Monthly Briefings

GT BRIEFING: April 2013 -- Realizing the Promise of New Geographic Markets

 

April 2013: How much does geography matter any more? As the world becomes increasingly urbanized and consumers become more connected across borders, as well as new geographies, there are other high growth markets to consider, whether cities, regions, or communities.

In our October 2012 briefing we talked about the rise of the BRICS and beyond and how this is giving rise to new forms of competition – as well as new competitors hungry for growth, and countless innovations. Home market competitors from BRICS markets are extending their presence on the global stage, particularly into other high growth markets, leveraging strong bases in their domestic markets. The mindset of many of these players is focused on aggressive expansion and investment, in contrast to the consolidation and risk management mindsets of many traditional, developed markets players.

But it’s not just the high growth geographic markets that business needs to focus on – the developed world will still be home to a significant amount of the world’s consumption for the forseeable future. One in particular, the U.S., is even being touted as the next “emerging” market! What’s going on?

In this briefing we take a look at some of these “new geographic” markets – some aren’t geographic, some aren’t new, but all will have a bigger role in future – and what it might take to realize the promise of growth within them. 

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GT BRIEFING: March 2013 -- Cyberspace – Empowered or vulnerable?

March 2013:

Cyberspace is the world’s newest toy. It’s a playground where almost everything is possible. The upside: It is a free-for-all world that offers the opportunity to empower more people and enrich more societies that ever before. The downside: As we transform our physical and tangible world into this digital and intangible universe we expose ourselves (and our personal information and behaviors) in new ways, leaving us more vulnerable. We are increasingly building our lives around wired or wireless networks making it possibly to live our lives in real-time, 24/7. The shift is not just in our personal lives. Businesses are becoming more and more networked and dependent on cyberspace and technology. So too are nations. The time of the Cold War with superpowers constantly on alert and building physical presence everywhere is long gone, with technology increasingly coming to the fore, for example remote-controlled drones.

For many years we have felt reasonably safe on our new playground. However, as an exploding amount of information moves into and is stored in the digital world, cyberspace is becoming the new frontline for security. A new kind of warfare is emerging with increasing numbers of targeted and malicious cyber attacks shaking up governments, businesses and consumers around the world. Knowledge and information is a source of competitive advantage, for organizations, nations and individuals. But it’s also a growing challenge to retain control as mobility and the democratization of everything (commerce, politics, and societies) increases. Cyberspace is here to stay and we want our digital freedom. But how do we keep ourselves safe once we have it? The costs are rising, not only in terms of deploying protective systems and approaches, but in the rising tide of litigation, policies and regulation that could potentially transform our world into a “big brother” society in the quest to fight these new types of security threats. Are you ready to defend your business and your personal information?

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GT BRIEFING: February 2013 -- The Workforce of the Future 

 

February 2013:

An estimated 600 million new jobs need to be created worldwide in the next 15 years, in particular in Asia, Sub-Saharan Africa, to keep up with the massive need for employment globally. (Source: 2013 World Development Report). However the labor market and our future workforce is a world of contradictions. While companies worldwide are crying out for new talent and skilled workers, they are unable to fill vacant positions, even as unemployment rates have been skyrocketing. How can we reduce this mismatch between the skills of workers and the talent companies are seeking?

One route is to help prospective employees build the knowledge they need to secure the jobs on offer.  The good news is that building knowledge offers almost limitless potential. In 2009 venture capitalist Brad Burnham put it like this: "Knowledge is, as the economists say, a non-rival good. If I eat an apple, you cannot also eat that same apple; but if I learn something, there is no reason you cannot also learn that thing. Information goods lend themselves to being created, distributed and consumed on the web. It is not so different from music, or classified advertising, or news." (Source: Mashable).

However, building knowledge for today’s jobs is not likely to be enough to keep up with the rapidly changing future of work. Globalization and ease of mobility as well technological advancements are changing the characteristics of the global labor market, the nature of jobs themselves, and how work will be done in future. These changes create opportunities as well as challenges for employers and employees, for example when managing cultural diversity becomes an integral part of everyday work life. Add to this the impact of game-playing and tech-savvy younger generations who are starting to enter the world’s workforce in larger numbers. However, for these generations there is a substantial risk of disenfranchisement as youth unemployment rates around the world remain high – discouraging some young people from participating in the workforce and potentially stirring social unrest.

The workforce of the future will look radically different in just a few short years.  Are you ready?

