Archive for the 'Global View' Category

Reflections on Africa

I suppose Nelson Mandela’s 90th birthday is as good a time as any to briefly reflect on Africa. As an African by both birth and choice, I must admit that my heart is often broken by this continent. Albeit that Africans are resilient, remarkably adaptable and generally hospitable and friendly (among the black languages of South Africa, for example, there is no indigenous word for “stranger”), there never seems to be a week without some tragic tale emerging from the 52 nations of this mighty continent. I am not saying that everything is as bad as the global news headlines often make it out to be. But, Africa nevertheless seems to have massive problems when compared to the issues facing other regions of the world. Why is this?

One thing that has helped me recently is reading Jeffrey Sach’s “The End of Poverty” in which he lists the major causes of extreme poverty (and most of Africa is in this category), showing that many of the factors that cause African poverty are beyond the control of people. Africa’s mosquitoes carry malaria, whereas India’s do not, for example. Africa has no major navigable rivers (OK, there is one, but that is all within the DRC). Africa has the worst top soil of any continent (except, I suppose, Antarctica). And Africa’s tribes are more divided by culture and language than any other continent (in South Africa, for example, there are eleven official languages. In Nigeria, there are over 100 unique, indigenous languages). So, Africa is partly as it is due simply to the lottery of geography.

But, in the 21st century, that does not explain the whole story. It does not explain Sudan, for example. And, it most certainly does not explain Zimbabwe.

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Free games

At TomorrowToday, we are great fans of games, and especially of the learnings we can get from games. We are also keen observers of the gaming industry, which often picks up on shifting values and economic models before other industries do (compare them, for example, to the music industry - especially on the issue of pricing I’m about to talk about!).

Here is a small feature from the latest Economist magazine on a new financial model for games. Give them away for free!

FOR millions of East Asians, online gaming is not so much a hobby as a way of life. “Massively multiplayer” online games such as “Legend of Mir 3” and “MapleStory” have legions of devoted fans who spend an alarming proportion of their waking hours sitting in front of their PCs, at home or in internet cafés, doing battle with elves, wizards and mythological beasts. Some players take their parallel gaming lives very seriously: one man murdered a friend in a dispute over a stolen virtual sword (GC: this happened a few years ago, and is the only known extreme incident - but it is still much quoted).

Many of these games rely on a business model that is different from the way the video-games industry works in the West. Rather than selling games as shrink-wrapped retail products which can then be played on a PC or games console, the Asian industry often gives away the software as a free download and lets users play for nothing. Revenue comes instead from small payments made by more avid players to buy extras for their in-game characters, from weapons to haircuts. In this way, a minority of paying customers subsidise the game for everyone else.

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Cement Usage

Here’s a link worth following. It contains a few images of cement usage around the world by the big users. China’s usage for the past 4 years is staggering.

We all know this, but seeing it in this particular format leaves you with your mouth hanging wide open. It certainly did for me.

I’ve not been to China. I can’t imagine what must be going on to be using this kind of volume?

TomorrowToday.biz Building Capacity in London and Europe

A JOURNEY TO A NEW WOLRD

Graeme Codrington moves to our UK branch in August this year. While not a permanent relocation, it’s expected that Graeme and his family will remain abroad for three to five-years. Already an internationally recognised expert on talent and the future of work, Graeme will continue to help organisations to understand global societal changes, and how these changes affect their staff, leaders and customers. While abroad, Graeme will periodically return to South Africa to honour requests from clients who wish to engage with him directly.

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Accenture’s Multi-Polar World

Accenture released an excellent report last year entitled “The Multi-Polar World”. In it, they argue that right now we live in a world going through major transitions, caught between different “poles” of focus, interest and power. I think they are spot on the money.

You can read the full report online for free. Just go here.

I have reproduced their summary below if you don’t have the time for a 2Mb PDF download and 36 pages of reading.

