McKinsey Explainers
Simple answers directly from our experts
Featured explainers
Agentic AI explained: When machines don’t just chat, but act
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Three McKinsey experts explain how agentic AI could reshape workflows, decision-making, and how humans and machines collaborate.
What is the future of mobility?
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This series of McKinsey Explainers explores what’s around the next corner for the mobility industry.
What is generative AI?
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Generative artificial intelligence (AI) describes algorithms (such as ChatGPT) that can be used to create new content, including audio, code, images, text, simulations, and videos. Recent breakthroughs in the field have the potential to drastically change the way we approach content creation.
What is health span?
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With aging populations and rising chronic disease, improving health span is becoming a societal and economic priority. Here’s what drives it and what can be done.
Interactive explainer
The future takes shape: Five dimensions of tomorrow’s wellness economy
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Health is wealth, for all of us—and increasingly, for organizations that operate in the thriving wellness space. In this McKinsey Explainer, we’ll delve into what people care about when it comes to their health and the changes we can expect in this space in the future.
Video explainers
What is sovereign AI?
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Three McKinsey experts explain what sovereign AI really means—and why control over the AI stack is becoming a strategic priority for countries and companies alike.
How are companies valued?
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Three McKinsey experts explain what really drives valuation—and where leaders often get it wrong.
The brain economy explained: Why strong brains power strong economies teaser
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Four McKinsey Health Institute leaders explain why brain health and brain skills are foundational to growth, resilience, and the future of work.
More explainers
Tech & AI
What is sovereign AI?What is sovereign AI?
Three McKinsey experts explain what sovereign AI really means—and why control over the AI stack is becoming a strategic priority for countries and companies alike.
Healthcare
What is health span?What is health span?
With aging populations and rising chronic disease, improving health span is becoming a societal and economic priority. Here’s what drives it and what can be done.
People & Organizational Performance
How are companies valued?How are companies valued?
Three McKinsey experts explain what really drives valuation—and where leaders often get it wrong.
People & Organizational Performance
The brain economy explained: Why strong brains power strong economiesThe brain economy explained: Why strong brains power strong economies
Four McKinsey Health Institute leaders explain why brain health and brain skills are foundational to growth, resilience, and the future of work.
Digital & Technology
Agentic AI explained: When machines don’t just chat, but actAgentic AI explained: When machines don’t just chat, but act
Three McKinsey experts explain how agentic AI could reshape workflows, decision-making, and how humans and machines collaborate.
Healthcare
The future takes shape: Five dimensions of tomorrow’s wellness economyThe future takes shape: Five dimensions of tomorrow’s wellness economy
In this McKinsey Explainer, we look at what people care about when it comes to their health and the changes we can expect in this space in the future.
People & Organizational Performance
What is an operating model?What is an operating model?
An operating model is the backbone of any organization. It outlines how the company delivers value to its customers, operates on a day-to-day basis, and achieves its strategic objectives.
Leadership & Economic Studies
What is Davos and the World Economic Forum (WEF)?What is Davos and the World Economic Forum (WEF)?
Davos, Switzerland, is where the World Economic Forum holds its annual meeting. Delegates from many sectors converge for several days of talks and meetings to address urgent global issues.
Macroeconomics
What is a stablecoin?What is a stablecoin?
Stablecoins aim to combine the flexibility of blockchain innovations with the stability of traditional money.
Digital & Technology
What is RegTech?What is RegTech?
RegTech, or “regulatory technology,” refers to technologies that improve processes at financial-services organizations, particularly those related to risk and compliance.
Digital & Technology
What is a data center?What is a data center?
A data center is a facility that houses and runs IT infrastructure that’s critical to the digital economy, particularly gen AI.
Automotive & Assembly
What is the future of mobility?What is the future of mobility?
This series of McKinsey Explainers explores what’s around the next corner for the mobility industry.
Automotive & Assembly
What is an EV?What is an EV?
EVs are vehicles powered by electricity and an electric motor rather than a conventional gasoline-fueled internal-combustion engine.
Automotive & Assembly
What is an EREV?What is an EREV?
Extended-range electric vehicles may ease the transition to the electric future of mobility.
Digital & Technology
What is multimodal AI?What is multimodal AI?