 

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January 2013: Proving yet again that evaluating trends and forecasts requires a healthy dose of common sense, a high tolerance of ambiguity and the ability to determine what is most relevant for you and your organization, the world continues to revolve after the end of the Mayan calendar, the US fiscal cliff (at least round one) and a host of geopolitical shifts. As we look forward to 2013 and beyond, these traits will be more important than ever as new and exciting trends shape how we live, work, consume and think.  Typing Trends for 2011 into Google on January 1^st 2011 gave us around 46 million results but typing Trends for 2012 gave us on January 1^st 2011 gave us around 808 million and typing Trends for 2013 into Google on January 1^st 2013 gave us around 1030 million results! The number of opinions about what’s in store in the forthcoming year is exploding – particularly in a year where we face increasing uncertainty over everything from the geopolitical world order (renewed tension in the Middle East and the China South Sea?) to the economy (recession or not? global or not?) to consumer behavior (to buy or not to buy?). With so many diverse forecasts it can be tough to sort the noise from the merely interesting to the extremely important. 

So, as here’s our annual round-up of where you can find some of the more interesting and important trend forecasts and ideas for 2013. As always, bear in mind that in a world as uncertain as ours such forecasts are not meant to be accurate. Treat them as directional and informed opinions on potential opportunities and challenges that can offer new perspectives to supplement your own thinking on what might be possible, feasible and desirable. And look at both sides of the arguments – as uncertainty and volatility grow, it’s more important than ever to think through all the options! Don’t forget to look at top trends outside your own industry or market space – these may well cross over sooner than you think! We will pick up on many of these trends in our 2013 GT briefings along with examples of how they are being – or could be – translated into action. 

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December 2012: Why care about Global Trends? Think about Kodak. They invented the digital camera, but side-lined it to focus on their core consumable film business – only to realize too late that their competitors were not who they thought they were and that consumer behavior had shifted. Take Hurricane Sandy, a deadly reminder of the world’s shifting climate patterns, following droughts across the globe – emphasizing the need for new ways to manage the world’s resources and environment. Or take the growing levels of social unrest over rising inequality, austerity, jobs, political ineptitude, institutional failure and more. Power is being redistributed away from traditional institutions that have failed to deliver progress, towards communities and individuals, as well as businesses.

It’s an uncertain and unstable world, one where leaders and organizations need to have a point of view on the future and to act today to address long-term trends. Access to resources, power, value creation, and values and beliefs are all becoming more distributed. The business of the future will not be at the center of the playing field – the consumer will, as cross-industry competition, distributed production and networks become the norm, underpinned by social technologies.  Let’s look at 10 key trends to watch for the next year, highlighted in The Global Trends Report 2013.

If you want the quick summary to share with your colleagues, you can find it in The Economist here.

To access the related presentation, 10 Key Trends to Watch in 2013 click on this icon.

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November 2012

The profound events of 2011 continued to play out in 2012, in some cases amplifying evolving trends. Last year, the people of the Middle East and North Africa raised their voices to drive regime change – in 2012, they were joined by many others, protesting over rising inequalities, austerity and lack of jobs, as well as history. It reflects a fundamental redistribution of power away from traditional institutions that have failed to deliver progress, towards communities and individuals; a shift that includes businesses increasingly stepping up to address societal challenges, often in partnership with public and no-profit entities.

Distributed networks and collaboration are becoming more important than ever, not only to address global issues, but also to create and capture value in a world where consumers and customers demand solutions and experiences, and increasingly have the tools or smart machines to create value themselves, potentially redefining whole markets. The business of the future will not be at the center of the playing field – the consumer will, as cross-industry competition and distributed production becomes the norm. Social technologies will be key linkages. Already permeating every aspect of work and life, they are becoming tools of creativity and productivity within and beyond the firm, as they empower employees and open networks to contribute – fast, because the speed of change is increasing.

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October 2012:

Open a newspaper, read a report, or listen to an executive interview and chances are that the focus will be the tremendous growth of the BRICS & beyond markets. Economists enthuse over the exploding middle class and long term economic prospects, in contrast with the stagnating growth of the developed markets. Executives talk about their companies’ strategies for growth in the BRICS & Beyond. Investors want to buy ever more “emerging market” stocks. Why? Because this is where the growth is, today and in future – and financial markets demand growth. In this briefing, we take a look at the potential of some of these markets, their impact on growth and innovation, and the challenges of competing in the B&B.

