Trends Identified

Connectivity-driven business models

For years, companies shared business models and tried to outperform each other. Today, connectivity is enabling new business models. For example, more than half of the respondents expect to see pay-per-use models within their own industries, with data monetization by far the next most common business model. Software is becoming much more important than hardware, and customer interactions are increasingly digitized, in many cases managing without intermediaries. Consequently, connectivity-driven fields such as shared mobility are expected to grow significantly in the coming years.

2018

Disruptive forces in the industrial sectors - Global executive survey

McKinsey

AI and autonomous systems

Learning from data and developing smart algorithms has become a competitive advantage. Executives from all sectors believe that AI and autono­mous systems will affect the entire industry. Investment in AI is at unprecedented levels from both tech firms and traditional manufacturers. Driverless vehicles are AI’s poster child, but industrial companies are also investing in machine learning and robotics to develop specific technologies related to their core businesses.

2018

Disruptive forces in the industrial sectors - Global executive survey

McKinsey

Internet of Things (IoT)

This much hyped term refers to the sensor-enabled devices that can communicate with one another via the Internet. The possible uses are still being unearthed, but the McKinsey Global Institute predicts that the annual economic impact of IoT applica­tions could be as much as USD 11.1 trillion by 2025. MGI suggests that factories are likely to see the greatest potential impact from IoT use – as much as USD 3.7 trillion per year – with substantial productivity improvements, including 10 to 20 percent energy savings and a 10 to 25 percent improvement in labor efficiency.

2018

Disruptive forces in the industrial sectors - Global executive survey

McKinsey

Electrification

Replacing traditional energy sources with electric energy – most notably in vehicles – is being driven by regulatory and technological changes and by growing consumer demand. The growth in electric vehicles sales is expected to be 25 to 30 percent a year to 2025 (see Exhibit 4). A senior executive at a European OEM believes it will affect at least half of the sector’s revenues, both in vehicles and infrastructure. Stricter emission regulations and lower battery costs are all contributing to the flurry of activity in this area.

2018

Disruptive forces in the industrial sectors - Global executive survey

McKinsey

Cybersecurity

The increase in connectivity between companies and consumers as well as within organizations, production facilities, transportation systems, defense systems, etc. means that cybersecurity is critically important. Once closed systems are now open, increas­ing vulnerability and placing ever higher-value assets and processes at risk, leading to an annual growth in the market for cybersecurity of 5 to 10 percent until 2025 (see Exhibit 4). Our survey revealed widespread and growing concern on this topic, and many companies are starting to bring in the skills they need for tackling cybersecurity concerns. Some even see cybersecurity as a battleground for competitive advantage and differentiation.

2018

Disruptive forces in the industrial sectors - Global executive survey

McKinsey

Data and AI

Data and AI, which include both advanced analytics and artificial intelligence

2019

Tech for good

McKinsey

Connectivity and platforms

Connectivity and platforms, under which we group digital platforms, the mobile internet, and the cloud .

2019

Tech for good

McKinsey

Robotics

Robotics, under which we include both advanced robotics increasingly able to augment humans in the workplace and traditional robotics, in which machines reproduce repetitive human actions, as well as autonomous and near-autonomous vehicles

2019

Tech for good

McKinsey

Internet of things

The Internet of Things, which uses networks of sensors and devices to collect data and optimize processes

2019

Tech for good

McKinsey

Virtual and augmented reality

Virtual and augmented reality, an artificial environment created with software and hardware that, in the case of augmented reality, provides the ability to overlay digital information into real-world settings

2019

Tech for good

McKinsey