Search Results for: Outside

After 30 Years of Silence, the Original NSA Whistleblower Looks Back

Longreads Pick

Adrian Chen tracks down Perry Fellwock, also once known as Winslow Peck, whose revelations were shared four decades ago in the radical magazine Ramparts magazine:

We set a new date: Noon on a Friday, at a bench outside the train station in Oceanside. Just as I was about to hang up he stopped me.

“Wait, I don’t think meeting at the train station is a good idea because that seems a little spookish,“ he said. ”I’m not a spook, so I don’t want to do anything spookish. Maybe you could meet me while I’m grocery shopping. What’s a normal thing we can do?”

I tried to think of things a 67-year-old antiques dealer and a 28-year-old journalist might normally do together. Grocery shopping was not high on the list. Fellwock came up with another plan: We would go to a Chinese restaurant near the train station and grab lunch.

Source: Gawker
Published: Nov 12, 2013
Length: 37 minutes (9,268 words)

The Non-Mysteries of the Female Orgasm

“My initial forays into oral sex were a crutch, a way of compensating for my sexual inadequacies, and they were approached with the assumption that cunnilingus was a poor man’s second to the joys and splendors of ‘real sex’–like many, I took it for granted that intercourse was the ‘right way’ for couples to experience orgasms. But, to my surprise, I discovered that the ‘way of the tongue’ was by no means inferior to intercourse; if anything, it was superior, in many cases the only way in which women were able to receive the persistent, rhythmic stimulation, outside of masturbation, necessary to achieve an orgasm. I quickly learned that oral sex is real sex, and later in life, when I happened to come across a copy of the seminal Hite Report on Female Sexuality, I was reassured to find that women consider oral sex to be ‘one of their most favorite and exciting activities; women mentioned over and over how much they loved it.’ When it comes to pleasure, there is no right or wrong way to have an orgasm–the only thing that’s wrong is to assume that women need or value them any less than men do.”

-From She Comes First: The Thinking Man’s Guide to Pleasuring a Woman, by Ian Kerner, Ph.D.. Read more in the Longreads Archive.

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Photo: ranieldiaz, Flickr

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Marriage, Equality and Household Chores

“RG: Sometimes when people talk about women and the workforce, they say a woman cannot truly be equal to a man unless she has her own income. What do you think?

“Mom: Well. Equality. What a word. When we choose go outside in the world, when we come home, we’re still mommy. The second shift starts. Equality doesn’t exist, period, even when you share the chores. Some days it can be 70/30 and other days it is 30/70. I don’t think that’s what we should be fighting for.

“RG: What should we be fighting for?

“Mom: Men participating more in the home, but it’s petty to say 50/50, because life doesn’t allow that.”

Roxane Gay’s interview with her mother about equality in marriage in The Hairpin.

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Photo: nostri-imago, Flickr

The A-Team Killings

Longreads Pick

Did U.S. Special Forces commit war crimes in Afghanistan? Matthieu Aikins investigates the discovery of 10 missing Afghan villagers who had been buried outside a U.S. base. Officials say a translator was solely responsible, but he and other witnesses say there’s more to the story:

I tell Kandahari that multiple witnesses claim to have seen him participate in abusive interrogations, and that another had seen him execute Gul Rahim, but he flatly denies ever killing anyone. He says that he had left Nerkh soon after Batson was injured, after quarreling with Kaiser. The Americans were trying to frame him for their own crimes, he says. “They knew what was happening,” he says. “Of course they knew. If someone does something on the base, everyone sees it. Everyone knows everything that’s going on inside the team.”

Source: Rolling Stone
Published: Nov 6, 2013
Length: 33 minutes (8,309 words)

Ingenious

Jason Fagone | Ingenious, Crown Publishing Group | November 2013 | 20 minutes (4,972 words)

 

Below is the first chapter from Jason Fagone’s book, Ingenious, about the X Prize Foundation’s $10 million competition to build a car that can travel 100 miles on a single gallon of gas. Thanks to Fagone and Crown Publishing for sharing it with the Longreads community. You can purchase the full book here. Read more…

“Circumstances in the Tenderloin are not normal. And San Francisco is not a normal city. Barring a seismic shift in city politics, the TL is not going to gentrify the way that similar neighborhoods have in other cities. Not next year. Not in five years. Maybe never. For better or worse, it will likely remain a sanctuary for the poor, the vulnerable, and the damaged—and the violence and disorder that inevitably comes with them. The thousands of working people, seniors, and families, including many Southeast Asians, who make up a silent two-thirds majority of the Tenderloin’s 30,000 residents will remain there. And so will the thousands of not-so-silent mentally ill people, addicts, drunks, and ex-cons who share the streets with them—as well as the predators who come in from the outside to exploit them. The Tenderloin will remain the great anomaly of neighborhoods: a source of stubborn pride for San Francisco, or an acute embarrassment—or both.”

