2
The 2000
world’s 1950
1940 2010
economic
centre 2025
of gravity
is shifting 1500
back to 0
Asia
Locations weighted
in 3D space by GDP
6.0
2.4
3.6 billion
2015 2030
1 Annual disposable income $3,600 and over
SOURCE: United Nations World Population Prospects; McKinsey Global Institute Cityscope 4
By 2030, 60% of the world population will live in urban areas
Percent of global population living in urban areas
84
70 60%
Global population (%)
Urban population
66
42
40%
28 Rural population
14
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040 2050
7
Shanghai 2013
8
Number of companies with $1B+ revenue Emerging regions
%, number of large companies Developed regions
SOURCE: Lions on the Move 2.0, McKinsey Global Institute, September 2016 10
The world needs
to spend annually
on infrastructure
$3.7 trillion
from 2017 to 2035
SOURCE: “Bridging Global Infrastructure Gaps,” McKinsey Global Institute, June 20161
11
China’s Belt Road Initiative
will be 12 times bigger than
the Marshall Plan 65+
Moscow Maritime Silk Road Initiative
countries
Duisburg
Silk Road Economic Belt committed
Rotterdam
$1.4
Venice Almaty Urumqi
Istanbul
Samarkand Bishkek
Athens
Dushanbe trillion total
Xi’an
Tehran
investment (12x
Kolkata
Fuzhou
Guangzhou
the Marshall Plan)
Hanoi
Colombo
$250
billion in projects
Nairobi Kuala
Lumpur
underway
Jakarta
12
Globally, middle class consumers in emerging markets
will want to consume like those in the developed world
Emerging market light vehicle production Emerging market airplane fleet size
Millions per year Total aircraft (Thousands)
56 19
38% 62%
41
11
14
SOURCE: UN Forum on “Soils, Society & Global Change”, 2007
Worldwide production by 2050
Millions of tons
Meat Milk
~450
56%
18
The pace
of technological
iPhone X is 210x
faster than the first
iPhone released just
change is 10 years ago
accelerating 3 1
Data Computing
power
Number of connected
devices will triple to +30
billion by 2020
30+
billion
2008
Connected devices
Number of connected
devices surpasses
world population
12.5
6.3 Population
7.2 8.1
6.8
0.5
2003 2010 2015 2025
SOURCE: Statistisches Bundesamt; Deutsche Bundesbank; Prognos; Thomas Nipperdey; IHS Markit 20
Global accumulated digital universe of data
trillion gigabytes
44
Less than
10x
0.5%
of all data
is ever
4.4 analyzed
2015 2020
or used
21
Technology
CYBERSECURITY THREATS
TRANSPORT COMMUNICATION
is disrupting
every aspect
of our lives LIVING ROOM FACTORY
BEDROOM
OFFICE
KITCHEN
22
13 disruptive Range of sized potential economic impact Low High
technologies
$ trillions, annual 1 2 3 4 5 6 7 8 9 10
are transforming
Mobile Internet
business and
Automation of knowledge work
society
Internet of Things
Cloud technology
Advanced robotics
Autonomous and near-autonomous vehicles
Next-generations genomics
Energy storage
3D printing
Advanced materials
Advanced oil and gas exploration and recovery
Renewable energy
Blockchain and cryptocurrency Could store 10% of global GDP by 2027
according to WEF
60
downloaded
Mobile $751,522
Spent online
46,200
Posts uploaded
15,000 990,000
GIFs send via Swipes
messenger
120
New
156 million
Emails sent
accounts 50 40,000
created
Voice-first Hours
devices listened
shipped
24
China’s digital landscape has exploded
in the past decade
China US
2006 2016 2016
Online population
Million
137 731 287
Online penetration
As % of total population
11% 53% 89%
Locomotive velocity
Average miles per hour per day
1 23
22
$250
million
in annual profit
Typical Digital-
enabled
26
Cloud technology integrating data analytics in agriculture could
increase global crop yields by 10-15% – or $120-180 billion in
annual value
genomics
reprogramming a patient's cells to cure diseases a reality.
08/30/2017
28
Technology
is challenging
2005 2017
fundamental
business
orthodoxies…
Asset 500,000 2M+
ownership rooms rooms,
no physical assets
Distribution 1,500 41
stores physical stores
29
Financial
Services
…and Retail
Telcom
breaking
& Media
Data
companies
down barriers
between
industries
Tech
Hardware Health
& software
SOURCE: Kevin Kelly. 2016. The Inevitable: Understanding the 12 Technological Forces that will Shape Our Future. Viking Press, New York, NY, USA. 31
Four forces are transforming the global landscape
32
By 2050…
The proportion of world’s population
over age 65 will double
For the first time in history, there will be more people over
the age of 65 than under the age of 14
strains on
governments 100% 216%
200% of GDP by
2030
100%
71%
59%
0%
2010 2025 2050
Spending power
of consumers age
60 and older1
Trillion, $
+7
15
2010 2020
36
The fundamental
structure of society
1
Increasing
is being affected displacement
from trade and
by four factors technology
4 2
Polarization
Rising
of media and
inequality
politics
3
Geopolitical
instability
37
Technology has driven significant value
gains with less labor
Detroit Silicon Valley
1990 2016
38
most likely Predictable
to be automated physical work
(e.g., welding, food prep)
78
Data processing 69
Data collection 64
Unpredictable
physical work 25
Stakeholder For 60% of
20
interactions jobs, at least
Applying expertise 18 30% of their
least likely
activities could
to be automated
Managing others 9 be automated
SOURCE: “Where machines could replace humans—and where they can’t (yet),” McKinsey Quarterly, July 2016 39
Daimler
Freightliner
self-driving truck
There are
3.5 million
professional
truck drivers
in the US
SOURCE:
http://www.alltrucking.com/faq/truck-drivers-in-the-usa/ 40
How long does it take to train a doctor?
Number of years to train a general physician
(including undergraduate and residency)
Low High
US 11 5 16
UK 10 5 15
Canada 9 4 13
South Korea 10 3 13
Singapore 8 4 12
56
55
54
53 We are living in
52
51
parallel universes
50
49
The wealthiest 62 Individuals
48
47
in the world have the same
46
wealth as the bottom half
45 of humanity1
44
500
Million people
2% 65-70%
1 By market income; population-weighted average of 25 countries extrapolated from six sample countries (France, Italy, Netherlands, Sweden, UK and US)
SOURCE: “Poorer than their parents?” McKinsey Global Institute, July 2016 44
48
All companies must adapt or risk being disrupted
Average tenure on the S&P 500
Years
90
61
83%
25
18 15
46
Imperatives for businesses and for governments
Government
Reinforce purpose Invest in education Lay a stronger foundation
in society and training for inclusive growth
1 3 5
2 4 6
Shift from short-term to Manage Rethink the social
long-term investing and ownership cyber-risk safety net
Business
47
The role of business in developing
inclusive capitalism
48
Leadership
in an age of disruption
49
Prioritize and Keep 21st century leadership
Compart- a “telescope and
mentalize microscope”
perspective
Anticipate Manage
the second energy,
not just time What leaders do
bounce Set bold
ambition
Chief
People
Purpose-
Officer Resilient Who leaders are
driven
Selfless Decisive
50
Set bold
ambition
Groundbreaking
ceremony for
steel plant 1970
51
What are the
second or
third order
Anticipate the second consequences
bounce of the ball
of a particular
decision?
Alex Gorsky
CEO
Johnson & Johnson