Only McKinsey Perspectives

The fashion industry is a major contributor to climate change and biodiversity loss, making its sustainability efforts crucial for the planet’s health.

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Fast-fashion retailers compress production cycles, enabling shoppers to expand their wardrobes quickly and cheaply.

This year’s Women in the Workplace report reveals some hard-fought gains at the top, with women’s representation in the C-suite at the highest level it has ever been.

To succeed with succession planning, boards must recognize and address their tendencies toward similarity bias.

By identifying where workers fall on a satisfaction spectrum, employers can help boost morale and motivate employees.

Generative AI, a form of AI that uses algorithms to create content, has come a long way since ChatGPT burst on the scene in 2022.

The much-coveted CEO role is the pinnacle for many talented senior executives. To secure the top job, candidates need foresight, boldness, and humility. However, it’s important for aspiring CEOs to examine their motivations and determine whether they’re sustainable. Otherwise, CEOs will be less likely to succeed, explain McKinsey senior partners Carolyn Dewar, Scott Keller, and Vikram Malhotra—coauthors of the New York Times best-selling book CEO Excellence: The Six Mindsets That Distinguish the Best Leaders from the Rest—and Kurt Strovink.

In the latest McKinsey Global Survey on economic conditions, executives’ outlook on domestic conditions in most regions has become more hopeful.

Financial institutions that use centralized gen AI operating models are reaping the biggest rewards.

To be successful, energy companies should be agile, efficient, and fast—all while operating in an industry for which talent is scarce, potential M&A is looming, and generative AI is poised to shake things up.

CEOs across industries say that M&A is a more vital strategy than ever.

It’s not the glass ceiling that holds women back from advancing their careers; it’s the broken rung, according to McKinsey and LeanIn.Org’s 2023 Women in the Workplace report.

After decades of thinning out middle management, organizations are investing more in the leaders that they have.

Succession planning is crucial for CEOs, but it can get short shrift as leaders get caught up in the day-to-day grind.

For 2024, McKinsey’s knowledge collaborations with WEF are intended to foster global cooperation for sustainable, inclusive growth.

Squeezed between executives and frontline workers, middle managers are a critical yet often neglected group.

Resilient and adaptable, family-owned businesses—companies in which founders or descendants hold significant share capital or voting rights—have survived and thrived for decades.

A substantial number of knowledge workers would prefer to resign or accept a pay cut rather than come into the office more.

McKinsey—through the media company Circana, which develops the lists—offers the most comprehensive resource available to explore the business books currently most popular in the US.

The relationship between CEOs and CMOs, particularly how CEOs and CMOs both define marketing’s role in shaping growth strategy, is highly correlated to their companies’ performance.

If and when Web3 fully arrives, it will signal a new era of the internet, one in which community-run networks control use and access.

For the first time, women leaders are voting with their feet; they’re leaving their jobs for more fulfilling work in unprecedented numbers, adds Krivkovich.

After years of McKinsey research on transformations, some persistent truths remain: a comprehensive approach to change is best, and the value at stake is incredibly high—and easy to lose.

Prompt engineering will likely become a larger hiring category in the next few years.

Is it possible for the world to return to an era of productive growth?

By 2030, gen AI could enable automation of up to 70% of business activities, adding trillions of dollars in value to the global economy, McKinsey research shows.

For global companies, China’s skilled labor force, extensive supplier ecosystem, and fast-growing domestic markets have long acted as a magnet for manufacturers.

As labor costs have increased and worker productivity has declined, companies are struggling to find objective ways to gauge employee effectiveness.

The COVID-19 pandemic broke traditional models of employment, says Leena Nair, former CHRO of Unilever.

In all 15 countries surveyed by McKinsey, toxic workplace behavior was the biggest predictor of burnout symptoms and intent to leave—by a large margin.

Under former president and CEO Mark Thompson’s watch, the New York Times’s digital readership jumped from half a million to nearly 5.7 million subscribers.

