What trends will transform business over the
next decade or two? That’s good information to have whether you’re an
entrepreneur, a small-business owner, or a megaconglomerate manager. Looking
into the crystal ball is always dodgy, but consulting firm McKinsey & Co.
has taken a stab at it.
Here are some of the forecasts.
Structure. In many industries, a barbell-like
structure is appearing: a few giants on top, a narrow middle, and then a flurry
of smaller, fast-moving players on the bottom. This structure will provide new
opportunities for small business.
Asia. Although the United States will still have the
largest share of absolute economic growth, Asia (excluding Japan) will account
for the same level of global gross domestic product as western Europe. Today,
Asia accounts for 13 percent vs. Europe’s 30 percent.
Aging. The aging of populations will increase demand
for social services, requiring either greater worker productivity or higher
taxes. Some private-public policy hybrid is likely in order to provide
healthcare and retirement security.
Consumers. Nearly a billion new consumers will enter
the global marketplace in the next decade as consumer spending power in emerging
economies will more than double to $9 trillion. That’s about where western
Europe is today.
Resources. Expect higher prices ahead unless
technology and innovation result in more-efficient use of resources. Oil demand
is projected to grow by 50 percent in the next two decades, and supply is
unlikely to keep up with new approaches.
Management. Running a business will turn from an art
to a science. More and more executives will adopt algorithmic decision-making
techniques and use highly sophisticated software to run their organizations.
Forget about getting a competitive edge—these tools will be necessary merely to
play the game.