The Importance of Trends in Business Planning - PowerPoint PPT Presentation

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The Importance of Trends in Business Planning

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  1. The Importance of Trends in Business Planning TAG October 2, 2008

  2. Somebody wasn’t paying attention “Everything that can be invented has been invented” Charles Duell, Commissioner U.S. Patent Office-1899 (Recommended that the US patent office be shut down)

  3. Question “Why don’t the railroads own the truck lines, bus lines and airlines?” They are in the same business Trends in disruptive technologies were evident Consumer trends were evident

  4. Question Why has Atlanta based Cox Enterprises/Communications evolved in the following way? Newspapers in the 1800s Radio Stations in the 1920s Broadcast Television Stations in the 1940s Cable TV Systems in the 1970s Cable Programming Services (Discovery) in the 1980s Internet/Mobile Capabilities in the Present Each segment in the same business The trends in disruptive technologies were evident Changing consumers trends were evident

  5. Answers Most businesses Know what businesses/markets they are in and what market segments they are targeting. Some do not. Winning Businesses On an ongoing basis have an understanding of where their core businesses/markets/segments are going Study and follow trends in spaces tangential to their core markets Continually are paying attention (Unlike Mr. Duell) Others Live in the present Do not take the time to collect and assess trend data Avoid/are in denial about what is coming around the corner See only part of what is coming around the corner In which category is your business?

  6. What is a trend? A trend is A pattern and general accumulation of data points and information that indicates a general progression or a direction that becomes the basis of an estimation and hypothesis of the future

  7. Where are your markets going? Understanding trends and opportunity related to trends particularly applies to start up companies. Investors are attracted to where your market and your company istodaybut they make their bets on where your market and where your company will betomorrow

  8. Video

  9. No Single Trend Drives The Future Of Your Business Recognize that the future of your business is part of an eco-systemof trends that interact with one another A synergy, an inter-relationship, a fusion of forces and trends create the future Key trends that interact with one another Societal Technology/Disruptive Technology Customers’ businesses/markets Suppliers Economic Political The environment Government and Regulatory Some say in today’s world you must think about the future of everything Look for the super-connections of trends

  10. The Record/CD Industry “Why don’t the record/CD companies own MP3 technology?” They didn’t follow a few technology trends occurring outside their industry Home Computer Ownership Increasing usage of the internet Increasing broadband connectivity Generational change vis a vis technology (Lawyers tripping over protecting copyrights) The music industry has evolved from being a provider of physical products to a service industry

  11. Demographic Trend:The Aging Population Largest consumer market segment of the future will be retired people Several major influential counties are growing older quickly: USA, Japan, Germany, Italy, Russia, China (due to its scale) will soon see their respective baby boomers reach retirement age In the USA this will be the largest generation of retirees in history These retirees will live longer than any other generation in history Certain forecasts say that in 2025 25% of the US population will be over 100 years of age

  12. Where do Technology Evolution and This Demographic Trend Intersect? Significant opportunities exist for new products and services targeted at seniors Home/Hotel design (stoves, microwaves, bathrooms) Food products Automotive design Financial services Aids to Connectivity Aid to helping seniors with mobility In-home/serve monitoring/sensors/services Entertainment Tourism Other? Are there opportunities here for your business?

  13. Ripple Impacts of the Trend Most active retired generation in history Many retirees will seek part-time work, new careers and news ways to contribute to society Boomers will be pre-occupied with maintaining their health and demanding better services from healthcare (But they will be aging-arthritic bones, blurry eyes, mental accuity)……. Eldercare will become a larger issue than childcare Assisted living Nursing Hospice Family assisted Key opportunities: keeping older people mobile, nourished, healthy, entertained and connected to society

  14. A broader unintended consequence of the trend Employers will need to replace millions of skilled workers A global talent war will emerge for skilled workers In US, Japan, Europe, and Russia there will not be enough young people in the work force to fill these jobs and to support social programs for the elderly Population trends don’t support this (14MM worker deficit in the US in 2015) Increased immigration into US will be required to keep up with demand Hispanics and women will dominate the future US workforce In 2025 2 of 3 workers in America will be a woman The Middle East and Africa will have very high percentage of people under 24 years of age (60%) There are few or no jobs waiting for them in their own countries The US, Japan, Europe and Russia will be competing for these workers These three trends will not subside for decades What does this mean for your business (threat or opportunity)?

