service design, and an engaging experience.”

Enter: McKinsey Design

Now, having accrued the constituent parts the firm felt it required to formally launch its design offering, McKinsey has consolidated its new properties into the new global McKinsey Design business unit, formally launching in New York on October 25. The new creative arm sits alongside its core strategy consulting outfit, and other divisions such as McKinsey Implementation, McKinsey Digital and McKinsey Solutions.

“It's no secret that design is increasingly a source of competitive advantage and business value,” Benedict Sheppard, a Partner in McKinsey’s London office, said of the new brand. “In a world of fierce competition, products, and services that are well designed – working better as well as looking better – have a critical edge.”

In discussion with the Wall Street Journal, Sheppard added, “Things that used to be separate in the business world are converging, and the consumer's experience has to be seamless. Service plus digital plus physical. That is not easy to deliver... If we bring design capabilities to pieces of strategy and operations, then we can do something quite extraordinary.”

“The business world is converging, and the consumer's experience has to be seamless. If we bring design capabilities to pieces of strategy and operations, then we can do something quite extraordinary.”
– Benedict Sheppard, McKinsey Design

The firm’s offering will revolve around helping clients with designing, prototyping and launching new products; designing experiences that delight customers and drive top-line growth; and optimising their service touch-points with consumers – online and offline. While for many firms just starting out, it might be a problem to win clients, the make-up of a patchwork of prestigious design entities, along with McKinsey’s heavyweight reputation, McKinsey Design already works for some of the most high profile clients in the market – including Apple, HP, Motorola, Philips and Porsche – though one thing that hasn’t changed even with the new brand in a new market is that in true McKinsey fashion, the firm’s Partner team remains secretive about who they are working with. To that end, Sheppard reaffirmed that “one of the things we guard most zealously is who we work with.”

Further playing to McKinsey Design’s air of mystique, Hugo Sarrazin, another Partner, this time from Silicon Valley, remarked that at its launch, with approximately 350 designers spread across ten global studios, “[McKinsey Design is] the biggest design firm you’ve never heard of!”

Companies McKinsey will take on in the industry include the likes of IDEO, Frog Design, Designworks, Artop, Designaffairs, Ammunition, ZIBA Design, Fuse Project, R&D Design, GK Design Group, RKS and BUSSE Design.

Related: For more information read 'McKinsey & Company unites design skills to launch McKinsey Design' on Consultancy.org.

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