Unleash their potential. hereLearn more about cookies, Opens in new We use cookies essential for this site to function well. Source: McKinsey Digital Survey 2018; McKinsey Global Institute analysis 1Lower than average industry. Please try again later. SOURCE: Eurostat; Local institutes of statistics, McKinsey Global Institute McKinsey & Company 12 … resulting in significant digitization gaps compared to other EU economies – these gaps will need to be closed to unlock full Rather, it is entering a new phase defined by soaring flows of data and information. China has grown more connected, reaching number seven, but advanced economies in general remain more connected than developing countries. Today, a more digital form of globalization has opened the door to developing countries, to small companies and start-ups, and to billions of individuals. Although there is substantial value at stake, not all countries are making the most of this potential. McKinsey Global Institute Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. Never miss an insight. And although this shift makes it possible for companies to reach international markets with less capital-intensive business models, it poses new risks and policy challenges as well. McKinsey Global Institute Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. MCKINSEY GLOBAL INSTITUTE Find this report and other MGI research at: www.mckinsey.com/mgi MCKINSEY GLOBAL INSTITUTE @McKinsey_MGI McKinsey & Company 8 Strong focus on digitization can generate additional 2.1 EUR billion of GDP in Slovenia by 2025 SOURCE: Eurostat; IHS; Local institutes of statistics; McKinsey Global Institute … Reinvent your business. In a new report, the McKinsey Global Institute attempts to measure the most and least digitized sectors of the U.S. economy with the new MGI Industry Digitization Index. Remarkably, digital flows—which were practically nonexistent just 15 years ago—now exert a larger impact on GDP growth than the centuries-old trade in goods, according to a new McKinsey Global Institute (MGI) report, Digital globalization: The new era of global flows. Practical resources to help leaders navigate to the next normal: guides, tools, checklists, interviews and more. We seek to provide insights on the evolution of the global … Most transformations fail. For countries that have been slow to participate, the opportunities for catch-up growth are too substantial to ignore. Conventional wisdom says that globalization has stalled. Subscribed to {PRACTICE_NAME} email alerts. The McKinsey Digital Survey covered 1,600 firms worldwide, with results unweighted. McKinsey Global Institute Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. Both inflows and outflows matter for growth, as they expose economies to ideas, research, technologies, talent, and best practices from around the world. It is projected to increase by an additional nine times over the next five years as flows of information, searches, communication, video, transactions, and intracompany traffic continue to surge. cookies, broader effects notably on the future of work and on societal welfare, Large economic potential is linked to digitization—and much of it yet to be captured, Digital superstars are rising far beyond the US big four and China’s big three, Digital changes everything—even industry boundaries, Playing the platform economy is an “in the money” option, Self-cannibalization and innovation are a necessity for digital reinvention, Effective management of digital transformation is vital—but challenging, Leveraging, and transitioning from, digital to new frontier technologies is an imperative. The McKinsey Global Institute’s Industry Digitization Index uses dozens of indicators to provide a snapshot of digital assets, usages, and workers, and our findings about Europe are sobering. In fact, each type of flow is concentrated among a small set of highly connected countries. Countries, sectors, and CEOs face an increasingly complex world characterized by the diffusion of new digital technologies, affecting productivity performance while causing disruption. Press enter to select and open the results on a new page. Flip the odds. Learn more about cookies, Opens in new Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. The gap to the digital frontier remains large across industries. Never miss an insight. The McKinsey Insights app offers business insights and analysis on the biggest issues facing senior executives today--from leadership and corporate strategy to the future of work and AI's impact on business and society. Virtually every type of cross-border transaction now has a digital component. Research by the McKinsey Global Institute indicates that digital transformation can result in productivity gains of 14 to 15 percent and cost reductions of 4 to 6 percent. our use of cookies, and Learn more about cookies, Opens in new We'll email you when new articles are published on this topic. McKinsey Quarterly Our flagship business publication has been defining and informing the senior Some 900 million people have international connections on social media, and 360 million take part in cross-border e-commerce. 「McKinsey Insights」をダウンロードしてiPhone、iPad、iPod touchでお楽しみください。 ‎The McKinsey Insights app offers business insights and analysis on the biggest issues facing senior executives today--from leadership and corporate strategy to the future of work and AI's impact on business and society. Please click "Accept" to help us improve its usefulness with additional cookies. McKinsey Global Institute Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. Our flagship business publication has been defining and informing the senior-management agenda since 1964. Please use UP and DOWN arrow keys to review autocomplete results. tab. Individuals are using global digital platforms to learn, find work, showcase their talent, and build personal networks. Learn about Use minimal essential These advanced technologies bring the promise of lower costs, more efficient business processes, and innovative new business models. [19] [74] Many consultants are contributors to the Harvard Business Review . Our new McKinsey Global Institute (MGI) report, Digital America: A tale of the haves and have-mores, represents the first major attempt to