Spot the future

Management guru Peter Drucker once said that the future was always already happening somewhere; it was just a question of spotting it. Well, here at World Business, we have done the work for you. Here are 10 ideas to consider - 10 issues that will undoubtedly affect your organisation.

by Stefan Stern and Emilie Filou, World Business
Last Updated: 23 Jul 2013

Unsurprisingly, there is much on the agenda regarding human resources and technology, what with the global war for talent once again gaining in intensity and the bewildering pace of technological change. The good news is that some of these ideas will be familiar. The bad news is that most companies so far have failed to take heed. Take our word for it: it's now or never.

1. THE SAVVY CONSUMER

The era of deference has passed. As with society, so in commerce: whereas in the past customers accepted (more or less) what grand corporations were good enough to offer them, today's web-enabled consumers shop around aggressively - instant price comparisons, anybody? - set up 'suck sites' to defame the businesses that have let them down and help define new-generation icons.

Companies can't just sell to customers any more. Instead, they will have to work with them and learn to let go of their brand. This process of co-creation, whereby consumers have an on-going say in the development and eventual success of the products, is well under way and responsible for some of the biggest hits of the last few years, such as iPod, Wikipedia, Pabst Blue Ribbon, Lego, YouTube.

Alex Wipperfurth, author of Brand Hijack: marketing without marketing (2005), explains that success is no longer about product specifics. It's about cultural positioning and being on the consumer's terms. "Starbucks' success had nothing to do with the quality of its coffee. It was about the concept and how it fitted into people's life," says Wipperfurth. "Dove was the same. There was no product innovation in this sector, but by championing women's beauty and self-esteem, it was a huge success."

Corporations be warned - involve your customers, or miss out.

2. FROM CSR TO CSO

Milton Friedman is dead, and dying also is the notion he most famously propagated, that "there is one and only one social responsibility of business - to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game".

Much of the early CSR activity was often dishonest or muddle-headed. But when Michael Porter starts writing seriously about the issue (as he did in a recent Harvard Business Review article), the corporate world takes note. Many companies have now realised that they had a good business case to turn their token CSR policy into mainstream strategy.

Virgin is an example of such enlightened companies. "We first did it for our staff," says Jean Oelwang, head of Virgin Unite, Virgin's CSR programme that supports a range of initiatives at home and abroad. "It was something that would pull everyone together." The advantages for the company were soon obvious: greater staff motivation, new entrepreneurial and learning opportunities, a widening skill base and new business opportunities with 'good' investments, such as biofuels, health and transport.

Similarly, Accenture's Isabel Naidoo says that its corporate citizenship programme - which encourages free use of the staff's time and skills - has become a major selling point in both attracting and retaining employees.

Be good and make money at the same time? All hail the new corporate social opportunity.

3. THE MANAGER DIPLOMAT

It's never been easy for companies to negotiate their way through the system. Leaders must deal with a range of institutions and people on a daily basis - customers, stakeholders, regulators, governments, suppliers, banks, media - and all must be kept happy to maintain a company's good standing.

But this exercise in corporate diplomacy will only get more important. Michael Watkins, founder of the consultancy Genesis and a visiting professor at INSEAD, explains that world events, such as wars in oil epicentre Middle East and nationalisation programmes in resource-rich Latin America, mean companies need to shape the context in which they operate.

But it's not just down to politics. Watkins argues that companies are now much more deeply integrated into the world economy than before. "Forty years ago, all that globalisation meant was trade barriers and tariff negotiations. These days, companies must work on the harmonisation of investments, worldwide labour issues and global environmental policies. The international agenda has changed in such a way that companies are at the heart of the global economy."

Taking on the role of ambassador will be crucial for success. Watkins says that most senior executives realise that they have a diplomatic role to play, but few are trained to act accordingly. It's time to sharpen those negotiating tools, including heroic levels of patience, tact and attention to detail.

