ad: Annual 2024 Now Open For Entries!
*

McKinsey shoot for the moon

Published by

Management consultancy giant McKinsey & Company this week announced the purchase of San Francisco-based design company Lunar in an effort on McKinsey's part to grow its design capabilities. The deal is understood to be McKinsey’s first-ever acquisition of a design company and comes two years after its competitor Accenture bought the London-based consultancy Fjord back in 2013.

McKinsey & Company this week announced the purchase of the San Francisco-based design company Lunar

The acquisition is hardly groundbreaking, but it is interesting, as it represents a natural progression for McKinsey, at a time of major change for both independent design agencies and large corporations. Traditional business services are increasingly investing in design and at the same time, independent design agencies are being snapped up left and right by companies recognising their business value. In just the last few months, for example, the Chinese communication group BlueFocus acquired Fuseproject, and the banking giant Capital One bought Adaptive Path. As more businesses understand the role design can play shaping their strategy, acquisitions, such as McKinsey's of Lunar, will only become more commonplace.

*

McKinsey first approached Lunar, a mid-sized firm set up in 1984 with just 75 people on board, back in 2013. Over the next 18 months the two companies tested their compatibility through a few test projects and ultimately, decided on an acquisition for an undisclosed sum, and an arrangement where Lunar’s four offices in San Francisco, Chicago, Munich, and Hong Kong will continue to operate as usual and serve existing clients under the Lunar name. The main difference now is that Lunar will take on McKinsey client projects, and also sit in on McKinsey's consultation practices.

McKinsey first approached Lunar back in 2013 and the two companies tested their compatibility through a few test projects

In return, Lunar will have access to a veritable smorgasbord of traditional design consultation work, which is important, as whilst Lunar has enjoyed a steady stream of work over the years and won prominent accolades, the business of independent design has shifted. Many large companies that once used outside design agencies have started bringing design talent in-house, meaning fewer projects for those agencies. The idea behind this deal, however, is that McKinsey will give Lunar stability and client leads and Lunar, in turn, will give McKinsey their in-house design expertise. The very definition of a win-win situation. At least in theory.

*

According to Lunar president John Edson, the deal will create “A first-ever, full-spectrum offering, combining McKinsey’s depth and impact in management consulting, business strategy and operations horsepower with Lunar’s unmatched capability in design, engineering, development and design strategy.” He feels that this latest deal 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.” He adds that “Design represents a powerful approach for transforming businesses into more responsive and agile organisations in an increasingly turbulent business environment.” He maintains that this is “Not a move of desperation,” but a “Very natural kind of partnership.” That might not have been true even a few years ago, but there’s more and more overlap between management consulting and design consulting these days, so in this case, I'd have to agree!

*

Comments

More Leaders

*

Leaders

Inspiring Female Leaders: An Interview with RAPP CEO Gabrielle Ludzker

Gabrielle Ludzker is not just any CEO. The current head honcho at customer experience agency RAPP has spent her career breaking away from the traditional corporate CEO stereotype. and leads to inspire rule breakers. Gabby is an inspirational rule...

Posted by: Benjamin Hiorns
ad: Annual 2024 Now Open For Entries!