Viewpoint: Megatrends that will change everyone's lives
- 11 February 2013
- From the section Business
Imagine a future where concerns about sustainability and the environment have given way to worries about individual health and wellbeing.
Investors would shy away from "green" solution to instead focus on so-called "smart" products and technologies, such as digital assistants - ranging from portable screens to vehicles or robots - that help individuals in their everyday lives.
These "smart" technologies can help business too, of course, as they help cement a community of four or five billion people who will be connected to each other via the internet, each and every one of them a potential customer.
As such, a technological revolution is under way, where gadgets, large and small, are changing society. And this stuff is not make-believe any more. In a decade or so, much of this will have become reality.
But how will we get there? How will society change along the way, whether at the local or the global level?
Many companies are still trying to work out how they should respond to global trends, such as the dramatic rise of China's economic and political power, or even to the need for strategic takes on issues such as e-commerce or the rise of social media.
Organisations are also responding to the emergence of a reverse brain drain that is increasingly forcing educated Westerners to look for skilled work in Asia, or with Asian companies in their home countries.
But while some react, others are taking the lead. To name but a few:
- Facebook has emerged to both shape and take advantage of online social networking trends
- IBM has transformed its computer hardware business to become a solution provider
- Amazon has carved out a dominant position in online retailing, then moved into hardware with its Kindle and into services with its cloud data-storage solutions
All three, and many others with them, have one thing in common. They have all been among the first to spot and adapt to major societal and transformative forces, or so-called megatrends, such as these:
Health and wellbeing
Public health is becoming unaffordable. In the Western world, healthcare costs are set to account for a fifth of total government spending by 2020. In the US, it already does so - almost.
Consequently, the age-old model of treating symptoms will give way to more holistic solutions that involve early diagnosis of disease, methods that can predict future ailments, efforts to prevent disease in the first place and ongoing monitoring of patients to ensure medical intervention takes place at an early stage when it is generally cheaper to do so.
Private health insurance schemes will change to reward individuals who stay healthy, and the private sector will increasingly sell gadgets, drugs and services that help them do so.
Smart is the new green
If "green" was the last decade's megatrend, the latest buzzword is "smart", a suitably vague term that starts in the home.
The idea is that technology will transform your ordinary home into a "smart home", where entry will be controlled by retina scanners, digital assistants will greet occupants, detect their mood and respond intelligently by controlling the ambiance with mood lighting, scents, sound and vision.
Meals will be planned with options displayed on the touch-screen kitchen table top and mirrors will offer fashion advice. The phone or tablet will become a caretaker that monitors energy usage during peak and off-peak periods.
The fridge will obviously restock itself, placing automatic orders for jam and ketchup whenever it is running low.
Outside the home "smart cars" will offer hands-free driving as they move autonomously through modern cities. "Smart initiatives" are set to emerge throughout modern society, reshaping the way we interact with homes and cities, buildings and cars, as well as with factories and utility companies. Big data will create new corporate ecosystems.
Innovating to zero
Another buzzword is "zero", which centres around the idea that with the help of innovation, we can remove what we do not want - that we can create foolproof systems that ensures there are "zero breaches of security", products with "zero defects", cars that result in "zero accidents", or clever models that result in "zero fatalities" in, say, construction or mineral exploration industries.
Concepts such as "zero emails" will gain popularity in our workplace as there will be a shift towards more informal collaboration and as increasingly versatile social media tools replace the inbox.
And then, of course, there are the so-called "zero emission cars".
By 2020, more than 45 million electric bicycles, cars, buses and trucks are expected to be sold annually.
True, sales of such vehicles remain weak and will probably remain so for a couple of years longer, but during the second half of the decade we will see sales take off, creating new markets for batteries, charging stations and wireless charging solutions, as well as electric motors for cars.
It will pave the way for new business models, such as pay-by-the-mile motoring.
Cities as customers
Across the world, the pace of urbanisation is picking up. Core city centres are seamlessly merging with suburbs and "daughter" cities. City limits are expanding and so-called "mega-cities" are emerging, along with "mega-regions" and "mega-corridors".
Each of these "mega-districts" - which will often be deemed "smart" or sustainable - will be so large that companies are beginning to consider them as autonomous hubs of customers, investment, wealth creation and economic growth.
As such, many of the companies will increasingly reorganise to focus their sales and marketing efforts and other business strategies on individual cities, as opposed to on countries or states as most of them currently do.
From planes to trains
Some 200 years after the railway was invented, we are about to see dramatic change. The next decade or two will see the creation of a global high speed rail network that will connect not only cities, states or countries, but even continents.
Some of the world's largest infrastructure projects will come together to make seamless rail travel between the United Kingdom and China, say, or between Moscow and the Middle East possible in the next 15 to 20 years.
Even the rail laggard USA will get in on the act as rail increasingly becomes a driver of economic growth.
Value for many
The emergence of a global middle class, which is interconnected via the internet and set to number some five billion people by 2020, is resulting in the creation of new "value for many" (VFM) business models that will help drive economic growth in the coming decade.
Examples that exist already include Groupon's collaborative business model, which uses the internet to connect buyers and buys goodsen masse to get the discounts. Car sharing schemes or the free Metro newspaper are also "value for many" business models, which by definition can only make money if they have a large number of members.
The most interesting feature of the VFM business model is that it drives innovation across a whole spectrum of industries, from low-cost flights to low-cost affordable healthcare products for the masses.
Connectivity and convergence
By 2020, the world will see 80 billion connected devices, nine billion mobile phones and five billion internet users, 50% of whom connect through handheld devices.
This creates an invisible network that amounts to a world without borders, where tasks can be completed at the blink of an eye and the touch of a finger, and where online video, social media and digital imagery create an era of connectivity and convergence that will change future human interaction in every aspect of life.
Cyber-wars fought by cyber-soldiers might sound like science fiction, but military forces around the world have come to accept it as a fifth battle front, alongside sea, air, land and space.
Much of it will centre around the control of information, and in turn around the control of the more than 1,200 satellites that are expected to be launched into space in the next decade, alongside myriad rockets carrying space tourists.
Population and internet growth will result in a twentyfold increase in the number of hackers around the world, each of them trying to wrestle control from companies or governments in order to make money or cause disruption.
Age and sex matters. Our private lives will change as a direct consequence of the population make-up in our home country. Or perhaps in our home mega-city.
In India, some 60% of the population will soon be aged below 34. Consequently, a new generation of political leaders below the age of 45 is waiting in the wings.
China has already seen a political generational change and the "younger" Chinese government is expected to bring new social changes such as the abolition or relaxation of the hukou system, which restricts people migrating within the country, and the single-child policy.
The abolition of the single-child policy will reduce China's dependence on the relatively few "little emperors" supporting their parents and grandparents. It will also increase the women-to-men ratio.
Increasingly, female empowerment, which will see women play an increasingly active role in the world of politics and business, will result in fewer children being born, often later in their mothers' lives.
Sarwant Singh is the author of New Mega Trends and a partner with the consultants Frost & Sullivan.