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Productivity – the amount of output each worker produces – is the core of our shared global prosperity and as the world wrestles with shifting geoeconomics, it matters more than ever. Asia has experienced a productivity surge in recent years, but cannot afford to be complacent if the region’s economies are to continue closing the gap with their advanced counterparts.Recent McKinsey Global Institute research, Investing in productivity growth, shows that…

Health systems around the world are facing a host of challenges, including rising costs, clinical-workforce shortages, aging populations requiring more care (for example, to treat chronic conditions), and increasing competition from nontraditional players. At the same time, consumers are expecting new capabilities (such as digital scheduling and telemedicine) and better experiences from health systems across their end-to-end care journeys. In response, health systems are increasing their focus on digital and…

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…