Emerging Macro Trends-My perspective

Macro Trends

  • Population is aging in Developed Economies and is getting younger in some Developing Economies
  • Skill mismatch amongst countries
  • Outsourcing / Offshoring are more prevalent
  • Increasing Globalization and Qualitative Restrictions
  • Increasing Regulatory Intervention
  • Increasing role of NGOs in Global society
  • Increase in speed of Change
  • Free flow of Information and Ideas on a real time
  • Convergence of Industries , Competition can come from anywhere
  • Conflict amongst Executive , Judiciary , Bureaucracy , NGOs and Corporates
  • Collaboration and Partnership approach
  • Over Capacity in most industries likely to stay
  • Increasing Role of emerging economies in growth of global GDP
  • Rich getting richer but in some countries like India share of Rural income has also increased
  • Piracy may be here to stay
  • Virus attacks and hacking may continue
  • Rising healthcare and pension costs
  • Money power is the dominant power
  • Literacy levels are going up
  • Rising Unemployment/underemployment
  • Increasing role of Corporations / NGOs / Individuals towards development of society
  • Role of media plays a big role in shaping the society
  • Declining role of some Global Institutions
  • Knowledge Capital is more important than Financial Capital
  • Unpredictable weather and Environment
  • Consolidation and fragmentation of economies/countries continue to co exist

Organization Structure

  • Flatter structures
  • Innovative and agile organization will have a relatively longer life
  • Role of leader undergoing a change
  • Merit rather than length of service and age criteria for growth
  • Pink Slip culture is here to stay
  • More and more people willing to take Ownership and Accountability
  • Organization that empathizes with people and has a transparent ,open and performance driven culture will grow faster than the others that don’t
  • Only monetary incentives will not drive performance , people will look for Affection, Attention, Appreciation , and Achievement
  • People look for Complex solutions for simple problems
  • CEO’s / Governments may not cut losses because of Legacy costs and Social repercussions

Science and Technology

  • Pace of Innovation will continue to increase
  • Technology will continue to Enable businesses improve productivity
  • Development cycles may continue to shorten
  • More features and benefits will be available at lower cost i.e better value for money
  • More intelligence will be embedded in products
  • Miniaturization of products
  • Benefits of Collaboration may be maximum in Research
  • One product for multiple consumer needs

Lifestyle and People Behavior

  • Greater awareness and higher Aspirations
  • Women , Young adults and children play a bigger role in all walks of life
  • People are more stressed than ever before , fear , frustration , anxiety and anger may continue to increase
  • Lower trust and confidence in relationships
  • Greed , Ego and short term approach could drive behavior of people
  • People are more health conscious
  • People may look for solace in a FAITH
  • Personal agenda could be more important than Organization agenda
  • People in emerging markets have started to assume more debt
  • Entrepreneurial Spirit and risk taking ability is on the rise

Customer, Markets, and Products

  • Competitive intensity will increase
  • Competition can come from a different industry or geography
  • Need to be Globally competitive
  • Consolidation will happen but may not yield perceived results
  • Consumer is more aware and has much more choices
  • Shift of power with consumer intermediaries
  • Buyers market
  • Quicker commoditization of products
  • Shorter product life cycles
  • Time to market will shorten
  • Development of used products markets
  • Continued focus on cost reduction
  • Consumers may not necessarily own the assets they would be happy to pay for use
  • Segmentation of mass media
  • Organizations are more focused on the benefits of Ad Spend
  • Individual solutions rather than mass market
  • Consumer may not necessarily pay for a Brand

Financial Markets

  • Free flow of Capital across borders
  • Development of complex derivatives instruments
  • Capital market expectations drive the behavior of an organization which in turn also impacts the behavior of the society
  • Power of US $ is declining
  • Allocation of Capital for emerging markets may increase
  • Growth Capital is not a constraint
  • Artificial wealth creation through inflation of assets

Some Questions

  • Will the world really become one i.e boundary less in true sense
  • Will BRIC economies be as powerful as they are perceived by Goldman Sachs
  • Will the definition of CORE undergo a change
  • Will there be another technology revolution that will impact Communication and Mobility
  • Can human brain be replaced by Computers and human actions replaced by robots
  • How will Bio Technology impact our lives
  • Will the industry cycles continue
  • How long will productivity continue to improve
  • How will the role of Institutions ( including Educational institutions) impact the future of society
  • When will there be a commercial substitute for petrol
  • Reliance on Gold and US$ as investment options

 

Rohit Chanana
Apr, 2005