Multimodal AI is a type of artificial intelligence that can understand and process different types of information, such as text, images, audio, and video, all at the same time. Multimodal gen AI models produce outputs based on these various inputs.
Healthcare
What are GLP-1 medications?What are GLP-1 medications?
GLP-1s are drugs that help people manage diabetes and lose weight. Their surging popularity has a range of economic and public health implications.
Digital & Technology
What is micromobility?What is micromobility?
Micromobility refers to lightweight vehicles—typically electric—used for short-distance urban transportation. These vehicles provide a sustainable and flexible alternative to cars, helping to reduce traffic congestion and carbon emissions.
Digital & Technology
What is a semiconductor?What is a semiconductor?
A semiconductor is a material that falls somewhere on the continuum between conductor and insulator, enabling a controlled flow of electrical current. Manufacturers process semiconductor materials such as silicon and other materials into chips for electronic devices.
Macroeconomics
What is a recession?What is a recession?
A recession is the part of an economic cycle that involves an economic contraction.
Digital & Technology
What is an AI agent?What is an AI agent?
AI agents are the tools we use to interact with AI. They can automate and perform complex tasks, such as natural language processing, that would normally require humans.
Automotive & Assembly
What is a self-driving car?What is a self-driving car?
A self-driving car, or autonomous vehicle, is a type of vehicle that can operate with little or no direct input from humans.
Marketing & Consumer
What is e-commerce?What is e-commerce?
E-commerce, or electronic commerce, is the buying and selling of goods and services over the internet, on websites, mobile apps, or social media. By optimizing e-commerce as part of a broader digital-commerce transformation, sellers stand to attract more customers and earn more profits.
Digital & Technology
What is SaaS?What is SaaS?
SaaS stands for software as a service. Users access SaaS products remotely via the cloud.
Digital & Technology
What is a context window?What is a context window?
A context window is how information is entered into a large language model (LLM). The larger the context window, the more information the LLM is able to process at once.
People & Organizational Performance
What is the future of wellness?What is the future of wellness?
Wellness is about more than feeling good. It’s a thriving business that is poised to keep growing.
Sustainability
What is the future of sustainability?What is the future of sustainability?
The global energy transition is entering a new phase. These ten McKinsey Explainers highlight what leaders need to know to grow through—and not just react to—the new climate era.
Sustainability
What is biodiversity?What is biodiversity?
Biodiversity is the multitude of diverse organisms across an ecosystem. It is essential for supporting the health and sustainability of all life on Earth.
Digital & Technology
What are AI guardrails?What are AI guardrails?
AI guardrails help ensure that an organization’s AI tools, and their application in the business, reflect the organization’s standards, policies, and values.
Sustainability
What are natural climate solutions?What are natural climate solutions?
Natural climate solutions, or NCS, are nature-based actions that either reduce or sequester greenhouse gas emissions, helping to protect, restore, and manage nature to further global climate goals.
Digital & Technology
What is retrieval-augmented generation (RAG)?What is retrieval-augmented generation (RAG)?
Retrieval-augmented generation, or RAG, is a process applied to large language models to make their outputs more relevant for the end user.
Sustainability
What is net zero?What is net zero?
Net zero is an ideal state where the amount of greenhouse gases released into the Earth’s atmosphere is equal to the amount removed. Emission removal and reduction through decarbonization efforts are needed to reach net zero.
Sustainability
What is decarbonization?What is decarbonization?
Decarbonization is the reduction and removal of carbon dioxide and other greenhouse gases from the atmosphere.
Sustainability
What is wind energy?What is wind energy?
Wind energy is a renewable source of electrical or mechanical power that could help transform the energy sector.
Sustainability
What are sustainable fuels?What are sustainable fuels?
Sustainable fuels are made from renewable materials instead of from fossil fuels. They include biofuels made from organic matter, so-called green gasoline, and hydrogen-based fuels.
Sustainability
What is hydrogen energy?What is hydrogen energy?
Hydrogen energy is an alternative to fossil fuels that may represent a cleaner way to power our world.
Sustainability
What are Scope 1, 2, and 3 emissions?What are Scope 1, 2, and 3 emissions?
Scope 1, 2, and 3 emissions are greenhouse gases that are released across an organization’s entire value chain. Scope 3 emissions are the most complex, as they are released before and after a product is delivered or consumed.
