There needs to be a dialogue between executives and their colleagues in the information professions: is this stuff valuable enough that you need to really invest in it? If the answer is yes, then there needs to be investment of both money and time. This means that you allot a reasonable amount of time for internal or external staff to provide reliable information, and moreover that you think about your needs in advance. I submit that if you wake up on a random Thursday and need a quick – yet awfully complete – review of agri-bio-nanotech, it may not be all that essential to your future. If it truly is a “strategic” issue (a term that is abused on a regular basis) then that means by definition it is not a quick, operational emergency. Not only should you take time with it – you probably have the time. Six weeks, six months: if it’s truly a megatrend issue, it’s not going anywhere. The question is how fast you act on it in comparison to competitors.

As far as the intelligence community’s ability to deal with highly detailed requests, it is often a problem…depending on with whom you work.

All great input – thanks so much!

http://blog.competitivefutures.com/2011/05/27/california-population-trends-increasing-while-jobs-stay-flat/

What the GDI graph below says to me is that we are living in a primary moment of a the high-wire balancing act that no group wants to presently address.

Contributions to Growth in GDI Graph
http://seekingalpha.com/article/249094-gdi-shows-faster-growth-mostly-from-corporate-profits

What then the original chart tells me is that corporate profits are a high water mark, at a time when the low water mark is the failure to choose a short-term pain threshold that tackles the US current account deficit without throwing the pain onto the backs of those born after 2015.

Without easing the deficit immediately from top of the line now, it will come strictly from the bottom line in the future (or in metaphorical terms, from the marrow of the economy rather than the meat).

Then I wonder who would want to be President when the days of reckoning arrive and the buck can no longer be passed on?

[$M.]

I’m interested in your thoughts, Eric, about whether or not US government funded and backed student loan programs are contributing to or perhaps even causing the bubble.

It continues to amaze me how not-for-profit universities are spending their money on amenities, even at the expense of their supposed core product. Private universities are facing a lot of criticism, much of it deserved, for taking advantage of student loan programs. Rather than being an indication of a for-profit/not-for-profit dichotomy I tend to regard what is happening with for-profit universities as another symptom of the distorting effect of our government’s funding policy towards higher education.

Like you, I also wonder what the role of Gen X will be since it is their time to lead and they cannot rely on demographics alone for their influence.

I wonder what might have been different in terms of transition if the huge numbers of boomers and GenYers had not effectively blocked out the influence of intervening generation. “…Gen X…is not sufficiently big enough to counterbalance their representation in government and business.”

That said, I don’t think any body misses those eight-tracks!

For example, for any product or service there are the R&D, product design, marketing, and sales activities — none of which per se involves any physical manipulation or transformation of assets. Those elements are all knowledge-based activities that wrap around the product or service itself and form a key part of the value-added bundle.

“Knowledge economy” was in some sense a way to make ourselves feel better about exporting the dirty work of manufacturing, much of which involves physical labor and/or despoiling of the environment.

Given the debt structure of the countries behind both currencies, I’m not sure if there’s an easy answer. Bags of gold doubloons?

Being from Vermont, I am partial to maple syrup-backed currencies.

And Iran had similar thoughts.
http://www.lankanewspapers.com/news/2008/7/30773_space.html

My work as a futurist is a constant search for that which is truly new and important, and that which is perennial. History is an irreplaceable component of that.

Also, HBO’s “Rome” and Showtime’s “The Tudors” are really awesome.

I do more forecasting now than ever, and I read more history.

All forecasting is inevitably based to some extent on extrapolations from the past. One needs to understand the past to understand, among other things, exactly HOW heavily weighted the past is in one’s own assumptions and forecasts.

As you might recall from our conversations on Design Thinking (see Roger Martin, et al), I believe the definition of leadership (as well as, management and productivity) in our society will become how effectively and rapidly organizations and their workforce drive knowledge from mysteries past heuristics to algorithms (and eventually into automaton-employing computer code, which, by definition of course, erases the original need for human work). I am convinced this is the way substantially all organized human enterprises have succeeded in the past and will be the way they succeed in the future, though much more rapidly thanks to the ubiquity of technologies that streamline this acceleration of knowledge.

Happily, the supply of new mysteries is virtually endless. The supply of insight however, not as much. With that, my very best wishes to you and yours for a continued prosperous, healthy, happy and insightful 2011, my friend! Keep up the good work.

Cheers!

~ Arik

Also, the loss of manufacturing jobs actually increases the likelihood that the manufacturer will jump into greater value-added sectors of the industry. In other words, great that Apple designs things in California, but one billion Chinese won’t be content forever with the cheaper parts of the value chain. They graduate thousands of engineers and have a ready-made market at home we can only dream of.

I agree with Michael Porter that America needs a competitive strategy. Who will articulate it?

I know Johansson’s work and find it relevant in many cases. I do wonder however what kind of work will be available for people who aren’t necessarily able to envision innovative combinations of knowledge-based disciplines. Manufacturing allowed immigrants and people of all levels of education to take part in a value-added portion of the global economy, and a world-beating middle class was the result. If they are abandoned in this transition, there are serious consequences ahead.

First, our “services” economy includes, but is not limited to, knowledge-based services. Anybody who cooks or serves food, cuts hair, fixes plumbing or computers, and so on, isn’t in “knowledge” as you probably mean it. (Though I believe ALL jobs have a knowledge component.) Ironically, it’s these services jobs that are least likely to be offshored — though they typically pay less than both manufacturing and “knowledge” jobs.

Second, those services that ARE knowledge-centric include far more than the law, consulting, and branding that you mention. The whole financial industry, for example. The economist Fritz Machlup as early as 1962 had documented our shift to a knowledge-based economy, which for him included education,financial services, media, information technology, and R&D. He could in my view have included health care, which currently is one of our largest and fastest-growing industries.

