Over the past two weeks, the blog has featured a discussion of 10 trends featured in the July 2009 edition of the Harvard Business Review http://tinyurl.com/l2ooj3. This is a recap and link posting for people looking to explore and contribute to the discussion as we all face a world of uncertainty and volatility.
This blog entry recaps each of the trends with the first bullet a summary of McKinsey’s view of the trend and the second a summary recommendation. The details are in the individual blog posts that are cross linked to the title of the trend.
Globalization is under fire - a declining trend
- Increased protectionism and reduce global trade are reducing the global flow of people, goods and services – according to McKinsey.
- IT is a global industry with global networks of suppliers and customers that does not seem to be slowing down.
Resources Feeling the Strain - a stable trend
- While resource and commodity prices pulled back during the recession, the fundamental forces driving these prices have not changed.
- CIOs need to be at the core of enterprise productivity improvement initiatives where they can use information, automation and technology to change resource consumption patterns, improve resource productivity, and operational excellence.
Trust in Business is Running Out - an accelerating trend
- The recession, its root causes and other factors have eroded consumer and public trust in businesses which raises the cost and lowers the brand value.
- Trust is information-based and use IT to communicate, deliver and demonstrate your ability to help consumers form and evaluate their expectations for your products and services.
A Bigger Role for Government - an accelerating trend
- Governments have played a significant role in stimuluating the recovery and re-regulating industries. Do not expect them to shrink back from these roles.
- IT will be at the forefront of an expanded public sector, either in the form of new systems to support new programs or additional regulatory and compliance requirements for enterprises.
Management as a Science - a stable trend
- Information and decision support technologies will continue to transform management and prevent the ‘decisions’ that led to the financial crisis.
- Management will replace the transaction as the primary focus of IT which will need to bring social technologies and web 2.0 to change the way we manage.
Shifting Consumption Patterns - an accelerating trend
- Consumption patterns are shifting as U.S. consumers pullback in the face of recession and debt in favor of Asia countries and older consumers.
- Use IT to reach Asian and other fast growing markets (see trend below) as well as inject information and technology to improve the access and usability of products and services to the 50+ crowd who still has the resources to sustain consumption.
Asia Rising - a stable trend
- Asian economies continue to rise in importance and growth as both a supplier and consumer. They will become about a quarter of the world economy dominated by India and China.
- Asia is not one economy or even one region. Use IT to ‘lighten’ your Asian business model to address the specific cultural, geographic reach, and supply chain considerations.
Industries Taking New Shape - an accelerating trend
- Industries are changing in the face of the recession that widens the gap between strong and weak rivals and continued disaggregation of industry structures. This requires a two tier strategy: seize immediate opportunities created by the recession and look for ways to redefine the industry in your favor.
- CIOs need to concentrate on raising enterprise effectiveness through raising IT effectiveness as company’s that are able to achieve their goals are the ones able to reshape the industry.
Innovation Marches On - a stable trend
- Resist the initial desire to cut back on R&D in the face of tough economic times. Rather continue investment, even through operational cuts, as innovation separates companies when the economy comes out of the recession.
- CIOs need to concentrate on raising IT productivity in order to be able to response to a diverse set of opportunities at speed and scale. Without increased productivity and reduced cycle time, IT becomes a bottleneck for innovation.
Price Stability in Question - an accelerating trend
- Economic forces are at play with a high probability of changing price stability either leading to inflation or deflation.
- IT recommendation: regardless of the direction firms need to build their pricing power using information and technology to better target, engage and meet customer needs.