McKinsey & Company

The advent of steam power in the late 18th century utterly transformed manufacturing, transportation, and construction. A new kind of upheaval is already under way—one that will energize all language-based capabilities, including communication, reasoning, analysis, sales, and marketing. In this episode of the At the Edge podcast, Reid Hoffman, a partner at venture capital firm Greylock Partners, and cofounder of LinkedIn and Inflection AI, speaks with McKinsey’s Lareina Yee about…

A hand with bright yellow nails reaches for the handle of a blue suitcase.All aboard! After the pandemic upended life and leisure as we know it, travel is roaring back. The industry is set to make a full recovery by the end of 2024, after losing 75 percent of its value in 2020. Much of this has been so-called “revenge travel,” or people embarking on international or bucket list trips…

Most large corporations have annual processes to allocate capital and other resources across business units and for strategic initiatives enterprise-wide. The typical practice is to begin with a strategy or “strategic refresh,” develop a long-term (three- to seven-year) financial plan, and lay out a highly detailed budget for the first year of the plan. Unfortunately, the processes are often both muddled and rigid; they typically take months to iterate, generate…

In this edition of Author Talks, McKinsey Global Publishing’s Mike Borruso chats with Elspeth Kirkman, chief program officer at Nesta, about her new book, Decisionscape: How Thinking Like an Artist Can Improve Our Decision Making (MIT Press, March 2024). Kirkman draws parallels between how artists create and how we make choices in our everyday lives. The book challenges us to understand why we make certain decisions and calls for us…

This article is one of McKinsey’s contributions to the Global Lighthouse Network’s latest white paper, published on December 14, 2023. The first article in this series explored the evolution of AI and how leading manufacturers have harnessed it to propel leading-edge manufacturing from the learning phase to the doing phase of the Fourth Industrial Revolution (4IR). The second article examined what artificial intelligence looks like among today’s leading manufacturers. This final installment…

For all the impressive revelations and technical feats unleashed by the sudden emergence of generative AI (gen AI), one of the most astounding aspects has been the accelerated pace of its adoption, particularly by businesses. Consider that large global enterprises spent around $15 billion on gen AI solutions in 2023, representing about 2 percent of the global enterprise software market. To put that level of growth in perspective, it took…

Payers currently face economic pressures that are likely to last a few years. Utilization of medical services has been higher than expected, providers are passing along higher costs through rate negotiations, and Medicare Advantage reimbursement rates are facing the most substantial downward pressure that payers have seen in years. In the face of these issues, artificial intelligence and automation present untapped opportunity for payers. The opportunity is sizable and available…

American shipbuilding has reached a critical inflection point—can supply keep up with demand? The US Navy, the industry’s principal customer, increased its shipbuilding budget by 12.5 percent per year from fiscal year 2020 to fiscal year 2024, and its most recent 30-year plan calls for the construction of 290 to 340 new ships by 2053. Beyond this domestic demand, there is additional demand to meet the anticipated needs of the…

Demand for luxury tourism and hospitality is expected to grow faster than for any other industry segment. This growth is being powered in part by a sharp rise in the number of individuals globally with net worths between $1 million and $30 million. But it’s also resulting from a large and expanding base of aspiring luxury travelers with net worths between $100,000 and $1 million, many of whom are younger…

After falling by 75 percent in 2020, travel is on its way to a full recovery by the end of 2024. Domestic travel is expected to grow 3 percent annually and reach 19 billion lodging nights per year by 2030. Over the same time frame, international travel should likewise ramp up to its historical average of nine billion nights. Spending on travel is expected to follow a similar trajectory, with…

As destinations and source markets have changed, tourism and hospitality companies have evolved too. Six key trends have shaped business models in this sector over the past decade. In accommodation, asset-light models like franchising and management have proliferated, though luxury and small-scale brands are opting out. Consolidation has driven economies of scale. Hotels are looking to reclaim their relationship with guests, and almost two decades in, home sharing is charting…

Tourism can help build a more connected, more vibrant world. But as tourism grows rapidly, the most visited destinations are experiencing more concentrated flows (Exhibit 1). Recent satellite data suggests that 80 percent of travelers visit just 10 percent of the world’s tourist destinations. The number of travelers and the frequency of their trips are only set to increase. A large flow of tourists, if not carefully channeled, can encumber…

What sorts of journeys do today’s travelers dream about? Where would they like to go? What do they hope to do when they get there? How much are they willing to spend on it all? And what should industry stakeholders do to adapt to the traveler psychology of the moment? To gauge what’s on the minds of current-day travelers, we surveyed more than 5,000 of them in February and March…

The McKinsey Global Institute aggregated a richly granular data set of micro-, small-, and medium-size enterprises (MSMEs) and large companies across 12 broad sectors, 68 level-two subsectors, and more than 200 level-three subsectors for 16 countries that account for more than half of global GDP. In these countries, MSMEs on average have only half the productivity of large companies, and less than that in emerging economies. Raising MSMEs to top-quartile…

