Insights to Impact: A weekly briefing on creating sustainable and inclusive growth 2023

| Executive Briefing
McKinsey’s 2023 insights on sustainable, inclusive growth are collected in this archive of weekly digests.

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December 21, 2023

Eight priorities dominate the CEO agenda for 2024. Our weekly digest explores that topic and more.

This week’s headline findings:

Amid one of the most difficult operating environments in recent memory, organizations are setting agendas for the coming year. Drawing on conversations with business leaders, senior partners Homayoun Hatami and Liz Hilton Segel offer eight CEO priorities for 2024. Geopolitics, the energy transition, and generative AI (gen AI) all make the grade as vital topics. But as they consider these important issues, CEOs mustn’t forget to also value their middle managers.

Gen AI could widen the racial wealth gap in the United States by $43 billion per year. But applied strategically, the technology also has the potential to strengthen pillars of Black economic mobility, such as financial inclusion, affordable housing, and the narrowing of the digital divide. Senior partner Mark McMillan and coauthors outline strategies for ensuring gen AI is deployed equitably and in ways that help rather than hinder Black Americans’ progress. 

Retail shrink, which encompasses not just theft but also factors such as waste and spoilage, cost US retailers more than $110 billion in 2022. Partner Bill Mutell and coauthor suggest approaches for mitigating these losses, such as taking a store-by-store approach to security, creating proper incentives for managers, and using technological solutions to rein in risks while freeing staff to focus on customer experience. One oft-overlooked issue: employee theft, which in 2022 accounted for 29 percent of US retailers’ shrink.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




December 14, 2023

Top insights from 2023 are collected in McKinsey’s year in review. Our weekly digest explores that topic and more.

This week’s headline findings:

Explore our most compelling insights from the past 12 months in McKinsey’s annual year in review. Prominent topics include gen AI, the energy transition, and the power of digital transformation. For further year-end edification, also see our year in charts and year in images.

Many organizations focus on near-term synergies in the wake of a deal. But senior partner Chris Hagedorn and coauthors suggest that transactions can provide opportune moments to fully reimagine newly combined businesses. A transformational approach to M&A can turn deals into levers for executing new strategies and delivering value creation.

Gen AI could boost consumer marketing capabilities by automating processes, enabling hyperpersonalization, and breaking through creative constraints. Senior partner Kelsey Robinson and coauthors say marketers can use gen AI as a tool to analyze competitor moves, assess consumer sentiment, and test new product opportunities. Companies can begin their gen AI journeys by defining the most relevant use cases, identifying the proper teams, and pinpointing potential risks.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features Dr. Fei-Fei Li, professor of computer science at Stanford University and founding director of the Stanford University Institute for Human-Centered Artificial Intelligence, speaking about her new book, The Worlds I See: Curiosity, Exploration, and Discovery at the Dawn of AI (Macmillan, November 2023). Li highlights the importance of creating AI governance models that prioritize human dignity.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




December 7, 2023

Decarbonization will require solving four interconnected problems. Our weekly digest of insights explores that topic and more.

This week’s headline findings:

Although there has been meaningful momentum, the world is not on track to reach net-zero emissions by 2050. Getting there will require tackling four interconnected problems: emissions reduction, affordability, reliability, and industrial competitiveness. Senior partners Tomas Nauclér, Daniel Pacthod, Sven Smit, Humayun Tai, and coauthors offer several principles that can guide decision makers along the way, such as creating incentives, driving down costs, building effective financial mechanisms, and anticipating bottlenecks.

According to McKinsey analysis of industry forecasts, the fashion world can expect top-line growth of 2 to 4 percent in 2024, with the luxury segment generating the largest share of profit. But uncertainty abounds as economic volatility and geopolitical tensions create potential headwinds. Senior partners Anita Balchandani, Achim Berg, Gemma D’Auria, and coauthors outline ten emerging themes for the year ahead, including a new generation of influencers, fierce competition in the realm of fast fashion, and greater regulatory scrutiny of the industry. (Download the full State of Fashion 2024 report.)

Family-owned businesses account for more than 70 percent of global GDP and about 60 percent of global employment. Some notable ones have been successful for more than a century. Analysis from senior partner Acha Leke and coauthors suggests four mindsets that are critical for high-performing family-owned businesses. Adopting them could quadruple a business’s value over the next decade.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




November 30, 2023

Public–private–philanthropic partnerships could help combat climate change. Our weekly digest of insights explores that topic and more.

This week’s headline findings:

Multistakeholder initiatives involving public–private–philanthropic partnerships (or 4P models) could play vital roles in tackling climate and nature challenges. These collaborations can include, for example, transactional financing or knowledge-sharing platforms. Senior partners Hamid Samandari, Daniel Pacthod, and coauthors offer a framework for assessing the materiality, suitability, and feasibility of 4P efforts.

