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May 20, 2015

New Releases: No Ordinary Disruption

By: Dylan Schleicher @ 9:00 AM – Filed under: Current Events & Public Affairs, Management & Workplace Culture

NoordinarydisruptionIn the Industrial Revolution, one new force changed everything. Today our world is undergoing a much more dramatic transition of 3,000 times the impact due to four fundamental disruptive forces—any single one of which would rank among the greatest changes the global economy has ever seen.

These forces are upending once reliable trends: the global capitals of consumer and business growth will be emerging market cities most westerners have never heard of; the era of cheap capital is ending; training for new job skills can’t keep up with technology’s elimination of old jobs; after decades of oil shortages and even crises, the U.S. recently surpassed Russia as the world’s largest supplier of oil and natural gas, and India has spent less on orbiting a spacecraft around Mars than Hollywood spent on the movie Gravity.

Whether we are business or policy leaders or ordinary citizens, the decisions we now make in the “era of trend breaks,” can no longer be based on our understanding of the world as we have known it in the past or know it today.

In No Ordinary Disruption: The Four Global Forces Breaking All the Trends (May 12, 2015; PublicAffairs), the directors of the McKinsey Global Institute (MGI), the flagship think tank of the McKinsey & Company global management consulting firm, interpret masses of illuminating data from MGI’s twenty-five years of research to guide us through the next two decades of a dramatically different future. With an urgent call to action to reset our intuition to an era of discontinuity, Richard Dobbs, James Manyika, and Jonathan Woetzel dive deeply behind current headlines to analyze six emerging trends caused by four disruptive forces transforming the global economy:

  1. The center of economic gravity is rapidly shifting towards emerging markets—and cities within them which few western executives have heard of, such as Tianjin, in China or Porto Alegre, in Brazil. 440 emerging market cities will account for nearly 50 percent of the world’s additional GDP growth between now and 2025 and have already spurred the largest mass migration from the countryside to the city in world history.
  2. The furious pace of technology breakthroughs and adoption by consumers is shortening the lifecycle of companies and requiring faster do or die business decisions.
  3. Aging demographics could lead to the first global population plateau. The resulting lower (or even negative) growth in workforce will place a greater onus on productivity to drive growth.
  4. Instead of a series of lines connecting major hubs in Europe and North America, the global trading system is expanding into a complex, intricate expanding web; Asia is becoming the world’s largest trading region and “South-South” flows between emerging markets have doubled their share of global trade.

The urgent implications of these four disruptive forces are brought to life by dozens of surprising data points and engaging stories of how forward looking governments and companies in all corners of the globe are adapting and taking advantage of them.

Rearview thinking is no longer an option, especially on such vital concerns as consumption, resources, labor, capital and competition. Instead, the authors urge us to “reset our intuition,” the new business imperative for making decisions based not on yesterday’s assumptions, but instead on a clear-eyed understanding of the “trend breaks” reshaping our future. With No Ordinary Disruption, readers will not only learn about the startling ways our world is changing. They’ll also develop the agile internal navigation system necessary for negotiating a new era, in which continuous trend lines have given way to a new normal of shifts, shocks and surprises.

ABOUT THE AUTHORS

Richard Dobbs is a director of the McKinsey Global Institute (MGI), and a director (senior partner) of McKinsey based in London. From 2004 to 2009, Richard co-led McKinsey's Corporate Finance Practice, where he was also responsible for research and development. He has served clients around the world in a variety of industries, ranging from high tech and financial services to petroleum, utilities, and the public sector. Richard has written numerous articles about the implications of the financial crisis for companies and managing in a downturn. At the McKinsey Global Institute he has led research on global economic trends, including urbanization, resource markets, capital markets, and productivity and growth. Other research has focused on performance management and measurement, mergers and acquisitions, valuation, capital markets strategy, and utility regulation. He was a co-author of Value: The Four Cornerstones of Corporate Finance, and his work has appeared in several books, including Valuation: Measuring and Managing the Value of Companies; in business and academic journals such as the McKinsey Quarterly, McKinsey on Finance, and Corporate Finance; and on the opinion pages of leading newspapers and business publications. He has appeared on CNBC, Fox Business Network, Bloomberg TV and CBC-TV.

James Manyika is a director of the McKinsey Global Institute (MGI), and one of its three global co-leaders. James is also a director (senior partner) at McKinsey, where he is one of the leaders of McKinsey’s Global High Tech, Media and Telecom Practice. Based in Silicon Valley, for the past 18 years he has worked with many of the world’s leading software, systems, Internet, media, and communications companies on a variety of issues, including strategy and innovation, and has helped companies outside of the tech sector fully leverage technology for business transformation. James was appointed by President Obama to serve on the President’s Global Development Council and to serve as the vice chairman of the Council. James is a non-resident senior fellow of the Brookings Institution and a member of the Council on Foreign Relations. James has led research on business strategy issues and on global economic trends, including technology and its impact on business and the economy, growth and productivity, globalization, innovation and competitiveness, and jobs and the future of work.

Based in Shanghai for more than 15 years, Jonathan Woetzel has been instrumental in establishing and scaling McKinsey's presence in China. He works with Chinese businesses to develop strategies, organizations, and operations for global growth, and with city, regional, and national authorities on energy, sustainability, and economic development. Published widely in both Chinese and international publications, Jonathan has written three books on China, including Capitalist China: Strategies for a Revolutionized Economy (Wiley & Sons, 2003). He is the co-author, with Jimmy Hexter, of Operation China: From Strategy to Execution (Harvard Business Press, 2007). He has led research on China, Asia, urbanization and city management, infrastructure, and other global economic and business trends.

 

About Dylan Schleicher


Dylan Schleicher has been a part of the 800-CEO-READ claque since 2003. Even though he's stayed on at the company, he has not stayed put. After beginning in shipping & receiving, he joined customer service and accounting before moving into his current, highly elliptical orbit of duties overseeing the ChangeThis and In the Books websites, the company's annual review of books and in-house design. He lives with his wife and two children in the Washington Heights neighborhood on Milwaukee's West Side.