Third, companies like Apple early on made a strategic decision to basically keep innovation here, and outsource manufacturing. Why? Because the economic value added from the former, relative to its cost, is much higher than from the latter, relative to its cost. Nobody forces them to do it this way, but it does work well for them. They’re basically arbitraging labor costs..

I do agree that we as a society need to address much more quickly, creatively, and effectively the challenge of what jobs are we training people NOW for that will be available in the coming decades. We’re doing a pretty lousy job of this now as far as I know.

At the same time we need to address at a policy level the bleeding off of manufacturing and services jobs from this country that have been on the short end of the labor arbitrage I mentioned above.

I would say that personally, I am totally with you. This is in fact the HR policy of my own company, to treat people as a long-term investment, whether they stay on as analysts forever or not, to see the deeper humanity in your colleagues, to recognize their ever-changing nature, to view it all as human development irrespective of the economic side of your relationship, to see all profit as rising from this more holistic philosophy. AND I’d go one further to say that I wish many if not all companies saw things your way, more broad thinking, less atomistic, zero-sum philosophies.

That said, let us turn to the large-scale corporations of 2011. There seems to be considerable interest in reducing the exposure to “risk” associated with a long-term relationship/obligation to employees, particularly in the United States. One Washington lobbyist told me this was the entire impetus for the Medicare Part D statute of a few years back – to get prescription drug benefits OFF the books of major corporations who were responsible for the healthcare of their pensioners. Looking toward Baby Boomer retirement, this will only increase in difficulty for companies. Just as they are overwhelming state governments, these retirement obligations will overwhelm private sector companies, putting more pressure on them to limit exposure to additional employees.

Will this cut their nose off to spite their face? Yes. Just when they will need critical talent to weather the storm, they might be treating it their shabbiest. See our reports on the Talent Crunch of 2020 and beyond.

Either way, companies are all too at ease with jettisoning talent, and I personally can’t identify a situation where that habit goes into reverse. If they remain on that tact, a hedge will be to at least hire people with more ease, and to remove the stigma against workers currently without full-time employment. We must make impermanence a regular part of economic activity.

The other option is to embrace your strategy, and I hope they all do. If not, people will flock toward the welcoming HR departments of flexible, talent-hungry companies in emerging markets. The choice is clear.

http://strategic-hcm.blogspot.com/2009/03/peter-cappelli-talent-on-demand.html

I don’t totally agree, though. First off, there are other costs associated with hiring and firing — lawsuits over “wrongful dismissal” come to mind, as well as the cost of training new people…and the cost of bringing them up to speed so they can actually be effective in their job. Potentially costly decisions should be made with some care.

HR doesn’t really do the actual hiring in most places — they just do the admin support for the hiring process. Actual managers give the actual nod, and they typically need to be in consensus — hence the need for all the interviews and deliberation.

Speaking of administrative stuff, HR is most places is also responsible for benefits. They are actually the “economic buyer” for things like life, health, and disability insurance, which are then made available to employees. Decades ago they did this for defined-benefit pension plans too, which now have largely been replaced out by 401ks.

These benefits are complex and do require time to understand, buy, and manage. One of the probable impacts of health care reform, which we’re watching closely, is that it will make health care more “portable”, like retirement savings already are. Companies may elect to have their employees buy on the exchanges that will be in effect by January 1, 2014. People will no longer stay on the job for the benefits, and it will possible change jobs even more often than they already do (which is a lot more often than it used to be.)

The net impact? HR people may have LESS to do with regard to benefits, but as a result of higher employee turnover may be hiring MORE often..making it something of a wash.

I do agree with your overall observation that on the whole our society, and our businesses, are over-bureaucratized, and a result sluggish and resistant to adaptive change.

Longer-term, I think the whole idea of a “job” may soon seem antiqued and maladaptive. It used to be that people worked for 30 years for the same organization. In business, this happens less and less frequently. In government, maybe more often — because the benefits are so good. But many government are in the process of going broke as a result!

With regards to my *promoting* an approach that treats people like resources, I beg to differ. I am *describing* a behavior that is already taking place at non-unionized organizations due to economic necessity. Companies hire when and if they want, and invent many wonderful euphemisms when needing to offload those hires – downsizing, rightsizing, offshoring, RIFing, et cetera. The offload comes with minimal friction as soon as the company perceives the economic need to “lose headcount,” or more often, changes the structure of the corporation through M&A activity, going public, or going private. I speak regularly with all manner of HR professionals – recruiters, talent acquisition, career counseling, HR admins – and they say that 15 years ago they would need to practically recommend psychiatric help when someone was laid off. Now, candidates have been through the “flourish elsewhere” ringer so many times, it no longer fazes them. Despite the best intentions of HR, this is a common facet of modern industrial life.

I simply wonder if organizations might not also increase the speed of uptake to match the speed of layoffs, so they can react to opportunities as quickly as they react to rough economic times. Besides, isn’t it treating someone like a commodity to let them “sit on the dock” for seven months during endless intake interviews as if there’s no urgency to finding a job? For whom isn’t that disheartening? These people aren’t lumps of copper ore to be processed whenever the employer gets around to it.

As far as finding “the right ones” this is more to my point. In a world that changes so quickly, the “right” candidate may have totally different characteristics in only a few years time. I’m thinking of Kodak, who needed chemical engineers for its photography products, then in the blink of an eye needed electrical engineers. You’ll note they were delisted from the S&P 500 this week.

We’re all getting a world that demands flexibility whether we want it or not. As I pointed out, I think economics have been more like this than not over the centuries. We should do fine as long as the resilience and appreciation for human needs swing in both directions.

Cheers.