4. FLEXIBLE WORKING

Home working had been hailed as work's flagship advance for the 21st century. In fact, flexible working is about to take on a whole new dimension not because of remote technology, but due to demographics. With a generation of baby boomers about to reach retirement, many companies will lose a substantial size of their intellectual capital. Yet few companies have acted on this danger: compulsory retirement age is still in place in many corporations, and early retirement packages have been a feature of downsizing programmes.

Many of these baby boomers would like to carry on working, if not for the money, then for the intellectual stimulation. Ed Jensen, a senior partner at Accenture's human performance practice, says that learning to cater for those senior employees will be crucial in retaining valuable knowledge. It will also bring its challenges: "Older people work well in a hierarchy; young people don't. And they work more virtually. Finding a workforce model that accommodates everyone will be hard."

Young people's career aspirations will also differ. With careers stretching into their 70s, and the global war for talent well on its way, Herminia Ibarra, professor of organisational behaviour at INSEAD, argues that the need to reinvent oneself over the course of one's career will be central. Companies able to cater for such aspirations will come out best.

5. NO-FRILLS ORGANISATIONS

When easyJet's Stelios Haji-Ioannou announced his intention to launch a low-cost airline in the 1990s, no one believed it could be done. Similarly, when Liann Eden and Dena McCallum came up with the idea of a low-overhead freelance management consultancy, many thought they were being less than realistic. Six years on, though, Eden McCallum is the second biggest strategy consulting firm in London by number of consultants (200 - all freelance, of course), with a turnover in excess of £10 million.

By cutting out the usual frills and expensive overheads (only 24 core staff, no large offices or other corporate paraphernalia), Eden McCallum's operating costs are minimal. It is also more flexible. Some clients prefer the idea of a tailor-made solution to the strategy flatpack of a big firm, and many consultants enjoy their new, flexible 'portfolio' careers.

But this works because Eden McCallum has highly experienced consultants. Ryanair customers are only too happy to forego their free meal and allocated seating for a cheaper ticket, but they still expect trained pilots to fly the plane. Similarly, Eden McCallum's consultants are MBA-educated with a background in a top consulting firm. Clients therefore get the same level of expertise at approximately half the cost. Just don't expect to be wined and dined: client meetings are more likely to be conducted over a cup of coffee.

Many professionals from PR to consultancy to engineering are now opting for this more nimble working practice. What, in 1998, MIT researchers called "the dawn of the e-lance economy" is now taking shape.

6. TIME MANAGEMENT

In spite of the illusion created by labour-saving devices and mobile technology, there are still only 24 hours in a day. In fact, the development of new, always-on technologies has arguably stolen more of managers' personal time. The global market never sleeps and neither do global clients, so the BlackBerry stays on and managers are on call 24/7/365.

Since teleporting will be available only aboard the Starship Enterprise, leaders will have to apply much sharper judgement to their use of time. In reply to a recent invitation, one busy CEO wrote: "Much as I would enjoy lunch, I doubt it would bring me much value." Every meeting, trip or meal will have to pass the 'strictly necessary' test.

Leaders must also learn to refocus. With up to 30 meetings a week and hundreds of phone calls and emails, leaders are constantly distracted. Research by consultancy Development Dimensions International suggests that leaders no longer have time to focus. Yet, taking the time to think something through is at the heart of crucial business decisions.

Resisting the information clutter requires a discipline that most managers do not have: time to switch off the BlackBerry for a couple of hours and turn off the email pop-up alerts for good.

7. BEYOND THE GREEN HYPE

The eco-debate is where CSR used to be: all hype, but token action. Most companies have made some sort of environmental commitment, be it recycling targets or manufacturing standards, but few have assessed the ecological impact of their activities or bothered to do anything about it.

But things are about to change. The Stern Report, released six months ago, seems to have struck a chord. It's not that it said anything new, but it said it with figures and urgency, something that always resonates with business leaders.