The world has never been more interconnected, but geopolitical tensions, supply chain breakdowns, and a backlash against globalization are combining to fray the ties that bind the world together. Senior partners Michael Birshan, Joe Ngai, Olivia White, and coauthor outline priorities for organizations confronting a new paradigm of global interconnectedness. Leadership teams should work to boost their familiarity with geopolitical nuances, undertake scenario planning that accounts for dynamic world events, and think about diversifying (as opposed to decoupling) supply chains.

Travel brands practically invented modern-day loyalty programs. But it might be time for a reinvention. Rule changes and benefit clawbacks have left many loyalty program members feeling dissatisfied and—increasingly—disloyal. Partners Clay Cowan, Jillian Tellez Holub, and coauthors detail a mindset shift, encouraging travel brands to think about loyalty as more than just points and miles. Elevated customer experiences and data-driven personalization can be the cornerstones of new loyalty initiatives.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features Pulitzer Prize winner Walt Hickey speaking about his new book, You Are What You Watch: How Movies and TV Affect Everything (Hachette Book Group, October 2023). Hickey highlights data demonstrating that pop culture has influenced things such as workplace dynamics, the tourism economy, and even security procedures at banks.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




November 16, 2023

How can organizations adapt to climate change? Our weekly digest of insights explores that topic and more.

This week’s headline findings:

Even as attempts to mitigate climate change continue, private and public sector actors will need to consider strategies for adaptation to global warming. Some current adaptation plans exist, but most lack adequate specifics. Senior partners Philipp Koch, Homayoun Hatami, Hamid Samandari, and coauthors outline a framework for adaptive action that is divided into four categories: developing a climate-risk-management mindset, identifying technological and behavioral adaptation levers, making economic and societal adjustments, and leveraging governance, institutional support, and commitment.

Economic uncertainty hasn’t stopped business leaders from prioritizing the building of new businesses, according to a recent McKinsey survey. Fifty-eight percent of leaders reported that creating new revenue streams has become more important because of the current economic environment. Organizations with more experience in building new businesses tend to achieve higher success rates. Senior partners Markus Berger-de León, Paul Jenkins, and Ari Libarikian suggest that taking a portfolio approach to new-business creation can help diversify risk while cautioning leaders not to expect that every new business venture will become a big winner.

Because the real estate industry is awash in data—about properties, communities, tenants, and the market itself—it might be fertile ground for the use of gen AI. Industry use cases for gen AI could include engaging with customers, sifting through leasing documentation, aiding investment decisions, and drawing architectural plans. Senior partners Matt Fitzpatrick, Vaibhav Gujral, and coauthors detail steps for real estate players to take now, including creating a library of useful gen AI prompts, focusing more sharply on proprietary data, and assessing the risks of using gen AI in a real estate context.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




November 9, 2023

Innovation and growth, done right, can work hand in hand. Our weekly digest of insights explores that topic and more.

This week’s headline findings:

Analysis of 53 large public companies that have both outgrown and out-innovated peers finds a few common traits that have led to success. These innovative growers tend to invest productively in R&D (often by developing strong patents), look to expand into adjacent business areas in which they can excel (using AI to identify opportunities), and use programmatic M&A (in some cases to build out product ecosystems). Partners Matt Banholzer, Rebecca Doherty, Alex Morris, and coauthor suggest that dedicated management attention, paired with patience, can help companies balance the twin goals of growth and innovation.

New consumer research from McKinsey examines US shoppers’ moods as the holiday season approaches. Seventy-nine percent of consumers say they plan to trade down, and most consumers are less inclined to splurge. Younger shoppers are more likely to use “buy now, pay later” plans and also are more willing to pay for same-day delivery. Senior partner Kelsey Robinson and coauthors say retailers should look for ways to personalize promotions, inspire consumers through storytelling, and use omnichannel strategies to meet shoppers where they are.

With responsibilities that can range from administrative to strategic, a modern-day chief of staff can play an outsize role in the success of a CEO—or an organization. Senior partner Andrew Goodman and coauthors draw on conversations and research to compile eight recommendations that might help a chief of staff excel. Among them: be careful to define the role’s scope, get things right on day one, and exert influence without playing politics.

Further notable analysis from McKinsey:

  • On an episode of McKinsey’s Forward Thinking podcast, Stephen King, a senior economic adviser to HSBC Bank, speaks about the resurgence of inflation—and offers historical perspective dating back to the Roman Empire.
  • Partner Tim Koller and coauthors analyze the data on dividends and find that large, stable corporations almost never cut dividends as a strategic choice to invest in growth.
  • Partner Kersten Heineke and coauthors outline best practices for companies looking to offer their employees mobility budgets—allowances that subsidize (and encourage) the use of sustainable transport.

