Five forces that shape the future threats and opportunities for business

For those who didn't see it yet, in the coming months McKinsey Quarterly will zoom in on the 5 global Forces it considers will have the most impact on the world's economy and -hence-businesses.

As Peter Bisson, Director at McKinsey, points out in the video introduction, these are trends that take shape very slowly, and hence might escape the attention of Business Leaders. But these are forces that undoubtedly exist, and those businesses that ignore them face the risk of discovering a whole set of well established new competitors in ten years from now. It also offers huge opportunities for those who can assess the impact the five forces will have on their industries. (Worth having an internal workshop about that !)

Those who follow my blog will know I share this opinion. What makes the McKinsey story compelling though are the way they structure the trends around the five 'forces'. Only the shifting power and behavior of consumers is missing -though one might argue that this is an effect of the 'global grid' force.

The Five Forces are mentioned below, but it's well worth watching the video introduction first:




The five forces McKinsey takes into consideration:

• The great rebalancing. The coming decade will be the first in 200 years when emerging-market countries contribute more growth than the developed ones. This growth will not only create a wave of new middle-class consumers but also drive profound innovations in product design, market infrastructure, and value chains.
• The productivity imperative. Developed-world economies will need to generate pronounced gains in productivity to power continued economic growth. The most dramatic innovations in the Western world are likely to be those that accelerate economic productivity.
• The global grid. The global economy is growing ever more connected. Complex flows of capital, goods, information, and people are creating an interlinked network that spans geographies, social groups, and economies in ways that permit large-scale interactions at any moment. This expanding grid is seeding new business models and accelerating the pace of innovation. It also makes destabilizing cycles of volatility more likely.
• Pricing the planet. A collision is shaping up among the rising demand for resources, constrained supplies, and changing social attitudes toward environmental protection. The next decade will see an increased focus on resource productivity, the emergence of substantial clean-tech industries, and regulatory initiatives.
• The market state. The often contradictory demands of driving economic growth and providing the necessary safety nets to maintain social stability have put governments under extraordinary pressure. Globalization applies additional heat: how will distinctly national entities govern in an increasingly globalized world?