2 in 3 leaders say their org is too complex. They already know the problem.

The number McKinsey put on what you already knew

McKinsey’s State of Organizations 2026 surveyed more than 10,000 executives across 15 countries. Two-thirds said their organizations are overly complex and inefficient. Nearly 40% said that fixing process flows is their single biggest unlock for the next two years.

Not AI. Not headcount. Not restructuring. Process flows.

That’s a striking answer from a population that has spent the last several years hearing that generative AI would solve the productivity problem. The executives who know their organizations best are pointing at something more fundamental: the way work actually moves from one person to the next.

Why the traditional productivity plays are running out of road

The McKinsey research offers a useful diagnosis for why organizations feel stuck despite repeated improvement efforts. The traditional levers — restructuring, cost cuts, headcount reduction — are hitting diminishing returns. The organizational complexity that creates the real drag has survived every round of those interventions.

The reason is that those plays don’t touch the workflow. You can flatten a reporting structure, cut a layer of management, or reduce staff by 10% — and the underlying process that required three approval steps to send a routine invoice remains exactly as it was. You’ve just removed people who were absorbing the friction. Now there are fewer people and the same friction.

McKinsey’s framing for what comes next: the next frontier of organizational productivity is improving how work actually moves — fewer unnecessary handoffs, less duplication, cleaner decision points. The gains that remain aren’t in the org chart. They’re in the workflow.

For professional services firms, this isn’t a new insight

The McKinsey finding describes enterprise-scale organizations. But for small and mid-sized professional services firms — law firms, CPA firms, consulting practices, insurance agencies — the same pattern has been present for years. You’ve felt it every day, just without a McKinsey report to name it.

It shows up as:

• Client intake that takes two weeks when two days would be more than sufficient — because no one has formally defined the steps or who owns them
• Billing cycles that drag because the data that should feed the invoice lives in someone’s inbox, a spreadsheet, and a time-tracking tool that nobody updates in real time
• Staff spending a meaningful portion of their week on coordination — chasing approvals, following up on missing information, manually re-entering data between systems — instead of on billable work
• Processes that work fine when one specific person is in the office and break down the moment they’re out for a day

These aren’t staffing problems. They’re not technology problems. They’re process problems — and they’re exactly what McKinsey’s 10,000 executives are pointing at when they say process flows are the next unlock.

The advantage small firms have that enterprises don’t

Here’s the part that matters most for a small firm: the same research that shows how difficult it is for large organizations to fix this problem implicitly reveals the advantage smaller organizations have.

Large enterprises face massive change management challenges. Redesigning a process that touches 500 people across 12 departments requires months of alignment, stakeholder management, and rollout planning before a single step actually changes. Adoption is slow. Reversion to old habits is common.

A professional services firm with 10 to 50 staff can map a key workflow in a morning, identify where the friction lives, redesign the handoffs in an afternoon, and have the team running the new process within a week. The complexity is lower, the number of stakeholders is smaller, and the person who can approve the change is often the same person who identified the problem.

Large enterprises now have McKinsey telling them to fix their process flows. Small firms have the ability to actually do it — much faster, and without a consultant army.

What the fix usually looks like

The McKinsey research is consistent with what we see in practice: the fix rarely requires new software. It requires an honest look at how work moves from one person to the next — and removing the friction before adding any technology on top of it.

That means mapping the actual current-state workflow (not the idealized version), identifying where work waits, where it gets re-entered, and where a single person’s absence creates a queue. Then redesigning those specific steps — adding a defined handoff, removing an unnecessary approval, consolidating where data lives — before any technology decision is made.

The technology question becomes much cleaner once the process is visible. Sometimes the right tool is already in place and just needs to be configured differently. Sometimes a simpler solution fits better than the platform that was sold in a demo. But that evaluation can only happen accurately after you understand the workflow that the tool needs to support.

Process first. Then the tool.

See where the friction is in your own workflow

We built a free Process Health Check for exactly this: 10 questions, 2 minutes, no email required. It surfaces the areas where your process friction is most likely concentrated — intake, billing, staffing handoffs, or technology gaps — and gives you a place to start.

If you want to go deeper, a 30-minute discovery call with our team covers the same ground more specifically for your business.

Source: The State of Organizations 2026 — McKinsey & Company, p. 35. Survey of 10,000+ executives across 15 countries.