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FortuneFortune

Fortune

April 2019

FORTUNE covers the entire field of business, including specific companies and business trends, tech innovation prominent business leaders, and new ideas shaping the global marketplace. FORTUNE is particularly well known for its exceptionally reliable annual rankings of companies. FORTUNE furthers understanding of the economy, provides implementable business strategy, and gives you the practical knowledge you need to maximize your own success.

Country:
United States
Language:
English
Publisher:
Meredith Corporation
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20 Issues

IN THIS ISSUE

access_time3 min.
broken records

AT THE SIMPLEST LEVEL, DIGITIZATION MEANS changing something, particularly information, into digital form. But that elemental description well underplays the size, the force, the impact of this process. Across the landscape of business, digitization has been nothing short of a seismic wave, shaking the foundations of venerable industries that had stood imperturbable for decades. It has uprooted business models, seeded instant commercial giants and demolished others, erased some jobs and transformed others overnight.For consumers, however, the digital wave has brought mostly good things, it seems: more convenience, more flexibility, more options. Indeed, it’s hard to think of any technological change that has delivered more power to consumers than this—thanks in large part to the digital devices we carry in our pockets or handbags. Sure, we may all be addicted to…

access_time5 min.
eradicating a $600 billion industry

HEALTH CARETHE 2020 ELECTION is coming. And health insurers are worried.A groundswell of support for Medicare for All among prominent Democratic presidential contenders has spooked the industry, with some candidates professing the private health insurance sector may (and even should) eventually be tossed into the dustbin of history.Sen. Bernie Sanders—author of a comprehensive Medicare for All bill—has never shied away from a fight with large corporations, and universal health care has long been one of his hobbyhorses. But candidates occupying a more centrist space in the Democratic Party, such as Sens. Kamala Harris, Kirsten Gillibrand, and Cory Booker, have all cosponsored Sanders’s legislation.The bulk of the Sanders bill would be paid for by a 7.5% payroll tax on employers and 4% from workers’ paychecks. The current system of Medicare and…

access_time9 min.
briefing

(PHOTOGRAPH BY THE VOORHES)Kraft Heinz: A Cautionary TaleCost cutting didn’t help Jell-O and wieners in an avocado-toast world. By Shawn TullyMERGERSTHE SHARES AND REPUTATION of Kraft Heinz took a huge hit when the world’s fifth-largest food company announced a $15.4 billion write-down on Feb. 21. It broadcast the failure of a brutal cost-cutting campaign, pioneered by one of its biggest shareholders, Brazilian investor 3G Capital. Wall Street had initially praised 3G’s moves, but what was advertised as the cure has now cost the ketchup-maker a lot of blood.Here are the three ways a maniacal focus on costs savaged a storied name.REVENUES WENT NOWHERE• From the close of 2016 to the end of last year, Kraft Heinz revenues fell by almost $229 million, or 1%, to just over $26 billion. The…

access_time10 min.
q+a / kevin sneader

ROCKY STARTSneader became McKinsey’s chief in July, inheriting multiple ethical crises. (STUART ISETT—FORTUNE BRAINSTORM REINVENT)KEVIN SNEADER, A 52-YEAR-OLD Glaswegian and 30-year veteran of McKinsey & Co., became the firm’s global managing partner in July. He spoke by phone on March 6 with Fortune about the firm’s very public spate of controversies, from charges of conflicts of interest in its bankruptcy advisory business to embarrassing entanglements from Saudi Arabia to South Africa and beyond. The conversation has been edited for clarity and space; you can read the full transcript at fortune.com.FORTUNE: You live in Hong Kong, have visited San Francisco and New York recently, and are in Europe today. How many airline miles did you log last year?KEVIN SNEADER: I prefer my wife not find that out. British Airways had this…

access_time3 min.
extreme measures

IN THE BACK OF A BIG WAREHOUSE in Torrance, Calif., engineers at home-essentials maker Simplehuman are putting the company’s voice-activated trash can through its paces. The goal: to test the reliability of its voice-recognition technology by subjecting it to a sonic pummeling.Every 10 seconds, hour after hour, a robotic voice from a speaker repeats, “Open can.” And every 10 seconds, hour after hour, the lids on a quartet of trash cans, arranged in a square in the middle of the room, open and close. A camera records video so that engineers can analyze any hiccups.“If we start talking really loud, I bet one of them might fail,” Simplehuman CEO Frank Yang says coyly.Simplehuman, described by some as the Apple of housewares for its sleek soap dispensers, high-tech mirrors, and dish…

access_time6 min.
china’s electric car showdown

TECHINSIDE BEIJING ELECTRIC VEHICLE’S headquarters, a glass-and-steel complex on the Chinese capital’s edge, a cafeteria awaits renovation so that cooks can crank out pizza and other Western fare for the posse of foreigners the company expects to hire. “We need to have a more international feeling,” says Wang Shitao, a Chinese engineer who earned a master’s degree in Germany in energy storage before returning to his country to ply his skills in its new and booming electric-car industry. “You cannot force them to eat Chinese food all the time.”Nor, the Chinese government has decided, can bureaucrats continue to aggressively steer Chinese electric-car buyers to domestic brands. The inescapable reality: Beijing Electric Vehicle needs a tune-up.All but unknown outside its homeland, Beijing Electric Vehicle, or BJEV, is China’s largest maker of…

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