Continue reading ‘Accenture’s Multi-Polar World’

Dwindling global electricity supply

Coal electricity supplyI live and work between Johannesburg and London. For the past few months, South Africa has been plagued by the short supply of electricity. This is due to lack of planning for the sustained economic boom we have experienced over the past decade. As early as 1998, forecasters were warning that South Africa would run out of electricity in about 2007. Well, to be clear - that we would reach the point where demand and supply were so closely aligned that any blip in the system would result in blackouts. That is precisely what happened.

The problem should soon be resolved by the opening of new power stations (they take some time to build!) and the recommissioning of old power stations that had been mothballed. In this respect, South Africa is not unlike other countries that have experienced electricity shortages due to economic growth and bad planning. Recent examples include Brazil, Russia, Indonesia and California.

I am planning to spend the next 3-4 years in my London base, but it seems I will not escape the power problem. According to The Economist, England faces the same dark future. The expected date of blackouts - 2012. Just in time for the Olympics in London.

Read the article here (subscription may be required), or an excerpt below.

Green and black
A looming supply crunch causes problems for a government with green ambitions

Apr 3rd 2008
From The Economist print edition

RHETORIC is a sad fact of political life, and most voters are smart enough to know that grand promises made in the heat of a parliamentary debate or an election battle should be taken with a pinch of salt. But on energy policy the gap between claim and reality is now wide enough to be embarrassing. Grandiose pronouncements about climate change (“our greatest obligation to future generations”, according to Alistair Darling, the chancellor of the exchequer) stand incongruously next to Britain’s anaemic record on cutting its greenhouse-gas emissions, which have stayed stubbornly unchanged for years.

That has led to much rancour, with greens accusing the government of “betrayal”. And in the midst of all this acrimony another problem looms: Britain is beginning to run short of electricity. Reversing this trend seems likely to turn up the heat even more.

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The Next Empire/s

The latest edition of Strategy+Business has a great article on a new book looking at USA, Europe and China. Here is an extract:

What can the U.S. do to maintain its competitive position against the E.U. and China? Foreign policy scholar Parag Khanna believes the answer lies right under our noses.

Only 30 years old, Parag Khanna has spent more than two years traveling to more than 100 countries, hoping to see firsthand the flash points of geopolitics and globalization. From his observations emerged a book, the recently published The Second World: Empires and Influence in the New Global Order ???????? ????? ????????(Random House, 2008), a thought-provoking look at the future of global competition. Khanna posits that the struggle for global economic and diplomatic influence over the coming decades will pit three empires — the United States, the European Union, and China — against one another on a battleground that he calls the “Second World.” This group comprises countries in five critical regions — Asia outside China, Central Asia, the Middle East, Eastern Europe, and Latin America — that hope to achieve full industrial development through economic and strategic alliances with one or more of the three major blocs.

Indiana McCain and the Election of Doom

I must give The Economist website the credit for this awesome headline. And I must agree with them that John McCain is in trouble. If elected as President later this year, he will be the oldest person ever elected American President. While this should be no factor, since life expectancy has been steadily increasing over the past half century, and McCain is sprightly, healthy and the very model of what today’s elderly can be, there is a problem.

McCain is not a Boomer. The Boomers (born after World War II and into the 1960s) are old and aging (although they will hate to read that bald fact stated so bluntly). They’re now in their mid 40s to mid 60s. But, they feel 25. Or, at least 35! Any decent marketing efforts aimed at them cannot treat them (or show visual images of them) as they are - i.e. over 50, ageing individuals. Marketing efforts aimed at Boomers should think of 35-39 year olds, and use similar images, too.

Americans are not ready for an old President. (There is a website devoted to things that are younger than Mr McCain - including the Golden Gate Bridge, plutonium, Coke-in-a-can, Velcro, 91% of Americans…). Or more specifically stated, Americans are not ready for an old President who is not a Boomer. In 20 years time, they’ll be ready for 70 something President, but not yet.

So, this should be a really fun election to watch. You will have either your first woman, or your first African-American. Or your first septuagint. Which of these is America more ready for. I’m not sure. But I am prepared to put my generational credentials on the line, and say that Boomers and Gen Xers would rather have a Boomer than someone from either the Silent or Veteran generations. So, for my money, on generational theory alone, McCain has no chance. But, then again, who would have thought that Indiana Jones would get another run at his age (actually, Harrison Ford is a Boomer in his 60’s - so maybe there is your answer!!)

