Can you give me a few examples of "drivers of growth" within context?

Question

This question has come up in a few McKinsey cases, and I find myself always giving generic, non-industry specific suggestions. I think I don't fully grasp the scope of what this term entails - would anyone be able to provide a few suggestions within a particular industry?

Answer 1

Hi Kay,

I use the following framework based on stakeholders to identify and communicate drivers of growth (let's say for the pharmaceutical industry):

Demand Side

Increase in per capita income resulting in more spending
Rise in lifestyle disease
Move to preventive rather than curative methods
Affordable insurance plans

Supply Side

New treatment techniques
Major R&D breakthrough
Introduction of generic drugs

Regulations

State-sponsored Medicare plans
Subsidy to a certain sub-sector

You can tailor it as per the industry you're discussing. Experts can obviously add more or provide a better framework than this :)

Thanks
Anuj

Answer 2

Hi,

There is a number of industry-specific ones like ARPU or Revenue per sqm. I recommend downloading the annual reports for investors of the top companies in each industry (retail, cpg, banking, etc) and check the metrics / drivers / KPIs they are using. It will answer all your questions.

Best