Automotive & Assembly Practice Truck as a service: The next step en route to zero-emission fleets Commercial vehicle decarbonization requires changes to the ways fleet trucks are financed and serviced. The truck-as-a-service model is the next logical step toward zero-emission trucking. by Anna Herlt and Tobias Schneiderbauer with Eric Morden and Lena Bell Today, more than 95 percent of trucks on the road around the world run on diesel or gasoline.1 The traditional truck ownership model of combining purchasi ...

Industry Investment Rating - The report highlights a significant opportunity for banks, insurers, multi-family offices (MFOs), asset managers, and WealthTechs to serve the growing number of family offices in Hong Kong and Singapore, driven by an estimated $5.8 trillion intergenerational wealth transfer in the Asia–Pacific region by 2030 [4][6] Core Viewpoints - The Asia–Pacific region is experiencing a family office boom, with the number of single-family offices in Hong Kong and Singapore quadrupling since 2020 to approximately 4,000 [4] - Ultra-high-net-worth (UHNW) families are expected to account for about 60% of the total wealth transfer, with UHNW and high-net-worth (HNW) families increasingly setting up family offices to manage their wealth [4][6] - The growth of family offices presents opportunities for financial service providers to offer differentiated services, including estate planning, investments, philanthropy, and tax management [4] - Hong Kong and Singapore are key hubs for family offices in the Asia–Pacific region, accounting for approximately 15% of the world's single-family offices, supported by tax benefits, clear regulations, and mature financial ecosystems [12][13] Industry Analysis Wealth Transfer and Family Office Growth - Between 2023 and 2030, UHNW and HNW families in the Asia–Pacific region are expected to transfer $5.8 trillion in wealth, with UHNW families accounting for 60% of this transfer [4][6] - The number of single-family offices in Hong Kong and Singapore has quadrupled since 2020, reaching approximately 4,000, driven by the need to manage intergenerational wealth transfers [4] Key Differences Between Asia–Pacific and Western Family Offices - Family offices in Asia–Pacific are less professionalized compared to their Western counterparts, with only about 5% of UHNW households having single-family offices, compared to over 15% in Europe and North America [10] - Wealthy families in Asia–Pacific prefer single-family offices for tighter control over their wealth, while Western families are more open to multi-family offices for cost efficiency [10] - Asian family offices show a rising interest in alternative investments, with about 30% allocated to alternatives, compared to 50% in Europe [10] Hong Kong and Singapore as Family Office Hubs - Hong Kong and Singapore manage approximately $1.3 trillion each in offshore assets, making them key players in the global financial ecosystem [13] - Wealth flowing into these hubs primarily comes from mainland China, India, and Indonesia, with increasing interest from Europe and North America as Asia–Pacific is seen as a third safe haven for portfolio diversification [13][16] Family Office Archetypes - Single-family offices in the Asia–Pacific region fall into four main archetypes: Visionary Entrepreneur, Traditional Business Owner, Embedded, and Professionalized family offices, each with distinct investment preferences and operational models [16][19] - Professionalized family offices, with in-house chief investment officers and higher assets under management (AUM), account for the largest proportion of family offices in the region [19] Challenges and Opportunities for Service Providers - Family offices face challenges such as weak governance, rising operational costs, limited access to bespoke alternative investments, and outdated technology [17][22][26] - Service providers, including banks, insurers, MFOs, and WealthTechs, can address these challenges by offering tailored solutions, improving governance structures, and leveraging technology for operational efficiency [17][22][26] Provider Types Serving Family Offices - Five types of providers serve family offices: banks with integrated or à la carte approaches, insurers, MFOs, and WealthTechs, each offering differentiated services and fee structures [28][32][36][37] - WealthTechs, in particular, are gaining traction by using technology to transform investment management and offering scalable solutions at competitive rates [37] Framework for Serving Family Offices - Providers should focus on scalability, solutions, service, and security to effectively serve family offices, with banks and insurers enhancing their operating models through partnerships, technology, and tailored offerings [43][46]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - Generative Artificial Intelligence (GenAI) has the potential to significantly enhance efficiency in public administration by automating tasks that currently consume 60-70% of employee time, such as content synthesis and citizen interaction [3] - The German government plans to invest €1.5 billion by 2025 to expand the AI sector and leverage its potential for employees and businesses [3][4] - Successful scaling of GenAI in public administration depends on seven key factors, including regulatory frameworks, centralized provision of solutions, and effective risk management [5][15] Summary by Sections Investment Rating - No specific investment rating provided in the report Core Insights - GenAI can close efficiency gaps and accelerate the digitalization process in public administration [3] - Current usage of GenAI in public administration is primarily through pilot projects, with a focus on creating acceptance and demonstrating effectiveness [3] - The true potential of GenAI lies in its scaled, widespread use across different authorities [3] Preconditions for Widespread Use of GenAI - A reliable regulatory framework is necessary for scaling GenAI applications in Germany, addressing data protection and quality assurance [5] - Transparency regarding data protection and security is essential for GenAI to be perceived as a reliable technology [7] Success Factors for Technical Scaling - Centralized provision of functional GenAI solutions can facilitate broader use in administrative organizations [8] - A unified governance structure for the widespread deployment of GenAI solutions is crucial [9] - Existing technical infrastructure must be expanded to support GenAI solutions effectively [10] Success Factors for Accelerated Scaling - Systematic development of skills and recruitment of GenAI talent is necessary for effective deployment [13] - Encouraging the exchange of GenAI solutions among different authorities can reduce redundancy and improve efficiency [14] - Establishing effective risk management practices is vital to identify and mitigate risks associated with GenAI usage [15][16]