Wired Politicians

A week or so ago, Dean noted that the Tories in the UK were trying to target (or needed to try and target) a younger generation of voters. In the same week, I read an article in The Economist about how British politics was using (or not using) digital communication technologies and Web-based tools. Read it online here, or a summary below.

The internet and politics

Semi-connected

Apr 17th 2008
From The Economist print edition

British politics is missing out on the potential of new media

EVEN the least fogeyish of politicians have been flummoxed by the internet. Tony Blair, champion of all things modern, paid no end of lip service to the potential of new media as prime minister but was comically technophobic himself. Still, the internet plays a role in huge areas of British public life: party politics, punditry and government itself. But web aficionados lament a yawning gap with America, and with the most go-ahead corners of Europe.

The official websites of the main political parties—Labour, the Conservatives and the Liberal Democrats—get less web traffic than the most popular political blogs, and much less than even the far-right British National Party. No surprise, say cyber enthusiasts; they do a passable job as repositories of information but offer little scope for users to get involved beyond signing up for e-mail distribution lists.

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Olympics, controversy and you

The Olympic torch has left Athens, Greece on its traditional torch run around the world until it eventually arrives at the Beijing Olympic stadium during the opening ceremony. Right from the first day, it has been met with something that the Chinese officials did not anticipate: protestors. In an unprecendented move, the torch was actually extinguished in Paris so that it could be loaded onto a bus and rushed away from growing violence amongst the protestors. TV news scenes from London, Paris and San Francisco show police beating protestors, dragging them into prison vans and frog marching them away - none of these are scenes that add to the Olympic brand and mythos.

This is becoming a major news story - a BAD news story. It’s China Inc that’s on the receiving end. But it could be you and your company next. We have been saying for some time now that there is a new generation of young people and global citizens that are going to rise up and become activist customers and ethical consumers. This Olympics needs to be YOUR company’s wake up call that this can happen anytime, anywhere. You have been warned - get your act together, and ensure that all the skeletons in your closet are well sorted out!

To err is Terminal 5

Heathrow Terminal 5 chaosI write this entry as a South African. I say that because we’re extremely hard on ourselves on this end of the planet. We often compare ourselves to the resources, experience and might of the ‘developed world’ when we open our world class attractions. And when things don’t work the way they’ve been billed to, we simply blame our ‘African-ess’ on our inability to deliver to the standards and levels that were expected.

This week British Airways opened Terminal 5. Since the opening it’s been on the news, flighted as the greatest travel achievement the world has ever seen.

You can imagine my amusement at the e-mail I got from our travel agent this afternoon. Even with truck loads of cash, and wheelbarrows of experience, getting it right isn’t as easy as one imagines. It doesn’t matter who you are or where you come from : )

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Lessons in attitude for the talented (or Ricky Ponting gets his just desserts)

Regular readers of this blog will know that many of the contributors are passionate cricket fans. (For our American readers, that’s the mysterious game that, in its purest form lasts five days and can end in an exciting draw!) Our fanaticism for the game is shared by at least 1 billion Indians. The world’s largest democracy has just had an unprecedented auction for international cricket stars, for the newly formed Indian Professional League. In the league, a number of Indian provincial teams get to “buy” international super stars to play with them. Each team can only have a maximum of 4 of these stars on the field at any time. They must also have four players under the age of 22 from India in the teams. The rest of the team is Indian. The bids in the auction will be paid to the player as a salary (I think I saw correctly that the Indian players in each team will be paid the same as the top paid international super star in their team). The contract is for three years.

Nice idea. It’s for 20-20 cricket, so will be a great spectacle too. I can’t wait.

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The Most Expensive Oil

Today the world wakes up to the most expensive oil ever. Those who believe in market dynamics of supply and demand will have an interesting time explaining this. The problem with oil is not that there isn’t enough oil around, but rather to do with where the available oil is to be found.

