How the best CEOs are meeting the AI moment
How the best CEOs are meeting the AI moment
https://www.mckinsey.com/capabilities/tech-and-ai/our-insights/how-the-best-ceos-are-meeting-the-ai-moment
Eric Kutcher is a senior partner in McKinsey’s Bay Area office and chair of North America. Lucia Rahilly is the global editorial director and deputy publisher of McKinsey Global Publishing and is based in the New York office, and Roberta Fusaro is an editorial director in the Boston office.
CEOs are confronting a make-or-break test of their leadership. Here’s what successful leaders are doing to get AI right.
AI has yet to deliver the ROI many leaders expected. What are they getting wrong? “This is probably the biggest, most complex transformation we’ve seen—but it’s 80 percent business transformation and 20 percent tech transformation,” according to McKinsey’s North America Chair Eric Kutcher. “That’s different from how most people have thought about it.” On this episode of The McKinsey Podcast, Eric speaks with Global Editorial Director Lucia Rahilly about how CEOs can deliver on AI’s revolutionary potential—and meet this “legacy moment” successfully.
The McKinsey Podcast is cohosted by Lucia Rahilly and Roberta Fusaro.
The following transcript has been edited for clarity and length.
This is it—your legacy moment
Lucia Rahilly: Eric, today’s CEOs are confronting a welter of consequential changes. Let’s start with the big kahuna: AI. Talk to us about what the advent of agentic AI means for leaders.
Eric Kutcher: I tell everyone that this is the most exciting moment in my 28-year career. I call it the reimagine moment, the CEO legacy moment. As one CEO I really admire said to me, “This is the real Fourth Industrial Revolution.”
Watching your kids adopt this, watching your grandparents adopt this, watching everyone have an LLM [large language model] at their fingertips—it’s amazing. My wife doesn’t go to a travel agent anymore. She just asks, “What does Chat say?” Or my son, when he was a senior in the early innings of this technology, two years ago—he prepared for exams by taking every problem set he’d done and every test he’d been given, throwing it into Chat, and saying, “Make me a 90-minute exam, and then show me the answer key.”
Every one of our employees is using it—whether at home or at work, they’re using it. Unlike semiconductors, which took years, this happened overnight. It’s the most democratized technology we’ve ever seen. That’s also probably because of the scale of this technology today. This is probably the biggest, the most complex business transformation—but it’s 80 percent business transformation and 20 percent tech transformation. That’s different from how most people have thought about it.
CEOs who take this on will take their organizations to a different level. And CEOs who sit and wait—their companies aren’t going to exist. They’re not going to thrive. It’s that binary in terms of importance.
This is probably the biggest, the most complex business transformation—but it’s 80 percent business transformation and 20 percent tech transformation.
What about that ROI?
Lucia Rahilly: We’ve seen so much research on the challenge of translating AI investments into bottom-line results. Many companies are experimenting, but few are realizing meaningful ROI. How do you see leaders addressing the value creation challenge successfully?
Eric Kutcher: The reason we’ve seen these results is that we’ve been in the world of, “Let’s take this technology, deploy it, and watch good things happen.” And good things have happened. They just don’t add up. You can’t just rely on the technology—back to my 80/20. You have to take a step back and reimagine the process.
So if you’re a CEO, how are you approaching this problem? Leaders need to envision what they want this to look like in five years. That may be nothing more than high-level thinking, their own North Star. It may be how they articulate where they’re going organizationally to realize the magnitude of this change. And they’re all choosing very differently. Some say, “I’ve got to bring the whole organization along at once.” Others say, “If I can get one or two functions to do something magical, I can use those examples to challenge everyone else, and that’s sufficient.”
One leader told me, “I’ve got a few folks who are running ahead. That’s not OK. I need everyone to run at the same pace, and I’m not going to let the first three slow down.” Another said, “I want to triple the share price in four years.” He went to one of his functions and said, “I need you to go from 1,000 to 3,000 customers. And I don’t want it done the way we’ve done it in the past. Here’s my vision for how to get it done. Go make it happen.” That’s ambitious. That, to me, is the difference between those out in front and those who are waiting to see.
The other thing I hear about a lot from CEOs is fluency. The irony is that the youngest employees often know the technology better. I’m a tech guy. I was an engineer. But to some degree, I’m a Luddite relative to these kids. You’ve got to really want to learn—it’s such a big thing.
One CEO I love has a passion for golf, and he said, “I went to ChatGPT to figure out what shaft to buy. That was my eye-opening moment. That changed how I thought about everything I do at work.” So the mechanism for creating fluency—that intellectual curiosity and willingness to pause and say, “I want to do this differently”—that’s what they’re struggling with big time.
