1160 Posts found for Source: McKinsey Quarterly

If prosperity is created by solving human problems, a key question for society is what kind of economic system will solve the most problems for the most people most quickly. This is the genius of capitalism: it is an unmatched evolutionary system for finding solutions. […] Human creativity develops a variety of ways to solve such problems, but some inevitably work better than others, and … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subjects: Capitalism, Economics

We typically talk about growth in terms of GDP, though it has been much criticized recently as a measure of progress. There have been a variety of attempts to make GDP account for things such as environmental damage, unpaid work, the progress of technology, or the development of human capital. In our view, the biggest problem with GDP is that it doesn’t necessarily reflect how … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subjects: Capitalism, Economics

Prosperity in human societies can’t be properly understood by looking just at monetary measures, such as income or wealth. Prosperity in a society is the accumulation of solutions to human problems. These solutions run from the prosaic (crunchier potato chips) to the profound (cures for deadly diseases). Ultimately, the measure of the wealth of a society is the range of human problems it has solved … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subjects: Capitalism, Economics

The essential role of capitalism is not allocation—it is creation. Life isn’t drastically better for billions of people today than it was in 1800 because we are allocating the resources of the 19th-century economy more efficiently. Rather, it is better because we have life-saving antibiotics, indoor plumbing, motorized transport, access to vast amounts of information, and an enormous number of technical and social innovations that … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subjects: Capitalism, Economics

Andy Haldane, the chief economist of the Bank of England, notes that the conventional theory views the economy as a rocking horse that, when perturbed by an outside force, sways for a while before predictably settling back down to a static equilibrium. But, as Haldane has pointed out, what we saw during the crisis was more like a herd of wild horses—something spooks one of … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subject: Economics

For the past century, the dominant economic paradigm—neoclassical economics—has painted a narrow and mechanistic view of how capitalism works, focusing on the role of markets and prices in the efficient allocation of society’s resources. The story is familiar: rational, self-interested firms maximize profits; rational, self-interested consumers maximize their “utility”; the decisions of these actors drive supply to equal demand; prices are set; the market clears; … [ Read more ]

Content: Quotation | Authors: Eric Beinhocker, Nick Hanauer | Source: McKinsey Quarterly | Subjects: Capitalism, Economics

Matrices are often necessary, but they may create uncomfortable ambiguity for employees. Clarifying roles can boost both the engagement of the workforce and a company’s organizational health.

Content: Article | Authors: Jim Harter, Michael Bazigos | Source: McKinsey Quarterly | Subject: Organizational Behavior

Governance arguably suffers most […] when boards spend too much time looking in the rear-view mirror and not enough scanning the road ahead.

Content: Quotation | Authors: Christian Casal, Christian Caspar | Source: McKinsey Quarterly | Subject: Corporate Governance

Organizations must build digital resilience to protect their most valuable information assets.

Content: Article | Authors: Chris Rezek, James M. Kaplan, Tucker Bailey | Source: McKinsey Quarterly | Subject: IT / Technology / E-Business

Although good execution is essential for defending market share in fiercely contested markets, and thus for capitalizing on the corporate portfolio’s full-market-growth potential, it is usually not the key differentiator between companies that are growing quickly and those that are growing slowly. These findings suggest that executives ought to complement the traditional focus on execution and market share with more attention to where a company … [ Read more ]

Content: Quotation | Authors: Mehrdad Baghai, S. Patrick Viguerie, Sven Smit | Source: McKinsey Quarterly | Subjects: Best Practices, Management, Strategy

Traditional corporate training programs still rely on classroom learning, even though researchers have long found that the classroom alone is a poor fit for adult learning patterns. Most adults instead need a mix of concrete experience, reflective observation, abstract conceptualization, and active experimentation.

Content: Quotation | Source: McKinsey Quarterly | Subjects: Human Resources, Training & Development

In a disruptive age, established business models are under attack. Here’s how incumbent companies can reframe them.

Content: Article | Authors: Marc de Jong, Menno van Dijk | Source: McKinsey Quarterly | Subjects: Innovation, Management, Strategy

A company’s strategy should consist of a portfolio of initiatives that consciously embraces different time horizons. Companies do, of course, have different business units with distinct strategies. But few strategies direct a company in a way that will enable it to adapt to events and capitalize on opportunities as they arise. Some initiatives in the portfolio will influence short-term performance. Others will create options for … [ Read more ]

Content: Quotation | Author: Ian Davis | Source: McKinsey Quarterly | Subject: Strategy

Since standard stock options don’t differentiate between value created by external factors and individual performance, investors may be shortchanged and CEOs may be rewarded regardless of merit and top-performing CEOs may be penalized if their tenure coincides with a bear market. Indeed, McKinsey research shows that from 1991 to 2000, market and industry factors drove about 70 percent of the returns of individual companies, company-specific … [ Read more ]

Content: Quotation | Authors: J. C. de Swaan, Neil Harper | Source: McKinsey Quarterly | Subjects: Compensation, Corporate Governance

For industrial manufacturers, resources remain a huge financial and managerial cost. A change in perspective can lead to real breakthroughs in reducing resource consumption.

Content: Article | Authors: Ken Somers, Markus Hammer | Source: McKinsey Quarterly | Subject: Operations

Companies will better integrate their people, processes, and structures by following nine golden rules.

Content: Article | Authors: Aaron De Smet, Deirdre McGinty, Steven Aronowitz | Source: McKinsey Quarterly | Subject: Organizational Behavior

An all-in-one, one-for-all formula to determine R&D’s productivity can help companies see how well the function is performing.

Content: Article | Authors: Eric Hannon, Florian Weig, Sander Smits | Source: McKinsey Quarterly | Subjects: Innovation, Management

Online communities are helping companies engage with employees to accelerate change.

Content: Article | Authors: Arne Gast, Raul Lansink | Source: McKinsey Quarterly | Subjects: Change Management, Management, Organizational Behavior

Today’s technology enables integrated operations that can change the globalization penalty into a premium.

Content: Article | Author: Pascal Visée | Source: McKinsey Quarterly | Subject: International

Before doing so, executives should ask themselves two sets of questions.

Content: Article | Authors: Olivier Sibony, Philip Meissner, Torsten Wulf | Source: McKinsey Quarterly | Subjects: Management, Personal Development