-A look at the future of San Francisco’s Tenderloin neighborhood (via San Francisco Magazine). Read more about San Francisco in the Longreads Archive.

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Photo: markcoggins, Flickr

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Confessions of a Drone Warrior

Longreads Pick

From a windowless box in Nevada, Airman First Class Brandon Bryant helped pilot drones that killed over a thousand people as part of the U.S. drone warfare program:

Bryant’s laser hovered on the corner of the building. “Missile off the rail.” Nothing moved inside the compound but the eerily glowing cows and goats. Bryant zoned out at the pixels. Then, about six seconds before impact, he saw a hurried movement in the compound. “This figure runs around the corner, the outside, toward the front of the building. And it looked like a little kid to me. Like a little human person.” Bryant stared at the screen, frozen. “There’s this giant flash, and all of a sudden there’s no person there.” He looked over at the pilot and asked, “Did that look like a child to you?” They typed a chat message to their screener, an intelligence observer who was watching the shot from “somewhere in the world”—maybe Bagram, maybe the Pentagon, Bryant had no idea—asking if a child had just run directly into the path of their shot. “And he says, ‘Per the review, it’s a dog.’ ”

Source: GQ
Published: Oct 26, 2013
Length: 21 minutes (5,485 words)

‘Quebrado’: The Life and Death of a Young Activist

Illustration by Kjell Reigstad

Jeff Sharlet | Sweet Heaven When I Die, W. W. Norton & Company | Aug 2011 | 37 minutes (9,133 words)

 

Our latest Longreads Member Pick is “Quebrado,” by Jeff Sharlet, a professor at Dartmouth, contributing editor for Rolling Stone and bestselling author. The story was first published in Rolling Stone in 2008 and is featured in Sharlet’s book Sweet Heaven When I Die. Thanks to Sharlet for sharing it with the Longreads community. Read more…

The Making of McKinsey: A Brief History of Management Consulting in America

Duff McDonald | The Firm, Simon & Schuster | 2013 | 12 minutes (3,000 words)

 

The American Century

In 1941 Time Inc. publisher Henry Luce coined the term “American Century” in a Life magazine editorial. He was describing the country’s global economic and political dominance leading up to World War II. But Luce was also correct in the literal sense: The American Century had actually started several decades before.

The building of the railroads and coincident spread of the telegraph in the United States in the middle and second half of the nineteenth century helped create the world’s first truly “mass” markets. If an executive had ambition, his company didn’t have to serve just local customers. It could serve an entire continent and beyond, if it had the wherewithal to get the organization and logistics right.

The economic historian Alfred Chandler documented the momentous changes in what came to be known as the Second Industrial Revolution in his seminal book Scale and Scope—the title of which referred to the simultaneous revolutions in both scale (in manufacture) and scope (in distribution) in American enterprise. Those twin revolutions transformed the United States from an agrarian society to an industrial powerhouse in the span of a single generation. In 1870 the nation accounted for 23 percent of the world’s industrial production. By 1913 that proportion had jumped to 36 percent, exceeding that of Great Britain.

By 1920, when only a third of homes in the country had electricity and only one in five had a flush toilet, the country’s business establishment was embarking on a course of radical, unprecedented expansion. This brought with it a dilemma that has preoccupied business leaders ever since: how to grow big while maintaining control over the enterprise. Moving from a single-product, owner-run enterprise into a complex and large-scale national one is a difficult task. First, you have to build production facilities massive enough to achieve the desired economies of scale. Second, you have to invest in a national marketing and distribution effort to ensure that sales have a chance of matching that scaled-up production. And third, you have to hire, train, and trust people to administer your business. Those people are called managers, and in the first half of the American Century, they were in very short supply.

The benefits to successful first-movers were gigantic. In industries where only one or two companies took the plunge early, they dominated their field for a very long time to come; this group includes well-known names like Heinz, Campbell Soup, and Westinghouse. A ten-year merger mania, from 1895 through 1904, also brought the creation of a number of corporate entities the likes of which the world had never seen—1,800 companies were crunched into 157 megacorporations, including stalwarts like U.S. Steel, American Cotton, National Biscuit, American Tobacco, General Electric, and AT&T.

