The McKinsey Quarterly articles from September 2002

The McKinsey Quarterly archives from September 2002

Gloom at the Top. (This Quarter)
September 22, 2002... The collapse of several large US companies and evidence of misleading accounting at many others have unnerved investors everywhere. They ask the obvious question: "What happened to corporate governance?" Sadly, the answer, at many companies,...

Revenge of the Multiplex. (Current Research)
September 22, 2002... Movie studios are warily eyeing consolidation among US theater chains. During the past two years, a small number of financial buyers have acquired several large ones, thereby gaining control over nearly a third of the nation's 35,000...

The New Math for Drug Licensing. (Current Research)
September 22, 2002... Big pharmaceutical houses have long relied on drugs developed by others-- particularly biotechnology firms--to fill the huge gaps in their product pipelines. In-licensed drugs accounted for 30 percent of Big Pharma's revenues in 2001, and...

Toolbox: Improving IT Efficiency. (Current Research)
September 22, 2002... During the past decade, companies in many industries spent heavily on information technology but logged disappointing productivity growth. The IT spending of retail banks, for example, grew by double digits throughout the late 1990s, yet the...

How Good Management Raises Productivity. (Current Research)
September 22, 2002... Governments around the world are committed to raisinq productivity to improve economic performance. As the research of the McKinsey Global Institute (MGI) has demonstrated repeatedly over the past decade, productivity at the sector level is...

Helping Employees Embrace Change. (Current Research)
September 22, 2002... When it comes to making big changes in an organization--implementing a Six Sigma program, optimizing business processes, adopting a new sales strategy--executives know that the wild card in the pack is their employees' capacity to adapt to a...

Serving Europe's Affluent Investors. (Current Research)
September 22, 2002... During the past two to three years, many retail banks and other financial institutions--brokerage firms, traditional private banks, and life insurance groups--have invested in new offerings and new businesses designed to serve Europe's...

Sending Money Back Home. (Current Research)
September 22, 2002... Money remittances are bic business. Official statistics are unreliable, but we estimate that every year immigrants in North America and Europe send more than $60 billion to their home countries (Exhibit 1), transmitting the funds largely...

The Greater China High-Tech Highway. (Current Research)
September 22, 2002... Taiwan's high-technology industry is about to benefit to an even greater extent from its economic ties with China now that both are members of the World Trade Organization (WTO). As tariffs fall and trade and investment policies liberalize,...

Change across the Board: Investors Are Angry. Directors Can Run but They Can't Hide
September 22, 2002... How long must corporate boards look bad? A swath of scandals has eroded trust in US corporate conduct to levels last seen a century ago, when the abuses of monopolies ushered in an era of trust-busting. Having watched tumbling share prices...

Has Pay for Performance Had Its Day? the Way to Get Your Employees to Focus on Both the Present and the Future Is to Adjust Your Culture and to Weaken Your Financial Incentives
September 22, 2002... Pay for performance has these days achieved the status of a management mantra. A generation of executives, motivated by performance-measurement systems linking their actions to results and, ultimately, to compensation, has embraced the creed...

Controversy Incorporated: Companies That Address the Social Concerns Surrounding Contentious Markets May Well Find the Effort Rewarding
September 22, 2002... Milton Friedman once famously said that "the business of business is business." (1) Today, however, the search for growth increasingly takes companies into controversial areas in which the rules of the game can't be stated so neatly....

Riding the Pharma Roller Coaster: In an Industry in Which Many Mergers Have Failed to Create Value, Fred Hassan Has Used Them to Take Pharmacia into the Pharmaceutical Big Leagues. Here He Explains How
September 22, 2002... Leading in the global pharmaceutical industry means mastering a hugely expensive game of trial and error. A company might discover a winning protein that could someday deliver a blockbuster drug but face expenditures of as much as $500...

How to Win in a Financial Crisis: When Is a Good Time to Make Strategic Advances? during a Crisis, of Course
September 22, 2002... Simple survival is the first strategy that most managers come up with when confronting a financial crisis. The savviest managers, however, realize that a period of great uncertainty, with financial and competitive landscapes changing almost...

Hyped Hopes for Europe's Low-Cost Airlines: Europe's Most Successful No-Frills Carriers Are Making a Lot of Money. but as They Mature, They Will Have Problems Expanding
September 22, 2002... Low-cost airlines are all the rage in Europe. With rock-bottom fares that entice travelers from the chillier north to places like Barcelona, Nice, and Rome, such carriers have introduced Europeans to a cheap, fast mode of transport--a...

The Return of Artificial Intelligence: Is AI Finally Ready for Business?
September 22, 2002... Artificial intelligence has come in and out of vogue more times than Madonna in the past 20 years: it has been hyped and then, having failed to live up to the hype, been discredited until being revived again. In the late 1990s, an observer at...

Keeping Your Sales Force after the Merger: Merging Companies Should Look to Their Revenues, Not Just Their Costs
September 22, 2002... Executives list revenue growth as one of their primary goals in 80 percent of all merger announcements. Yet most of the time, it remains elusive. Merging companies typically focus on integration and cost cutting after the deal and neglect...

Fighting for Your Price: A New Kind of Professional Purchaser Bent on Getting Rock-Bottom Costs Threatens Suppliers of Basic Materials. but These Companies Can Save Themselves by Taking Up the Purchasers' Weapons
September 22, 2002... There is a killer on the loose near the start of the value chain. Suppliers of basic materials (1) have seen tough times as their own suppliers consolidated and customers squeezed their margins. Now some of those customers are using a kind of...

A Case for the Family-Owned Conglomerate: The President and CEO of the Philippines' Largest and Most Conservative Family Conglomerate Expounds on the Value of Financial Discipline, Trust, and Good Governance in a Volatile Market
September 22, 2002... The Philippines would seem to be an unlikely place to find perspectives on management and governance. Hit hard by the 1997 Asian crisis, the country endured two years of fiscal mismanagement and economic decline under the administration of...

Fixing Asia's Bad-Debt Mess: A Banking Crisis Crippled Asia's Economies in 1997. A Bad-Debt Crisis Threatens to Do So Again Unless Governments and Banks Crack Down on Nonperforming Loans
September 22, 2002... Perhaps the most serious aftershock of Asia's 1997-98 financial crisis has been a growing burden of bad debt that threatens the region's banks and national economies. Private estimates suggest that nonperforming loans now total a staggering...

Wi-Fi Goes to Washington: A New Technology Could Not Only Restart Economic Growth but Also Help Connect Everyone, Everywhere to the Internet-At Low Cost. (A Closing View)
September 22, 2002... Remember when technology-based start-ups were going to put established companies out of business? The surviving incumbents are now having a last laugh. But their schadenfreude may be short-lived in the telecommunications industry because a...