What’s the future for human workers?
Lucia Rahilly: As leaders start realizing more meaningful productivity gains from agentic AI, the next step will presumably be to reinvest some of those gains into growth. Do you see this leading to reductions in the human workforce?
Eric Kutcher: What will the future organization look like? The short answer is none of us knows. My two cents: The organization will feel a lot flatter. You’ll have human and agent hybrid workflows. You’ll have to figure out where to deploy agents: What’s the objective function? How do I evolve workflows where people and agents are responsible for output? You’ll need way more workers and judgment, and way fewer managers. So I think it’s a flatter organization.
I also think it’s an organization where people who are fast learners, who are willing to challenge, will succeed. And folks who just go through their daily routines—those jobs or tasks can easily be replaced.
One of the things I hear a lot is, “Gosh, the early stages of the career ladder will go away.” I don’t believe that, because as a CEO or leader, I’m not just thinking about this moment; I’m thinking about the future. I know I’ve got to apprentice people. I can’t just have everyone come in ready to play a senior-level, judgment-based role. I have to give them the opportunity to learn and experiment. And again, it’s more likely that these young folks, who are less experienced as employees, will have more fluency. I tell all early-career folks that when I started out, what I did over six weeks they now call Tuesday morning. And the problems now are more complicated. There’s a lot more to do than there was back then.
You’ll need way more workers and judgment, and way fewer managers. So I think it’s a flatter organization.
Alchemizing adoption
Lucia Rahilly: How should CEOs be thinking about balancing between new—if not AI-native, then at least AI-literate—talent versus existing teams that need to be upskilled to accelerate growth?
Eric Kutcher: I get this question all the time: “Do you have to bring everyone along, or do you just have to give them access?” And I think where my head has gotten to is that you’ve got to give them access—to the education, the tooling, et cetera. If they choose not to learn, you can be Darwinistic, because they’re not going to succeed in any environment going forward.
Personally, I’m trying to create more hands-on experiences. For example, I just got back from a two-day off-site where we talked about creating a Slack community so people can exchange ideas about their agentic AI experiences. Also, every training needs to be 30 percent how you’re thinking about AI and what employees do every day. The more you talk about it, the more you give people experience, the more they recognize they can’t ignore it.
Lucia Rahilly: Some say that embedding agentic in internally facing workflows first might be safer than, say, starting with the customer experience. Are you seeing that?
Eric Kutcher: I’ve gone back and forth on this one. Very few people get excited about internal change for the purpose of internal change. I think about it this way: If I’m a B2C company, can I change something around the customer? That’s what the organization gets its head around. The majority are there to serve that end customer, to drive toward a different outcome that leads to the company’s success. So I think you’ve got to do more to be more customer oriented because that’s what matters.
What about the risks?
Lucia Rahilly: Let’s talk about AI governance, particularly vis-à-vis agentic. How should leaders be thinking about responsible AI at scale?
Eric Kutcher: I’m not the expert on this, to be perfectly frank, so we should be careful how deep we tread. I think “responsible AI” is a very big and potentially loaded term. It is absolutely important. But people think about it on many different levels.
Some level of responsibility relates to thinking about AGI [artificial general intelligence]. What will it mean for humans, and for jobs, if all of us can be replaced? I don’t think we’re anywhere near that risk anytime soon, and I happen to believe in human ingenuity. But part of responsible AI is thinking about the broader good for humanity. That’s one definition.
Then there are obviously a bunch of other risks—one of which is that we’re going to create a level of technical debt as a result of this. If we don’t have the right governance, 15,000 agents today will go to 30,000 agents tomorrow. Do we have to retire these agents? As a leader, I don’t want people to call on the wrong ones, because the wrong ones have issues. So how do I manage the life cycle? This is a real issue that CIOs [chief information officers] will have to deal with in a real way.
So responsible AI has different levels. We’re going to need real governance, and depending on which part of the problem you’re trying to solve, you’ll bring in different parts of the organization.
Technology in a shifting world order
Lucia Rahilly: Let’s turn to geopolitics, given that the shifting global order remains a top priority for CEOs. How are you advising leaders to plan for growth in a world where geopolitical dynamics remain in flux—in some cases with tangible ramifications, such as supply chain reconfiguration?
Eric Kutcher: Most of what leaders think about is, “What’s the right answer for me and my organization over time?” And if you talk to most CEOs, they will say, “We have found a reasonable equilibrium.” I do think there are questions around whether the trust that has existed between historical allies is still reliable. But those questions sit more at a governmental level. I’m seeing people continue to make the investments they know will be the right investments.
