Product Development & Procurement
Operations

Growth by design

Helping manufacturers build sustainable products that result in happier customers, company growth, and increased profitability

Customers are paying more attention than ever to product ratings and online reviews. Brand loyalty is becoming less important than product availability, and a large majority of customers are using an omnichannel approach for purchasing products across all sectors. At the same time, environmental sustainability is both a driver of purchasing decisions—with consumers willing to pay a premium—and a moral imperative for manufacturers.

Growth by design provides a suite of cutting-edge tools that can be deployed across a full product portfolio to unlock growth. This approach uses three levers to renovate existing portfolios, innovate new products and services, and identify opportunities to reduce costs and allow reinvestment in growth drivers. Environmental sustainability also informs the approach, delivering a dual mission in carbon and cost reduction.

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      Typical results

      Our Approach

      Portfolio

      Identify and close gaps across your product portfolio to drive incremental growth

      Streamline offerings to remove redundancies and unnecessary complexity

      Design

      Use deep customer insights to redesign product portfolios in order to deliver a wide range of offerings

      Quality

      Improving quality can decrease the number of returns and help build star ratings, which can also increase word-of-mouth referrals and reduce warranty issues

      Supply chain

      Decrease end-to-end logistic costs by trimming packaging and optimizing products

      Drive growth by increasing the amount of stock on shelves without expanding the shelf space, and reducing the level of out-of-stock items

      Sustainability

      Increase knowledge about where sustainable materials and design approaches may be able to fulfill a dual mission of reducing both carbon footprints and cost

      Featured capabilities

      Resource cleansheet

      Bring environmental and economic transparency to product development and procurement by integrating CO2 optimization with cost and product design.

      Track CO2 emissions through the value chain to identify areas that could improve sustainability

      Competitive landscape insights

      The engine that drives the growth by design offering by utilizing technology that combines web scraping and the latest natural-language processing

      Identify specific growth drivers within product portfolios and help clients understand overall performance, customer experience, and optimal assortment mix

      Packaging benchmark database

      This solution transforms—through digitization and AI—the otherwise slow and labor-intensive process of competitive design optimization in packaging categories

      Create a more effective and efficient process with accelerated data collection and processing, benchmarking, and identifying new opportunities for competitive advantage

      Design execution

      Translate insights-driven opportunities into leading products focused on value, time-to-market, and cost. From concept with McKinsey Design through to testing and evaluation—and drawing on expertise from external partnerships—products deliver stakeholder value and fulfill user needs

      Impact stories

      Delivering a pioneering coffee product platform in record time
      Delivering a pioneering coffee product platform in record time

      A company wanted to improve its commercial coffee brewing system.

      We helped launch a six-month research, design, and implementation program to address growth challenges and meet the needs that were arising from new trends in coffee consumption among consumers.

      Developing an end-to-end packaging and shipping solution for fast-food company
      Developing an end-to-end packaging and shipping solution for fast-food company

      A fast-food company wanted to reduce the environmental impact of one of its food lines. By understanding more about customer confusion around recycling, a wasteful frozen-food supply chain, and applying a sustainability lens to packaging, we were able to help drive sustainability impact results. Highlights included one million serving bags eliminated annually, 80 tons of polypropylene removed from the waste stream, and the removal of 310 tons of greenhouse gas emissions from the production process

      Optimizing box dimensions for better stocking and more sustainable fillers
      Optimizing box dimensions for better stocking and more sustainable fillers

      Using a competitive teardown allowed us to help a manufacturer of woodworking equipment reduce box size by 30 percent and cut CO2 levels by 600,000 kilograms. Doing so solved a key challenge—allowing retailers to keep more products on the shelf during busy periods.

      Our people

      Dave Fedewa
      PartnerAtlanta
      Serves clients in consumer and retail and leads consumer durables and our growth by design work
      Jan Henrich
      Senior PartnerTokyo
      Co-leads McKinsey’s Asia–Pacific Operations Practice and serves the consumer and industrial industries globally across many functional areas such as strategy, organization, operations, digital, growth, marketing, and sales
      Kristi Klitsch Weaver
      Senior PartnerChicago
      Advising a wide variety of consumer-facing, global organizations at pivotal strategic points on topics including strategy, growth, disruption, M&A, transformation, and organization for long-term growth and performance
      Jennifer Spaulding Schmidt
      Senior PartnerMinneapolis
      Product Development & Procurement global leader, increasing the competitiveness and profitability of retailers and consumer companies by leading large transformation programs and strategic growth strategies.
      Daniel Swan
      Senior PartnerConnecticut – Darien
      Co-leads McKinsey’s Operations Practice globally, and helps manufacturing and service companies transform their operations performance and capabilities
      Warren Teichner
      Senior PartnerNew York
      Coleads our Private Capital Practice globally and brings deep expertise in serving food, beauty, consumer-health and wellness, and retail clients

      Featured insights

      Small Gift Packed in Multiple Cardboard Boxes Nesting, Excessive Packaging
      McKinsey Direct
      Packaging: The underrated performance and value driver
      -
      At leading consumer companies, packaging decisions enable margin and revenue gains through improved customer experience and operational excellence. Five approaches should be on the C-suite’s agenda.
      Digital generated image of grass and flowers growing on abstract torus shape made out of transparent glass.
      McKinsey Direct
      Reducing emissions and costs: Putting your products on a ‘low-carb’ diet
      -
      The time to develop a cost-optimal product portfolio and CO2 abatement strategy is now—success in doing so requires product design and procurement to work hand in hand.
      Open refrigerator in a supermarket showcase brandless packagings and bottles of juice, coffee, energy drinks, water, smoothies, salad, puree, and diverse food items.
      Podcast
      How product design can yield ‘triple wins’: Growth, margin, and sustainability
      -
      Some consumer companies have simultaneously increased sales, cut costs, and reduced carbon emissions. Their secret? Paying closer attention to the design of their products and packaging.
      Rows of cans
      Podcast
      Skinny design: Smaller is better
      -
      The ability to improve cost savings, sustainability, and consumer benefits has proven skinny design packaging to be a powerful tool to maximize product volume and performance.

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