How We Help Clients

McKinsey Industrial Software Hub

Helping industrial companies create sustainable value and accelerate software-enabled revenue growth

With high potential margins and transformative impact, software products and services are increasingly critical to driving business success across industries. Many organizations are well-positioned to harness this value, with leaders expecting a growing share of their revenue to come from digital and software-enabled solutions in the coming years.

The McKinsey Industrial Software Hub (MISH) helps businesses excel in three areas: value creation, software value assurance, and the creation and scale-up of dedicated software units.

Our experts leverage proprietary tools, data, and benchmarks to deliver tailored solutions that address unique challenges and opportunities. Drawing on extensive experience across industries, we have supported hundreds of projects, helping organizations achieve measurable improvements in productivity, quality, and cost efficiency.

What we do

Software Strategy
We assist clients in identifying and capitalizing on software-driven business opportunities by pinpointing areas where software can generate significant value, developing comprehensive product and technology roadmaps, designing strategies to effectively deliver software solutions throughout the customer lifecycle, and determining the necessary investments to build and sustain software capabilities
Software Development Excellence and Operating Models
We drive excellence and productivity in software development by strengthening software development capabilities through advanced methodologies and tools, leveraging GenAI-enabled operating models to optimize development processes, and utilizing benchmarking tools to assess and improve software development performance.
Software Talent and Footprint
We support clients in building robust software talent strategies by defining optimal locations for software teams to maximize efficiency and access to talent, identifying required roles and competencies to meet organizational objectives, establishing comprehensive processes across the talent lifecycle, and setting clear guidelines for compensation, training, and professional development.
Software Sourcing and Procurement
We provide fact-based assessments and strategic guidance in software sourcing by evaluating software development costs against industry standards, defining holistic strategies for in-house development versus external procurement, and selecting and managing vendors to ensure seamless integration and quality.
Software Launch and Project Recovery
We ensure successful software launches and turnaround troubled projects by identifying and addressing potential risks to ensure smooth project execution and managing key project milestones to prevent delays and cost overruns.
Software Validation and Process Compliance
We help clients achieve compliance and quality assurance in software development by establishing processes and methods to ensure adherence to industry standards and regulations and implementing measures to meet cybersecurity requirements and protect against threats.
Software Pricing and Go-to-Market
We enhance software market strategies by developing effective pricing and business/monetization models, including Software-as-a-Service (SaaS) offerings, optimizing marketing and product launch processes to maximize market impact, and establishing customer service and maintenance frameworks to support product success.
Software Product Management
We elevate product management practices by assessing and implementing product management best practices across the development lifecycle, crafting targeted initiatives to drive product success, and providing team coaching through our specialized Product Management academy.

Examples of our work

Industrial-services business
Expanding to operational solutions
An industrial-services business wanted to expand its focus from hardware to operational solutions and accelerate the growth of its digital-products business. We worked with the company to improve its go-to-market strategy, streamline software-development activities, identify new offerings, and provide guidance on modernizing product architecture. These changes helped identify underperforming or misaligned products, which reduced costs by about 10 percent. Together, the cost reduction and go-to-market initiatives created the potential for the client to more than double revenues.
Turbine OEM
Reducing software development bottlenecks
A turbine OEM was experiencing delays in time-to-market because of bottlenecks related to embedded software development. We assisted with helping to identify problem areas and pinpoint root causes through interviews, project reviews, performance benchmarking, and other analyses. We also helped the company with reorganizing software teams, leading to greater productivity, and outlining plans for a multi-year transformation that helped the client become a market leader for the full value chain for turbine software.
Building-materials company
Creating a software suite of digital product offerings
A building-materials company had experienced strong growth but was struggling to develop digital products. We collaborated with the client to design and deliver a software suite that was ready for market in under a year. We also helped train sales, marketing, and country management globally and assisted with recruiting technical employees and finding strategic partners. The client’s software and service portfolio is expected to account for about 10 percent of revenue by 2025. 
Automotive OEM
Building a standalone software unit
An automotive OEM wanted to create a dedicated software unit. We worked with the client to define the unit’s organization, including its scope and shared responsibilities, assisted with financial and budget planning, provided operational support, and developed a growth strategy. The unit now delivers core software to all of its brands. 

