Wednesday, November 13, 2013

"Levers" and What It Means to "Pull" Them at McKinsey

Your McKinsey boss might ask you what "levers" you're pursuing or seem most promising on a project or workstream.  In this post, I'll explain what "levers" are at McKinsey...

What is a "lever"?

In consulting terms, "levers" are initiatives that a McKinsey team or client can undertake in order to drive the desired impact.  There is usually a limitless number of things a company can consider trying in order to improve their business.  The options should be narrowed down to include only the levers most relevant to the client and their situation and goals.

From where does the lever terminology come?

If you think of a McKinsey or client team as a machine that generates a desired type of impact, then the levers are the switches that turn on (or off) specific parts of that machine. 

What does it mean to "pull" a lever?

"Pulling" a lever (or levers) means to actually pursue a specific initiative (or set of initiatives).  If each switch represents an initiative in the impact-generating machine, then "to pull a lever" means to activate or pursue that specific initiative.

Why not pull all the levers?

If each lever generates more impact, you might wonder why the team doesn't just pull all the levers.  To take the machine analogy further, assume that it takes a certain amount of fuel (i.e., people, time, effort, and resources) to run each part of the machine once the lever is pulled.  As discussed in previous posts, the "critical" or "vital" few levers will generate the most impact, based on the 80/20 rule.  Therefore, it's most efficient for the McKinsey team and/or client to only pull the most impactful levers and optimize the investment of effort.  Some levers might also be out of the team's control or cause negative side effects that would offset the targeted benefits.


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