Tuesday, March 15, 2016

McKinsey's Six Factor Framework for Digital Disruption

In March 2016, McKinsey published a free article that explains a six-factor framework for understanding and evaluating digital disruption (here).   I like it.

The paper is not long; over 12 pages it explains the model captured in the key exhibit:


Disruption can affect supply (right two sectors) or demand (left two sectors.)  In affecting supply, you can "uncover latent supply" or change the supply business operations and cost structure.  OK.   Disruption can affect demand; by addressing unmet needs or creating new value propositions for customers.  OK too.   That makes four of the six factors.   Between supply and demand, at top, is a factor for making new markets.  That's in the right place.   At the bottom, there is a space they've chosen to fill with "hyperscale platforms" which is probably only one way that digital might connect new business systems on the supply side with new value propositions on the demand side.  To some extent the "six factors" existed before "digital" did, but the focus here is how the six factors are specifically impacted by digital evolution.

How this applies best to health care and digital disruption...would make a good follow up paper.