Corporations are joining the green bandwagon. With a few exceptions, most fall short of the eco-overhaul the situation calls for, but it's a step in the right direction. Wal-Mart wants to sell 100 million eco-friendly light bulbs by 2008 (saving $3 billion in electricity); car manufacturers are pumping out cleaner cars (with infinite variations on hybrid, electric or bio-fuelled); and Tesco is 'carbon labelling' all its 70,000 products.

As with CSR, what started as a PR exercise will end up as a strategic consideration. GE's $1.5 billion a year Ecomagination campaign, which commits the company to market environmentally friendly technologies, is a good example. But companies should not kid themselves: turning into a green giant will be hard and will require major changes.

8. HUMAN CAPITAL METRICS

Human performance measurements are back. After years of debate about whether metrics worked, and if so, which one produced better results, experts have finally realised that they do work and that arguing over the type of metric used was as pointless as debating on which size of gauge trains should run.

New human capital metrics add a qualitative element to the traditional 'hard' numbers. People are complex creatures and cannot be pinned down to a set of figures. In the knowledge economy, where so much of a company's assets are composed of people, measuring human capital value takes on a new importance. Richard Donkin, a journalist and expert on human capital issues, explains: "It's a nice way for companies to treat their employees as an investment rather than assets, which is a much more positive way of looking at them than traditional management metrics."

Some companies have turned to simple measures such as ex-Bain director Fred Reichheld's Net Promoter Score, which poses the question: "How likely is it that you would recommend your employing company to a friend or colleague?" Standard Chartered uses a simple set of 12 questions devised by Gallup, including: "At work, do you have the opportunity to do what you do best every day?" Enterprise Rent-a-Car in the US asks its customers to rate service levels in a customer satisfaction index, and employees' reward and promotional opportunities are tied to its results.

Now that finance and marketing as well as HR directors are converts to metrics, the question is not whether you should do it but whether you do it better than your competitors.

9. THE SCREEN GENERATION

As well as learning to tease out how employees use their brain cells, managers will soon come across a new type of brain. The 'screen generation', shaped by video games, MySpace and interactive media, is about to enter working life. It's not that they're that different - they just think differently.

Susan Greenfield, a professor of pharmacology at the University of Oxford, argues that the culture of the screen, where everything is visual and available at once, is shaping a different kind of reasoning. "The screen culture is not conducive to taking time to think," she says. "The result is iconic thinking, quick fixes and short attention spans."

On the other hand, they are less overwhelmed by the information deluge that swamps less technology-savvy seniors. Steven Johnson, author of Everything Bad is Good for You (2005), also says that this new generation has an unparalleled ability to navigate new, often complex systems. If you find it hard to follow TV programmes such as 24, then you probably belong to the generation of the printed page.

Managing this new generation will be particularly challenging, for their interaction with others is also a virtual matter. Instant messaging and emailing often replace direct or even phone contact. Different generations will have to learn each other's language to avoid misunderstanding. Soon to follow, of course, is the challenge of being managed by them.

10. VIRTUAL/REMOTE TEAMS

This is globalisation's legacy to management. Thanks to advances in communication technology, companies have been able to look for the talent and skills they need, wherever it is in the world. The result is increasingly scattered teams - and at the highest levels of management.

For leaders, the toughest challenge in managing these geographically dispersed teams is to create and maintain relationships of trust and create a team spirit, despite the distance. Barbara Harvey, global leader for survey and industry research at Accenture, manages a team of 130 employees in 30 locations and 14 countries around the world. "I use a combination of phone, email, instant messaging and shared folders and websites," she explains. New hi-tech videoconferencing systems, such as Cisco's TelePresence, also help people interact better in 'virtual' meetings.

Managers who master the ability to run dispersed global teams virtually will be able to reap the benefits of greater collaborative working, more innovation, access to unique talent in different clusters around the world and keep work going 24/7 by making it 'follow the sun'. They will also be able to help their companies in their business continuity planning. They will have to become attuned to different cultures, and know when to visit people to foster good relations and understanding.

Harvey tries to bring her team together at least once a year and moves employees round so that they are able to meet each other. No matter how good communication technology has become, nothing can really replace direct human contact - yet.

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