Lucia Rahilly: There’s a way in which tech itself has become geopolitical, given increased focus on sovereign AI, data sovereignty. What should CEOs be thinking about when it comes to global strategy and competing in a world shaped by national tech priorities?
Eric Kutcher: One question I sometimes get relates to decoupling. Will we have one stack or multiple? How will this evolve? I believe we’ll see two stacks because of the way both are competing to win. We’re going to have very difficult solutions in that space, and I suspect they will exist in different markets because of geopolitics and some of the protections you’re describing. But there will still be collaboration due to the development of multiple stacks.
Then you get into the implications of sovereign AI or data restrictions. I think we’ll continue to live in that world, and that it will only become greater. Some places want not just access to more technology that stays within their region, but more of their own local technology that lets them say, “We’re not reliant.” People are trying to avoid tricky geopolitics.
So there’s the question of where data and AI modeling sit, and how much that data can be used outside, which I think is incredibly manageable—maybe slightly more expensive. That’s different from, “I only want to use technology developed in my region.” That’s harder because it runs a real risk. That said, I don’t think it will play out, because the economic impact of not having the best available technology is likely to be much greater than the risk associated with using someone else’s. So then you’re stuck in a world where, sure, you have more complicated data center constructs, more complicated data residency constructs. But again, it’s all manageable. It’s a complicating factor, not a game changer.
How leaders are meeting the moment
Lucia Rahilly: You’ve talked a lot about leading through this interval of uncertainty. What other leadership mindsets and behaviors do you see among CEOs who navigate this kind of challenge particularly well?
Eric Kutcher: You can’t do these jobs unless you absolutely love what you do. You have to love the organization. You have to believe in what you’re doing. And I think the great ones today have gotten past “I’m going to say what I think people want me to say” and say what they believe, which helps. It’s easy to say what you think people want you to say, but then the winds switch and you’re stuck. If you believe in something, you’re not worried about which way the wind is blowing because you believe in it.
The great ones are also constantly learning. I love it when I see a CEO spend time with a junior team to really understand what they’re doing day-to-day. You want to get to know tech? Go spend time with the folks in your organization who are great at using it, ask them questions, and watch their eyes light up when they get to interact with you and teach you something. Those are the leaders who really understand what’s going on in their organization, because they take the time.
I also think great CEOs now are willing to be more vulnerable. In the past, you might have felt you had to be the command and control, but now I think it’s OK to say, “That’s a great question. I don’t know the answer to it.” Or “That’s a good point. I’ve got to go think about that some more.” It’s liberating and inspiring for an organization to see their leader as human and approachable.
Lucia Rahilly: AI is presumably revving up the pace of executive decision-making, in addition to juicing productivity and enacting other transformational changes. How are CEOs approaching the need to make strategic moves at this new speed—at pace and at scale?
Eric Kutcher: I’ll probably get into trouble and receive some hate mail, both internally and from my CEO friends, but leaders actually spend less time on strategy than you think. Most of their time is spent on change management—moving the organization from A to B, versus deciding to go from A to B. The beauty is now I can execute on B a bit faster, but I still have to take my organization through that process. What may change is, “Is the ambition that I have big enough? Is it bold enough?” That’s what most good CEOs spend their time on.
I love it when I see a CEO spend time with a junior team to really understand what they’re doing day-to-day.
What’s on the horizon
Lucia Rahilly: What are you most excited about, and what are the leaders you work with most excited about, as we embark on the new year?
Eric Kutcher: I think this is the most interesting transformational moment we’ll live through in our professional careers. To be at the beginning of this, to shape the way the change takes place, is unbelievable.
I’m also optimistic about the rate of adoption because I think organizations are starting to realize, “I can’t just insert this technology. I have to change the way I operate.” And the beauty of this is that you can set bold, audacious goals. It is so fun to go after something that no one ever thought possible.
I sometimes get the question: “Is AI a bubble?” I have no idea if the valuation is a bubble. But the moment itself is not a bubble. The moment is real, and it’s happening, whether or not the valuations are right. The question is, “Do I see a world that looks different ten years from now as a world I get excited about?” Conversely, I don’t like it when people are overly excited. It makes me nervous, because that’s when something goes awry. But I think this next decade is going to be wild, and it’s going to be exciting.
Lucia Rahilly: If you had one piece of advice for junior folks starting their careers in this environment, what would it be?
Eric Kutcher: I’m not good at just one; I’ll give you three. First, never lose your intellectual curiosity. The thing I worry about is that it’s super easy to ask AI to do something for you. You’ve got to ask not five whys, like we used to always do, but 50 whys.