The hotel of the future is a place where “every single pain point will be removed” and almost every aspect of your stay will be personalized to your tastes.

Many US employers are speeding up adoption of automation technologies. Generative AI is extending the possibilities for automation to a much wider set of careers.

Our annual summer reading list reflects today’s evolving times, with selections by CEOs, founders, and editors from around the world, including picks from McKinsey leaders.

As India faces a rapidly changing physical environment, extreme heat and humidity could put millions of lives and billions of dollars at risk.

Today’s generative AI boom offers a unique chance for CIOs and CTOs to guide the C-suite in turning the promise of generative AI into sustainable value for the business.

As multiple generations work side by side at the office, people are paying more attention to age-based differences, explain partner Bryan Hancock and McKinsey alumnus Bill Schaninger on an episode of the McKinsey Talks Talent podcast.

Real estate in the world’s superstar cities—places that claim a disproportionate share of urban GDP and GDP growth—faces tough challenges. How long could the pain last?

Organizations with top-performing managers yield stronger shareholder returns than those that don’t, McKinsey research reveals.

Social media has four primary functions for businesses, including using social channels to respond to consumer requests.

Generative AI is particularly good at generating personalized content and communication, due to its ability to analyze customer characteristics, behavior, and preferences.

Capturing the full value of operating as one firm—which emphasize a collective identity, working in teams, and shared decision making—is elusive for most.

Moving away from private-car use—which contributes to road congestion and increased carbon emissions—and toward shared mobility could create a more seamless and sustainable mobility ecosystem.

Many children under five have traumatic experiences that affect their physical, emotional, and cognitive development, says Sesame Workshop’s Jeanette Betancourt.

Uncertain times call for leaders who can make their organizations more resilient—and cultivate resilience within themselves.

A new McKinsey Health Institute survey finds that respondents largely agree about the importance of having purpose, managing stress, enjoying meaningful connections, and preserving independence.

While interacting might be easier than ever, value-creating collaboration isn’t.

Organizations have taken lots of steps in recent years to become more diverse, equitable and inclusive—and still, change has been slow.

Many organizations are transforming their industries with a new organizational approach.

Nowadays, CEOs need to focus on more than the bottom line.

Soaring energy prices, rising inflation, and other shocks have taken most CEOs into a place they’ve never been before.

Equity, inclusion, and sustainability are table stakes for many in their teens and 20s.

Generative-AI-powered design platforms can produce entirely new designs based on inspirational pictures and directions that designers use as prompts.

Disruptions to the world’s food system are deepening the global food crisis. Efforts by the grocery industry and consumers can help prevent a worsening scenario.

California is on track to become the fourth-largest economy in the world. However, it also hosts half of the unsheltered homeless population in the US, with a significant share in the San Francisco Bay Area.

Cloud computing is more than just data storage. Here’s how to maximize its potential.

Four types of behavior account for 89% of leadership effectiveness, according to McKinsey analysis.

The world of work is clearly changing, and looking ahead can help organizations prepare for what’s next.

Efforts to increase overall well-being at work have come a long way, but many employees are still struggling.

The absence of strong workplace rituals may lead some employees to adopt a “me” mentality.

Generative AI-tools have the potential to transform how many different jobs are performed.

McKinsey has identified 23 drivers of health—with many of them sitting outside of the conventional healthcare system.

It’s a long climb to chief financial officer, and responsibilities look very different once you’re in the lead.

People who maintain dual awareness can act with intentionality and perform at their best no matter what else might be happening.

Recent events, including rising geopolitical tensions, have motivated leaders to reexamine global interdependencies.

With this talent shortage, companies should be thinking about how they can customize propositions that meet the needs of their own workers.

Looking back, 2022 was another year of upheaval—one of many recently. The changes we’ve seen this year are not garden-variety disruptions.

It is hard to become a software company—less than 7% of all software revenue in the world accrues to nontech companies, according to McKinsey analysis of 2019 IDC data.

