Our Take
McKinsey identifies a real dysfunction (misaligned incentives kill change) but offers no method, metrics, or case evidence to show how CEOs actually solve it.
Why it matters
Transformation failure rates remain high, and most post-mortems blame execution rather than design. If the real problem is coordination, not capability, then org structure and incentive alignment become the intervention—not another strategy cycle.
Do this week
Executive team: map which three transformation milestones depend on cross-functional alignment, and assign one owner per milestone (not a committee) before month-end so accountability becomes visible.
McKinsey's diagnosis: alignment, not capability, kills transformations
McKinsey's latest transformation guidance rests on a single claim: successful transformations require everyone in the organization to move in the same direction, and that only happens when CEOs directly address what economists call collective-action problems.
Collective-action problems are real. They describe situations where individual incentives and organizational goals diverge. A sales team optimizes for quarterly bookings while the product team optimizes for technical debt. Finance locks the budget in Q1 while operations need flexibility in Q3. Everyone is rational within their silo; the organization moves in fragments.
McKinsey argues this is not a planning failure. It is a governance failure. The implication is that CEOs cannot delegate this away to a transformation office or a consulting engagement. The CEO must actively remove the structural misalignment that causes each unit to pull in a different direction.
Diagnosis without a method is not enough
The insight has merit. Transformation failure studies consistently show that execution breaks down at handoffs between departments, not within them. And most transformation programs spend 80% of effort on vision and strategy, then expect the hard part (alignment) to happen by announcement.
But McKinsey's framing stops at diagnosis. The article does not show how a CEO actually solves a collective-action problem. Do you change incentive structures? Reorganize reporting? Create new decision-making forums? How do you measure whether alignment has moved? How long does this take, and what does failure look like in month three?
Without those answers, the insight becomes another way to say "transformation requires leadership commitment," which is true and unhelpful. Practitioners need a method, not a metaphor.
Make alignment visible before you measure change
If your transformation is stalling, do not assume the strategy is wrong. Audit the incentive structure across the three units most critical to execution. Identify which metrics each unit is measured on, who owns each metric, and which metrics conflict. Do this before the next strategy meeting.
Then, for one pilot workstream, assign a single owner (not a steering committee) who has the budget authority, hiring authority, and the power to say no to other priorities. Run it for eight weeks. Do not announce it as a test; make it the new pattern. If alignment improves measurably, you have found a method. If not, you know the problem is not coordination.