The world is shifting from asset light and infinitely scalable to asset heavy. Across the globe, trillions of dollars are going into assets. Capital expenditure is on the rise. What is driving this? What sectors are we seeing it in? What are the challenges and bottlenecks companies face in delivering on CapEx programs? And how do new technologies and approaches to talent overcome this? Our guest is Erikans Kok, Senior Partner at McKinsey where he leads their Capital Excellence Practice globally.<br><br>For related content and to find out more about HC Group, a search firm dedicated to the energy &amp; commodities sector, visit https://www.hcgroup.global

The Great CapEx Surge with Erikhans Kok

The HC Commodities Podcast

# Full Transcript

**Podcast:** The HC Commodities Podcast

## Participants

- **Paul Chapman** (HC Group)
- **Erikhans Kok** (McKinsey)
- **Erikhans Kok** (McKinsey)

## Transcript

Welcome to the HC Commodities Podcast, a podcast dedicated to the commodities sector and the people within it. I'm your host, Paul Chapman. This podcast is produced by HC Group, a global search firm dedicated to the commodities sector. The world is shifting from asset light and infinitely scalable to asset heavy. Across the globe, trillions of dollars are going into assets. Capital expenditure is on the rise.

What's driving this? What sectors are we seeing it in? What are the challenges and bottlenecks companies face in delivering on CapEx programs? And how do new technologies and approaches to talent overcome this? Our guest is Erikhans Kok, senior partner at McKinsey, where he leads their capital excellence practice globally. As always, you can really support the show by leaving us a positive review on the platform you're listening on. And as always, I hope you enjoy the episode. Erikhans, welcome to the show.

Thank you, Paul. It's great to be on. Thank you for having me. Yeah, we're lucky to have you because we're going to get a bit of a broader vision here about a huge global trend. We're going to take it from the US perspective, but certainly a global trend. And this is kind of a return to real world assets, going from a world of the sort of the technology companies of infinitely scalable and asset light to a world now

where every single vertical, and as you're going to describe, is investing in assets, big capital expenditure programs. And we're going to talk about the why of that, some of the challenges and some of the solutions. But it's a story that's playing out industry wide. It's certainly very consequential to the commodities sector. We could sort of start with kind of, I guess, the general thesis here.

You know, why suddenly have we transformed in this world of 10, 15 years ago of, you know, if you have big CapEx programs, you were discounted by the market to today, where it seems every company out there, especially these tech companies, are spending every last cent of free cash flow on huge CapEx programs. Can you just give us the meta picture there? Yeah, great, Paul. I think at the macro level, as you're describing it, capital expenditures are critically important for the world.

We need CapEx for energy needs, such as oil and gas and electricity. We need manufacturing capacity to produce more medicine, right? That's of course needed in the US, but of course also globally. We need CapEx to connect us through telecom. We need to build data centers to basically support all the analytical capabilities that we're getting more and more excited about. Of course, huge expectations in the US, but also globally. But equally, and this is not a new trend per se, but, you know, we need to continue to build big infrastructure.

Roads, bridges, airports to con...

The Great CapEx Surge with Erikhans Kok

Transcript

Built for investment professionals

Every day you wait, your competitors are finding
edge in conversations you're not hearing.

The Great CapEx Surge with Erikhans Kok

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.