March 2010


It turns out that the Internet does change everything.” States author Don Tapscott for point #7. The focus of this discussion was the power of social networking. In fact, as Tapscott points out, if Facebook were a nation it would be more populous than Russia. Going back to point # 6, the question can be asked ‘where does this leave the traditional nation-state’?  Can nations harness the power of the internet or will they try to control it. Business is already trying to understand and create best practices around harnessing social networking to achieve business objectives. Workshops and speakers on the topic are proliferating, but can business or government retrieve the power that individuals have gained via the Internet?

And, speaking of individuals, the role of women in point # 8. Girls, women, and gender: A sea change is underway.  The purchasing power, and so-called “girl effect” in developing countries was extensively discussed. However, discussions also revolved around the continued weakness for women from a political perspective. In fact, even though it is recognized that women have the strongest role in purchase power, yet building women’s power in both government and financial venues could “be key in refocusing our political and economic efforts away from consumerism.” Lofty goals, but what does this really mean globally? Will balancing gender roles in government, financial , and corporate circles around the world bring stronger economies, greater propensity for peace, a new world order? Heady topics – and at the end of the day, what if any of this should global companies pay attention to now?

Advertisements

“5. Sustainability’s time has come. Business is moving from talk to action. And 6. The world needs better governments.” The next two points from the article on Davos speak to the fact that the financial services industry is not alone in needing to change.  Businesses focused on “sustainability”, going beyond “green” in their discussions to looking at how sustainability can be integrated into the business strategy – and how it relates to the rest of the world. The premise regarding governments at Davos is that many governments are dysfunctional, and the perspective differs depending on which country the person was from. Essentially, governing will become more difficult as funding government activities becomes more difficult.

 Given the discussion on points #3, and #4 below, can companies afford to invest in sustainability? What will happen to the business model, and how will it truly affect consumer demand? What about governments’ ability to influence or drive economic recovery, and eventually growth? Are points #5 and #6 mutually exclusive? Change is certain, and the complexity of global business and government relationships is increasing.

Continuing on the Davos discussion, “3. Rethinking the financial services industry’s role in society and 4. Executive pay, especially for bankers, needs fixing.”: the financial services industry played a very different role at Davos this year: The Wall Street Journal noted “Bankers are on the run.” Add a strong opinion that executive compensation needs to be corrected (read ‘reduced’) particularly given the bonuses that many times followed the government bailouts. The international community mood was “fed up” at Davos when it came to discussion of the financial industry crisis, and it’s impact on the global economy.

I see many companies still working to reduce costs, but also now to rebuild revenue streams. Strengthening profitability as well as the balance sheet is high on the priority list. How were your companies or clients impacted? What about credit availability? Better or worse for existing companies? What is happening to entrepreneurs in your world?