Global Forces – Major trends and opportunities for British Columbia
Date: September 9, 2015
Name: Global Forces – Major trends and opportunities for British Columbia
Presenter: Dominic Barton
Leaders need to understand how global forces can impact the business operations in British Columbia. Moreover, leaders need to adapt the changes to create more business opportunities for locals. Vancouver Board of Trade invites Dominic Barton, the Global Managing Director of McKinsey & Company, to share his perspective on global forces. Leaders will learn how forces can change their business landscape and seek better implications. This presentation will benefit many leaders who are looking to capture new opportunities in the current global economy.
Dominic Barton is the Global Managing Director at McKinsey & Company. In his 29 years of experience, Barton has helped out many businesses in many industries, especially in banking, consumer goods and high technology. Barton was also the Asia Chairman for McKinsey at Shanghai from 2004 to 2009. Barton has published over 80 articles on society, leadership and financial services. Moreover, Barton is the co-author of a book called “Dangerous Market”. Moreover, he involves with many society works, including the member of Canadian Prime Minister’s Advisory committee and the chair of Seoul International Business Advisory Council.
Barton announces McKinsey & Company will open a Vancouver office this year. Barton seeks the digital trends in Vancouver and believes it is the right time to capture the opportunities.
Barton states in order to improve the odds of success in any organization, leaders need to accomplish these 3 steps.
- Starting point
- Global trends
- Bold moves
Starting point determines who they are. The global trends represent where they are going, and the bold moves illustrate what they need to do. By looking at the power curve, many organizations usually stop in the middle of the curve; however, leaders need to make bold move to push organizations towards the top.
Starting point refers to the size, resources, structures, and productivity. This represents 20% of the impact. Global trends focus on industry and geographic trends. Nevertheless, bold moves are strategic choices in M&A, capital, expenditures and resource allocation. Barton indicates 20-40% of leading companies will focus on bold moves.
Barton shares the 5 forces that will change the global business.
- The rise of emerging markets
- The power of disruptive technologies
- The aging of the global population
- The changing nature of capitalism
- The return of geographic politics
The world economic centre of gravity is shifting back to Asia and Barton believes many organizations are not aware of this change. Nearly 2.2 billion new middle class will be in the population by 2030 based on the forecast of 5.0 billion people in 2030. The emerging market cities will fuel nearly half global growth, which result of increase 45% in global growth.
The pace of digital disruption is accelerating. This means organizations are expected to be exponentially faster, smaller, cheaper and better. The disruptive technology will have substantial economic impact by 2025. This includes mobile internet, automation on knowledge work and cloud technology. The technology is disrupting every aspect of people’s lives and the consumers are setting the bar higher than ever. Therefore, digitization is the key to drive massive improvement s in efficiency.
Barton believes the steps will be typical, improvement, and then digital. In the future, the data flow will reduce downtime and increase velocity. Digitization has a ripple effect, which creates second bounce to other industries. However, not every organization will survive, but Barton expects the extent of disruption will be over 5 years for all industries.
The average lifetime of organizations is declining. Comparing with 1935 to 2011, it has already reduced over 80%. Barton explains the new technology is upending the fundamental truths of business what traditional leaders used to believe.
Barton shares 6 different ways organizations can adapt the change.
- Prepare for disruption
- Think about data holistically
- Experiment and innovate at speed
- Redesign the organization
- Invest more in education
- Manage risks
Prepare for disruption can be assess digital quotient. Data holistically relates to appoint Chief Digital Officer. Crowdsource is an example of innovate at speed. Leaders can redesign the organization with flatter, smaller and more autonomous structures. Organizations can provide lifelong learning and reduce business loss from cybersecurity.
Barton believes British Columbia has strengths in human capital, industry and geography; however, British Columbia has weakness in human capital, such as talents and aging population, and industry, such as transiting economy and turbulent commodities markets.
Organizations can create action plan based on these 5 potential bold moves
- Agriculture
- Tourism
- Innovation
- Education
- Infrastructure
Agri-foods growth can quadruple the export value by 2025. The key driver is to harness the power of sensors through internet and leverage advanced technology. Barton mentions British Columbia can adapt new investment in innovation, private sector and education. By investing in Asia tourism can improve the performance of British Columbia destination. Vancouver can be the next technology hub if there is high ambition, public sector investments, and private sector collaboration.
British Columbia has 3 high performing universities, many motivated industry partners, and deliberate leadership. These factors are considered to be “research quadrangle”
In order to continue to develop BC as a logistic hub, Barton believes momentum needs to be build. With the right talent, Asian links, and grass roots potentials, BC can fully utilize the asset to become next hub.
The hub will help the global to integrate government, business, and institutional planning. The networking and knowledge sharing will improve and it will create incentive for business to grow in BC.
Barton emphasizes 3 mindset shifts to raise the ambition
- Aspire to be global hub
- Challenge all orthodoxies
- Take a long-term perspective
“Help Vancouver continue to develop into a global hub”