Trends Identified

Competing in an age of divergance
Over the past 20 years CEOs have witnessed tremendous upheavals as a result of globalisation and technological change. Both were core to our enquiries when we conducted our first Annual Global CEO Survey back in 1997. Since then, trade flows have quadrupled and global internet traffic has risen by a factor of 17.5 million.1 The twin forces of globalisation and technological progress have helped to boost living standards and lessen inequality between countries.2 And, in what’s perhaps the most remarkable achievement of all, they’ve lifted a billion people out of extreme poverty.3 But greater convergence has come with greater divergence, as CEOs have long predicted. In 2009, when we first asked CEOs about the risks associated with various global trends, 46% thought governments would become more protectionist; 73% expected other countries to challenge the G8’s dominance; and 76% anticipated a rise in political and religious tensions. And by the time we published our last survey in January 2016, most CEOs foresaw a world in which multiple beliefs, value systems, laws and liberties, banking systems and trading blocs would prevail (see Figure 1).
2017
20th Annual global CEO survey
PWC
Managing man and machine
Some worry that globalisation will take away their jobs and they’re even more nervous about the impact of technology. Twenty years ago, there were fewer than 700,000 industrial robots worldwide; today, there are 1.8 million, and the number could soar to 2.6 million by 2019.9 Manufacturing output has simultaneously risen, but employment in the sector has fallen in various advanced economies.10 Technology has been one – although by no means the only – cause of these changes. Robots are now entering the services arena; 3-D printing can be used to make cars and aircraft; biotechnology will change the way we grow crops, produce food and manufacture medicines; and nanotechnology and artificial intelligence (AI) will affect numerous industries. All this could happen much more quickly than we expect. Just look at the advent of self-driving trucks to make deliveries, or Amazon’s new Go store, which uses technology to track what customers put in their shopping carts and bill them automatically when they walk out, eliminating the need for human cashiers.11
2017
20th Annual global CEO survey
PWC
Gaining from connectivity without losing trust
Twenty years ago, trust wasn’t as high on the business radar as it is today. In fact, we didn’t survey CEOs about it until 2002, when the business community was reeling from accounting fraud scandals, the bursting of the dotcom bubble and the collapse of the equity markets. With hindsight, it seems hard to believe that only 12% of CEOs thought public trust in companies in their country had greatly declined, and only 29% thought the fallout from corporate misdeeds was a serious threat. Since then, the financial crisis has catapulted trust into the limelight, and the after-effects of stagnant economic growth and spiralling debt levels continue to fuel a climate of mistrust. The impact on CEOs has been significant: in 2013, 37% worried that lack of trust in business would harm their company’s growth. This year, the number has jumped to 58%. The breakdown in public trust now poses a potent risk to political, economic and social systems the world over.
2017
20th Annual global CEO survey
PWC
Making globalisation work for all
For the past 20 years CEOs have been largely positive about the impacts of globalisation on their businesses and markets. But, by 2007, they were beginning to express reservations about the short-term effects on society. CEOs are still ambivalent. Today the vast majority believe that globalisation has helped to free up flows of money, people, goods and information, facilitate universal connectivity and create a skilled workforce. Yet a significant number say it’s done nothing to mitigate climate change, promote the development of fairer tax systems or close the gap between rich and poor (see Figure 14).
2017
20th Annual global CEO survey
PWC
Demographic dynamics
The growth and aging of populations, migration, and urbanization are factors that will shape the course of societies and economies. As one of seven megatrends identified and analyzed in our Trend Compendium 2030, changing trends in demographics loom large. In this publication, we take a focused look at demographic dynamics, their impact on our world, and how they will affect the way we do business.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants
Globalization & future markets
Globalization is a multifaceted process not limited to economic effects — political and social aspects are closely intertwined. But globalization has both proponents and critics. As the U.S. presidency of Donald Trump shows, the progress of free trade agreements and thus globalization strongly depends on the accordance and objectives of political leaders. In an interconnected world, migration constitutes one major facet of globalization with a strong impact on society and political debate.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants
Scarcity of resources
Population and GDP growth, urbanization, and a growing global middle class lead to an increasing demand for energy. Continued development in non-OECD countries is expected to increase demand by 29% between now and 2030, mostly concentrated in Asia, and particularly China and India. In 2030, like today, most energy will come from fossil fuels. A continued reliance on fossil fuels is tempting, but it also risks accelerating climate change. Despite the dominance of fossil fuels, the sun remains a vast, mostly untapped energy source, delivering more than 1,300 times the Earth's daily energy consumption to land each day. Water and food also stand to become increasingly scarce—we predict global water demand to rise 32% by 2050, driven mostly by the growing manufacturing and electricity sectors. Scarcity of water is already widespread, however, and even today many European countries face low resources per capita. By 2050, over 50% of the world's population will live in water-stressed areas. Demand for food will also increase 43% by 2050, mostly driven by population growth and changing eating habits. A final area of scarcity is critical raw materials. China is the major supplier of these materials, which include rare earth elements and metals. Demand for these raw materials will grow depending on the supply situation. The main challenge associated with these shortages is one of regional imbalance: most critical raw materials are produced outside of Europe, and conflict over these resources could arise between developed and developing countries.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants
Climate change & ecosystem at risk
Global warming and strategies to offset carbon emissions are two of the most prevalent issues of the 21st century. As economies continue to grow, so too does the demand for energy and, as a result, CO2 emissions. As part of Roland Berger’s leading Trend Compendium 2030 , this in-depth analysis takes a detailed look at what growing energy demands mean for the future of industry. We investigate three key components – global warming, rising CO2 emissions, and the obstacles faced by our ecosystems – to uncover the global challenges that climate change will bring with it.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants
Dynamic technology & innovation
Over the coming decades, disruptive, as well as enduring innovations will change our lives and drive wealth. There is a positive power to innovation, as it helps to solve the major challenges facing humanity, for example providing water, food and healthcare for a growing and aging population, using resources more efficiently, or fighting climate change. The fields of biology, chemistry and pharmaceuticals hold particular promise in combating these challenges. In terms of patent applications, life sciences markets are increasingly shifting from the US to Asian countries, while national research clusters in Asia are beginning to flourish.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants
Global knowledge society
In this study, we zero in on megatrend number six, the Global Knowledge Society, and its three subtrends: know-how base, war for talent, and gender gap. From basic education to workplace applications, we uncover the challenges and opportunities that lay ahead in the field of education and the need for a skilled workforce. We begin by looking at how the diffusion of knowledge can be increased. Education, of course, is the foundation of the know-how base. We track how the number of years spent in primary, lower and upper secondary, and tertiary education directly correspond to increased GDP per capita. We also examine literacy rates, how enrollment figures differ between world regions, and what can be done to level the field. This will be a critical step in ending the war for talent, where certain demographics in established economies have left them lacking skilled workers—approximately 38% of employers struggle to find suitable candidates—and emerging regions are threatened with a brain drain. We continue by examining the gender gap, comparing figures across developed and developing regions, and identifying the factors that must be addressed to bridge the difference.
2017
Megatrends: a bigger picture for a better strategy
Roland Berger Strategy Consultants