Mega trends and your business
Businesses from across Hertfordshire met at West Herts College Business Lounge in Watford this week to attend our latest seminar on ‘Mega trends and Your Business’. Our guest speaker Helen Webb, Director of Webb Strategy and former Managing Director of Lastminute.com gave an informative and enlightening presentation on the changing business landscape and how businesses could better prepare themselves for the challenges and opportunities presented by mega trends.
So, what are Mega trends?
What do mobile, big data and e-commerce all have in common?
They have all had a major impact on people, businesses, society and the economy over a sustained period of time. That makes them mega trends!
Mega trends are the global shifts that change our society and the way we do business. They are the forces that shape our personal and business lives and the socio-economic norms of tomorrow. They span a wide range of areas, from Artificial Intelligence and Robotics to Climate Change and Globalisation.
They may be considered beyond our control, but it is within our power to understand them and take a proactive approach to considering the implications they may have on our businesses. Will they be disruptive – yes, but they may also present opportunities.
During the seminar Helen explored the top mega trends and provided some mega facts to accompany them:
Who would have believed 20 years ago that global mobile traffic would have exceeded traffic from wired devices or that across the world more people would have access to mobile phones than they do running water.1
Mobile data is estimated to grow at 46% Compound Annual Growth Rate between 2016 and 20211 and as a consequence, mobile app spend is increasing and consumer spend on mobile is set to surpass $110 billion in 2018.2
2. The Internet of Things
Whilst a new term to the average consumer the Internet of Things (IoT) has been talked about by tech companies for decades. Smart devices of all kinds are on the increase and becoming commonplace in the modern home. Alexa and Siri are now household names helping families with everyday tasks. Other examples include: smart meters, smart thermostats, smart watches and even smart cars. It is estimated that by 2020 there will be over 10 million self-driving cars on the road and by 2030, a conservative estimate suggests 1 in 4 cars will be self-driven.3
3. Artificial Intelligence (AI) and Robotics
The phenomenal changes in technology that we are experiencing have been termed the fourth industrial revolution. AI and Robotics are changing the way we live and work. They have had a significant impact already on sectors such as manufacturing and are set to revolutionise the job market. Increasing automation will undoubtedly mean that the workforce of today will need an entirely different skillset in the future.
4. Ageing population
10% of the UK population will be over 80 years old by 20504 and as the age of retirement increases for the first time in history there will soon be 5 generations in the workforce. Businesses will need to embrace the diversity that each generation can bring to the work environment.
5. Emerging markets
China and India, the world’s largest emerging economies are shaking up the market. According to PwC projections China’s economy will be unquestionably larger than the US’s by 2028 and India will be second largest by 2050.5
The unprecedented rate of growth of these economies is resulting in a global shift of power away from the traditional G7 developed countries.
Whilst not a new phenomenon advances in communication, transport and technology have accelerated the rate of globalisation. The world has got ‘smaller’ with consumers benefiting from greater choice from a global marketplace. For businesses there are benefits too with increased competition lowering prices, labour mobility offering greater choice of workers and opportunities for more efficient production through economies of scale.
7. Climate change
Undeniable (by most) climate change is very real and the effects of it can be seen in our news daily. In recent weeks we’ve seen wild fire, floods and tornados across the world. In the UK we’ve felt the effects in recent years with increased flooding in some areas and snow days that have caused disruption to many businesses.
8. Resource scarcity
The combined pressures of an increasing population and climate change are having an interminable effect on our natural resources. By 2030 it is estimated that with a predicted population of 8.3 billion people there will need to be 50% more energy, 40% more water and 35% more food to meet demand.6
A frightening but sobering statistic because if demands for resources cannot be met then the other mega trends will pale into insignificance. Businesses that can look to save or find new resources will becoming increasingly important.
9. Big data
This mega trend has been high on the agenda in 2018 with the introduction of the General Data Protection Regulation (GDPR) and concerns the digital trace or information we leave behind that can be used, stored and analysed. Internet searches, emails, social media interactions, photos, videos, etc. can all be reviewed and analysed to find out more about us as individuals.
