Managing organizations is more difficult than ever. Ongoing disruptions, as well as fresh opportunities, require CEOs to lead in whole new ways.
As CEOs around the world, in every industry and market, forge their company’s path through ever-growing complexities and uncertainties, they need to focus on what’s most important. Liz Hilton Segel, Chief Client Officer, and Homayoun Hatami, Managing Partner for Global Client Capabilities, have spoken with hundreds of CEOs and, discussed what they learned during the latest McKinsey Live event. The following priorities top CEOs’ agendas of the most successful companies.
Gen AI: The start of something meaningful. In the past year, companies have moved from piloting generative AI programs to enterprise-wide rollouts. To capture lasting value, CEOs must determine the organizational changes gen AI requires, and the capabilities needed to implement it at scale. Leaders can take nine actions to define and shape a strategy and manage risk. Worldwide, the once-in-a-generation technology has the potential to unlock $4.4 trillion of value annually.
Outcompeting with technology. While 90 percent of companies have launched some type of digital or AI transformation, on average they have captured only about a third of the expected revenue benefits. Top CEOs do six things that are critical to a successful transformation. It’s never just tech.
Geopolitics: Beating the odds. Escalating tensions and conflicts have moved geopolitical risk from the chief risk officer’s desk to the boardroom, where the best CEOs are having strategic conversations. In the face of unpredictable events, resilience and flexibility are more important than ever. And top CEOs do not just stay knowledgeable about geopolitics, they infuse resilience into their business strategy.
The energy transition: Time is short. Companies need to accelerate efforts to reach net-zero targets. CEOs must solve the equation that requires scaling low-carbon energy systems and decarbonizing existing systems at the same time. Green technology offers new opportunities; the growing demand for zero-net offerings could generate up to $12 trillion in worldwide sales by 2030.
Navigating the road to courageous growth. Leaders of the 25 percent of companies that outperform their industry peers in revenue and profit growth follow six strategies. Two stand out the most: creating a culture of growth and innovation and using technology to generate additional growth of the company’s core business.
Powering middle managers. The best CEOs support middle managers, who are the heart of their company. Rather than promote them to senior management jobs they don’t want or are not suited for, good leaders aim to expand their roles, provide development opportunities, and keep them in positions where they add the most value.
What’s your superpower? It’s essential for the CEO to identify the business’s superpower—that is, the one capability that sets a leading company apart from the rest—and then act to enhance it. Having a dialogue with the board about changes that could strengthen the superpower will help the company move to a new level of growth.
A new lens on the macroeconomy. Four years after the COVID-19 pandemic shook the world, the economy continues to undergo long-term structural shifts, with unknowable results. By using scenario planning, leading companies can prepare to shift when the economy does and to operate under—and even capitalize on—uncertainty.
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For more on the topic, see the full report and explore the interactive article collection called “What matters most? Eight CEO priorities for 2024.”
Additional resources:
Rewired: The McKinsey guide to outcompeting in the age of digital and AI, a deeper dive into successful digital and AI transformation
The organization of the future: Enabled by gen AI, driven by people
The economic potential of generative AI: The next productivity frontier
Technology’s generational moment with generative AI: A CIO and CTO guide
Scaling green businesses: Next moves for leaders
Decarbonize and create value: How incumbents can tackle the steep challenge
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