  15. Further Ripple Further as boomer retirees age and pass away the largest transfer of wealth in history will occur $18 trillion in assets will transfer from Boomers and transfer to Generation X And generation Xers are worse at saving than any earlier generation……. Where do the opportunities lay in this intersection? Will Generation Xers become the next wave of angel investors? Great business in 2020-2030: mortician/crematorium Boomers will be dying by the millions

  16. BRIC(Brazil, Russia, India, China) 20th Century: Century of America 21st Century: Century of BRIC In the future these four countries have the potential to dominate the world (they have and will have 40% of the population of the earth Explosive demand for new products and services Inexpensive, quality production Dynamically growing consumer markets China and India (Chindia) have 1/3 of the current world population and will dominate world GDP over at least the next 40 years (A high percentage of these populations is under 35) India will overtake China as the world’s most populous country by 2030 Chindia graduates 500,000 engineering students per year (the USA graduates 60,000/year) China has 5X more business schools and 10X more engineering schools than the US and Europe combined Cars in total world 2007: 795MM Cars in China 2030: 1.1BB

  17. The Age of Anxiety and Uncertainty Terrorism Natural disasters/Global Warming War/Geo-political instability The credit crisis (and its ripple effect) Identity Theft (is growing exponentially Mistrust of security on the internet Many people are confused, stressed and searching for something to believe in. Ironically, due the related uncertainty driven by the above, consumers need to escape and are increasinglyturning to religion and spirituality and this has become a trend Opportunities exist related to security in its broadest definition The trade-off of individual rights and security will become an increasing issue

  18. Personal Control Remote Control PVRs/TIVO The internet WiFi (mobility) Self service revolution has begun Touch screens Kiosks (services/products) ATMs, Retail, Airports, Healthcare Trend: addressing essential convenience with speed What’s next?

  19. The environment Air pollution Destruction of rain forests Global warming Accumulation of chemical pollutants in soil and water Diminishment of fresh water tables Sources will not meet demand Species extinction Over-fishing of oceans The calamity has created opportunity

  20. Dawn of Conscious Capitalism and the Values-Driven Consumer Trends of “Organic” and “Environment Friendly” Trend of “Clean and Green”/”Sustainable-Renewable’ Energy sources (Solar, Wind, Ethanol, etc) Hybrid/Electric vehicles Natural Foods Green Buildings Organic Products Zero-energy homes Eco-tourism Energy friendly appliances Alternative medicines Socially responsible/”Green” investing (E-Bay: “World of Good” products with social/environmental impact

  21. The internet The killer-app for the internet is people Enabling access to other people Numerous business models exist Few are successful…. But web 2.0 is the future of advertising Highly targeted relationship marketing Leveraging the extraordinary flexibility of digital technology SEO is key By 2020 the internet will be wireless and pervasive, with access anytime, anywhere and it will be free to everyone By 2020 the telephone and TV will be fully integrated into the internet By 2020 three billion people will be using the internet for purposes of commerce The business model of charging for internet access is temporary

  22. IT-1 Moore’s law will continue for at least the next 10 years (Transistor density will double every 18 months while price remains at parity) Power of home computers will dramatically grow Opportunities exist related to small, inexpensive, low power, low maintenance, disposable computers Future computers will have become wearable devices Web 2.0 will be increasingly applied on the commercial side

  23. IT-2 Ever-increasing linkage of international/global supply chains linking Creators Manufacturers Distributors Sellers Capture orders at one end of the world, fulfill orders on the other, and find production somewhere else…….on demand They will be automated and internet enabled New processes and technology will emerge that will enable the global, fast, inexpensive and on-demand production and distribution of goods Collaborative virtual workspaces will emerge By 2020 every manufactured product will be on the internet

  24. Nanotechnology The most profound and exciting new technology wave Nano-based products could change everything Nanometer is a measurement of one-billionth of a meter The manipulation of matter at the atomic scale, producing new drugs, fuels, materials, and machines Design of materials from the molecular level to be exactly what we want The manipulation of matter on all levels Increasing applications driven by nanotechnology will touch beyond its implication for science Fabrics Precious Minerals Robots Energy Manufacturing Military Robotics Billions being spent on R&D

  25. Biotech/Neurotech The unlocking of DNA, life sciences, and the impact of genomics on health care, life extension, and medicine. Specialized DNA Genomics Gene restoration therapy Genomic disease prevention Create safer foods and drugs/customized to the person’s genetics Bio-engineered organs Longevity medicines Optimized immuno defenses/Anti aging drugs Stem cell technology Organ engineering Stem-cell therapy for bio-restoration of memory and personality Nano-bio devices that heal, prevent illness, and restore capabilities New forms of implants (microelectronic medical implements) Medical Devices Intersects with demographic trends The beginning of the android era

  26. Healthcare Healthcare costs are expected to rise 8% per year into the future, and is expected to double By 2020 the USA will be short 200,000 doctor and 800,000 nurses On a continuing basis the US will compete with Europe and Asia for medical talent Healthy lifestyles must be part of the future Where are the business opportunities? Self diagnosis?

