Elon Musk spells danger for Accenture, McKinsey and their rivals

IT SHOULD be a management consultant’s dream. The organisation is immense. The bloat is obvious. And the new boss is eager to shake things up. President Donald Trump and his disrupter-in-chief, Elon Musk, have already begun hacking away at America’s federal bureaucracy. Musk’s Department of Government Efficiency (Doge) has set itself the target of cutting government spending by a colossal US$2 trillion.

For an industry that helps organisations remake themselves, that seems like an opportunity like no other. Yet consulting firms, which have come to rely on the federal government for a growing share of fees, are looking on nervously. None of them appear to have a seat at Musk’s table. They could instead be on the menu.

Consultants have a long history of cashing in on government projects. McKinsey, the world’s most prestigious strategy adviser, at least by its own estimation, helped Dwight Eisenhower establish the post of White House chief of staff in 1952 and designed Nasa’s first organisational structure in 1958. By 1977, Jimmy Carter was grumbling that the federal bureaucracy was employing consulting firms “excessively, unnecessarily and improperly”. That year Booz Allen Hamilton, one consultancy, was paid US$320,000 (US$1.7 million at today’s prices) by the Department of Agriculture to figure out how many chickens its inspectors should examine per minute.