SAMI Consulting

1. SAMI Consulting Scenarios to 2050 Mental models for Blowing the cobwebs off your mind Gill Ringland www.samiconsulting.co.uk

2. Global population www.samiconsulting.co.uk

3. Resolution of crisis? Slow return to health; US consumer stage centre Banking crisis remain chronic, as does state intervention Prolonged depression, growing statist environment UK US Japan Euro zone The economic situation is completely predicated on the banking crisis Economic situation develops independently of the banking crisis India Middle income industrialising Slow grind to expunge debt; some deliberate use of monetary inflation Business grows as before China Banking crisis is settled relatively quickly www.samiconsulting.co.uk ©Beyond Crisis, Ringland, Sparrow, Jlustig, ohn Wiley 2010

4. Demographics 3.5 3.0 2.5 Ratio of people under 16 years to people over 45 2.0 1.5 1.0 0.5 Africa 1988 S America Asia 1998 Oceania Time N America 2008 Europe www.samiconsulting.co.uk ©Beyond Crisis, Ringland, Sparrow, Lustig John Wiley 2010

5. Our “Ahas” • Demographics drives economics e.g. airport expansion • Everywhere will have an older population by 2050 • Asia is not homogeneous – • East Asia ageing fast • India, Indonesia, Philippines about 30% under 14 • Africa starts to boom (Uganda 50% under 14) • Fast growing middle class in Asia and Latin America. • Service economies boom in BRIC companies www.samiconsulting.co.uk

6. Values Relevance to a moral decision Harm Fairness Affiliation Authority Purity Decreasing traditionalism  www.samiconsulting.co.uk ©Beyond Crisis, Ringland, Sparrow, Lustig, John Wiley 2010

7. Our “Ahas” • Globalisation does not mean homogeneity. • Cultural differences & religion affect strategy • Languages constrain thinking eg • Mandarin – no tenses of verbs or equivalent of please and thank you • Greek – same word for book-keeping, cost accounting, management accounting ------ • Diversity and equality as “good’s” do not travel • Soft drinks company in India • “Chief Values officer” in some Indian companies www.samiconsulting.co.uk

8. Politics, law and regulatoin www.samiconsulting.co.uk

9. Our “Ahas” • The “tsunami” of bank regulation threatens capital availability. • Lack of co-ordination amongst regulators • Different legal jurisdictions • Halal standards being created by Islamic governments for law & accountancy. • The PRC has announced that it will build a “magic circle law firm” & a “Big four accountancy firm” www.samiconsulting.co.uk

10. Technology www.samiconsulting.co.uk

11. Our “Ahas” • Information technology, TMT convergence • Processing capability - the “Singularity”, big data • Disposable laptops which match the human brain. • Use of the web, billions connected • Holography, interactive surfaces & virtual assistants • DNA mapping – effect on insurance • Biotech • Artificial and remote limbs • BP’s CTO “by 2057, every employee of a Fortune 100 company will be augmented” • The “cure” of ageing. www.samiconsulting.co.uk

12. Environment The logarithm of the ratio of the current situation to the probable long term sustainable limit: those in italics have been breached already Carbon dioxide Change in land use Species extinction rate 0 Freshwater use Nitrogen cycle Sustainable limit Ocean acidification Phosphorus cycle Stratospheric ozone depletion www.samiconsulting.co.uk ©Beyond Crisis, Ringland, Sparrow, Lustig, John Wiley 2010

13. Our Ahas • Energy, ecology, resources, water • Approaching limits: nuclear power back on the agenda • If we all eat like Americans we need 7.5 planets • Role of technology in food production? • GM foods back on the agenda • Livestock eat 70% of all the grain we produce - hamburger grown from stem cells www.samiconsulting.co.uk

14. Over to you • In syndicates • How are these trends affecting your sector’s operating environment? Now? in the future? • What other trends do you see affecting your sector? • Be ready to share at 3:55 www.samiconsulting.co.uk

15. Assumptions - 2050 • Global population will grow to 9 BN and get older • Most of the additional people in Africa and Asia • Turbulence as the world rebalances to new centres of economic power • New centres may not share the value systems of the West, or the Washington consensus • Washington consensus describes economic policy prescriptions for a market economy • Technology (info, cogno, bio, nano) will continue to introduce changes in personal capacity and lifestyles • Ecological, energy and environmental limits tested or breached • Population increases • Population lives in cities (70% by 2050) • New middle class uses electricity, travel, eats meat www.samiconsulting.co.uk

16. Scenarios Forecasts are over-precise Scenarios explore the rangeofuncertainties Today Trends  Timing ? www.samiconsulting.co.uk

17. Uncertainties • Will our economy and society be similar to now, • Will it implicitly follow the Washington consensus • or • Will there be a new paradigm? • Does geography matter? • If geography does matter, what sort of new paradigm might there be? City states? • or • If geography does not matter, will markets be global and so largely virtual? Based on affinity groups? www.samiconsulting.co.uk

18. Scenarios for 2050 Community based Many Hands Long Hand Virtual connections Geography matters Second HandVisible Hand Washington consensus www.samiconsulting.co.uk

19. Over to you • How would each scenario affect your sector? • Which is nearest to your assumptions? • Which do you prefer? • What would be different in your sector? • Would scenario thinking improve the quality of decision in your organisation? (? How?) www.samiconsulting.co.uk