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Key Disruptive Global Trends: The View from McKinsey

By Shlomo Maital

     “The trend is your friend.” Thus begins a terse McKinsey Quarterly (April) article on disruptive global trends.   The trend is your friend – provided you spot it accurately. It is your enemy if you miss or misread it. Here is McKinsey’s take on the nine key disruptive global trends.

   The first three: “ ● The globalization of digital products and services is surging, but traditional trade and financial flows have stalled, moving us beyond globalization. ● We’re also seeing new growth dynamics, with the mental model of BRIC (Brazil, Russia, India, and China) countries giving way to a regional emphasis on ICASA (India, China, Africa, and Southeast Asia). ● Finally, the world’s natural-resource equation is changing as technology boosts resource productivity, new bottlenecks emerge, and fresh questions arise about “resources (un)limited?”

   What do these trends mean to you, to your job or business or startup? Can you find opportunity in them?

   The next three tensions highlight accelerating industry disruption.    “● Digitization,            ● machine learning, and ● the life sciences are advancing and combining with one another to redefine what companies do and where industry boundaries lie. In the words of Alibaba’s Jack Ma, B2C is becoming “C2B,” as customers enjoy “free” goods and services, personalization, and variety. And the terms of competition are changing: as interconnected networks of partners, platforms, customers, and suppliers become more important, we are experiencing a business ecosystem revolution.”

   The final three forces: “● underscore the need for cooperation to strike a new societal deal in many countries. We must cooperate to safeguard ourselves against ● a “dark side” of malevolent actors, including cybercriminals and terrorists. ● Collaboration between business and government also will be critical to spur middle-class progress and to undertake the economic experiments needed to accelerate growth. This is not just a developed-market issue; many countries must strive for a “next deal” to sustain progress.

   Scary? Risky?   McKinsey strikes an optimistic note: “These tensions seem acute today because of fast-moving political events and social unease. But earlier times of transition provide encouraging precedents: the Industrial Revolution gave rise to social-insurance programs in Western Europe and the Progressive movement in the United States, for example.”   In other words, times of change and disruption always bring opportunities, for those who see clearly and act decisively.

     Are YOU among them?

 

BRIC is so 2013! Now It’s…Want to make a MINT?

By Shlomo  Maital

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       There’s nothing like a good acronym to catch the eye of those seeking new places to make money.  That’s why Jim O’Neill, former head of asset management at Goldman, Sachs, coined the term BRIC 13 years ago – Brazil, Russia, India, China – to name the four up-and-coming nations.  He got China right. Brazil is struggling. So is India.  Russia still doesn’t have a true economy other than oil and gas.  So – one out of four.  Pretty good, for a global banker.

   Now comes a new acronym.  Remember it:  MINT.  Mexico, Indonesia, Nigeria, Turkey.   If you want to make a MINT, then invest in MINT.  According to   www.metro.co.uk:    

     ‘If they get their act together, they’ve got the ability to get so much bigger,’ said O’Neill of the MINT countries.  It will be the subject of an upcoming BBC radio series, MINT: The Next Economic Giants.   ‘If not as big as the BRICs, then not that far off.’    Mexico, O’Neill argues, previously lost out to China on cheap exports and labour. But with wages increasing in China, Mexico can capitalise, especially with its proximity to the US.  ‘It’s probably the most competitive OECD country at the moment,’ said O’Neill. ‘And these guys have a bunch of young reformers who make Maggie Thatcher look like a pussycat.’

O’Neill argues convincingly that Nigeria is THE MINT country to watch:

“Indonesia has a chance to boom, like Mexico, because of a large, willing workforce and a rapidly urbanising population, said O’Neill. ‘There are 240m of them in Indonesia, the third largest populated country in the world.’  Turkey, meanwhile, benefits from its geographical position between East and West and ‘because they know how to deal with us in the West, with the Middle East, with the Russians’.   But the most exciting MINT country is Nigeria. ‘The place is complete madness, of course, and one can’t be 100 per cent sure, given its challenges, that it will be one country in four years. But after India, it’s the best in the world in terms of useful population. By 2050, Nigeria will have more people than the United States. If you get those young people in productive jobs, that place will arguably be the most exciting country in the world in the next 30 years. Linked to that, there are so many creative entrepreneurs there and, interestingly, so many educated Nigerians returning from the US because they smell this opportunity to be the next big thing.’ Nigeria is also rich in resources, including oil.

  There are at least two ways to take Jim O’Neill’s acronym.   1.  Given his 1 out of 4 record in the past:  Search elsewhere.  Or 2.  Bet big time on Nigeria.  

    What are your thoughts, readers?  
 

Blog entries written by Prof. Shlomo Maital

Shlomo Maital
July 2017
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