People & Organizational Performance
What is leadership?What is leadership?
Leadership is a set of mindsets and behaviors that aligns people in a collective direction, enables them to work together and accomplish shared goals, and helps them adjust to changing environments.
People & Organizational Performance
What is Gen Z?What is Gen Z?
Generation Z comprises people born between 1996 and 2010. This generation’s identity has been shaped by the digital age, climate anxiety, a shifting financial landscape, and COVID-19.
Digital & Technology
What is digital-twin technology?What is digital-twin technology?
A digital twin is a digital replica of a physical object, person, system, or process, contextualized in a digital version of its environment.
Strategy & Innovation
What is digital transformation?What is digital transformation?
Digital transformation is the rewiring of an organization, with the goal of creating value by continuously deploying tech at scale.
Digital & Technology
What is cloud computing?What is cloud computing?
Cloud computing allows companies to store their infrastructures remotely via the internet, ultimately reducing costs and creating value.
Growth
What does the future hold for India?What does the future hold for India?
This may be India’s century. We look ahead at seven trends likely to shape the country for years to come—and help it achieve its development goals.
Sustainability
What is circularity?What is circularity?
Circularity refers to practices that optimize resource use and minimize waste across the entire production and consumption cycle, emphasizing sustainability and economic efficiency.
Macroeconomics
What is the future of travel?What is the future of travel?
Travel is roaring back after the COVID-19 pandemic nearly decimated the industry. Here’s what you should know about the journey ahead.
Macroeconomics
What is productivity?What is productivity?
Productivity measures the amount of value created for each hour that is worked in a society.
Digital & Technology
What’s the future of AI?What’s the future of AI?
AI is here to stay. To outcompete in the future, organizations and individuals alike need to get familiar fast. This series of McKinsey Explainers dives deep into the seven technologies that are already shaping the years to come.
Digital & Technology
When and why to use a digital twin?When and why to use a digital twin?
A digital twin can drive growth and innovation. Here's how to determine whether using one could benefit your company.
Digital & Technology
What is machine learning?What is machine learning?
Machine learning is a form of artificial intelligence that is able to learn without explicit programming by a human.
Digital & Technology
What is deep learning?What is deep learning?
Deep learning is a type of machine learning that is more capable, autonomous, and accurate than traditional machine learning.
Macroeconomics
What is inflation?What is inflation?
Inflation is the gradual loss of purchasing power, reflected in a broad rise in prices for goods and services.
Digital & Technology
What is quantum computing?What is quantum computing?
Quantum computing is a new approach to calculation that uses principles of fundamental physics to solve extremely complex problems very quickly.
Digital & Technology
What is AI (Artificial Intelligence)?What is AI (Artificial Intelligence)?
Artificial intelligence is a machine’s ability to perform some cognitive functions we usually associate with human minds.
Digital & Technology
What is generative AI?What is generative AI?
Generative artificial intelligence (AI) describes algorithms (such as ChatGPT) that can be used to create new content, including audio, code, images, text, simulations, and videos. Recent breakthroughs in the field have the potential to drastically change the way we approach content creation.
Strategy & Innovation
How to prepare for the CFO role?How to prepare for the CFO role?
Amid decade-high CFO turnover, former chief financial officers share advice on what matters most today for securing the top job in finance.
Strategy & Innovation
How can banks prepare for regulatory exams?How can banks prepare for regulatory exams?
Mock exams can help banks prepare for regulatory reviews and synchronize business objectives and risk management.
Digital & Technology
What is prompt engineering?What is prompt engineering?
Prompt engineering is the practice of designing inputs for AI tools that will produce optimal outputs.
Digital & Technology
What is artificial general intelligence (AGI)?What is artificial general intelligence (AGI)?
Artificial general intelligence (AGI) is a theoretical AI system with capabilities that rival those of a human. Many researchers believe we are still decades, if not centuries, away from achieving AGI.
People & Organizational Performance
What is diversity, equity and inclusion?What is diversity, equity and inclusion?
It’s three values held by many organizations working to be mindful and supportive of different groups of individuals.
Macroeconomics
What is economic inclusion?What is economic inclusion?
Economic inclusion is when people not only have their basic subsistence needs met but also are productive, fulfilled, and fully empowered to make choices about their lives.
Digital & Technology
What is tokenization?What is tokenization?