In 2021, private-sector funding in space-related companies topped $10 billion—an all-time high and about a tenfold increase over the past decade.

Americans are increasingly drawing down savings and running up credit card debt. Twenty-four percent of respondents saw a decrease in their debt payments or savings.

In the face of the COVID-19 pandemic, a new Gulf consumer is emerging, one with shifting financial sentiments and spending habits, find McKinsey partner Abdellah Iftahy and coauthors.

Every manager needs to have conversations that help put on the table some of the social and emotional issues going on in the workplace and be able to coach somebody through them.

After three decades of relative calm, today’s unnerving events have largely come as surprises: a global pandemic, energy scarcity, rapid inflation, and rising geopolitical tensions.

Cumulative capital spending on physical assets for the net-zero transition would need to change from today’s annual average of $5.7 trillion to an estimated $9.2 trillion through 2050.

Demand for low-carbon steel is expected to surge from around 84 million tons in 2021 to nearly 200 million tons in 2030.

Electric-charging stations, climate tech start-ups, and corporate India’s focus on sustainability are all signs of activity in India’s clean-energy transition. Investors are increasingly funding companies working in green technologies.

A digital twin is a digital representation of a physical object. Crucially, digital twins are linked with real data sources and can be updated in real time.

Around the world, one out of four employees experiences toxic behavior at work, according to a recent MHI report on burnout.

Respondents worldwide are generally downbeat about the economy, with those in most regions citing inflation as the main risk to growth in their home economies, according to McKinsey senior partner Sven Smit and colleagues.

The wellness market is growing quickly. Overall, around 50% of US consumers now report wellness as a top priority in their day-to-day lives.

What’s interesting right now is we can’t afford to ignore those who have stepped out of the workforce. Why? Because there are not enough people looking for jobs.

Unlike other sectors … where companies have a meteoric rise and fall, you don’t have that here, which is a greatness of the industrial sector: it’s very resilient.

We’ve asked McKinsey leaders to envision their respective industry’s next decade. Here are some of their more evocative—and provocative—predictions.

Humans are wired to fear uncertainty, but it’s helpful to remember that “uncertainty is the portal to possibility.”

What differentiates bold leaders isn’t moving in the right direction, but doing so decisively before others have mustered the collective confidence to commit.

Just over a quarter of respondents say they do independent work because they must. Another quarter say that they do this work because they enjoy it.

The future office must be configured in new ways to support diverse, flexible, and tech-enabled workforces.

Attributes, not skills. When faced with stress and uncertainty, who is the “real you” who shows up?

Defying the odds. In every year of its existence, the airline industry has failed to earn its cost of capital. But some carriers have managed to defy the odds to generate consistent value for their shareholders—and are widening their lead over others.

Anti-Asian racism isn’t new in the US, but since the COVID-19 pandemic began, there’s been a growing amount of violence and hostility against Asian Americans.

Meta-what? No one can seem to agree on a single definition of what exactly the metaverse is.

Innovation is critical to growth. But fear can stop experimentation in its tracks, leading to less creativity and less ambitious ideas.

Since 1975, the global population has increased by one billion people every 11 to 12 years, and the planet is now approaching the eight-billion-people mark. What does it mean for this many people to exist?

Energy and food costs are skyrocketing, supply chains are constrained, and consumer demand is strong. The upshot? US inflation rocketed to a forty-year high of 8.5% in March from the same month a year prior. Though economists see some encouraging signs that inflation may be peaking, such as a slowing rise in the core price index, the Russian invasion of Ukraine and China’s COVID-19 surge may mean that supply disruptions—and resulting higher prices—endure longer.

Call it what you will—the “Great Resignation” or “Great Disruption”—the fact remains that nearly 69 million people in the US quit their jobs in 2021. A common misconception: better compensation stops worker flight. While pay and benefits are important, two-thirds of employees left their jobs in 2021 for reasons related to engagement and well-being. That means the majority of US workers are quitting because they aren’t happy with their bosses, work cultures, or work–life balance, according to Gallup’s research.

