W1 Insight

Another BRIC in the wall

The BRIC economies – Brazil, Russia, India and China – everyone is talking about them. There’s nothing new to know and we’re all doing everything in our power to help our firms benefit from engaging with these rapidly growing economies. Aren’t we?

These emerging economies, as they are frequently referred, are set to deliver 40% of global economic growth from now to 2018. China will be the largest of these economies. It’s already the second largest economy in the world, having just overtaken Japan and is forecast to become the largest economy in the world, in GDP terms, by 2020. (Deutsche Bank Research 2010)

At that time, in 2020, the big four economies in the world will be China, the EU, the USA and India and will represent 60% of all worldwide economic activity (PWC). The top economies by 2030 will be – China, USA, India, Japan, Brazil, Russia, Germany, Mexico, France and UK. In 2005 the UK economy was the fifth largest economy in the world. In just 25 years that will have slipped to 10^th or even lower. How will this impact our international competitiveness?

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Freemium

New business models are forming all around us, developing on the back of rapid technological innovation, our desire to take more control of our lives and through ever shifting economic and political circumstances. The turn of the century saw an explosion of online businesses, many of which are now history and their business models confined to the bin. Some however have survived and even thrived beyond their wildest dreams – Google, eBay, Paypal, facebook, Myspace, LinkedIn, Skype  and Flickr  to name a few. They’ve changed our business and social landscape and are hollowing out established markets in the process. Freemium was born in the white heat of the dot-com boom and bust. The free to use models that tried to advertise themselves to success failed to gain the critical mass to make them viable. Today however we understand a great deal more about how Freemium models work and we’ve seen some highly successful businesses transform themselves through their thoughtful deployment.

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Digital Explosion

Ten years ago it was baffling news to us that we would go through a digital revolution. Can you remember a time when the radio, your music recordings on cassette tape, your vinyl records, the analogue television, your telephone and the cinema you went to were all disconnected with no way of transferring their content easily between them. Today, we are dissatisfied if we can’t copy-and-paste between any of these media in the time it takes to make two clicks of your mouse. Where will it all end?

We tend to think in terms of ‘projects’ – a start and an end to things. This is comforting and containing for the many tasks we have to achieve and the changes we have to cope with. Unfortunately we live in continuity and discontinuity and increasingly in an exponential world of change. ‘Everything’ is changing around us, all the time, and we are just experiencing our life’s worth of change.

The digital explosion is continuing to provide us with information, communication and connectivity. Our business and social models are being changed – year-on-year – as we learn to factor in new ways to work, buy, govern, market, sell and connect with one another. This is set to accelerate – not end!

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