Investment Rating - The report does not provide a specific investment rating for the industry Core Insights - Versatile leadership is essential for navigating complex business environments and engaging effectively with diverse stakeholders [4][5][22] - Leaders must cultivate a mix of humility, confidence, and resilience while being adaptable to changing circumstances [4][5] - The ability to communicate authentically on social and environmental issues is increasingly important for CEOs [19][20] Summary by Sections Leadership Versatility - Successful leaders are characterized by their ability to pursue diverse experiences, maintain curiosity, and master stakeholder dynamics [4][5] - Versatile leaders know when to broaden their focus and when to delve deeper into specific issues [5] Challenges Faced by Leaders - Leaders today must manage external challenges such as supply chain disruptions, inflation, and generational differences among employees [3][4] - The rapid pace of technological change, particularly in AI, is reshaping business models and workforce dynamics [3] Importance of Diverse Experiences - Leaders should seek varied environments and challenges to develop a broad skill set [10][12] - Versatility allows leaders to pivot between different operational modes, such as cost-cutting and growth [7][10] Deep Learning and Curiosity - Deep, creative thinking is crucial for leaders to understand their business intricacies and competitive landscape [13][14] - Continuous learning and curiosity enable leaders to adapt and thrive in changing conditions [16][17] Communication and Social Responsibility - CEOs must navigate the complexities of taking public stances on social and environmental issues [19][20] - Authenticity in leadership is vital, as stakeholders expect leaders to align their actions with their stated values [22][23] Conclusion on Leadership Versatility - Cultivating versatility is critical for leadership success, requiring leaders to identify necessary skills and experiences [24] - Leaders should focus on areas that are most relevant to their organizations and invest time in deepening their understanding [24]

Investment Rating - The report does not explicitly provide an investment rating for the industry Core Insights - The energy transition is in its early stages, with only about 10 percent of the required deployment of low-emissions technologies achieved by 2050 in most areas, indicating significant room for growth and investment opportunities [9][15][28] - Twenty-five interlinked physical challenges must be addressed to advance the energy transition, which involves developing new low-emissions technologies and entirely new supply chains and infrastructure [9][10][29] - Understanding the physical challenges can help CEOs and policymakers navigate the transition effectively, identifying viable opportunities and addressing bottlenecks [11][42] Summary by Sections At a Glance - The energy system accounts for over 85 percent of global CO2 emissions, necessitating a transition to low-emissions technologies while expanding energy access globally [9][15] - Progress has been made in some areas, but the most demanding challenges remain largely unaddressed [9][28] Introduction - The global energy system is complex and has been optimized over centuries, but it is responsible for high emissions and inefficiencies [14][57] - The transition aims to reduce emissions while maintaining or improving energy system performance [57][58] Executive Summary - The current energy system is high-performing but generates significant emissions, with two-thirds of energy currently wasted [24][57] - Low-emissions technologies like solar and wind power need to be deployed effectively to ensure a successful transition [25][27] Energy Transition Challenges - The transition involves transforming seven interlinked domains: power, mobility, industry, buildings, raw materials, hydrogen, and carbon reduction [26][40] - Addressing the hardest of the 25 identified physical challenges is crucial for reducing energy-related emissions [29][35] Physical Challenges Overview - The report categorizes challenges into three levels based on technological performance and interdependencies, with Level 3 challenges being the most difficult [34][35] - Significant scaling of low-emissions power generation capacity is required, alongside advancements in electric vehicles and industrial decarbonization [36][37][38] Conclusion - A successful energy transition requires a comprehensive understanding of physical challenges and the interdependencies within the energy system [20][42] - Stakeholders must consider both immediate actions and long-term strategies to facilitate the transition while ensuring affordability and reliability [43][44]

