The megatrends that will transform global business

New research published this month reveals the six ‘megatrends’ that are fundamentally transforming the global business environment.

The research illustrates the dramatic impact these megatrends are having on companies and on their markets, cultures, systems, and processes. It sets out a compelling vision of how firms will need to be structured and led in the future.

Written by Hay Group consultants Georg Vielmetter and Yvonne Sell, Leadership 2030: The Six Megatrends You Need To Understand To Lead Your Company Into The Future sets out the future battlegrounds for leaders:

1. Globalisation 2.0: Asia dominates the global economy, and a new middle class emerges.
2. Environmental crisis: Sustainability moves from CSR initiative to business-critical imperative.
3. Individualism and value pluralism: Freedom of choice erodes loyalty and overhauls employee motivation.
4. Digitisation: Work goes mobile, and the boundaries blur between private and professional life.
5. Demographic change: Aging populations intensify the talent war.
6. Technological convergence: Powerful new technologies combine to transform many aspects of everyday life.

Georg Vielmetter, European head of leadership and talent at Hay Group, commented that the study set out to establish what is changing, what the future will look like, and how business leaders need to adapt to cope.

The authors also identified five combined consequences of the megatrends for businesses to tackle:

1. Stakeholder proliferation: A multiplication of the vested interests leaders need to consider.
2. A power shift: Away from leaders and toward stakeholders.
3. New working practices: The emergence of a new ‘social practice’ of work.
4. Cost explosion: Due to the scarcity of talent and natural resources and use of new technologies.
5. Ethicisation of business: A demand for the highest ethical standards from firms and their leaders.

The researches conclude that the business leaders of tomorrow will need to be very different to those of today. Conventional styles of leadership will prove inadequate in a world shaped by the megatrends.

“Traditional, command-and-control leadership will fall short in the face of the megatrends. The future will demand a new style of leader: one who instinctively understands the subtleties of leadership, and knows that he or she cannot navigate the complexities of the business environment alone,” Vielmetter commented.