  27. Energy Energy issues will become increasingly central to consumers, governments, and businesses as we begin to deplete existing energy sources and place increased demand on existing energy infrastructures BRIC countries and the Middle East will put enormous pressure on global energy supplies and pricing Enormous tension between Russia and the West will emerge over energy issues Sustainable/Renewable energy sources will emerge but fuels will not totally replace emerge fossil fuels Solar, Wind, Ethanol, Biodeisel Many opportunities will emerge Hydrogen is the fuel that will drove the middle and latter parts of the 21st Century Most plentiful gas in the universe Highest energy content per unit weight of any known fuel It is everywhere

  28. Media/Communications/Entertainment-1 Technology will continue to transform media and entertainment Moore’s law of devices: every year the devices that create, communicate and play digital media get smaller And they will further enhance mobility/portability (3G) Broadband connectivity will evolve to where high quality digital video will be sent in real time or faster than real time to consumer devices Media is/are converging into one continuous interactive digital stream of information and entertainment Memory density will continue to increase such that consumers will have millions of audio and video products Digital camera/editing/switching technology will continue to evolve at consumer prices and will lead to a herefore unseen explosion in creative amateur videos (user-generated video) that will be distributed via broadband Technology that enhances the consumer entertainment experience in autos, airplanes and boats will emerge There is a trend toward virtual reality (escapist trend that is driving people to increased church attendance) (2nd life) Technologies will emerge to address this

  29. Media/Communications/Entertainment-2 Media is increasingly becoming personal and participatory The blogosphere is 60X larger than it was three years ago and is doubling in size every six months Trend toward social/sharing sites will continue to grow (need is to find successful business models) You Tube, MySpace, Facebook, Flickr, etc. New web communities are and will be emerging daily New ways will emerge that will connect people, information, and financial transactions in real time By 2020 all e-mail will be multimedia, audio and video streaming enabled Gaming Integral part of young people’s lives Open source for gaming will emerge Multi-point gaming will surge (extension of community) Gambling on the web is a trend Traditional television will increasingly need to compete for viewership with web sites offering video Media brands will blur (what is a network?/what is station?)(they have lost relevance) People watch shows/programs, not channels or networks Ex-Real time info networks (CNN, FNN, MSNBC, CNBC, TWC (web scalability)

  30. Factors that will define the Future Speed and an increasing rate of change Same day delivery of everything ( news, emails/instant messaging, banking, entertainment, self service touch screens, etc) Slow is dangerous Everything will be more complex Surprise will be daily feature of life (the uncertainty trend) E.G. the mercurial economy Everything is/will be in a state of flux E.G the mercurial economy Small companies can react more quickly than big companies to changing trends, especially fast moving trends

  31. Get Started/Get SmarterSources of Trend Data Important to obtain credible data/info from accurate sources The web. Type in “Trends in X”/”Future Trends of X” Magazines about your space and related areas Peer-reviewed industry journals (E.G AMA) Avoid biased reports from activist organizations Official reports Universities Government Agencies (National Science Foundation) NGOs White Papers Industry analyst reports Industry forecasts…”By X date X will take place” Industry “thought-leaders” Industry-specific seminars/conferences Books about trends and the future Be aware/keep your ears and eyes open Track it/catalog it

  32. Tips Start with analysis of your own industry Study adjacent industries/industries related to your space Go back 5 years and forward 5-20 years Assess if the trends are going up or down Is your business targeting a future up market or a future down market? Assess at what stage in the trends you/competitors are operating-today Accept the trend data with emotional detachment Pay Attention to current and future competition Plan scenarios Make time to think and to talk about it May be the best time you’ll spend: understanding the current and future status of your markets -study one trend each month/have the team work together/lunch/cocktails Trend spotting should be part of your business strategy Investors are interested in where your business is going/markets are going

  33. No Single Trend Drives the Future of Your Business Recognize that the future of your business is part of an eco-system of trends that interact with one another A synergy, an inter-relationship, a fusion of forces and trends, create the future Key Trends that interact with one another: Societal Technology/Disruptive Technology Customers’ businesses markets Suppliers Economic Political The Environment Governement/Regulatory Look for the super-connections of trends

  34. Bibliography The Extreme Future -James Canton-Dutton Future Inc -Eric Garland-Amacom Next/Now -Salzman and Matathia-Palgrave Megatrends 2010 –Patricia Aburdene-Hampton Roads Micro Trends -Mark Penn-Twelve (Hachette)