McKinsey Global Institute: Digital China, Powering the Economy to Global Competitiveness

China has become a force to be reckoned with in digital at home and around the world. As a major worldwide investor in digital technologies and one of the world’s leading adopters of the technologies, it is already shaping the global digital landscape and supporting and inspiring entrepreneurship far beyond its own borders.

But there is much more to come. As China digitizes, industries will experience huge shifts in revenue and profit pools across the value chain. This creative destruction is happening globally as the world digitizes, but it is likely to happen more quickly and be on a relatively larger scale in China given a combination of inefficiencies in traditional sectors and massive potential for commercialization.

In this report, the McKinsey Global Institute (MGI) assesses the strengths of China’s digital system and the degree of digitization of industries. In order to understand how digitization is shaking the status quo and creating winners and losers, MGI looks at how three digital forces—disintermediation, disaggregation, and dematerialization—can restructure value chains and increase the magnitude of disruption. The research explores how policy makers can facilitate the transition toward a digital economy and what choices companies can make to prepare for the impending wave of change.

Please read the whole report: McKinsey Digital China