measure the … Digitization in Europe is lagging behind both the United States and China. Please email us at: McKinsey Insights - Get our latest thinking on your iPhone, iPad, or Android device. Please try again later. Our mission is to help leaders in multiple sectors develop a deeper understanding of the global economy. … 01.01.2014 - McKinsey Global Institute | Digitization, automation, and other advances are transforming industries, labor markets, and the global economy. In this article, we offer a closer look at how E&C companies can realize benefits like … If the rest of the world had increased its participation in global flows at the same rate as the top quartile over the past decade, world GDP would be $10 trillion, or 13 percent, higher today. Flip the odds. Please use UP and DOWN arrow keys to review autocomplete results. tab, Engineering, Construction & Building Materials, Travel, Logistics & Transport Infrastructure, McKinsey Institute for Black Economic Mobility. collaboration with select social media and trusted analytics partners tab. We'll email you when new articles are published on this topic. We have chosen to focus on the business and management aspects of digitization, but acknowledge, as we have made clear in much of our research, that digitization has broader effects notably on the future of work and on societal welfare. Today, Europe operates at only an Even the smallest enterprises can be born global: 86 percent of tech-based start-ups surveyed by MGI report some type of cross-border activity. Ten insights can help leaders navigate this new digital world. Today, Europe operates at only an estimated 12 percent of its digital potential, compared with the United States’ 18 percent. Learn about According to McKinsey research, Indonesia has the potential to increase its economic productivity through digitization by US$121 billion by 2025. The amount of cross-border bandwidth that is used has grown 45 times larger since 2005. People create and sustain change. In addition, explore new articles on digitization, marketing, and analytics, across industries such as consumer goods, financial services, and tech. The index “combines dozens of indicators to provide a comprehensive picture of where and how companies are building digital assets, expanding digital usage and creating a more digital workforce,” the report authors write. The McKinsey Insights app offers business insights and analysis on the biggest issues facing senior executives today--from leadership and corporate strategy to the future of work and AI's impact on business and society. Global flows of all types support growth by raising productivity, and data flows are amplifying this effect by broadening participation and creating more efficient markets. Select topics and stay current with our latest insights, Twenty-five years of digitization: Ten insights into how to play it right. McKinsey Quarterly Our flagship business publication has been defining and But the industry has an intractable productivity problem and, according to Reinventing construction: A route to higher productivity, a new McKinsey Global Institute report, an opportunity to boost value added by $1.6 trillion. Singapore tops the latest rankings, followed by the Netherlands, the United States, and Germany. Use minimal essential McKinsey Global Institute: AI Critical for Productivity, Economic Growth At a time when productivity is stagnating around the world, artificial intelligence and automation offer a lifeline. Using digital platforms and tools, they can sell in fast-growing markets while keeping virtual teams connected in real time. cookies, McKinsey_Website_Accessibility@mckinsey.com. SOURCE: The Conference Board (May 2017 release); McKinsey Global Institute analysis McKinsey & Company 4 Trend line of labor productivity growth, total economy % year-over-year 1955 60 65 70 75 80 85 90 95 2000 15 0 8 About us The McKinsey Global Institute (MGI) is McKinsey's business and economics research arm. Press enter to select and open the results on a new page. SOURCE: McKinsey Global Institute … Today, even the smallest firms can compete with the largest multinationals. Approximately 12 percent of the global goods trade is conducted via international e-commerce. Part 1 looks at China’s position in the global digital landscape. Our flagship business publication has been defining and informing the senior-management agenda since 1964. hereLearn more about cookies, Opens in new Practical resources to help leaders navigate to the next normal: guides, tools, checklists, interviews and more, Learn what it means for you, and meet the people who create it, Inspire, empower, and sustain action that leads to the economic development of Black communities across the globe. The most digital companies see outsized growth in … Discussion Paper - McKinsey Global Institute. This is a moment for companies to rethink their organizational structures, products, assets, and competitors. But although the global goods trade has flattened and cross-border capital flows have declined sharply since 2008, globalization is not heading into reverse. Digital platforms for both traditional employment and freelance assignments are beginning to create a more global labor market. The McKinsey Global Institute’s Industry Digitization Index uses dozens of indicators to provide a snapshot of digital assets, usages, and workers, and our findings about Europe are sobering. This value amounted to some $7.8 trillion in 2014 alone, and data flows account for $2.8 trillion of this impact. tab, Engineering, Construction & Building Materials, Travel, Logistics & Transport Infrastructure, McKinsey Institute for Black Economic Mobility. MGI’s analysis finds that over a decade, all types of flows acting together have raised world GDP by 10.1 percent over what would have resulted in a world without any cross-border flows. [74] McKinsey consultants published only two books from 1960-1980, then more than 50 from 1980 to 1996. Lagging countries are closing the gaps with the leaders at a very slow pace, and their limited participation has had a real cost to the world economy. Years of Digitization: ten insights into how to play it right China has grown 45 larger. 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