Extract of Ernst &Young’ s 25 rapid-growth markets

Estimated Real GDP growth (% per year)

(Source: Ernst &Young – Rapid Growth Markets )

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September 2012:

Searching the Web for definitions of “social business” you will find hundreds of different interpretations. Social business was a concept originally described by Nobel Peace Prize laureate Professor Muhammad Yunus as a cause-driven business where the investors/owners can gradually recoup the money invested, but cannot take any dividend beyond that point (Source: Yunus Centre). However, the original concept of social business has been watered down, if not completely reinvented. It is no longer only about “doing social good” but also about the world of opportunities that are being created by disruptive and transformational social media technologies, shifting consumer behaviors and changing business models. A new era of social business is beginning to take shape based on the social technologies that increasingly underpin the digital economy.

 

For most organizations social business is still in its early days but organizations failing to engage in social business will most likely be stuck with traditional, low-tech approaches inside and outside their organizations in the future. Are you ready? In this briefing we take a look at the social technologies aspect of social business – we will cover the definition provided by Professor Yunus in other briefings and reports.  So what are the social technologies that underpin social business – and who controls them? And how are companies using them – or being forced to use them by tech savvy consumers – to create value in their marketplaces externally? And to drive new ways of working and productivity internally?

 

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July/August 2012: In 2000, leading management thinker Peter Drucker opined that “For the first time – literally – substantial and rapidly growing numbers of people have choices...” In the last decade his words have been demonstrated as incredibly prescient. People have choices, and they are making them, often with friends, or communities, or networks, but choices are happening. The impact is being felt from the political leadership of Middle Eastern countries to the stores on the high street to the way we seek ideas and knowledge. Everything can be influenced – and even done – by an individual or collection of individuals with a purpose and objective, plus perhaps some new technologies. Everything is being democratized.

Are you ready? Already the impact is being felt in many industries – how about yours? For this brief we take a brief look at how democratization is working in practice in healthcare, education and retail. And by the way, we don’t really think of them as “industries” any more – to see how your playing field is really changing, start by defining markets around consumer or customer needs.  Even if we don’t cover your markets, take a few minutes to think about how consumer and community power could play out in future for your market – what are the opportunities and challenges your organization will face?

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June 2012: It has been an eventful start to the century from a geopolitical perspective. 2001 saw the 9/11 terrorist attacks in America. The attack was not only an assault on American families and the American economy. It also sent a shock wave though the world showing the vulnerability of industries including finance, transportation and tourism.  In 2003 a new era of geopolitical relationships began with the “war on terror” in Iraq and then Afghanistan. In 2007 the financial bubble burst leading to a global financial crisis that many economists consider to be the worst since the Great Depression of the 1930s.

Today the world leaders are still struggling to stabilize the global economy. The financial crisis led to many people worldwide losing retirement savings and homes, while facing skyrocketing food prices and growing unemployment. Desperate situations call for desperate acts: In December 2010, a young fruit and vegetable seller in Tunisia, who supported eight people on less than US$150 a month got fed up with injustice, poverty, dictatorship and corruption and set himself on fire triggering a year of tremendous political and social unrest, widely called the Arab Spring. Today, the world and the countries involved are still struggling with the way forward.

Despite the Arab Spring many populations worldwide do still not enjoy the freedom of democracy and for some countries the term “election” it is more a matter of “transition of power” than a free election. No matter the wording, elections and transitions often lead to shifting political alliances among countries and critical new geopolitical relationships can emerge when power balances changes within countries. In this year of geopolitical change worldwide, many questions of how relationships will shift remain unclear while others are more easily answered.

From a business perspective the terrorist attacks and geopolitical shifts of the last decade have shaken up the corporate world. It has dawned on many more business leaders that the geopolitical environment needs to be reflected in the company’s strategy because not doing it equals risky business. Understanding and mitigating geopolitical trends and risk as well as political and social changes is new to many corporations. But as Jeffrey E. Garten, the former undersecretary of commerce for international trade and the current dean of the Yale School of Management, argues, “CEOs ought to think more broadly about what true business leadership means today.… They ought to realize that they should take more responsibility for shaping the environment in which they and everyone else can prosper. They should be corporate chief executives, but also business statesmen.” (Source: Strategy+Business)

With this in mind let’s take at look of some of the more important geopolitical shifts happening in the world.  What are the implications for your organization – and for society more broadly?

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