Featured Experts

Jeremy Schneider
Senior PartnerNew York
Coleads McKinsey’s global software and high tech department and serves software and tech clients on strategy, sales and marketing,...
Dominik Hepp
PartnerMunich
Coleads our industrial software work in Europe and leads software-excellence transformations for industrial and automotive clients,...
Hiroshi Matsubara
PartnerTokyo
Serves manufacturing clients with a focus on growth strategy, digital-enabled operational excellence, and company-wide transformation...
Martin Harrysson
Senior PartnerBay Area
Draws on expertise in software product development and digital strategy to help clients innovate the customer experience, evolve...
Johan Rauer
PartnerMunich
Advises semiconductor, software, and high tech clients on strategy, operations, and performance transformation
Roberto Argolini
PartnerMilan
Boosts cross sectors companies and operation performances on innovative technologies and software topics

Our leaders’ videos

“Fundamentally, software is becoming a core source of differentiation for many companies and in many cases, a business unto itself.”

Jeremy Schneider
Senior Partner, New York

“In the next three to five years, the most important area for software will be how to accelerate development.”

Hiroshi Matsubara
Partner, Tokyo

“The value of products for industrial companies is migrating toward software…this will increase by up to 50 percent within the next three years.”

Dominik Hepp
Partner, Munich

Featured Insights

A worker using a tablet computer to operate machinery.
Article

What it takes for industrial companies to unlock software value

-
To generate growth from their software investments, industrial companies can adapt their go-to-market playbook.
A low-angle view of a complex of telecommunication towers against a clear blue sky.
Article
Technology, media, and telecommunications: Software deals and creative partnerships will carry the day
-
Multiple trends will likely fuel M&A growth across technology, media, and telecommunications in 2025, with an increase in carve-outs as organizations look to simplify and reshape their corporate portfolios.
Abstract technology Infinity Symbol, Futuristic technology background, vector illustration
Article
How an AI-enabled software product development life cycle will fuel innovation
-
AI has the potential to fundamentally transform the development of software products, increasing the pace of the process and the quality of the final output.
Glowing construction blueprint of futuristic electric car
Article
From engines to algorithms: Gen AI in automotive software development
-
As the automotive and industrial sectors undergo major technological advancements, gen AI–driven operating models can allow companies to develop software more easily, safely, and innovatively.
""
Article
Software-defined hardware in the age of AI
-
Software-defined hardware is reshaping multiple industries as advances in AI enable new capabilities and dramatically reduce development costs.
Isometric Illustration of people collaborating around a multi-layered structure representing data analysis and global supply chain management.
Article
Digital twins: The key to unlocking end-to-end supply chain growth
-
Complexity, COVID-19, and competition have upended supply chain organizations. They can reignite revenue growth and deepen resilience by deploying AI-powered digital twins.
Illustration of truck cruising down road, passing by a palm tree, on the way to a software-centric strategy unlocking new opportunities
Article
The big shift: Moving commercial vehicle OEMs to centralized E/E and Software
-
A software-centric strategy can help commercial vehicle OEMs transition to electrical/electronic architectures with centralized computing and hardware–software separation, unlocking new opportunities.
3D illustration of an arrow trending upward above a matrix of different size boxes
Article
How efficient growth can fuel enduring value creation in software
-
A renewed emphasis on efficient growth could allow software companies to unleash $500 billion in incremental shareholder value.
Shot of two programmers working together on a computer code at night - stock photo
Article
Navigating the generative AI disruption in software
-
The technology could accelerate growth, but presents new challenges, including shifts in value pools, user segments, and competitive dynamics that could spur a realignment of product categories.
Image of two groups of ropes linked and tied together by a central rope as symbolizing connection and mediation between groups.
Article
The growing importance of software product marketing managers
-
As launching new products becomes more challenging, the multifaceted role of product marketing manager is poised to become a differentiator for the most successful software providers.

How we help clients

Back to practice overview

Connect with the McKinsey Industrial Software Hub

Contact