The key business problem identified during this transition—and one that underwrote McKinsey’s success for several decades—was that a single, central office could no longer adequately administer such far-flung empires. Power had to be ceded to the extremities. The question was how. It was a quandary that beguiled some of the great thinkers of the time, including political scientist Max Weber, who argued that a systematic approach to marshaling resources through bureaucracy was a necessary and profound improvement over pure charismatic leadership.

In his book American Business, 1920–2000: How It Worked, Harvard professor Thomas McCraw pinpointed the issue: “In the running of a company of whatever size, the hardest thing to manage is usually this: the delicate balance between the necessity for centralized control and the equally strong need for employees to have enough autonomy to make maximum contributions to the company and derive satisfaction from their work. To put it another way, the problem is exactly where within the company to lodge the power to make different kinds of decisions.”

Companies such as DuPont, General Motors, and Sears Roebuck were the first to address this problem systematically. According to Chandler, DuPont sent an emissary to four other companies experiencing similar issues—the meatpackers Armour and Wilson and Company, International Harvester, and Westinghouse Electric—to ask what they were doing. And the answers were remarkably similar: The innovators moved from the centralized system to a multidivisional structure with product and geographic breakdowns. The concept left operating division chiefs with total control over everything except funding resources. Top managers took a more universal view of the business, monitoring the divisions and allocating capital accordingly.

The most successful companies of the era, such as General Electric, Standard Oil, and U.S. Steel, all employed some variant of this model. But by and large, they had developed these ideas on their own, a process of trial and error that was costly and time consuming. They would have much preferred hiring outside experts to help them with it, if only such experts existed. This was a huge commercial opportunity that called for an entirely new kind of service.

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Stepping into the Breach

Unwittingly, the federal government did its part to create the modern consulting business. Starting in the last part of the nineteenth century, Washington made periodic regulatory efforts to curb the power of big business, including the 1890 Sherman Antitrust Act, the Federal Trade Commission Act and Clayton Act of 1914, and the Glass-Steagall Act of 1933. The intended effect of these measures was to prevent corporations from colluding with one another to fix prices and otherwise manipulate the markets. The unintended effect, according to historian Christopher McKenna, was to accelerate the creation of an informal—but legal—way of sharing information among oligopolists. Who could do that? Consultants.

Regulatory efforts paid another rich benefit to the likes of McKinsey: Restricted from cutting backroom deals with each other, firms were thus obliged to actually compete, which meant they needed to make their operations more efficient. Here again, consultants were the answer.

But perhaps the circumstance that most aided the creation of the consulting industry was the entry of a new, key player into business itself. Empire builders with names like Carnegie, Duke, Ford, and Rockefeller had built huge, vertically integrated companies, but they had neither the time, the talent, nor the inclination to create and carry out management systems for those entities. These were the conquerors of capitalism, not its administrators. And yet, as Chandler pointed out, “their strategies of expansion, consolidation, and integration demanded structural changes and innovations at all levels of administration.”

Into the breach stepped a new economic actor who was neither capital nor labor: the professional manager. Gradually, he replaced the robber baron as the steward of American business. Alfred P. Sloan, the legendary president of General Motors, was the first nonowner to become truly famous for his managing skills. His decentralized, multidivisional management structure gave GM the agility to outmaneuver the more plodding Ford Motor Company and snatch the industry lead. Ford may have revolutionized manufacturing, but Sloan realized that the car-buying market had become big enough to be segmented into people who bought Buicks, Cadillacs, Chevrolets, Oldsmobiles, and Pontiacs. By the late 1920s, the car market was maturing, and people wanted choice. Sloan also gave them the ability to buy a car on credit—a groundbreaking idea at the time. Before the decade was over, GM had surpassed Ford as the market share leader, a position it didn’t relinquish until the 1980s.

Sloan and his ilk were perfect customers for McKinsey: Lacking the legitimization of actual ownership, professional managers felt great pressure to show they were using cutting-edge practices. And who better to bring those practices to their attention than consultants who were talking to everyone else? This was the beginning of a decades-long separation of ownership from control in corporate America, and the consultant was an able ally to the professional manager in this tug-of-war—an ally who wasn’t gunning for the manager’s job. Thus began the era of managerial capitalism.

For more than two centuries, economists had argued that companies operated in some sense at the mercy of Adam Smith’s “invisible hand” of the market. But the revolution in management thinking in the United States offered up an alternative idea: the “visible hand” of management, which made things happen, as opposed to merely responding to external market forces.

