Short answer
McKinsey & Company was founded in Chicago in 1926 by accounting professor James O. McKinsey. After his death in 1937 the firm split, leaving the Chicago practice to become A.T. Kearney. Marvin Bower then built the modern McKinsey around professional values and top-management clients. Today it is the largest MBB firm, with an estimated 40,000-46,000 people.
Key takeaways
- James O. McKinsey founded the firm in Chicago in 1926 to apply accounting principles to management problems.
- After McKinsey's death in 1937 the partnership split, and the Chicago side became A.T. Kearney while McKinsey & Company kept the name.
- Marvin Bower, managing director from 1950 to 1967, shaped the firm's professional standards and its focus on top management.
- The firm's reputation has been tested by the Enron collapse, Rajat Gupta's 2012 insider trading conviction and opioid-related settlements of about $600 million (2021) and $650 million (2024).
- McKinsey last published revenue of about $16 billion for 2023; headcount estimates run 40,000-46,000.
How did McKinsey start?
McKinsey began in Chicago in 1926, when James O. McKinsey, an accounting professor at the University of Chicago, opened a firm to advise executives on budgeting and management. He called the work "management engineering": using financial data to diagnose how a company should be organized and run.
The idea was new. Most advisers of the time were efficiency experts focused on factory floors. McKinsey looked at the whole company from the top, through its numbers, which set the template for strategy consulting.
Why McKinsey and A.T. Kearney split
James McKinsey died suddenly of pneumonia in 1937, after leaving the firm to run a client company, Marshall Field's. The remaining partners disagreed over how the practice should grow, and by 1939 the firm had divided.
Tom Kearney led the Chicago practice. Marvin Bower led the New York office, which kept the name McKinsey & Company. In 1947 Bower secured the rights to the McKinsey name, and Kearney's practice became A.T. Kearney and Company, today known simply as Kearney.
Marvin Bower: the architect of modern consulting
Marvin Bower joined McKinsey in 1933 as a young lawyer and led the firm as managing director from 1950 to 1967. My 2011 original misnamed him "Martin"; Marvin is correct, and he deserves the precision, because almost every habit of modern consulting traces back to him.
Bower modeled the firm on a law practice. He insisted on these principles:
- Serve top management only, on the problems that matter most to the company.
- Put the client's interest ahead of the firm's revenue, including turning work away.
- Keep client matters confidential.
- Hire graduates and train them, instead of hiring older industry experts.
- Act as one firm, with a shared culture across offices.
He also cultivated the firm's discreet professional image, down to a conservative dress code for consultants. Under his leadership McKinsey expanded to Europe from the late 1950s and became the reference point for every strategy firm that followed.
McKinsey and the rise of MBB
From the 1960s, McKinsey gained two serious rivals. Bruce Henderson founded the Boston Consulting Group in 1963 and won attention with ideas such as the experience curve. In 1973, Bill Bain left BCG to found Bain & Company. Together the three became known as MBB, the most selective employers in consulting.
Each firm carved out a distinct identity. McKinsey kept its emphasis on top-management problems and institutional reputation. Read BCG's history and Bain's history for the other two stories.
Controversies that shaped the firm
McKinsey's size and influence have drawn scrutiny. Three episodes stand out.
| Period | Episode | What happened |
|---|---|---|
| 2001 | Enron collapse | Former McKinsey partner Jeffrey Skilling led Enron, a long-time McKinsey client. McKinsey was not investigated and denied advising on Enron's accounting, though critics questioned its influence on Enron's culture. |
| 2012 | Rajat Gupta conviction | Gupta, McKinsey's managing director from 1994 to 2003, was convicted in June 2012 of insider trading tied to his role on Goldman Sachs' board and sentenced to two years in prison. The case concerned his conduct after leaving the post. |
| 2021-2024 | Opioid-related settlements | McKinsey paid about $600 million to settle claims from US states in 2021 over its marketing advice to opioid makers, then $650 million in December 2024 under a deferred prosecution agreement with federal prosecutors. It apologized for its sales and marketing work for Purdue Pharma. |
These episodes have changed how the firm talks about client selection and risk review, and interviewers sometimes expect candidates to have a considered view on consulting ethics.
McKinsey today
McKinsey is a private partnership and publishes few figures. It last reported revenue of about $16 billion for 2023, and estimates of its headcount in 2026 run 40,000-46,000 people, which makes it the largest of the MBB firms by most measures. Treat these numbers as estimates.
Recruiting has changed with it. The paper Problem Solving Test I took years ago is retired, and McKinsey now screens candidates with Solve, a gamified digital assessment described in our McKinsey test guide.
What this history means in your interview
History will not come up as a quiz question, yet it gives you material for three parts of the interview.
- Motivation. When asked "why McKinsey", link a specific trait to your own experience. Bower's principle of putting the client first is a strong anchor if you can tie it to a moment where you chose quality over speed.
- Personal Experience Interview. McKinsey's PEI emphasis on connection and leadership echoes Bower's one-firm culture. Your stories should show you acting on your own initiative while bringing others along. See the McKinsey case interview for how the PEI works.
- Ethics questions. If an interviewer raises the opioid settlements or other controversies, give a calm, factual view and explain what you think good client selection looks like.
Stephan's note: When I interviewed, a candidate who could explain why a firm's values mattered to them personally always beat one who recited the founding date.
To prepare for the interview itself, from personal-fit stories to fully worked cases, see my book Cracking the Case.
Frequently asked questions
Who founded McKinsey & Company?
James O. McKinsey, an accounting professor at the University of Chicago, founded the firm in Chicago in 1926.
Who was Marvin Bower?
Marvin Bower joined McKinsey in 1933 and led the firm as managing director from 1950 to 1967. He is widely regarded as the architect of modern management consulting.
What does MBB stand for?
MBB stands for McKinsey, BCG and Bain, the three strategy consulting firms most often grouped as the industry's most selective employers.
How big is McKinsey today?
McKinsey last published revenue of about $16 billion for 2023. As a private partnership it does not report headcount each year, and estimates in 2026 run 40,000-46,000 people.
What was McKinsey's role in the opioid crisis?
McKinsey advised Purdue Pharma and other opioid makers on sales and marketing. It paid about $600 million to settle claims from US states in 2021 and $650 million to resolve a federal criminal investigation in December 2024, and it apologized for the Purdue work.