For all the financial, operational, and market challenges incumbent telecom operators have faced over the past decade-plus, they still retain real competitive advantages in their efforts to spur renewed growth. Global brand recognition, a large customer base, a rich data set, and a broad array of sales channels are all vital assets they can leverage for success. But telcos won’t likely be able to realize these advantages unless they are…

This interview is part of the Leading Asia series, which features in-depth conversations with the region’s most influential leaders on what it takes to lead in Asia today.Asia–Pacific’s changing demographics, growing middle class, and insurance protection gaps are just a few trends shaping opportunities and challenges in the region's life and health insurance markets. There is clearly ample room for sustained growth in these markets. Lee Yuan Siong, AIA group…

Making great products is not enough in software these days. The “build it, and they will come” mindset will no longer lead to success in this ever-competitive space. As software products become more sophisticated and customers more discerning, the path to market acceptance has become much more complicated. Companies need different capabilities to navigate this more challenging environment, with sustainable success increasingly requiring a role devoted to understanding and priming…

In this episode of McKinsey on Building Products, a podcast dedicated to the exploration of software product management and engineering, McKinsey partner Rikki Singh spoke to Dr. Ya Xu, vice president of engineering and head of data and AI at LinkedIn. They discuss strategies engineering leaders can undertake to prioritize AI use cases, advance the development of AI technologies, and weave AI initiatives into the fabric of the company’s culture.…

The apparel and footwear industry’s standard playbook for managing global supply chains has been overtaken by recent events and rising complexity. The sprawling footprint of global supply chains was supposed to the lower the chance for disruption, but the pandemic and resulting dramatic demand shifts punctured that veil. With volatility looking more and more like the rule rather than the exception, brands face the task of reimagining their supplier strategies—and…

The promise and peril of cloud is a common refrain in many C-suites: huge economic potential and regularly underperforming reality. What’s much less clear, however, is what to do about it.Out of the more than 80 enterprises McKinsey profiled for its CloudSights database, 40 percent have found limited value in their cloud programs. In addition, half of companies five or more years into their cloud journey still have not achieved…

Fueled by record-high investment from semiconductor players and once-in-a-generation federal backing, semiconductor manufacturing capacity is poised for a massive expansion in the United States. This strategy aims to rebalance the country’s supply and demand profile to establish greater autonomy in semiconductor manufacturing, design, and intellectual property rights; as the US secretary of commerce has stated, one of the goals is to propel the United States to produce 20 percent of…

Advances in AI have accelerated dramatically over the past two years, marked by an ability to design, train, and—most important—run AI at a large scale and for many millions of users. AI’s potential impact spans sectors and could deliver positive social change. In fact, AI is already being used to further all 17 UN Sustainable Development Goals (SDGs)—from the goal of eliminating poverty to establishing sustainable cities and communities and providing…

Eric Kutcher, a senior partner at McKinsey, talks to the chief executive officers of two of Indonesia’s largest telecommunications providers—Ririek Adriansyah, chief executive officer of PT Telkom Indonesia Tbk (Telkom), and Vikram Sinha, president director and chief executive officer of Indosat Oredoo Hutchinson (Indosat or IOH). Referencing the diversity of a country that consists of thousands of islands, they talk about the challenges of creating an inclusive society and how…

In this episode of McKinsey on Building Products, a podcast dedicated to the exploration of software, product management, and engineering, McKinsey partner Rikki Singh talks to Kareem Yusuf, senior vice president of product management and growth at IBM. Throughout his career, Yusuf has worked across disciplines to sharpen his product management skills and has led IBM in creating platforms for companies to improve their sustainability practices. In their conversation, Singh…

Nonstop disruption. We have all lived through it the past several years: a global pandemic, geopolitical and economic instability, and the rise of new technologies such as generative AI (gen AI). This increasing pace of change, coupled with the anxiety of prolonged uncertainty, has created a situation in which companies can’t afford to keep doing business as usual. Indeed, workers have sent a clear message that they are disengaged to…

Midsize companies don’t dominate the headlines and investor attention the way corporate behemoths do, but they are the economic engines of many countries and a vital part of the global business ecosystem. The world’s 50,000-plus midcap companies—which we define as organizations with $200 million to $2 billion in revenue—represent more than 40 percent of the global workforce and account for approximately one-third of most economies’ GDP. These companies play a…

In just two years, the debit card has replaced cash as the preferred payment method among Spanish-speaking Latin Americans, and mobile payments have quickly gained ground, too, particularly in countries such as Argentina and Peru.Those are some of the key findings from our two comprehensive payments surveys polling more than 15,000 people in Spanish-speaking Latin America in 2021 and 2023. Respondents to our 2023 survey overwhelmingly indicated that they prefer…

