I’ve been an admirer of Neil Croft’s work for several years and was fortunate enough to spend an evening in his company a little while back. I love his quest for authenticity, his optimism and courage. This is from today’s newsletter. If you like it go to his website and subscribe in whatever format suits.
Dear Alun,
Society is changing fast. Economic uncertainty, technology, climate change, extremism and the internet are all accelerating the pace of change.
For many well established business models the writing is on the wall. Now more than ever constant innovation is the only route to sustained success.
Here are some predictions for the next five years I have synthesized from the evidence:
Zero Carbon Transport – It has already started with a massive growth in cycling in many developed countries. Climate concerns and government policy (as well as military investment in electric robots) are going to accelerate the development of batteries and fuel cells.
These in turn will lead to the development of truly practical electric and fuel cell cars. The state of the art are cars from independent start ups such as Riversimple, Aptera and Tesla. The more innovative of established car manufacturers will catch up quickly.
Expect to see brakes that generate energy, solar battery recharging, one electric motor per wheel, super efficient ancillaries such as air conditioning. I expect 30% of cars to be electric in 10 years.
Air travel is also under a great deal of eco-pressure and will be keen to avoid carbon taxing. Bio fuels made from waste and from algae seem to the the most obvious options.
Look for growth in cycling, electric car tech, home charging and biofuels. Look for contraction in fossil fuels.
Zero Carbon Home – Solar water heating, Solar PV (direct electricity generation), Solar Thermal and Ground Source heating/cooling are all technologies that are rapidly heading towards market readiness.
Initially the take up will be individual, but as the prices drop expect to see local collective schemes, both by communities and through local authorities. Solar Thermal and Ground Source heating and cooling in particular are relatively low tech solutions that work better at a collective scale.
Look for growth in green tech.
Tele Tech – Congestion, security and climate concerns make physical travel increasingly unattractive. Physical travel will be reserved for valuable experiences and connections rather than the mundane.
Home offices, high speed internet, sophisticated hardware and software will all make home working, shopping and virtual meetings more and more attractive. Internet telephony and video conferencing will become more reliable and easier to use making “tele-presence” and “virtual teams” much more plausible reality.
Look for growth in software and hardware and home delivery subscription services for regular products. Contraction in commuting and business travel generally.
Going Mobile – The iPhone has shown us just what mobile computing power can mean. The do anything, anywhere device is already redefining what is possible, what “at work” means, where we find our entertainment and how we interact.
As the technology develops, speeds increase and more developers get involved in creating applications for every conceivable purpose, we will find that our need to be in specific places and at specific times diminishes.
Expect growth in personal flexibility, bandwidth and software capabilities.
Going digital – When I was at Razorfish in the late 90’s we had a slogan “Everything that can be digital, will be”.
We are increasingly becoming used to the idea that digital changes the rules. Although there are still plenty of business people in denial. Only last week Rupert Murdoch responded to losses at News Corp by saying that they plan to charge for access to news web sites!
The basic rules of digital still apply, and with new devices and greater bandwidth even more so. Everything that can be digital, will be and digital will tend towards free.
Music, TV, film, books and news will all have to find business models that work with minimal or no cost to end users. In the end piracy will not be controlled in spite of the amazingly heavy handed tactics of the old guard.
A new generation of content creators will use strategies more similar to software companies, looking for long term relationships, massive and very low cost, direct distribution.
Expect internet based marketing and sales to become much more sophisticated and important. Expect direct band/author/film maker to customer relationships.
Experience Retail – A new generation of retail outlets where theme park and shop collide with authentic advice takes retail to a whole new level. The Globetrotter adventure travel stores in Germany where visitors can actually test diving equipment in a pool, climbing equipment on a wall and outdoor gear in a rain and cold chamber, all with advice from experienced adventurers, show the future of retail.
The Apple Stores, among the most successful retailers per square meter, are another example of experience based retail.
Fair Finance – Banks have managed to be one of the least innovative sectors, at least in a social and customer perspective. Right now the banks are expecting a return to business as usual, but the fundamental flaws in the system have been exposed and it won’t be long before new models emerge.
Banks have a service that can be entirely digital. Low cost, peer to peer models will emerge mainly from new players – not from among the incumbents. Zopa, Paypal and Grameen bank all point to the future.
Pensions based on passive income rather than annuity policies, that allow people to stop work as soon as their earning threshold is reached, if they want to.
Financial management software that automatically maximises passive income from credit and minimises costs from debt to the accountholder.
Zero cost fully electronic transactions using existing mobile devices (such as phones).
All based on a partnership between bank and customer aimed at maximising the customers financial security with the banks financial security coming as a by product.
What all of these developments have in common is that they require businesses to operate with a level of authenticity and transparency.
The car manufacturers, retailers, banks and computer companies that succeed in this new transparent, hi-tech, low carbon market will be the ones that seek to generate their profits BY benefitting both society AND customers.
Their staff will be passionate and motivated BECAUSE they are doing something that matters and because they care about personally.
Their profits will be higher BECAUSE they are authentic businesses
If you want some help in finding strategic and authentic innovations give me a call.
These messages are now available as a Podcast. This means you can download and listen to these messages on your iPod or iPhone. You can subscribe for free at www.neilcrofts.com
Also available for free at http://www.neilcrofts.com is a audio visual slideshow of my “10 Leadership Lessons from the Tour de France” message from a couple of weeks ago. If you want to use this with a group, let me know and I can supply a higher resolution version.
With love
nx
I enjoyed a couple of working days in Yorkshire last week. I met old and new friends including Janet Mason from DPAS who I bumped into outside a Dental Practice in a certain market town. This particular practice has been in place for a couple of years but hasn’t managed to get as far as any external signs (not even a brass plate, in spite of GDC regs). It’s true there are a couple of printed paper notices stuck in the window claiming that this is a “Dental Health Care Clinic”. My local guide told me that this practice has been doing lots of advertising for new patients in the local press recently.
The Incisal Edge 