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features Columbia Law School professor Anu Bradford speaking about her new book, Digital Empires: The Global Battle to Regulate Technology (Oxford University Press, September 2023). Bradford foresees a regulatory scuffle between the world’s three leading digital powers—China (with its state-driven model), the European Union (with its rights-driven model), and the United States (with its market-driven model).

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




November 2, 2023

Marketing can be a vital component of growth. Our weekly digest of insights explores that topic and more.

This week’s headline findings:

CEOs who embrace marketing as a core component of growth are twice as likely as their peers to top 5 percent annual growth rates. But more than 40 percent of Fortune 500 companies don’t have a growth- or customer-related role established on their CEOs’ executive committees. Companies often saddle their CMOs with poorly defined purviews, underestimate marketing’s ability to propel growth, and use the wrong metrics to assess marketing’s efficacy. Drawing on survey research and conversations with CMOs and other C-level growth executives, senior partner Marc Brodherson and coauthors offer guidelines for properly measuring the effects of marketing, clarifying CMOs’ remits, and strengthening the relationships between CEOs and CMOs.

Financial institutions have well-established approaches for managing financial risks related to balance sheets and cash flows. But they may lack defined strategies for managing nonfinancial risks—those (such as financial crimes) that stem from people, processes, systems, and external events. Nonfinancial threats can involve bigger reputational effects and more expensive and complicated remediation efforts than financial threats. Senior partners Thomas Poppensieker, Sebastian Schneider, and coauthors suggest five principles—including flexible governance, timely monitoring, and carefully chosen metrics—that can help financial institutions design a framework for nonfinancial risk appetite.

Large, established companies sometimes focus too much on maintaining legacy strengths instead of seeking growth. Staircase Ventures founder Janet Bannister—in a conversation with McKinsey senior partner John Kelleher and coauthor—advises executives to act more like VC firms by creating a portfolio of long-term bets designed to topple the status quo. Incumbent players need to develop both the will and the skill to disrupt themselves.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features Suzanne Heywood, a former McKinsey senior partner who is now the chief operating officer of Exor Group, speaking about her new book, Wavewalker: Breaking Free (HarperCollins, October 2023). Heywood says her difficult childhood—she spent most of it at sea, sometimes in physical peril—has taught her how to be a resilient leader who doesn’t panic under threat.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




October 26, 2023

Courageous growth flows from aspirational mindsets. Our weekly digest of insights explores that topic and more.

This week’s headline findings:

Companies that embrace courageous growth initiatives—even amid global disruptions—are more likely to outperform their industry peers. Senior partners Michael Birshan, Paul Jenkins, Greg Kelly, Ari Libarikian, Jill Zucker, and coauthors suggest strategies to build enterprise-wide resilience through bold transformation. Companies should create aspirational cultures by fostering innovative mindsets and a commitment to sustainable, inclusive growth; activate growth pathways by strengthening core businesses using data and AI, expanding into adjacent businesses to add value streams, and divesting from underperforming businesses where necessary; and execute with excellence by helping employees feel ownership of growth efforts.

Consumer companies aiming to innovate faster and grow more profitably than competitors should consider revamping their operating models. Partner Shaun Callaghan and coauthors outline six strategies to enable superior growth, improved margins, and innovation at scale: prioritize around consumers’ needs, instill a culture of accountability, use data and AI across the organization, upgrade talent, create a team-based approach, and elevate technology and engineering excellence. Streamlining by building simpler organizational structures—while eliminating low-value work—can help companies focus on what matters most.

Senior partner Dymfke Kuijpers and coauthors examine the growing global cadre of “zero consumers”—shoppers associated with zero boundaries (between physical and digital channels), zero midrange brands (these consumers either go cheap or splurge), zero loyalty (they’ll switch brand preferences at the drop of a hat), and net zero (they value sustainability and transparency). In response to the rise of zero consumers, consumer companies should consider taking steps such as strengthening their value and premium offerings, ramping up their personalization capabilities, and reshaping their societal footprints.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features Ron Shaich, founder of Panera Bread and Au Bon Pain, speaking about his new book, Know What Matters: Lessons from a Lifetime of Transformations (Harvard Business Review Press, October 2023). Shaich says the key to creating and sustaining successful enterprises is to always act with intent, by identifying today what will matter tomorrow.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




October 19, 2023

A global banking transition is under way.

This week’s headline findings:

Rising interest rates have boosted global banking profits, giving the sector its best results since 2007. But a “great banking transition” is under way: transactions and balance sheets are drifting toward other types of institutions—including digital-payments specialists and alternative-asset-management firms. In this year’s Global Banking Annual Review, senior partners Miklós Dietz, Alexander Edlich, Asheet Mehta, Eckart Windhagen, and coauthors outline five priorities for financial institutions hoping to future-proof themselves. Among the authors’ suggestions: develop distinctive technology, elevate risk functions (which could have a broader role to play in a fast-changing environment), and either scale or exit the transaction business.

