Executing on an existing strategy may no longer be enough. Businesses and governments must think more deeply about the opportunities and risks presented by evolving trends.
In 2010, the global financial system remained fragile, but economies around the world began moving toward recovery. Some — especially those in emerging markets — hardly broke stride, continuing their rapid growth.
Our report, Tracking global trends, looks at six broad, long-term developments that are shaping our world:
- Emerging markets increase their global power
- Cleantech becomes a competitive advantage
- Global banking seeks recovery through transformation
- Governments enhance ties with the private sector
- Rapid technology innovation creates a smart, mobile world
- Demographic shifts transform the global workforce
Global economies are so tightly interconnected that companies, governments and industries will soon be forced to cooperate in ways we could not have imagined just a few years ago.
In fact, Ernst & Young believes the six trends are themselves connected by three underlying drivers that have helped establish each trend and perpetuate it.
- Demographic shifts. Population growth, increased urbanization, a widening divide between countries with youthful and quickly aging populations and a rapidly growing middle class are reshaping not only the business world, but also society as a whole.
- Reshaped global power structure. As the world recovers from the worst recession in decades, the rise of relationships between the public and private sectors has shifted the balance of global power faster than most could have imagined just a few years ago.
- Disruptive innovation. Innovations in technology continue to have massive effects on business and society. We're now seeing emerging markets become hotbeds of innovation, especially in efforts to reach the growing middle class and low-income consumers around the globe.
Six global trends, interconnected by three key drivers of change
Winner and losers
As these trends change the ways in which businesses operate, grow and compete, winners and losers inevitably will emerge.
The winners will be easy to spot:
- They will be the organizations that constantly monitor broad trends in the external environment, embrace technology and look for talent everywhere, especially among previously neglected segments of the workforce such as women, minorities and older workers.
- Regardless of what industry they are in or where they are headquartered, these organizations are looking outward. In so doing, they are navigating multiple jurisdictions and regulatory frameworks while adapting to local environments and attempting to create global workforces.
- They are modifying supply chains to leverage shifting labor cost structures and mitigate raw materials' price fluctuations.
- They are figuring out how cleantech fits into their growth plans and making it an integral part of their future strategy.
- National governments, meanwhile, are seeking ways to meet growth agendas while reducing cost structures and future debt obligations.
Shaping the future
As businesses and governments look to the future, they would do well to remember that executing on their existing strategy may no longer be good enough. They must think more deeply about the opportunities and risks presented by the evolving trends, and the driving forces behind them.
With a different mindset, they can re-imagine what is possible, discovering what they can do that is new, and how best to do it.
Those that succeed may find themselves not just navigating tomorrow’s global trends, but actually shaping them.