Lareina Yee, a McKinsey technology expert and contributor to the McKinsey Technology Trends Outlook 2024, joins Roger Roberts, a senior partner, to explore fascinating tech trends. They discuss the swift advancements in generative AI and its importance for business innovation. The pair also highlight the need for effective communication strategies for CEOs, especially in crisis situations, and delve into the electrification trend as a key driver for carbon-free energy, emphasizing the role of emerging technologies and digital trust.
Despite a significant decline in overall investment in technology, specific sectors like generative AI and climate technology are experiencing notable growth and interest.
Successful CEOs are focusing on organized communication plans that effectively address both everyday operations and crisis management, highlighting the importance of strategic leadership.
Deep dives
Technology Trends and Investment Insights
Current technology trends continue to experience strong innovation and interest, although investment in new technologies has significantly dropped, with estimates showing a decline of 30 to 40 percent, totaling about $570 billion. This downturn is notable yet not surprising, as the market adjusts to broader economic challenges while still seeing pockets of growth, particularly in areas like generative AI and robotics. For example, while overall investment decreased, sectors such as climate technology have attracted increased attention, illustrating a shift in focus despite the downturn. The correlation between job postings for tech talent and investment levels further highlights the ongoing demand for skills in advanced technology fields.
Generative AI as a Catalyst
Generative AI has emerged as a transformative force within the technology landscape, acting as a catalyst that enhances various trends, including analytics and robotics. Its capabilities are driving increased investments and job postings as organizations explore applications across multiple sectors, reflecting an ongoing surge of interest. The advancements in generative AI also play a key role in the development of robotics, especially as robots become more adept at tasks requiring flexibility and adaptability, such as food preparation. This innovation signals a shift from fixed-task robots to more general-purpose machines capable of tackling diverse challenges in dynamic environments.
Electrification and Renewables as Competitive Edges
Electrification is becoming crucial for businesses aiming to remain competitive, especially as industries transition towards carbon-free energy sources. This shift necessitates substantial improvements to electric infrastructure, including better grid management and technologies to address supply and demand dynamics. Alongside this, the renewable energy sector has experienced rapid advancements, with increased deployments of solar and wind technologies driving productivity and addressing climate challenges. Companies are encouraged to leverage both public sector incentives and private investments to capitalize on the growth in renewable sources and electrification initiatives, helping to shape a sustainable future.
Innovation and interest in the tech sector remain strong, despite market challenges and dips in investment. On this episode of The McKinsey Podcast, McKinsey technology experts Lareina Yee and Roger Roberts share findings from the McKinsey Technology Trends Outlook 2024 report. They talk with editorial director Roberta Fusaro about where innovation is exploding, interest is deepening, and investment is flowing.
In our second segment, from our CEO Insights series, McKinsey partner Blair Epstein explores how successful CEOs organize their yearly communication plans, including how to manage comms through crisis.