Europe’s regional attributes create unique opportunities and challenges as organizations increasingly look to make the most of generative AI (gen AI), say senior partners Holger Harreis, Gökhan Sari, Alexander Sukharevsky, and coauthors. For example, Europe’s multiple languages and cultures and complex regulatory environment could complicate the use of gen AI, but these same characteristics might also offer local players a home field advantage.

Telecom companies might once have been the employer of choice for tech talent, but fiercer competition for STEM graduates is making hiring more difficult, even as telcos’ demand for tech talent increases. Tech trends shaping the industry—including AI and quantum technology—make attracting, cultivating, and retaining tech talent more important than ever. Senior partner Tomás Lajous and coauthors outline a three-phase telco talent approach: identify the talent implications of the business strategy, assess talent gaps and define priorities, and design a tech talent operating model.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of Author Talks features BBC journalist Ros Atkins speaking about his new book, The Art of Explanation: How to Communicate with Clarity and Confidence (Wildfire, September 2023). Atkins says that good communication can flow from asking oneself, “Does this sound like me?”

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




October 12, 2023

Women in the corporate workplace have grown more ambitious since the pandemic.

Here are this week’s headline findings:

The ninth McKinsey Women in the Workplace report, conducted in partnership with LeanIn.Org, shows substantial leadership gains for women, with C-suite representation climbing from 17 percent in 2015 to 28 percent in 2023, but continuing underrepresentation for women of color at nearly every step on the corporate ladder. Senior partners Alexis Krivkovich, Lareina Yee, and coauthors spotlight several other noteworthy findings. For instance, women are now more ambitious than before the pandemic as a result of new workplace flexibility, the biggest barrier for women is the first step up into management ranks (perhaps better characterized as a “broken rung” than a “glass ceiling”), and workplace microaggressions against women can have a large and lasting effect, making women who endure them more likely to think about quitting their jobs.

A study examining large American corporations reveals that very few have been able to beat market TSR by 5 percent or more over a ten-year period. Partner Tim Koller and coauthors identify five main routes to TSR success. Among them: offer new or enhanced products (for example, a breakthrough medicine), undertake a turnaround (such as by revamping core operations), or simply outmanage peers (through superb strategy and execution).

Consumer package delivery via drone is already a fact of life in some places—especially Asia–Pacific. Globally, the number of packages delivered by drone grew by more than 80 percent from 2021 to 2022. Partner Robin Riedel and coauthors project that commercial drones will complete more than one million deliveries by the end of 2023. Expanding use cases (including healthcare and restaurant deliveries), coupled with greater regulatory clarity, are making drone deliveries an increasingly viable option.

Here’s some further notable analyses from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.




October 5, 2023

Are new concerns reshaping global expectations for growth?

This week’s headline findings:

A McKinsey Global Survey that was in the field from August 31 through September 8 finds overall economic sentiment leaning more positive than negative for the second quarter in a row. But senior partner Sven Smit and coauthors note that differences emerge when results are examined on a regional level. European respondents report a more negative collective outlook than their North American counterparts. And while inflation fears remain top of mind across the globe, apprehensions about slowing economic activity in China have come to the fore for Asia–Pacific’s respondents. Private sector respondents were, on the whole, increasingly optimistic about their own companies’ prospects.

Advances in AI could profoundly alter how the travel industry serves customers, develops products, and manages operations. In collaboration with Skift Research, senior partner Ben Ellencweig and coauthors explain how AI can help travel companies use data to more narrowly segment customers, aiding efforts to hyper-personalize marketing and services. AI can also identify promising product niches while empowering workers to find operational solutions to complex problems.

In an episode of McKinsey’s Deal Volume podcast, partner Brian Vickery speaks with David Steinbach, global chief investment officer of Hines, one of the world’s largest real estate investors, developers, and service providers. Steinbach compares the upheaval of this real estate moment to the disruption that e-commerce brought to the retail sector. As city tax bases erode and office space tenants discover different needs, Steinbach predicts that real estate industry change will accelerate.

Further notable analysis from McKinsey:

The case study collection Rewired in Action illuminates companies that have launched digital transformations to build value. Supported by technical and industry expertise from McKinsey, these organizations have changed their trajectories through the integration of digital and AI.

A recent edition of the Inside the Strategy Room podcast features partner Emma Gibbs speaking with John Horn, professor of practice in economics at Olin Business School at Washington University in St. Louis, about his new book, Inside the Competitor’s Mindset (MIT Press, April 2023). Horn details how to predict competitors’ future moves by stepping into their shoes.

This briefing note, based on McKinsey’s latest published insights, was prepared by Seth Stevenson, a senior editor in McKinsey’s New York office.

Do these insights resonate with you? What else should we be writing about now? Tell us by emailing insightstoimpact@mckinsey.com.