For example, they advise executives to do what they already want to do (layoffs and increased executive compensation) and thus justify that decision (blame outsourcing).

A more generous take: when a business or project is stagnating due to bad management and communication, almost any advice that leads to change improves the situation. Especially when the situation is such due to some "principal actor" type issues, introducing more actors with different inscentives can rebalance things in the short term.

The most common one is that leadership wants to make a change but some people won't like it so it's easier to have a consulting firm work out the details, make the recommendation and then leave. Even when the outcome is predetermined, the details still matter, and McKinsey adds credibility.

Also, you can obtain more information about what your competitors are doing in that area, not like illegal levels of information, just, more than you have without them.

Make no mistake, these are all valuable services that large companies will pay a lot of money for.

The obvious point of comparison is security consultants. A security consultant knows a lot less about your product than your engineers do, but that's precisely why they're helpful - they bring an outside, generalist perspective that isn't bogged down by all the arguments you've accreted over the years about why X component has to be structured in Y way and there's no need for a security boundary around Z.

Probably because management can CYA by claiming to have done due diligence to their higher ups. "Well, we consulted McKinsey and took their advice, so if they got it wrong, then the industry is getting it wrong."

(These are the same guys that tell countries with successful agricultural sectors to embrace corporate farming. Cui bono?)

For certain problems, it will be people having looked at the same problem many times/speaking to industry leaders frequently, the junior people drawing slides etc. are not why you'd hire them.

McKinsey's product is McKinsey services.

Imagine all the effort that goes into marketing, networking, and greasing the wheels of business that goes into selling this and you'll more readily appreciate why McKinsey keeps appearing in spots they have no business being involved in. Their product isn't a good or sound outcome, it's paying the fee to be able to append "McKinsey said..." onto a decision.

Same reason kings hired bishops.