the old joke has it that nostalgia isn’t what it used to be. As the unrelenting COVID-19 pandemic rolls on, the future isn’t what it used to be, either. What used to be a simple idea now comes freighted with caveats, assumptions, and speculations. In the spirit of illumination, McKinsey researchers this week took a look at how things might develop in six sectors beyond the next few weeks.
The auto industry is one of the world’s largest and has been devastated by the pandemic: sales may drop by 20 to 30 percent in 2020, and we estimate that profits will fall by $100 billion. But automakers can respond. One example: software-subscription services, which enable people to pay for programs that unlock features from heated seating to full self-driving capabilities, allow dealerships to develop a better relationship with consumers while offering drivers additional flexibility and customization.
The US restaurant industry has given many iconic brands to the rest of the world. But today, the sector is in trouble. In our latest podcast, we review the industry’s predicament, which we explored earlier in some depth, and assess the innovative solutions that companies are devising. Takeout and delivery are here to stay, and restaurants are working to make those experiences better. Menus also need a rethink. People don’t order sides, appetizers, and desserts as frequently when they’re ordering for delivery—but as leaders know, those items are often the difference between profit and loss.
https://portfolium.com/entry/2020-hd-2after-we-collided
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For banks, the pandemic has changed everything. Risk-management teams are running hard to catch up with cascades of credit risk, among other challenges. Down the line, we expect that automated underwriting will take hold for retail and small-business customers and will both reduce losses and save costs.
Asian insurers are looking at a more consolidated future. Our new report argues that insurtechs’ new, pandemic-oriented products and digital capabilities—not least the ability to reach millions of customers within a few months—mean that a programmatic approach to M&A is the surest strategy to overcome the industry’s structural weaknesses.
https://portfolium.com/entry/2020-hd-2091
We recently hosted a panel discussion with Shobana Kamineni, executive vice chairperson of India’s Apollo Hospitals, to discuss the evolving nature of healthcare at scale. Apollo Hospitals comprises more than 7,000 physicians and 30,000 other healthcare professionals, and its app is downloaded about 30,000 times a day. Among the findings: public–private partnerships are working well and have the potential to influence the future of healthcare.
Finally, we consider five fundamental questions for US higher education, as colleges fashion their pandemic response. Also this week: a new survey of Europe’s small and medium-size businesses lays out the extent of the economic damage and owners’ muted outlook.
Executives everywhere are thinking through the contours of the next normal. Start with The McKinsey Download Hub to find McKinsey’s latest research, perspectives, and insights on the management issues that matter most, from leading through the COVID-19 crisis to managing risk and digitizing operations. Also consider our special collection The Next Normal: The Recovery Will Be Digital, featuring a 172-page curated volume that you can download—the first of five edited collections that accompany Our New Future, a multimedia series we created with CNBC.
You can also see the full collection of our coronavirus-related content, visual insights from our “chart of the day,” a curated collection of our first 100 articles related to the coronavirus, our suite of tools to help leaders respond to the pandemic, and how our editors choose images that help readers visualize the impact of an invisible threat.