A recently published book by three McKinsey Global Institute researchers reveals the four major global forces that are transforming the world and business and what leaders need to do to adapt.
Disruption: everyone in business talks about it; we’ve posted blogs about it; universities teach courses about it. The thought of disruption can creates knee-shaking fear in the boardroom and tap the imagination of innovators working out of a garage. But no matter how you feel about it, disruption is now a fact of life in the world of business. A recent book, No Ordinary Disruption: The Four Global Forces Breaking All the Trends, makes it clear that there’s a new reality out there. Things change at a faster rate than ever. And they’re changing in ways that will transform every aspect of our lives.
Written by McKinsey Global Institute researchers and directors, Richard Dobbs, James Manyika, and Jonathon Woetzel, No Ordinary Disruption covers the four major disruptive trends that are reshaping the world. As the authors note, “Compared with the Industrial Revolution [which transformed the world in the late 18th and early 19th centuries], we estimate that change is happening ten times faster and at 300 times the scale.” The four disruptive trends they write about are ones we are all familiar with: urbanization, accelerated changes in technology, the aging of the world’s population; and globalization. The point the authors make is, as these trends gain strength and begin to interact with one another, the disruption will only intensify.
The surprises aren’t in the categories of disruption; we already know them. But when you dig down, there are some truly unexpected surprises that, when considered, will ultimately change the world as we know it. We’ll be covering each of these forces in depth in future blogs:
- Urbanization – The authors note that “nearly half of global GDP growth between 2010 and 2025 will come from 440 cities in emerging markets….that many Western executives have never even heard of.”
- Accelerated changes in technology – Fifty years after the invention of the telephone, only half of the homes in America had one, stated the authors. Yet, less than 10 years after Facebook became available to the public, it now has approximately 1.4 billion users.
- The aging population – Whether it’s the one-child policy in China or the low birthrate due to more women entering the workplace and the availability of birth control, the fact is that population growth has slowed. While that’s a good thing when it comes to the availability of resources, it’s not such a great thing when you consider what the costs of this demographic shift will be…a society with more retirees and a shrinking workforce.
- Globalization – We’ve gone from a world where there were defined lines of trade and investments in traditional hubs to one where countries that, mere decades ago, would barely talk to one another in the halls of the United Nations now have robust trading relationships.
Any one of these forces of disruption would have a significant effect on the world as we know it; but the reality that they are all occurring together is intensifying the impact. This confluence of effects means that business leaders and policy makers will need to be agile, flexible, and adaptable. They will need to be willing to cast old ideas and notions aside and to work with the world as it is, not as they wish it would be.