CONSULTING TOOLBOX

The Pyramid Principle - McKinsey Toolbox (with Examples)

Updated: Sep 20, 2023
The Pyramid Principle - McKinsey Toolbox (with Examples)

At McKinsey, one of the lessons we learned was the importance of constructing compelling arguments. But persuasive communication is not only relevant for consultants, it's essential to most corporate jobs. 

Yet, most people struggle with this. 


This article presents a simple framework you can use to solve this issue and make your communication a lot more effective. 
 

Picture this: It's Thursday afternoon, and you receive a message informing you that a 30-minute meeting with the CEO has been scheduled for TOMORROW so that you can present your strategy for the coming quarter. 

You know every detail of the strategy, but the coherent, persuasive narrative you need to bring your CEO on board is still only a few unstructured notes. 


Fear not; the Pyramid Principle comes to the rescue.

Barbara Minto

What is the Pyramid Principle? 

The Pyramid Principle was developed by Barbara Minto during her more than ten years at McKinsey. While at McKinsey, Minto noticed that people, in general, were terrible at constructing compelling arguments. Their arguments lacked structure and focused too much on presenting data and facts upfront. As a result, by the time they reached their final recommendation, the audience had already lost interest or become distracted by the details. 

Minto realized that unlike how you usually tell a good story, where you build suspense by delaying the resolution of a key issue until the very end, in a business presentation context you should do the exact opposite: Start with the answer. 


Your colleagues or stakeholders don't need to be entertained; they're busy and want to get things done. So, the simple solution is to start with the answer. 

This is what is known as the Pyramid Principle:

  1. Start with the recommendation/answer/solution upfront
  2. Back up that recommendation with a handful of supporting arguments
  3. Build trust in your arguments using supporting data

 

If you do this the structure of you argument ends up looking like a pyramid:

The pyramid principle by McKinsey

It's the exact opposite of what most of us are naturally drawn to — the upside-down-pyramid:

Reverse pyramid

Most people, consciously or unconsciously, tend to use to the upside-down pyramid when presenting complex information. This is how we think and process information. We build up to a conclusion by first reciting all of the facts, recounting all of the analyses that have been done, or reviewing all of the supporting ideas. Then, we get to the punch line. 

However, effective communication and thinking are not done in the same way. As Minto put it, "You think from the bottom up, but you present from the top down.".    
 

Lead with the answer  

At McKinsey, "lead with the answer" is drilled into every new hire. So, when an executive asks, "What should we do?", you should immediately respond with, "You should do X." Only after stating your conclusion should you delve into the reasons behind it. 
 

Why is this approach effective?

  1. Time Efficiency: Executives are constantly pressed for time and appreciate brevity. They're accustomed to digesting information swiftly and can become restless if they feel you're beating around the bush. By leading with your recommendation, you respect their time. Sometimes, they might already align with your conclusion, so this method lets them agree and move on without needing a lengthy justification.
  2. Big Picture Thinking: Most executives prefer a "top-down" approach. They prioritize overarching strategies over minutiae. Presenting your conclusion upfront aligns with this mindset, letting them quickly grasp your main point.
  3. Persuasiveness: Directness conveys confidence. When you state your recommendation assertively from the start, it underscores your conviction, making you more persuasive. It ensures you appear decisive and straightforward.

Let's look at an example:   
 

Before the Pyramid Principle

Hi (Manager),

I'm increasingly concerned about our customer churn rate in the car insurance division.

Look at the charts below showing our churn rate and revenue development over time and the forecasted car insurance churn and profitability for next year.

Data from Customer Service shows that churn is highly correlated with customer satisfaction, as seen here. Dissatisfied customers are reporting several reasons, listed and ranked in this table. As seen here, two sub-segments of customers account for 91% of the total churn.  

Finally, our exit surveys indicate that 72% of churning customers are switching to our competitor XYZ, who are increasingly aggressive in the market. A summary of their pricing, value proposition, and product offering can be seen in this table.

To address this situation, I propose we dedicate our next strategic planning session to devising effective churn reduction initiatives.

Let me know if you approve of this course of action. 

After the Pyramid Principle

Hi (Manager),

I propose we dedicate our next strategic planning session to devising effective churn reduction initiatives for the car insurance division. 

Here's why: 

1) Our customer churn rate is growing significantly faster than our division top line.

  • See this chart showing historical development in churn and revenue.
  • See this chart projecting our churn rate for next year.
  • See the projected impact on the overall division profitability. 

2) Customer dissatisfaction is causing churn.

  • Here's data from our Customer Service team showing a clear correlation between churn and dissatisfaction.
  • See the list and ranking of main drivers for dissatisfaction. 
  • See how the problem is isolated to two customer segments.

3) 72% of churning customers are switching to competitor XYZ

  • See this exit survey report
  • Here's a graph showing their growing ad spend and sales reps headcount.
  • Here is a one-pager summarizing XYZ pricing, value proposition, and product offering. 

I look forward to hearing your thoughts on this matter.

Can you see the difference? 
Suddenly, the ask is clear, and each following argument ties directly to it and strengthens it. The pitch is not only a lot more reader-friendly, but it's also way more persuasive and confident.


How to create effective presentations with the Pyramid Principle

When creating business presentations, "starting with the answer" translates to launching with a punch. Your initial slide should be a clear and well-structured Executive Summary, delivering the key takeaways, implications, or recommendations stemming from your analysis.

When you get into the details of your analysis, use the Pyramid Principle to lay out your proposed recommendation: answer first followed by supporting arguments.
 

Final notes

If you're interested in learning more, check out the original book by Barbara Minto. At Slideworks, we have applied the Pyramid Principle across many of our most popular slide decks - e.g., our Business Strategy and Business Case templates.

We recommend you try the Pyramid Principle when you are writing or presenting your next proposal, strategy presentation, or pitch. We are confident you will notice the difference.