For businesses the volume of data being amassed is leading to changes in how it’s stored. Whilst there are obvious concerns about privacy, data collected and used in the right way can transform business processes and provide valuable intelligence to aid business growth.
10. Gig economy
The gig economy is redefining the world of work and has caused massive disruption in some markets. How many of London’s black cab drivers would have foreseen the arrival of Uber? There has been a rise in companies like Uber and Deliveroo who use self-employed workers. In the UK 4.8 million people, that’s 12% of the labourforce, are now ‘self-employed’.7 If we look across the pond Weforum estimate that by 2025 more than 50% of workers in the US will be freelancing.8 This seismic shift in employment status provides greater flexibility to businesses and workers, but we need to ensure this trend is not at the expense of workers’ rights and their quality of life,
11. Digital platforms
Commonly known digital platforms include Facebook, Twitter, YouTube and LinkedIn. Each platform facilitates interaction between people for services, products or information. Most recently we have seen an increase in peer-to-peer trading sites for example Airbnb, Uber, Etsy and Spotify. Such marketplaces are booming and PwC predicts the market will go from $15 billion in 2013 to $355 billion in 2025.9
Why do mega trends matter?
So, mega trends are happening, we’ve established we can’t stop them – but why do they matter so much?
Mega trends have different implications for different businesses and are bringing opportunities and threats that cannot be ignored. To be successful we must all stay relevant, look to the future and embrace change.
Amazon is a fantastic example of a business that has continually evolved, updated its offering and stayed ahead of the market place. By contrast, we have seen examples such as Kodak, Nokia and Blockbuster who have failed to notice the sea change occurring and how their offering could have been adapted to secure their long-term future.
How do I spot a mega trend?
All too often business leaders can spend time working ‘in’ the business rather than ‘on’ the business. It’s important to take time to look around at what is going in the world and to consider how the changing landscape may affect your business and its many and varied stakeholders.
Get as close to your customers as possible – understand what they need but don’t forget innovation can change expectations. Who would have thought we’d have wanted a phone for something other than making a phone call or a watch for anything other than telling the time? We need to do more than satisfy needs we need to learn to predict future desires too.
Look to the emerging markets and what is going on there, what trends are you seeing. Consider who is investing, where are they investing and what are they investing in?
To attract the best people, you will need to create a culture that embraces trend spotting and is not afraid to adapt to ensure long term sustainability.
How do I get my company on board?
PwC’s Annual Global CEO survey in 2017 revealed that 70% of CEO’s saw the speed of technological change as a top concern – a rise from 58% in 2015.10 Based on this statistic, a good place to start is to get the technologists in your business in the room. Add to this, key staff from across the business from multiple functions and start the mega trends conversation.
Considering all the potential opportunities and threats posed it can seem overwhelming but stay positive, keep it simple and tackle in bitesize pieces. Highlight the 3 mega trends most likely to impact your organisation in the immediate future. Consider how they may affect your product or service, your processes, skills, structure and strategy and consider what opportunities they could present.
Determine concise action and start by implementing change that is realistic and achievable and finally and crucially, involve all parties to ensure they are informed and engaged in the process.
In time, we hope that meeting the challenges and maximising the opportunities that mega trends provide will become culturally embedded into your organisation’s DNA. As Charles Darwin said, “It is not the most intellectual of the species that survives; it is not the strongest that survives; but it is the one that is able best to adapt and adjust to the changing environment in which it finds itself.”
The team at SA Law can help you adapt and adjust and transform your business to meet these demands, with practical advice on strategy, staffing and business structures.
Further mega trend reading mentioned in this article:
- Cisco Visual Networking Index Global Mobile Data Traffic Forecast for 2016-2021
- Consumer spend on apps to reach $106.4 billion this year, $156.5 billion by 2022
- 10 Million Self-Driving Cars will hit the road by 2020
- Sizing Up the Challenge Ahead: Future Demographic Trends and Long-term Care Costs
- Megatrend: the shift to emerging markets
- National Intelligence Council Global trends 2030: Alternative Worlds
- Office for National Statistics
- The megatrend that will shape our working future
- 4 open source peer-to-peer marketplaces
- PwC's 20th Annual Global CEO Survey