Date: 21-11-2019
Source: The Economist: Schumpeter
When businessmen talk to partners of McKinsey, the high priests of management consultancy, it is like Catholics going to confession. They reveal all. They expect confidentiality. And whether or not it changes behaviour, the act itself is good for the soul.In this era of corporate unease, over everything from the next recession to climate change, executives are lining up at the confessional. But McKinsey, too, has some soul-searching to do. Its industry, estimated to be worth $300bn, is, like those of its clients, being transformed. And as its most revered—and hermetic—standard bearer, it is under more scrutiny than ever before.
Kevin Sneader, who took over as global managing partner last year, has lots on his plate. Recent years have been uncomfortable. Until a decade ago no McKinseyite had ever been sued for securities-law violations. In 2012 its former managing partner, Rajat Gupta, was convicted of insider-trading committed after he left the firm. Then in 2016 McKinsey was embroiled in a scandal in South Africa after it worked with Trillian, a local consulting firm owned by an associate of the controversial Gupta family (no relation to Mr Gupta). Mr Sneader has repeatedly apologised. Den Rest des Beitrags lesen »
Date: 10-11-2019
Source: The Wall Street Journal By Irving Wladawsky-Berger
Agility, the ability to respond to rapidly changing technologies and markets, is key
A quarter century into the digital age, many corporations and institutions still struggle to embrace digital technology advances.
At a conference several years ago, I learned about the Sunday-night/Monday-morning syndrome. The term captures the frustration of employees who, after having access to the latest devices and applications at home, arrive at work on Monday morning to once again wrestle with primitive devices and applications that their IT departments support.
“If digital technologies are consistently making our consumer lives easier, why aren’t they making it easier to succeed in business?” ask Jeanne Ross, Cynthia Beath and Martin Mocker in „Designed for Digital,“ their recent book. “Why are business leaders anxious about digital disruption rather than marveling about how quickly they can provide new, exciting, and ever-improving digital solutions to their customers?” Den Rest des Beitrags lesen »
Date: 05-10-2019
Source: The Wall Street Journal By Irving Wladawsky-Berger
Grow comfortable with being agile
Artificial intelligence is the biggest commercial opportunity for companies and industries over the next 10 to 15 years. Separate reports by McKinsey & Co. and PricewaterhouseCoopers LLP recently concluded that AI has the potential to boost global economic output by between $13 trillion and $15 trillion between now and 2030.
Yet many organizations’ efforts are falling short, according to the authors of a recent Harvard Business Review article. They found that most firms are only using AI in ad hoc pilots or applying it to a single business process.Only 8% of firms are engaged in practices that support widespread adoption.
Why the slow progress? “It’s a reflection of a failure to rewire the organization,” write the authors, who are McKinsey partners. “AI initiatives face formidable cultural and organizational barriers…at most businesses that aren’t born digital, traditional mindsets and ways of working run counter to those needed for AI.” Den Rest des Beitrags lesen »
Date: 22-09-2019
Source: The Wall Street Journal By Irving Wladawsky-Berger
The U.S. economy looks good by almost any measure. Unemployment is at historical lows. There are more job openings than unemployed people to fill them. Inflation remains low. A number of recent studies have concluded that over the next decade, the economy will create new occupations that will more than offset declines in jobs displaced by automation.
Why then are so many Americans so anxious about the future? Why do they feel left behind?
A recent McKinsey & Co. report sheds light on these questions, presenting a detailed analysis of more than 3,000 U.S. counties and over 300 cities.
The study found that while the country is doing well in aggregate, there are essentially multiple Americas, some of which are doing quite well, while others risk falling further behind. Den Rest des Beitrags lesen »
In 2011, German Chancellor Angela Merkel announced the country was turning away from nuclear energy in favor of a renewable future. Since then, however, progress has been limited.Berlin has wasted billions of euros and resistance is mounting.
It’s a fantastic idea. The energy landscape of tomorrow. There are 675 people in Germany working every day to make it a reality — in federal ministries and their agencies, on boards and panels, in committees and subcommittees. They are working on creating a world that on one single day in April became glorious reality. Here in Germany. It was April 22. Easter Monday.
That day, it was sunny from morning to evening and there was plenty of wind to drive the turbines across the entire country. By the time the sun went down — without the need of even a single puff of greenhouse gases — 56 gigawatts of renewable energy had been produced, almost enough to cover the energy needs of the world’s fourth-largest industrialized nation.
People with the right skills and talents are the greatest differentiator for banks. They are also the scarcest resource.
The heart of wholesale banking, and the prime differentiator among firms, is talent. A small subset of talent creates the majority of value in the industry, making it critical to identify, attract, develop, and retain the right people. This task has become more challenging, however, as financial services has lost some of its allure as a destination for many top new graduates.
Here is the challenge: banks must envision the future value chain for products, customers, and technologies in their sector and then pinpoint what talent they will need to bring this value chain to life. They must assess what sorts of talent their business lines need, recruit and identify the individuals best suited for those roles, align talent to the value those functions produce for the organization and maximize their productivity, and broaden their organizations’ reach to create more diverse and inclusive teams of talent.
Best-practice talent management can deliver highly cost-effective incremental value. At capital-markets firms, for instance, full electronification combined with the astute talent management required to attract and retain the talent that remains could shrink the front office by 20 to 30 percentin the long term, while increasing the productivity, value, and rewards to the remaining team. For the largest capital markets and investment-banking firms, this combination of a smaller, more highly rewarded team could cut compensation costs by about 10 to 20 percent, realizing savings of $300 million to $600 million annually off of the average $9 billion in capital markets and investment-banking costs (3 to 7 percent). Den Rest des Beitrags lesen »
Date: 10-02-2019
Source: The Wall Street Journal By Irving Wladawsky-Berger
Artificial Intelligence is seemingly everywhere. In the past few years, the necessary ingredients have finally come together to propel AI beyond early adopters to a broader marketplace: powerful, inexpensive computer technologies; advanced algorithms; and huge amounts of data on almost any subject. Newspapers and magazines are full of articles about the latest advances in machine learning and related AI technologies.
Two recent reports concluded that, over the next few decades, AI will be the biggest commercial opportunity for companies and nations. AI advances have the potential to increase global GDP by up to 14% between now and 2030, the equivalent of an additional $14 to 15 trillion contribution to the world’s economy, and an annual average contribution to productivity growth of about 1.2 percent.
Over time, AI could become a transformative, general purpose technology like the steam engine, electricity, and the internet. AI marketplace adoption will likely follow a typical S curve pattern with a relatively slow start in the early years, followed by a steep acceleration as the technology matures and firms learn how to best leverage AI for business value. Den Rest des Beitrags lesen »