Strategy & Corporate Finance Practice The Committed Innovator: Helping India's e-commerce leapfrog into the future Shiprocket cofounder and CEO Saahil Goel talks about why he started an e-commerce logistics platform, how it unlocks value in a developing economy, and his vision for scaling it. August 2024 In this episode of The Committed Innovator, McKinsey innovation leader Erik Roth speaks with Shiprocket cofounder and CEO Saahil Goel about how he built his e-commerce logistics company into a highly succes ...

McKinsey Explainers What is digital transformation? Digital transformation is the rewiring of an organization, with the goal of creating value by continuously deploying tech at scale. June 2023 Digital transformation is the fundamental rewiring of how an organization operates. The goal of a digital transformation, as outlined in the new McKinsey book Rewired: A McKinsey Guide to Outcompeting in the Age of Digital and AI (Wiley, June 20, 2023), should be to build a competitive advantage by continuously deplo ...

Strategy & Corporate Finance Practice The transformation imperative for midcap companies Transformations, when done right, can enable midmarket companies to unleash their full potential. August 2024 Midsize companies are the lifeblood of many economies but can often increase their scale and impact by undertaking transformations. In this episode of the Inside the Strategy Room podcast, three experts offer advice on how midcaps can reach a higher level of performance. Zak Gaibi, who leads McKinsey's Transform ...

Investment Rating - The report does not explicitly provide an investment rating for the insurance industry or Prudential Group. Core Insights - Prudential Group is undergoing a customer-centric transformation driven by digitalization, data, and artificial intelligence, while maintaining the importance of human interaction [1][2][3]. - The company aims to create a seamless and personalized customer experience across all touchpoints by leveraging data and technology [2][3]. - The focus on customer satisfaction, loyalty, and advocacy is seen as a pathway to sustainable growth and value creation [2][3]. Summary by Sections Digital Transformation - Prudential has recognized the importance of artificial intelligence and data analytics in enhancing customer experience and operational efficiency [3][5]. - The company is investing in a digital platform to support agents in better interacting with customers, providing timely reminders and personalized information [5][6]. Customer-Centric Approach - The organization emphasizes the need for a culture that prioritizes customer insights and feedback, integrating these into decision-making processes [5][6]. - Prudential aims to engage all employees in customer interactions, with a goal for each employee to connect with 100 customers within a year [6]. Data Utilization - Data is identified as a top priority for Prudential, especially in understanding customer behavior and optimizing communication strategies [5][6]. - The company is committed to complying with data privacy regulations while leveraging data to enhance customer trust and experience [6]. AI Integration - AI is viewed as a transformative force in the service industry, enabling personalized solutions and automating processes to improve service delivery [3][5]. - The integration of AI is aimed at simplifying underwriting processes and enhancing customer service efficiency [3][5]. Cultural Shift - A cultural shift towards a customer-centric mindset is essential for Prudential's transformation, requiring the right attitudes, skills, and tools among employees [3][5]. - The company is fostering a symbiotic relationship between human expertise and AI, emphasizing the importance of listening to customer feedback [5][6]. Performance Metrics - Customer satisfaction scores are utilized as a key metric to gauge progress towards a more customer-centric approach, with a goal to reach the top quartile by 2027 [6].

Financial Services Practice Prudential embraces customer centricity: An interview with Priscilla Ng Prudential plc's shift to customer-centric insurance hinges on digital transformation, with data and artificial intelligence as key enablers and humans still playing a crucial role. August 2024 As Prudential plc embraces digital transformation, the 176-year-old insurance company finds itself navigating a delicate balancing act: harmonizing the power of AI with a human touch, essential to delivering exceptiona ...