“Prof. Popstar”, Kjell Nordström, on Business of Tomorrow

I’m at the Swiss Export Day event, kindly invited by Credit Suisse. Prof. Popstar (google him) gives some interesting insights into the markets of tomorrow. E.g. that export is driven by solving very practical problems for the local population. Like telecommunication for the thinly populated Northern Europe (Nokia, Ericsson). Or cheap furniture for a poor and remote area (Ikea). Exports work best with similar countries.

Capitalism isn’t a philosophy but a machine. This machine is best in separating efficient from inefficient business. The machine decides who gets rewarded and who not.

There are 5 forces that will affect the capitalist machine, and which business will be rewarded and which business not:

1. Women
They are completely taking over higher education. Even in countries like Morroco, United Arab Emirates, etc. Men in higher positions will be minority in the near future. There are very few areas where men and women are different. One of them is ‘risk’. Women always pay back, other than men. Women deliver and deliver and deliver.. Men deliver… sometimes. This means it is a lot less risky investing in women dominated business. The risk of business in general is going to decrease with more women being in control.

2. Families
Family is the oldest institution we have. But we don’t found families anymore. This will have effect on all business, like logistics, housing, infrastructure, finance systems, etc. Interestingly today we have the lowest birth rates in the catholic countries and the highest in countries like Sweden. Today 52% of humanity live in cities, in 2040 it will be 90%. Life quality in the future will be a lot higher in cities than in the countryside. “Austria will be Vienna and junk space around it.” Countries will be dominated by the big cities. “We will see the birth of the city state like we had it before. These cities will host almost all business and not be willing to pay for the junk space surrounding them.”

80% of the Silicon Valley’s population were not born in the United States. In Phoenix, Arizona you find a majority of retired people. We see a major differentiation of society segments into different regions.

The United States is not a country but an idea. It takes anyone only 3-4 years to become an American, no matter where they were born. It takes another European 3 generations to become Finnish, accepted as such by the Fins. “It takes 4 generations to become French. Even the French have difficulties to be French.” It is almost impossible to become Japanese. Innovation, value, growth takes place in open societies like the US. Because these societies attract the best people. And the best people are globally oriented.

In the past business created innovation and then made money by exploiting these innovations to the maximum. In the future creation will have the same share as exploitation. The most successful companies will be those who permanently reinvent everything and create new innovations at the same time.

Somehow I lost track with regard to the categories 3 and 4. Here’s 5:

5. Freedom
Technology sets people free. Know, be, go, do. It’s a powershift from the center to the peripherie. Doctors hve to face patients that have done their own research ready. Companies have to face well informed customers who see through the whole value chain.

Here is the recipe for making money and business in the future:

Have a (very) good idea. (Most ideas are bad.) To find out whether your idea is good, test it, find out if it survives a temporary monopoly. Ikea, the iPhone are temporary monopolies in their markets. These are products that totally stand out in their markets. You need at least a small temporary monopoly, which is just a perception, like a piece of art. It’s all about perception. Now, within this temporary monopoly create something outstandingly new.

The bad news: the information technology transforms every technology into necessary but not sufficient for success. Technology will no longer be a success factor. Competition is a moving game. Volvo hat struck a temporary monopoly with safety. It is no longer one, as all cars are safe today. All temporary monopolies will fall into dust.

Look at nature. Everything in nature is about change, survival of the fittest. The ability to change is almost the only thing that is rewarded. Another selection criteria is sexual attraction. But do never combine attraction with fitness. It would kill your business.

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