Take a fifty-minute deeper dive
Now that you’ve
read the Five …
Back to top
Book
Strategy Beyond the Hockey Stick
Article – McKinsey Quarterly
Strategy to beat the odds
Article - McKinsey Quarterly
Using people analytics to drive business performance: A case study
Discover more Five Fifties
Take another Five
Subscribe
Sign up for weekly email briefings from the Five Fifty
Share this edition
When your industry is moving up the industry power curve, your own performance gets a helpful boost.
Industries as escalators
Industry effects are so substantial that average companies in great industries tend to outperform great companies in poor industries.
Better average than great?
Book
Strategy Beyond the Hockey Stick
Dive deeper
Dive deeper
Not all industries perform equally—they follow a power curve, with a long, hanging tail and a high peak.
Where you play
A quick briefing in five—
or a fifty-minute deeper dive
Share this
What’s the single biggest determinant of how your company performs relative to others? The industry you compete in.
The industry effect
In this edition:
Sparking creativity in teams:
An executive’s guide
Article – McKinsey Quarterly
Change, or change?
But what if you’re not in a favorable industry?
You have two options: neither is easy, and both require bold moves.
Annual economic profit of companies within each industry, 2010–14, $ million
Software
Middle quintiles
Bottom
quintile
Top
quintile
Construction materials
Company in industry
Industry average
Annual economic profit, 2010–14 ($ million, log scale)
Dive deeper
Dive deeper
Strategy Beyond the Hockey Stick
Book
Bottom
Middle
Top
% of companies
from a ...
megatrend industry
upward-trend industry
downward-trend industry
10
12
78
12
28
60
40
33
27
for companies that were in the middle quintiles in 2000–04
Quintile ranking in 2010–14
Dive deeper
Dive deeper
Strategy Beyond the Hockey Stick
Book
Transform your industry structure through shifts in business models, technology, and regulation. For example, Chile’s LAN Airways created a business model focused on both passengers and cargo.
Leave your industry by forcefully edging investment toward attractive subsectors in more promising industries. The more granular you get, the better this works.
Dive deeper
Dive deeper
Strategy Beyond the Hockey Stick
Book
Not all industries perform equally—they follow a power curve, with a long, hanging tail and a high peak.