FOUR OF OUR BEST NEW IDEAS FOR THE C-SUITE

The CEO role has never been easy: the boss is ultimately in charge of forming the company’s new strategies, then marshaling the resources to deliver on them. But what we’re hearing now from the world’s CEOs is that their role is harder than ever. Accordingly, we’re doubling down on our commitment to support them. Our CEO Excellence research is generating a steady stream of insights on how the best CEOs consistently deliver results. And other colleagues continue to surface the issues that matter most to CEOs and their teams in the C-suite. In line with that, we’ve changed the focus (and the name) of this newsletter to signal our commitment to helping CEOs—both present and future—do the best jobs they can. Rest assured, we will continue to deliver, twice monthly, four articles and reports that are must-reads for people across the workforce—from C-level execs to the front line. In this edition, we look at how organizations with an innovative culture are more likely to confer a competitive edge with generative AI, how consumer companies are becoming software companies, and more. We hope you enjoy the read.

—Liz and Homayoun

What’s new

Here’s what’s not new. Companies with highly innovative cultures are better able than their peers to meet the demands of dynamic times. This is known. But in today’s business environment—where generative AI is the talk of every watercooler, and fast movers take the prize—we’ve found that highly innovative companies are even more adept than we thought. When it comes to deploying generative AI at scale, top innovative organizations are widening the competitive gap between themselves and their trailing peers.  

Hone your company’s innovative edge with five strategic actions in Companies with innovative cultures have a big edge with generative AI, a new article by Matt Banholzer, Ben Fletcher, Laura LaBerge, and Jon McClain. 

What’s now

Every consumer company is now a software company—or soon will be. More than 500 million people interact with Nike through its apps annually, for example. The Starbucks app clocks more point-of-sale payments in the US than any other platform except Apple. And e-commerce figures prominently in most consumer companies’ ambitions. But the pace of technology innovation is frantic, the demands are huge, and many companies are falling behind.

Keep up with Turning consumer and retail companies into software-driven innovators, by Aman Dhingra, Chandra Gnanasambandam, Rahul Mangla, Hannah Mayer, and Roger Roberts.  

What’s next

Working hard or hardly working? With hybrid work firmly entrenched at many companies, some leaders are left wondering if all those faces on the videoconference call are committed to the mission, or if some might be spending most of their time on their hobbies (or working another job). Our new research finds that 10 percent of workers at an average organization are highly dissatisfied and actively disengaged. The cost to productivity is staggering—at least $228 million annually for a median-size company.

Companies can reconnect with the disengaged—and all other employees too, including star performers. To learn how, read Some employees are destroying value. Others are building it. Do you know the difference? by Aaron De Smet, Marino Mugayar-Baldocchi, Angelika Reich, and Bill Schaninger.

What’s needed

Tell me a story. We’ve known anecdotally for a long time that investors value ESG but want to see a clear path to value creation before investing. Now, we have the data to back it up, from a new survey of chief investment officers. Once a strong case is made, though, investors are ready to open their checkbooks: our data shows that a significant majority of them will pay a premium for companies that link ESG efforts to financial performance.

Learn how to tell a compelling ESG equity story with Investors want to hear from companies about the value of sustainability, by Jay Gelb, Rob McCarthy, Werner Rehm, and Andrey Voronin. 

We hope you find our new focus on CEOs inspiring and helpful. See you in two weeks with four more McKinsey ideas for the CEO and others in the C-suite.

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