No Ordinary Disruption: The Four Global Forces Breaking All The Trends

So, who's this book for? It's mainly aimed at corporate decision makers at all levels. But its wealth of interesting facts, depth of analysis, and valuable insights about how the world's economy is changing would appeal to anyone who's curious about their future.

Using lots of examples and anecdotes, the book is written in a clear, conversational style that makes for a challenging, but engaging, read. Instead of using diagrams or charts, the authors present their ideas in the form of case studies, which illustrate the changes happening today. While it can feel like an overload of information at times, the book will make you think twice about everything, from email to Alzheimer's.

The ideas in this book are based on trends identified by the McKinsey Global Institute, the research arm of the management consulting firm McKinsey and Co., where all three authors are directors.

Richard Dobbs is based in London, where he leads the Institute's research on global economic trends, including urbanization, resource markets, productivity, and growth. From 2004 to 2009 he co-led McKinsey's Corporate Finance Practice.

James Manyika is based in San Francisco. He leads research on global economic and technology trends, and has worked with many of the world's leading high-tech companies on growth, innovation and strategy. Jonathan Woetzel leads research on China, Asia, and global economic and business trends, and he's based in Shanghai.

In this book, the authors use their insights and knowledge to create a "big picture" view of the changes happening in the world today, looking at economic trends, technology and global expansion, among other issues. At the same time, their extensive research enables them to zero in on the details that are causing these changes. So we get both a macro and a micro view.

So keep listening to hear about the four factors that will keep prices rising, the revolutionary way a telecom company in Austria is making use of old phone booths, and how an aging population is redefining the workforce.

The book is divided into two sections. In the first, the authors describe the four great disruptive forces that are changing our world: urbanization, technological change, an aging population, and greater global connections.

In the second section, titled "Intuition Resets," they outline how we can respond to the challenges these changes bring. But their suggestions are not limited to this part of the book. Their insights, and, in some cases, demands for how and why we need to change our actions and our thinking, are scattered throughout the book.

According to Dobbs, Manyika and Woetzel, the four disruptive forces will make the global population richer, more urbanized, more skilled, and healthier than ever before. We need to rein in our assumptions and develop new approaches to face the reality of these global changes. So let's take a look at these forces and how the authors expect them to affect us.

They begin by talking about urbanization. The population of cities is rising worldwide by an average of 65 million people per year. This staggering number is driven largely by developments in China and India.

Rural lifestyles are being exchanged for urban ones. People are moving into cities in search of jobs, better living conditions, and social security. By attracting workers, cities are turning previously poor rural people into consumers. This change in the way we live and work is boosting innovation and creating economic diversity across the globe.

The authors use Telekom Austria as a case in point. In Vienna, the company has converted hundreds of disused phone booths into electric car-charging stations, where drivers can pay for fuel with a text message. It's a way of dealing with increased urbanization that boosts profits and benefits the environment, using modern technology.

The second force the authors explore is something most of us are aware of, and that's the fast pace of technological change. They say technology is shortening the lifespan of ideas and making market positions less stable. This is forcing business leaders to rethink the way they monitor and respond to the competition.

These changes are all due to digitization, which has cut the cost of sharing information. It converts physical goods into virtual ones, enhances content, and creates online platforms that facilitate production. The bottom line is that people are adopting new technologies faster than ever, and that trend is expected to continue.

So how do we adapt to technological change? Make the most of your capital by tracking data, the authors suggest, and exploit the lower costs of going digital – for example, by creating mobile shopping apps for your business. Whether it's your people, your organization, or your investments, you need to use technology to help you move forward.

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Another force that's changing the way we live is aging. People are living longer than ever before. In 1950, for example, global life expectancy was 47 years. Today, it's 69.

As the large baby boomer generation nears retirement age, many of these people are choosing to stay in the workforce. This means we need to rethink the way we see older people. They're not just senior citizens anymore – they're employees, consumers and stakeholders.

Lower global fertility rates are also contributing to these demographic changes. As countries are becoming more urbanized and economically stable, they're growing richer. And research by the authors shows that the richer the country, the fewer children a woman has, because of better birth control, more choice, and fewer infant deaths. By 2050, the world's developed countries will have twice as many older people as children. This will have significant repercussions for businesses and governments. More people will be receiving benefits and needing care, while there will be fewer younger people to support that.

What's interesting about this book is that facts are presented in a way that makes you sit up and pay attention. We all know the baby boomers are getting older, but this book describes the consequences of trends like this in conjunction with the three other forces. It makes us look at these issues in new ways.

