The Big Con

Mariana Mazzucato and Rosie Collington trace the growth of the consulting industry from the 1980s, when governments in the United States and Britain embraced the idea that the state should steer rather than row. They argue that the Big Three strategy firms (McKinsey, Boston Consulting Group and Bain) and the Big Four accounting firms (Deloitte, PwC, EY and KPMG) sell confidence more than knowledge, and that every contract leaves clients less able to do the work themselves.

Mazzucato is the founding director of the Institute for Innovation and Public Purpose at University College London and the author of The Entrepreneurial State, The Value of Everything and Mission Economy. Collington was a doctoral researcher at the same institute. Both write as critics of the small-state consensus.

The evidence includes the troubled launch of HealthCare.gov, McKinsey's work in Puerto Rico after Hurricane Maria, and firms that advise governments on decarbonization while taking fees from fossil fuel companies. Publishers Weekly praised the research and the writing, and The Times named it one of the best business books of 2023. Critics noted that the evidence comes mostly from English-speaking countries, and Jacobin's reviewer found the recommendations unclear, noting that the new theory of value the book calls for is never defined.

Read it before joining a consulting firm or hiring one, and for a useful outside view of how professional-services firms make their money.

1. Expertise outsourced is expertise lost. Every contract that sends core thinking outside an organization weakens its ability to make the next decision on its own.
2. Watch the land-and-expand model. A cheap first engagement often leads to years of follow-on work, a pattern clients and investors in professional services should both recognize.
3. Conflicts are structural. Firms that advise governments, regulators and the companies they oversee all at once face incentives that disclosure rules rarely capture.
4. Confidence is the product. The authors argue that the industry's value rests heavily on credibility and polish, not on evidence that its advice improves outcomes.
5. Measure outcomes, not deliverables. Governments and boards should judge consulting work by what changed after the contract ended, not by the slide deck.

The book moves from history to diagnosis to remedy.

1. The rise of the consultocracy. The authors trace the spread of management consulting from corporate strategy into government, accelerating with the outsourcing and Third Way reforms of the 1980s and 1990s in the US and UK.
2. How the business works. Consultancies win trust by hiring former officials and elite graduates and by publishing research that looks academic. Their fees, the authors argue, often far exceed what in-house staff would cost.
3. What it costs clients. Repeated outsourcing hollows out the capabilities of ministries and companies, so they keep returning for advice they could once have produced themselves. Reforms often have to be redone.
4. Conflicts and reach. The same firms advise regulators and the regulated, governments and fossil fuel producers. The authors follow consultants into developing countries and into Puerto Rico after Hurricane Maria, where their advice favored privatization.
5. Remedies. The book closes with three proposals: mandatory disclosure of conflicts of interest, investment in public-sector skills, and better evaluation of what contracts actually deliver.

There is an entrenched relationship between the consulting industry and the way business and government are managed today that must change. Mariana Mazzucato and Rosie Collington show that our economies’ reliance on companies such as McKinsey & Company, Boston Consulting Group, Bain & Company, PwC, Deloitte, KPMG, and EY stunts innovation, obfuscates corporate and political accountability, and impedes our collective mission of halting climate breakdown.

The “Big Con” describes the confidence trick the consulting industry performs in contracts with hollowed-out and risk-averse governments and shareholder value-maximizing firms. It grew from the 1980s and 1990s in the wake of reforms by the neoliberal right and Third Way progressives, and it thrives on the ills of modern capitalism, from financialization and privatization to the climate crisis. It is possible because of the unique power that big consultancies wield through extensive contracts and networks—as advisors, legitimators, and outsourcers—and the illusion that they are objective sources of expertise and capacity. In the end, the Big Con weakens our businesses, infantilizes our governments, and warps our economies.

In The Big Con, Mazzucato and Collington throw back the curtain on the consulting industry. They dive deep into important case studies of consultants taking the reins with disastrous results, such as the debacle of the roll out of HealthCare.gov and the tragic failures of governments to respond adequately to the COVID-19 pandemic. The result is an important and exhilarating intellectual journey into the modern economy’s beating heart. With peerless scholarship, and a wealth of original research, Mazzucato and Collington argue brilliantly for building a new system in which public and private sectors work innovatively for the common good.