Speaking up is vital to advancing meaningfully in our careers—yet many of us have made a habit of keeping quiet. In this edition of Author Talks, McKinsey Global Publishing’s Lucia Rahilly chats with Elaine Lin Hering, author, facilitator, and speaker, about her new book, Unlearning Silence: How to Speak Your Mind, Unleash Talent, and Live More Fully (Penguin Random House, March 2024). Hering explores why we often choose silence, how…

Anant Bhalla became chief executive of American Equity Investment Life (AEL) in March 2020, a turbulent time as COVID-19 was spreading around the world. When he joined AEL, which was founded in the mid-1990s and based in West Des Moines, Iowa, the company was the last big independent seller of fixed-indexed annuities in the United States. Its specialty is using its insurance and investment underwriting capabilities to promise customers the…

A year of strong funding coupled with sturdy underlying fundamentals and significant technological advances reflected strong momentum in quantum technology (QT). Updated McKinsey analysis for the third annual Quantum Technology Monitor reveals that four sectors—chemicals, life sciences, finance, and mobility—are likely to see the earliest impact from quantum computing and could gain up to $2 trillion by 2035 (see sidebar “What is quantum technology?”). Private and corporate funding for quantum technology…

The US film and television industry has an unmatched influence on popular culture and broader attitudes. The stories it tells and the trends it sparks reverberate in every corner of the country. By many outward measures, the influence of the Asian and Pacific Islander (API) community on the film and television industry has never been greater. On-screen, for example, Everything Everywhere All at Once took top honors during the 2023…

Global preconceptions about Japanese organizations have often resulted in their potential being overlooked. Yet, as discussed by Naoyuki Iwatani and Michele Raviscioni, McKinsey senior partners and co-authors of the Japanese-language book, Unlocking the Full Potential of Japanese Corporates, the strengths of Japanese corporations are numerous, ranging from focused customer orientation, employee loyalty, management resilience, and soft power. By changing mindsets that hinder growth, taking full advantage of their strengths, and…

By 2050, carbon dioxide removal could be a $1.2 trillion industry. On this episode of The McKinsey Podcast, McKinsey senior partner Mark Patel joins editorial director Roberta Fusaro to discuss McKinsey’s recent report about the business of carbon dioxide removal and how it could play a vital role in responding to hard-to-abate emissions in various sectors.In our second segment, Black Americans are especially vulnerable to the effects of climate change. McKinsey partner…

The speed of battery electric vehicle (BEV) uptake—while still not categorically breakneck—is enough to render it one of the fastest-growing segments in the automotive industry. Our projections show more than 200 new battery cell factories will be built by 2030 to keep up with rising demand. Overall, the market for cell components—comprising cathodes and anodes, separators, electrolytes, and cell packaging—is expected to grow by 19 percent per annum until 2030,…

In this episode of the McKinsey Global Institute’s Forward Thinking podcast, co-host Janet Bush talks with Ed Glaeser. Glaeser is the Fred and Eleanor Glimp Professor of Economics and the chairman of the Department of Economics at Harvard University, where he has taught since 1992. His latest book, coauthored with health economist David Cutler, is Survival of the City: The Future of Urban Life in an Age of Isolation, written…

Peak disease burden for chronic physical health conditions typically occurs in an individual’s 50s and 60s, whereas the prevalence of mental and substance use disorders peaks much earlier—in an individual’s 20s or 30s. About half of all mental disorders appear by age 14, and three-quarters by age 24. When left untreated, these conditions can negatively affect lives and livelihoods. That’s why early diagnosis and intervention are critical for adding years to…

In this episode of Talking Banking Matters, payments industry expert and McKinsey partner Roshan Varadarajan talks with Johnny Ayers, the founder and CEO of the digital identity verification and fraud prevention company Socure. As digital payments and commerce continue to expand throughout every facet of the economy, digital identity verification and fraud prevention are increasingly critical safeguards. The following edited transcript shares highlights from the conversation. For more discussions on…

US healthcare leaders are actively pursuing innovative business models, including both vertical integration and pure-play specialization (Exhibit 1). However, the growth rates of these business models have diverged in the past few years. While no organization focuses on just one of them, business models that emphasize vertical integration have produced the strongest growth in the past few years, our research finds (Exhibit 2). Much opportunity remains across all types of…

Canada’s financial-services industry seems to be a textbook case of an industry primed for disruption by fintech. First, its banking industry is large compared with other G-7 countries. Banking revenues of $180 billion accounted for 7.9 percent of GDP in 2023, compared with 5.8 percent in the United States and an average of 5.6 percent among other developed economies. Canadian banks are also more profitable than those in other developed…

Many companies turn to transformation because their leaders seek to capture untapped potential or realize growth or efficiency gains. Yet transformations take work to get right. Our research shows less than a third of transformations reach their goals to improve organizational performance and sustain these improvements over time. In this episode of the Inside the Strategy Room podcast, we talk with two transformation experts about how to beat those odds…