So, how can we cope with this aging population? According to the authors, we must see older people as assets, not a drain on our resources, and it's this kind of change in perspective that underpins the book. Organizations have to adapt to their needs, so products and services should focus on health and wellness, as well as value for money. And companies should offer more flexible working options for older people, so their valuable skills and knowledge stay in the workforce.

The fourth disruptive force is increasing global connection. The flow of people, goods, services, and finances around the world is growing and the web of the world economy is becoming more complex.

This means organizations are reaching more customers and finding new sources of supply and demand. But it also means that a crisis in one country, like an earthquake in Japan, will affect people in many other countries too.

Thanks to technology, online trading has increased and money can now be moved with the touch of a button. And the direction of trade is changing too. There's now more movement between developing countries than to developed countries.

How do we adapt to all this global movement? The authors advise us to expect businesses to emerge from anywhere in the world and to build new global ecosystems, such as digital platforms and cross-border networks. They say we need to respond quickly to these changes and the problems they bring.

By the end of part one, we have a pretty good idea of how our lives are being disrupted by these four forces. We also have some sense of how to respond. But the main thrust of the authors' suggestions come in part two. They admit they don't have all the answers, but they do offer some interesting ideas. Here are a few of them.

There's a new consumer class emerging in China. Chinese tourists are now bringing revenue into places like the U.K., helping to breathe new life into struggling high streets up and down the country. Companies should be aware of this huge group of consumers and market products and services to them.

Organizations also need to think of expansion in terms of cities and urban centers, not countries, say the authors, and reallocate their resources and employees to those areas. By customizing products to suit local tastes, organizations can tap into new consumer markets. So while our markets may be changing, the authors point out, our own perceptions need to change as well.

So what are the four things that will keep prices rising? They are: demand from consumers, lack of resources, global interlinking, and environmental costs.

To deal with these factors, the authors suggest we improve productivity through energy efficiency, and increase supply using technology and renewable energy sources, like solar and wind power. We should also design products for multiple uses and reuse, and adjust prices to reflect the cost and availability of source materials.

Earlier in the book, the authors outlined how technology and global demographics were changing fast. In this section, they explore how these trends are putting pressure on the social system and what can be done to mitigate it.

Technology is creating a surplus of unemployed low-skilled workers, with automated machines replacing people in factories. At the same time, companies are losing many of their highly-skilled workers, as large numbers of older people retire.

What we need to do, the authors say, is tap new pools of talent, such as people living in other countries, older people who want to keep working, women, and young people, so we need new hiring practices and flexible working options. We'll need to use technology more to communicate with employees. And employers should offer training and education programs too, to fill the gaps in skilled employment.

And what about the emerging companies that are growing with their countries' industrialization and urbanization? More established companies need to be aware of developments taking place in their current and potential markets. And they should be offering enhanced customer services and establishing alliances with the new arrivals.

If you're feeling shocked or overwhelmed at this stage, it might be a comfort to know the authors feel the same way. But they don't offer any action points or To-Do Lists. The changes, they say, are coming too quickly to anticipate. Instead, they suggest we enter this brave new world with a sense of optimism. The world is getting richer and countries are becoming more equal. The key to coping, they insist, is agility. We need to be able to adapt to change, and adapt quickly.

We agree with this analysis, but only up to a point. These changes are exciting and there is cause for optimism, for instance, when it comes to greater economic equality and better education worldwide. But there's also cause for concern. The authors are excited about the enormous riches that will become part of our everyday lives, but they fail to note the potential for damage too, to society and the environment.

Increasing industrialization may provide more jobs and consumers, but there's a chance that natural landscapes might be harmed as cities expand. Urbanization means more people will have access to shopping centers, healthcare and universities, but studies from the American Psychological Association show people don't just need better housing and jobs; they also need green spaces to be both mentally and physically healthy.

The authors point out the problems and benefits that come with increased use of technology. But the speed at which innovations emerge, and our inability to adapt quickly, is really at the heart of this. As the authors write, "there is a powerful human tendency to want the future to look like the recent past." So, while the prospect of advances in technology are certainly exciting, it remains to be seen whether people and organizations will ever develop enough themselves to take full advantage of them.

This book certainly gives food for thought. It's packed with interesting information and anecdotes, and offers fresh insight on today's global economy and the forces that are affecting change around the world.

"No Ordinary Disruption: The Four Global Forces Breaking All The Trends," is published by Public Affairs.

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