Tokenization is the process of creating a digital representation of a real thing. Tokenization can be used to protect sensitive data or to efficiently process large amounts of data.
Digital & Technology
What is fintech?What is fintech?
Fintechs are companies that rely primarily on technology and cloud services—and less so on physical locations—to provide financial services to customers.
Strategy & Innovation
What is the C-suite?What is the C-suite?
The C-suite is the group of executives responsible for running an organization.
Digital & Technology
What are the responsibilities of a CIO versus a CTO?What are the responsibilities of a CIO versus a CTO?
Broadly speaking, a chief information officer focuses on internal technology, while a chief technology officer focuses on emerging technologies and product strategy.
Strategy & Innovation
Why do organizations have COOs?Why do organizations have COOs?
The operations lead is the counterweight to the external-facing CEO, building organizational resilience and employee empowerment.
Strategy & Innovation
What does a chief transformation officer do?What does a chief transformation officer do?
A chief transformation officer is the high-level orchestrator of a business transformation.
Strategy & Innovation
What are the roles and responsibilities of a CFO?What are the roles and responsibilities of a CFO?
The CFO role was named for its original function of overseeing an organization’s finances, but it’s now seen as a cross-cutting common denominator linking every part of an organization.
People & Organizational Performance
How is the CHRO role changing?How is the CHRO role changing?
The new mandate? Propel technological and operating-model changes in HR while still keeping the “human” in human resources.
Marketing & Consumer
Why is collaboration key to CMO success?Why is collaboration key to CMO success?
CMOs are responsible for more than marketing their company’s products or services. They should also forge strong partnerships with their C-suite colleagues to drive growth.
Strategy & Innovation
What makes a successful CEO?What makes a successful CEO?
The CEO is the person ultimately responsible for the success of a company. Their job is to develop strategy and deploy the resources to deliver on it.
Sustainability
What is the global stocktake?What is the global stocktake?
The global stocktake is an assessment of progress made toward mitigating global warming since the Paris Agreement in 2015. The results from the first-ever global stocktake will be discussed at COP28.
Digital & Technology
What is Web3?What is Web3?
Web3 is a term used to describe the next iteration of the internet, one that is built on blockchain technology and is communally controlled by its users.
Sustainability
What is cultivated meat?What is cultivated meat?
Cultivated meat is animal protein grown in a lab from animal cells.
Sustainability
What is COP?What is COP?
COP refers to the United Nations’ annual conference on climate change. Its 30th meeting, COP30, is scheduled to begin November 10, 2025, in Belém, Brazil.
People & Organizational Performance
What is brain health?What is brain health?
Good brain health means more than just the absence of disease. It also includes overall healthy cognitive functioning, resilience, and a state of well-being where individuals feel able to fulfill their potential.
Digital & Technology
What’s the future of generative AI?What’s the future of generative AI?
Generative AI has hit the ground running—so fast that it can feel hard to keep up. Here’s a quick take pulled from our top articles and reports on the subject.
Strategy & Innovation
What is business risk?What is business risk?
An organization faces business risk when it is exposed to a situation that can lead to decreased profits or even bankruptcy.
People & Organizational Performance
What is burnout?What is burnout?
Burnout is the feeling of depletion, cynicism, and emotional distance that results from a lack of impact or autonomy at work.
Retail
What is fast fashion?What is fast fashion?
Fast fashion retailers have sped up their production processes, getting new styles to customers at a record pace—and creating significant environmental and social challenges.
People & Organizational Performance
What is financial inclusion?What is financial inclusion?
Financial inclusion is when everyone can access financial services that can help them build wealth, including savings, credit, loans, equity, and insurance.
People & Organizational Performance
What is the gig economy?What is the gig economy?
The gig economy refers to the workforce of people engaged in freelance and side-hustle work.
Aerospace & Defense
What is space junk?What is space junk?
Space junk refers to fragments left behind in space. Most space junk is debris from rocket-launching material and disused satellites.
People & Organizational Performance
What is psychological safety?What is psychological safety?
Psychological safety is the absence of interpersonal fear. Feeling psychologically safe allows people to perform their best at home, school, and work.
Strategy & Innovation
What is a board of directors?What is a board of directors?
A board of directors is a governance entity that oversees and supports management on behalf of shareholders and other stakeholders to maximize value creation.