People sometimes believe that remote work protects them from having to deal with obnoxious colleagues. But jerks aren’t going to suddenly stop being jerks just because you’re working from home. It doesn’t matter whether you’re in the office or on a video call. Toxic coworkers are going to give their version of events to your boss, in real life, or during an online chat. It’s delusional to think otherwise.

To counter the global chip shortage, chipmakers have sought to increase production. But a lack of chips is choking off the supply chain itself. For example, the CEO of one large supplier of chip-making equipment has said that his company can’t find enough chips to make its tools, resulting in long lead times. The biggest chip shortages aren’t in cutting-edge semiconductors but in the less sophisticated ones—those used in industrial equipment and cars.

One popular business school course at a leading university is teaching the softer side of leadership, with the key tenet that happy leaders are effective ones. But happiness doesn’t just magically happen. Happiness, students learn, can be cultivated within yourself, and then you can cultivate it within your teams. And that’s especially important when workers are quitting their jobs at a rapid pace, with many organizations rethinking the nature of work with a focus on employee morale and happiness.

While many employees are still working from home, companies are considering what to do with their existing offices. Some are downsizing. Others are redesigning their offices into spaces where employees collaborate and work together, versus perform individual tasks 9-to-5 style. And still other organizations are building new offices, including elaborate showplace headquarters.

CEOs losing jobs because of workplace misconduct happens surprisingly often for such a smart cohort. The job itself can enable bad behavior by isolating leaders, who can become entitled, overawed by their own supposed importance, and unwilling to admit mistakes or recognize competition. The word hubris comes to mind.

Over the past few years, C-suite executives and other senior leaders have struggled with the demands of work and family life along with everyone else, and many have joined the ranks of millions who are resigning. In the last quarter of 2021, the number of departing CEOs rose 16% from a year earlier.

For older workers, the hot job market is just lukewarm. Roughly one-third of US job seekers aged 55-plus remained unemployed for at least 27 weeks as of January, compared with about 22% of younger workers. Age discrimination is persistent. Even those who think racism and sexism are unacceptable in the workplace still hold ageist attitudes toward older employees, academic research has found.

Forty-two percent of women report being burned out. That is higher than last year and higher than [the percentage of burned-out] men.

Most executives say they frequently find themselves spending way too much time on pointless interactions that drain their energy and produce information overload.

Gen Zers, ranging from middle-school students to early professionals, are reporting higher rates of anxiety, depression, and distress than any other age group.

Flying taxis will happen; it’s a question of ‘when,’ not ‘if.’

Instead of focusing on productivity, focus on purpose, cultivate compassion, and give employees the agency to make decisions.

By 2022, global sales of electric two-wheelers and electric three-wheelers could reach $150 billion.

“Leaders are thinking about what a new culture and a new way of working might look like, and how to perpetuate culture in a primarily hybrid world.”

In an era of workplace upheaval, workers are hungry for trust, social cohesion, and purpose.

In a period of continuous corporate change, injecting more civility can help companies navigate the uncertainty and volatility

Charge-point operators need to build a dense, reliable network that provides customers with carefully selected locations in high-traffic areas.

A purposeful organization can strengthen resilience and deliver value at the same time. Here’s how.

Companies cannot manufacture the flow state, but they can create an atmosphere that encourages it. When senior executives were at their peak, they reported being five times more productive than they were on average.

Environmental and social issues are increasingly affecting how companies do business. More companies are starting to make sustainability a strategic and operational priority, but few are structured for success.

Effective meetings begin with a clear goal. For decisions, gather six to eight decision makers and follow an agenda that identifies the choices. Here’s how to decide whether to have it, who comes, and how to make it count.

Up to one-half of American employees worked from home throughout the COVID-19 pandemic. As workplaces figure out which work model—100% in person, 100% remote, or somewhere in between—they’re going to choose after the pandemic, there are lots of issues to navigate.