Uncommon Sense: Global Trends That Will Affect Us All

Uncommon Sense: Global Trends That Will Affect Us All

Earlier this week, I had the honor of participating in a panel at the Aspen Ideas Festival. The topic—“Global trends that will affect us all”—hit on the key issues that will shape our economies and cultures for the next 20 years.

I was joined by our friend and client Zein Abdalla, a 20-year veteran and current President of PepsiCo; Nicholas Burns, a longtime diplomat who finished his years in public service as the Under Secretary of State for Political Affairs and is currently a Professor of International Relations at Harvard’s Kennedy School of Government; and Dalia Mogahed, Chairman and CEO of Mogahed Consulting and the former Executive Director and Senior Analyst of the Gallup Center for Muslim Studies, as well as a World Economic Forum Young Global Leader. Joan Dempsey, an EVP in Booz Allen Hamilton’s defense and intelligence practice, moderated the group.

As we discussed a number of large-scale trends, I was struck by the way in which the very tenets that I believe should guide our company, our clients and the markets we serve proved to be those everyone felt would be needed to move the world forward productively into the heart of this century: collaboration and innovation.

I believe collaboration and innovation work at all scales. From our own activities internally and externally, to vast movements of people and economic power, these are the two principles that always win.

The conversation ranged over the shifting of geopolitical and economic power from West to East and from developed to developing countries; the increasing connectedness that allows individuals access to information, goods and services within and beyond any sovereign border; urbanization; a population more and more of which is middle class; and the youth bulge in the Arab world. All offer challenges and opportunities that can be met only by innovation and collaboration: new ideas, and avoiding a go-it-alone mentality.

Nick pointed out that the movement of military and economic power from what he called “the Mediterranean to the Pacific”—neatly including the U.S. in both formulations, while marking the transition from Europe to Asia—will create a new power center. We wrestled with the question of how the U.S. will react to this shift. Will it move in a more isolationist direction, or will it continue to lead?

Of course, we at Nielsen see this West/East shift ourselves as well when we look at our clients. As a global company, we increasingly look for the West-to-East movement of innovation and development to be complemented by a powerful countercurrent in the other direction. During the conversation, we agreed this would not simply mean a diminished role for the West, but would also bring with it many benefits. Just as Japan transformed the automotive industry to the great benefit of the American consumer, so we expect the rising giants of Asia to bring innovation to our Western doorstep. That said, Zein made the excellent point that U.S.-based multinationals are in a terrific position to blend the best of the West with the needs and possibilities of countries newer to the international business scene.

If the West/East shift brings opportunity as well as challenge, so too will a connected phenomenon: the globe’s shifting demographics. Most conversations on this topic dwell only on West/East comparisons, with China first and foremost. At Aspen, Dalia offered a different perspective, reminding us of the importance of the “youth bulge” in the Arab world today. Those in this demographic, she reported, approach life interconnected, empowered, and unafraid. That said, while the drive that precipitated the Arab spring is still strong, it seemed that, without the hope of a bright future—a hope that can only be fulfilled by the availability of suitable employment and capital to fund entrepreneurial ventures—there is a possibility that parts of this group will fall into extremism.

More generally, we discussed how demographic shifts in general—a population exploding in some areas and graying elsewhere, the emerging middle class and massive urbanization—will place enormous demands on the world’s resources: the supply chains by which food, water and energy are brought to those who need them will need completely rethinking.

It was clear to all of us that this is an area in which certain kinds of successful innovation will have to be repeated at the same scale, at least. Take food. Before his death in 2009, the biologist Norman Borlaug invented sturdier strains of wheat that, it has been said, perhaps saved more than a billion lives. On the basis of his innovations, Mexico became a net exporter of wheat, and Pakistan and India almost doubled their wheat yields between 1965 and 1970. Later in his long life—he died at 95—he helped apply these methods of increasing food production in Africa and Asia. It looks as if we will need another “green revolution,” but I am optimistic that there is another Borlaug, and perhaps several, out there hard at work somewhere.

At Nielsen we believe that the long-term, persistent tailwinds created by the migration to an urbanized, Pacific-focused world will present businesses with significant opportunities. We know that within a few decades 80 percent of the world’s population will live in Asia and Africa, and that by 2025 the top 600 cities will make up the 50 percent of the world’s GDP. Businesses that enable these trends to unfold in a productive fashion will thrive.

The expanding presence of mobile technology in the hands of this swelling population creates further complexity—and with it further opportunity. Hyper-connectivity will massively accelerate a transfer of power into the hands of the individual that has already begun. Just one phenomenon it has made possible in the business world is the emergence of e-commerce. Today, e-commerce still presents a small percent of global sales, but it is already a force to be reckoned with. Perhaps the best example is China’s Alibaba. Its business-to-business, business-to-consumer, and consumer-to-consumer platforms—, T-Mall, and Taobao, respectively—make it bigger than Amazon and Ebay combined, and it presents almost endless possibilities. As always, however, as we know from many of our businesses, interconnectivity brings privacy issues to be navigated. How do we protect privacy while also allowing people to benefit from technology’s capabilities?

Interconnectivity brings other challenges, of course. I spoke earlier of the Arab youth bulge. Many of them will be empowered to improve their lives by accessing information within and beyond their country’s borders. Some, however, will use technology to find others who share potentially extreme beliefs.

We were asked what made us optimistic about the future. Here is where the theme of innovation fueled by collaboration emerged. Nick noted that the (still) new century demanded a different mindset, and that the major powers will need to struggle together against the issues that affect us all—climate change, human trafficking, and the drug trade were the three he singled out. But there is cause for optimism. In the recent past, the world has collaborated to make significant and lasting strides in global health and poverty, succeeding by making these challenges an absolute priority. We—governments, business, NGOs, academia—need to band together again, as we did in taking on health and poverty, and take advantage of a time of substantial change to create an ecosystem that will move us towards a healthier society.

Innovation does not, of course, mean throwing out the old for the sake of the new. Access to capital will be helped by microfinance and crowdsourcing, but traditional mechanisms such as large-scale business-driven investment will also be necessary if we are to keep up and ideally keep ahead of the megatrends shaping the world right now. Similarly, the competition that creates healthy markets must be accompanied by the collaboration that can drive efficiencies where there would otherwise be duplication.

This type of collaboration requires “non-zero sum” thinking. It’s difficult. It requires confidence, trust and leadership. But it’s immensely important. Throughout history, it’s been the key to progress for entire markets, communities and nations. The same will be true of the years ahead.