The academy helped move this ideology along. Before 1900, there was only one undergraduate business school in the country, the University of Pennsylvania’s Wharton School of Finance and Economy, founded in 1881 with a $100,000 donation from financier Joseph Wharton. The Tuck School of Business at Dartmouth followed in 1900. Over the next decade, pretty much every major institution started explicitly preparing its students for careers in management.

Although the rise of today’s industrial-farm-style MBA programs is really a postwar phenomenon, Harvard founded its Graduate School of Business Administration in 1908, with a second-year business policy course designed to give the student an integrative approach to addressing business problems, including accounting, operations, and finance. The purpose of the course, according to the school, was to give the student an ability to see those problems from the top management point of view. Much of James McKinsey’s academic writing centered on this very issue and later informed the practice of his firm.

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McKinsey’s Oeuvre

As a young academic, McKinsey was a prolific writer, if not an especially engaging one. His first four books were dry tomes on the nitty-gritty of accounting and taxes: Federal Incomes and Excess Profits Tax Laws (1918), Principles of Accounting (cowritten with A. C. Hodges, 1920), Bookkeeping and Accounting (1921), and Financial Management (1922). But with his fifth effort, he broadened his horizons significantly. Budgetary Control (1922)—the first definitive work on budgeting—turned accounting on its head, promoting it as an essential tool of managerial decision making. “Budgetary control involves the following,” McKinsey wrote. “1. The statement of the plans of all the departments of the business for a certain period of time in the form of estimates. 2. The coordination of these estimates into a well-balanced program for the business as a whole. 3. The preparation of reports showing a comparison between the actual and the estimated performance, and the revision of the original plans when these reports show that such a revision is necessary.”

It seems commonsensical, but McKinsey’s new way of looking at the use of the budgeting process sparked nothing short of a revolution. “No other mechanism of management of similar scope and complexity has ever been introduced so rapidly,” wrote one commentator just ten years later. “It is estimated that 80 percent of budgets installed in industry have been put in since 1922.”

Up to that point, budgeting was a one-way exercise: Accountants added up all of a firm’s expenses and then tossed in a sales projection almost as an afterthought. In McKinsey’s view, companies should start by developing their business plan, figure out how to achieve it, and then estimate the costs of doing so. In this new context, budgeting wasn’t just a ledger activity; it could also be used to identify excellence in performance (i.e., those who outperform their budget), to spot weaknesses (those who underperform), and to take corrective action. “[While] there are many who do not yet plan scientifically … ,” he wrote, “there are few who will deny the merits of the system.”

Two subsequent books fleshed out McKinsey’s ideas: 1924’s Managerial Accounting and Business Administration. The former taught students how accounting data could be used to solve business problems. Using the data of traditional recordkeeping, he suggested the possibility for much greater control over a company’s destiny, including the establishment of standard procedures (how things should be done and to whom information should be reported), financial standards (ways to judge operating efficiency), and operating standards (including nonfinancial measures, such as quality). To today’s business student, this kind of comprehensiveness seems obvious. But at the time, the idea of planning, directing, controlling, and improving decision making by means of regular and rigorous reporting of company results was novel. The latter book contained the seeds of McKinsey’s General Survey Outline—a thirty-page system for understanding a company in its entirety, from finances to organization to competitive positioning. It became part of his consultants’ toolkit sometime in the early 1930s.

It is hard to overestimate the impact of the General Survey Outline (GSO). It served as the foundation of his approach to understanding a company and provided novice consultants with a clear road map to do so themselves. The survey also shaped consultants’ thinking: The emphasis in the GSO was more on whymanagers did things, as opposed to how they did them. Using the GSO, consultants started every engagement by thinking of the outlook for the industry of their client, the place of the client in the industry, the effectiveness of management, the state of its finances, and favorable or unfavorable factors that might affect the future of the firm. No detail was too small to take note of, whether it was a study of all firm policies—including sales,production, purchasing, financial, and personnel—or an analysis of whether the layout of equipment in a company’s plant provided for the most efficient flow of the production operations. By the time the young consultant had completed the survey for his client, he knew the company and its business cold.

“You can see McKinsey’s intellectual development,” says John Neukom, who worked at McKinsey from 1934 to the early 1970s and wrote a brief memoir of his time at the firm. “He had lost interest in the details of accounting. By the time I arrived, he had lost interest in the budgetary procedure and was now excited and interested in analyzing companies and seeing how companies worked. He was clearly diagnosing the total problems of the company.” In a 1925 speech at a conference for financial executives in New York, McKinsey offered the kind of pointed insight for which he is remembered: “Usually, I find that the executive who says he does not believe in an organization chart does not want to prepare one because he does not wish other people to know that he had not yet thought through his organization properly. For the same reason many men are opposed to budgets. They are unwilling for anyone to see how little they have thought about what they are going to do in future periods.”