Second, never stop learning. Many folks starting out today already understand what this technology can do. How can you maintain that learning mindset? It’s another form of intellectual curiosity.
And third, never lose your own voice. I can tell when someone’s written something using AI. Find your voice, make it yours, and then use everything around you to help you communicate. If you haven’t figured out how to express yourself in your own way, you’re not thinking critically.
Marriott posts strong 2025 growth, adds nearly 100,000 rooms worldwide
https://hotelsmag.com/news/marriott-international-2025-growth/?
Marriott International reported global growth across its development pipeline and brand portfolio in 2025, driven by new brand introductions, midscale expansion, luxury development and branded residences. The company grew net rooms by more than 4.3% during the year, adding over 700 properties and nearly 100,000 rooms to its system. More than 630 of those properties were added through organic deals, representing over 89,000 rooms.
“2025 was a defining year for Marriott, marked by bold expansion and global milestones,” said Anthony Capuano, president and CEO of Marriott International. “We scaled our iconic brands to new markets around the world, strengthened our portfolio across every segment, and opened doors to destinations that inspire travelers worldwide. These achievements reflect the dedication of our global teams and the trust of our hotel owners, as we continue to deliver exceptional experiences for our members and guests.”
Marriott ended the year with approximately 610,000 rooms in its development pipeline, a 5.7% year-over-year increase. The company signed nearly 1,200 organic deals globally in 2025, covering 163,000 rooms. Regional milestones included a record 94 deals in the Caribbean and Latin America region, 187 deals in Asia Pacific excluding China and 201 deals in Greater China.
Conversions continued to account for a significant portion of growth. Marriott signed nearly 400 conversion deals encompassing more than 50,800 rooms. These represented over 30% of annual organic room signings. Around 75% of conversion openings in 2025 occurred within 12 months of signing.
Brand development was supported by several new portfolio additions. Marriott completed the acquisition of the citizenM brand in July, adding more than 35 hotels and nearly 9,000 rooms to the system following integration in the fourth quarter. The company also launched Series by Marriott, a midscale and upscale collection brand, which opened 37 properties in India by the end of the year. Thirteen agreements were signed to bring the brand to the U.S. & Canada, with two hotels opening in the fourth quarter. Outdoor Collection by Marriott Bonvoy closed the year with over 30 open properties.
In the midscale segment, Marriott closed 2025 with 216 open properties across City Express by Marriott, StudioRes and Four Points Flex by Sheraton, totaling approximately 27,000 rooms. The midscale pipeline exceeded 250 properties. City Express ended the year with 158 open properties and 150 in the pipeline, with expansion in CALA and agreements in APEC and the U.S. & Canada. StudioRes opened its first property in Fort Myers, Fla., and closed the year with four open properties and 85 in the pipeline. Four Points Flex by Sheraton ended 2025 with 54 open properties and 22 in the pipeline.
Luxury development accounted for 114 deals and 15,301 rooms. The luxury pipeline reached 296 hotels and resorts with approximately 60,000 rooms. JW Marriott signed 27 agreements, including JW Marriott Hotel Tashkent. EDITION and W Hotels recorded milestone openings, including The Lake Como EDITION and W Punta Cana. Ten luxury resorts opened during the year, representing 1,400 rooms.
The Ritz-Carlton Reserve added two properties in Mexico and Costa Rica. Branded residences reached a record 55 signed deals. Marriott closed the year with 149 open residential locations and 175 in the pipeline, with regional records in EMEA, U.S. & Canada and CALA. Standout developments included The Dubai Beach EDITION and The Ritz-Carlton Residences, Houston.
Locals Say the Devil Left His Footprint at This Ancient Cathedral — and You Can Still See the Evidence
Fairy-tale Neuschwanstein Castle in Bavaria, Germany. View from the bluff with tree roots at famous vintage landmark. Picturesque evening sunset landscape.
https://www.fodors.com/world/europe/germany/munich/experiences/news/devil-footprint-at-munich-cathedral-folklore
A darkened footstep on the Munich Cathedral’s floor just might be that of the Devil itself.
The distinctive towers of the Munich Cathedral compete with the clouds, shaping the city skyline. Inside, the image is just as powerful; the Cathedral seems to stand in a different era entirely, with its late-Gothic architecture, stained-glass window designs, and even a 500-year-old automaton clock with quaint figures, planets, and signs of the zodiac that move each day at midday. It is a place to admire and a place for tranquility. That is, of course, except for the time the Devil is said to have stepped in.