Digital & Technology
What is bioengineering?What is bioengineering?
Bioengineering is the application of engineering principles to improve disease prevention and treatment, agricultural production, energy sustainability, and more.
Marketing & Consumer
What is social media?What is social media?
Social media comprises the applications and websites that allow people to interact with other users, businesses, communities, and content.
Marketing & Consumer
What is personalization?What is personalization?
In marketing, personalization is when seller organizations use data to tailor messages to specific users’ preferences.
People & Organizational Performance
What is talent management?What is talent management?
Talent management includes all the ways that organizations bring employees on board, keep them happy and productive, and help them continue to develop their skills over time.
Strategy & Innovation
What is an effective meeting?What is an effective meeting?
Effective meetings are all about purpose, preparation, and presentation.
Strategy & Innovation
What is business transformation?What is business transformation?
Business transformations are designed to boost overall performance through increased revenue, lower operating costs, and better customer satisfaction and workforce productivity.
Marketing & Consumer
What is influencer marketing?What is influencer marketing?
Influencer marketing is a collaboration between popular social-media users and brands to promote brands’ products or services.
Digital & Technology
What is cybersecurity?What is cybersecurity?
It’s what organizations do to protect their own and their customers’ data from malicious attacks.
Strategy & Innovation
What is agile?What is agile?
Agile is a way of working that seeks to harness the inevitability of change, rather than resist it.
People & Organizational Performance
What is decision making?What is decision making?
Decision making is simply the process of making a choice. But decision making often isn’t easy and can be particularly complex in an organizational context.
Strategy & Innovation
What is design thinking?What is design thinking?
Design thinking is a systemic, intuitive, customer-focused problem-solving approach that organizations can use to respond to rapidly changing environments and to create maximum impact.
Macroeconomics
What is central bank digital currency (CBDC)?What is central bank digital currency (CBDC)?
CBDCs are digital currencies issued by central banks. Their value is linked to the issuing country’s official currency.
People & Organizational Performance
What is the future of work?What is the future of work?
It's an informed perspective about how work could shift and how workforces and workplaces can prepare for those changes.
Strategy & Innovation
What is resilience?What is resilience?
Resilience is the ability to not only recover quickly from a crisis but to bounce back better—and even thrive.
Digital & Technology
What is proof of stake?What is proof of stake?
Proof of stake (PoS) is a consensus protocol in blockchains. It is a way to decide which user or users validate new blocks of transactions and earn a reward for doing so correctly.
Digital & Technology
What is 5G?What is 5G?
5G is the fifth generation of wireless technology. Its increased speed, lower latency, and improved reliability stand to revolutionize a wide variety of industries.
Digital & Technology
What is blockchain?What is blockchain?
Blockchain is a secure database shared across a network of participants, where up-to-date information is available to all participants at the same time.
Digital & Technology
What is exascale computing?What is exascale computing?
Exascale is the next milestone in computing. It’s a higher level of computer performance that will have unprecedented impact on society and the economy.
Macroeconomics
What is supply chain?What is supply chain?
The supply chain is the interconnected journey that raw materials, components, and goods take before their assembly and sale to customers.
Strategy & Innovation
What is innovation?What is innovation?
Innovation—in a business context—is the systematic practice of developing and marketing breakthrough products and services for adoption by customers.
Marketing & Consumer
What does CX mean?What does CX mean?
It's everything an organization does to put customers first, managing their journeys and serving their needs.
Digital & Technology
What is Industry 4.0?What is Industry 4.0?
It's the next phase in manufacturing's digitization, driven by the rise of data, connectivity, and other tech trends.
Marketing & Consumer
What is the Internet of Things (IoT)?What is the Internet of Things (IoT)?
It describes objects and a variety of technologies that connect the digital and physical worlds.
Marketing & Consumer
What is omnichannel marketing?What is omnichannel marketing?
It's when you interact with your customers over whatever channels they prefer.
Sustainability
What is food insecurity?What is food insecurity?
The term “food insecurity” refers to the economic and social conditions that limit access to safe, nutritious food—and sufficient amounts of it. More than two billion people worldwide experience food insecurity.
Macroeconomics
What is economic growth?What is economic growth?
It describes how much an entity, such as a country, is increasing and improving the goods and services it produces.