Armed with that insight—and the general philosophy that management can shape a company’s destiny—he decided to set up shop and sell it.

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Bastards Require No Diplomacy

In the mid-1920s, McKinsey began doing business under the banner of James O. McKinsey and Company, Accountants and Management Engineers, the progenitor of the modern-day McKinsey & Company. Strangely for a company that prides itself on getting the details right, the actual date of its founding is unknown—a firm training manual from 1937 suggests 1924, while John Neukom’s memoir says 1925. Whichever it was, McKinsey’s timing was excellent. The economy was booming, and the need for consulting services was seemingly endless.

It is worth noting that the word “consultant” was not in the name of his firm. Rather, the term “management engineers” reflected the prevailing ethos of the time: that science held the answers to most serious questions, and even human commerce could profit from the rigors of this kind of data-driven analysis. McKinsey’s standard working pads have always been crosshatched graph paper, another nod to engineering. The fact that McKinsey himself employed no actual engineers was beside the point.

Intellectual underpinnings aside, the firm’s real-world roots were in red meat. McKinsey’s first client was Armour & Company, one of the country’s largest meatpackers. The treasurer of Armour had read Budgetary Control and wanted McKinsey to help rethink the meatpacker’s approach to budgeting and planning.

The first partner McKinsey brought on board was A. Tom Kearney, who had been director of research at Swift & Company, another Chicago meatpacker. Kearney was a warmer, more congenial complement to McKinsey’s formal and pointed demeanor. Another early partner was William Hemphill, the same treasurer of Armour who had hired McKinsey in the first place.

McKinsey continued to teach at the University of Chicago for a time, but he eventually switched full-time to the firm. One reason he seems to have juggled so many responsibilities is that he didn’t waste time with niceties at the office. In Hal Higdon’s 1970 history of consulting, The Business Healers, one associate recalled him saying: “I have to be diplomatic with our clients. But I don’t have to be diplomatic with you bastards.”(Marvin Bower later modeled his own approach to constructive criticism after McKinsey’s tough love approach.)

McKinsey was blunt, but he was also a quick and agile thinker. He once diagnosed a client’s problems just by looking at the company’s letterhead. A Midwestern maker of air conditioners had stationery that announced “Industrial Air Conditioning Installations—Coast to Coast from Canada to Mexico.” In an era before salespeople traveled by airline, McKinsey observed that travel expenses were probably eating up the majority of the company’s profits and that employees should confine themselves to a radius of five hundred miles around Chicago. He was right.

Even the Depression couldn’t stop the growth of the firm. By 1930, McKinsey’s professional staff totaled fifteen. In 1931 he drafted the General Survey Outline, and the next year he opened a New York outpost in the offices of a defunct investment house at 52 Wall Street—six offices with a reception area. The New York–based consultants busied themselves working not only for local industrial companies but also for investment banks like Kuhn, Loeb & Co. In 1934, the Chicago office moved to the forty-first floor of the new Field Building on 135 South LaSalle. By the mid-1930s, McKinsey’s partners were charging $100 a day for their services—a giant figure, though nothing compared with the founder himself, who was billing five times that, the highest rate for a consultant in the country.

From The Firm by Duff McDonald. Copyright © 2013 by Duff McDonald. Reprinted by permission of Simon & Schuster, Inc.

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Illustration by Kjell Reigstad

Syria’s News Smugglers

Longreads Pick

Who’s really covering Syria—and who’s funding them? Shaer meets the citizen journalists and upstart news organizations reporting on the civil war, and raises questions about what’s motivating their work:

"One of the reporters changed the channel on a nearby television to CNN. ‘Every Western media organization had an agenda,’ said Mohammed. ‘CNN is always talking about ISIS, Al Nusra, Islamists, Al Qaeda. But they never talk about humanitarian aid.’

“Earlier, when I had asked Mohammed what he wished to see in Syria, he had answered quickly: ‘A modern Islamic state.’ But when I pointed out that Nashet also had an agenda, the room grew hushed and tense. ‘CIA,’ a reporter sitting behind me whispered accusingly. Sami motioned me to leave. Outside, he remarked, ‘You can’t have that kind of place if you don’t have a backer with a big agenda.’”

Published: Oct 21, 2013
Length: 15 minutes (3,892 words)