Tricking the Devil
City legend states that a footprint, clearly seen amongst the tiles of the Cathedral, were made by the Devil himself. There are many versions of this tale, but the most popular says that when construction of the church began in 1468, the Devil was rather unhappy about it and set his sights on stopping the church’s success as a place of worship. The Devil enticed the architect, Jörg von Halsbach, into a deal, promising to help build the building so long as the church had no windows, which would mean it was celebrating the dark rather than the light, or so the story goes.
The church was duly constructed (rather quickly in only 20 years, perhaps due to the Devil’s help) but the architect was a wily one. Due to a high altar at the time, windows that were installed towards the back of the Church were hidden from view at first. This visual trickery led to a few different endings depending on which tale you’re listening to. One version goes that the Devil came to survey his handiwork only to discover he had been cheated out of the deal, stamping his foot in rage. Visitors today can still see this Teufelstritt or “Devil’s footprint,” the black mark the Devil stamped on the floor a few feet inside the cathedral, where he realized he had been duped.
Another version of the story goes that the Devil stamped his foot with pleasure at finding the Cathedral had been made with no windows, and according to Munich Cathedral’s Mysterious Places guide, once he discovered he had been tricked, he used his resulting rage to turn himself into an icy wind that “still often blows around the cathedral today.”
If you visit the Cathedral in Munich today, you’ll more than likely experience some of these extraordinary winds, as the Cathedral’s tall towers and location in the city center are ripe for wind tunnels. If you believe these legends, perhaps this is the Devil trying to find a way to blow the cathedral over, to hide his embarrassment at his folly.
So which tale to believe? Jake Slisz, owner and tour guide of Heart of Munich Tours, explains that the beauty of folklore is that it is less about one specific story and more about the act of sharing them with one another.
“Not understanding the exact origins of folklore makes sharing these stories even more fun,” explains Slisz. “Human civilization is built on stories. Although not [always] completely true, they do give us an insight into the past.”
He goes on to theorize that the footprint may belong to the architect who died shortly after the Cathedral was built, or, if it was the Devil, he must have been wearing some nice shoes, since it looks mostly like a human footprint.
Where Else Did the Devil Step?
Scotti Stephens, a tour guide and owner of BayernTrips, explains that Bavaria, and Munich in particular, has even more history with the Devil than you may expect.
“Just north of Munich in the UNESCO World Heritage city of Regensburg, the Devil was also involved in building the massive Stone Bridge [Steinerne Brücke] across the northernmost point of the Danube River,” explains Stephens. “Being a prideful tradesman, the builder of the bridge and the builder of the cathedral bet on who would finish their project first. The bridge builder quickly realized that the cathedral was rising much faster than his bridge. Frustrated by the difficult currents of the Danube, he called upon the Devil for help. The Devil agreed to assist him and speed up the construction, but demanded the souls of the first three living beings to cross the completed bridge as payment.”
Stephens goes on to explain that the bridge was then completed in record time–sound familiar?–but that once a huge ceremony was created to celebrate the completion, the builder realized the first men to cross the bridge would be condemned to hell forever, so he quickly drove a rooster, a hen, and a dog across the bridge, cheating the Devil of his promised souls.
What were the consequences? Similar to the Munich Cathedral, Stephens explains how the Devil tried to destroy his creation in a fit of rage.
“He flew underneath the bridge and tried to bust it apart and dislodge it from the riverbed. However, the bridge was already so massive and solid that he couldn’t break it,” says Stephens. “All he managed was to put a kink in the bridge. To this day, the Stone Bridge has a distinct “hump” in the middle because the Devil pushed up on it so hard that he bent the stone forever.”
While the Bavarian culture and landscape—dotted with half-timber houses, castles such as the Neuschwanstein Castle surrounded by the Alps, and tales of collective guilt, shipwrecks, and ancient contracts—is ripe for inspiring the imagination for these folktales, the “physical” traces of the Devil are not just limited to Bavaria.
European folklore is understandably fascinated with tales of the Devil, demons, and darkness, and many stories come with a physical component. Other “Devil’s footprints” exist in South Devon, England, if you’re so inclined to hear a tale of mysterious hoof prints, while elsewhere in Germany, the Gothic-style St Mary’s Church in Lübeck has physical “evidence” of the Devil in a slab of stone next to the church, after a similar altercation when the Devil offered to lend a helping hand in construction.
Whether or not you believe in the footprint’s mysterious origins, the Munich Cathedral tale is undeniably a compelling one – and fits more widely into German folklore’s ability to not shy away from the darker aspects of magic that attracts so many tourists today.
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