McKinsey

Generative Artificial Intelligence (gen AI) has already initiated a seismic shift in work and value creation. A recent McKinsey report identified up to $4.4 trillion in potential global economic impact from gen AI across functions and industries. With gen AI in its infancy, organizations are just beginning to understand the potential of applying it to their own goals. As often happens, the advent of a new technology can create or exacerbate divides, including the racial wealth gap. This article explores how gen AI may affect Black communities and Black workers.

The digital divide was first recognized in the mid-1990s. Three decades later, due in part to long-standing economic inequity and the economics of broadband, it remains an impediment to inclusive economic growth, particularly in Black American communities. There are five steps that state and local leaders and broadband stakeholders could take to expand broadband access and promote digital equity and inclusion in Black communities:

For China’s small enterprises, greater digitization provides an opportunity to boost their labor productivity, collaborate in new ways, and expand their reach via e-commerce.

New applications of the Internet could account for up to 22 percent of China’s labor-productivity growth by 2025. Greater adoption of web technologies in China could lead to the introduction of entirely new products and services if government and industry take the right steps to maximize the potential.

A new report from the McKinsey Global Institute (MGI), : The Internet’s impact on productivity and growth, projects that new Internet applications could fuel some 7 to 22 percent of China’s incremental GDP growth through 2025, depending on the rate of adoption. That translates into 4 trillion to 14 trillion renminbi in annual GDP in 2025.

The adoption of IT in healthcare systems has, in general, followed the same pattern as other industries.

In the 1950s, when institutions began using new technology to automate highly standardized and repetitive tasks such as accounting and payroll, healthcare payers and other industry stakeholders also began using IT to process vast amounts of statistical data.

Twenty years later, the second wave of IT adoption arrived. It did two things: it helped integrate different parts of core processes (manufacturing and HR, for example) within individual organizations, and it supported B2B processes such as supply-chain management for different institutions within and outside individual industries.

Many institutions in the private and public sector have already moved to the third wave of IT adoption -- full digitization of their entire enterprise, including digital products, channels, and processes, as well as advanced analytics that enable entirely new operating models.

No longer limited to helping organizations do a certain task better or more efficiently, digital technology has the potential to affect every aspect of business and private life, enabling smarter choices, allowing people to spend more time on tasks they deem valuable, and often fundamentally transforming the way value is created.

What will this third wave of IT adoption look like for healthcare? Programs like the N3 communication network in the United Kingdom and the secure telematics platform in Germany have created powerful infrastructures that have the potential to support the third wave of digital services in healthcare.

This report examines the inflows and outflows of goods, services, finance, and people, as well as the data and communication flows that underlie them all, for 195 countries around the world.

Our research finds that such flows matter for global GDP growth. Today, we estimate, they add between $250 billion and $450 billion to it every year, or 15 to 25 percent of the total. In addition, we find that countries with a larger number of connections in the global network of flows increase their GDP growth by up to 40 percent more than less connected countries do.

The penalty for being left behind is rising. MGI’s new Connectedness Index ranks 131 countries on total flows of goods, services, finance, people, and data and communication, adjusting for country size. The index shows that developed economies remain more connected than emerging ones: Germany tops the list, followed by Hong Kong and the United States. Emerging economies are less connected to global flows, but some are climbing up the ranks rapidly: Morocco and Mauritius gained 26 places and 28 places, respectively, between 1995 and 2012 -- the largest increases in our index. Saudi Arabia rose 19 places, reflecting the rising value of oil exports and the recycling of oil wealth into global financial markets. India gained 16 places in this period, thanks to growth in services flows, and Brazil jumped 15 on the strength of expanding services and financial flows.

More and more business value and personal information worldwide are rapidly migrating into digital form on open and globally interconnected technology platforms.

As that happens, the risks from cyberattacks become increasingly daunting. Criminals pursue financial gain through fraud and identity theft; competitors steal intellectual property or disrupt business to grab advantage; “hacktivists” pierce online firewalls to make political statements.

Research McKinsey conducted in partnership with the World Economic Forum suggests that companies are struggling with their capabilities in cyberrisk management. As highly visible breaches occur with growing regularity, most technology executives believe that they are losing ground to attackers. Organizations large and small lack the facts to make effective decisions, and traditional “protect the perimeter” technology strategies are proving insufficient.

Most companies also have difficulty quantifying the impact of risks and mitigation plans. Much of the damage results from an inadequate response to a breach rather than the breach itself. Complicating matters further for executives, mitigating the effect of attacks often requires making complicated trade-offs between reducing risk and keeping pace with business demands. Only a few CEOs realize that the real cost of cybercrime stems from delayed or lost technological innovation -- problems resulting in part from how thoroughly companies are screening technology investments for their potential impact on the cyberrisk profile.