Of course, supply and demand does have something to do with the record price. High growth rates around the world, in places as far flung as China, India, the Middle East and Africa, have seen demand for oil grow as their economies fly. At the same time, oil firms, in particular Western oil firms, are struggling to increase production - mane still producing at the same levels as they did two or three years ago. That has left little spare production capacity and, in America and other countries, dwindling stocks. Whenever storms brew in the Gulf of Mexico or chaos erupts in the Middle East or Africa, or Russia talks nasty, jittery markets push prices higher. Part of this has to do with speculators, rather than customers.

But there are other reasons for the higher oil prices, and the lack of supply.

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Emerging market art

The latest Economist has a short note on an interesting trend: the massive increase in selling prices of artworks. This has been a great investment trend over the past few years. But, now, the trend has hit emerging markets, so to speak. Russian and South African artists, in particular, were singled out in the article (read it here, or below).

Irma Stern was a white South African woman of Jewish heritage who was able to evoke wonderful images of Africa. Read more about her here. Over 40 years after her death, her art is internationally recognised, and due to fetch remarkable prices at upcoming auctions around the world.

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A car for the people of the world

Tata NanoThis is how new markets are made, and how worlds are changed! Today, Tata released their latest car. It was a car that all of their rivals said could not be made. About 5 years ago, Tata announced that were going to build a car that would cost less than 100,000 rupees, or US$ 2,500 (the price of a DVD player in most luxury cars).

Today, they unveiled it in India. See the early news reports here and here.

It is the Tata Nano. And, besides being a 5 door sedan, seating four, with just less than 650CC power, it also has remarkable fuel efficiency (20km/l), top speeds at 100km/h, meets all emissions standards and all safety standards, too. The deluxe model will have aircon. See the Reuters “factbox” for details. At this price, it is bound to be attractive to those who have not been able to enter the car market in the past.

It is no surprise that a car for the people in the “bottom half of the pyramid” should come out of India (see previous post on selling profitably to the world’s poor). For some, it may be a sad truth, but it is true nonetheless: unless companies make money out of supplying goods and services to the world’s poor, they won’t. But Tata shows yet another example of how this can be a win-win for everyone.

With a car like this, Tata will create a new market of car drivers, and are poised to conquer the world. I wish them well!

1968 nostalgia

It’s 40 years later! Prepare yourself for a year (or at least a few weeks) of breathless nostalgia as the Baby Boomers put on their misty eyes and remember back to one of their most defining years as young people (and just when you think it’s over, the 30 year reunion of the “summer of ‘69″ will be upon us next year).

For the record, I wasn’t there. My parents weren’t married yet (although that was becoming less and less of an issue for childbearing in 1968). But, in my studies of generational defining moments, 1968/9 is one of those periods of a few months in which it can be said, “everything changed”. (Probably the most defining such period in recent history was April 1989 to February 1990 - Tiananmen Square, the Berlin Wall comes down, Perestroika and Mandela’s release all within 8 months!).

But back to 1968. Before you look at my list of highlights below, why not take the “do you remember 1968″ online quiz.

Now, here are the highlights:

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Beware the Chicken Littles (SA, ANC, Zuma and more)

I received this by email from the great lads at SA The Good News. I don#8217;t go with everything they say below, but it#8217;s worth thinking about (especially for our South African readers):

Mbeki vs ZumaThe prospect of a Zuma ANC presidency is becoming more and more of a reality and with it a scenario so long feared by the chattering classes. The prospect of a Zuma ANC presidency is becoming more and more of a reality and with it a scenario so long feared by the chattering classes.

Normally sane, rational people have said things like “If Zuma becomes President, I#8217;m outta here!? and “You#8217;ll really battle to find any “good news”? if Zuma is elected. The country will be screwed.”?

It reminds me of the hysteria and popular opinions that swirled around the suburbs before the 1994 General Election (”You better stock up on water, canned food, guns and ammunition because there#8217;s going to be chaos”?). Similarly, the world wide angst over the Y2K computer bug in the lead up to January 1, 2000 (”Planes are going to drop out of the sky! Nuclear plants will melt down!”?).

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Small is beautiful - and connected

Small, rich and stable countries tend to be the most globalised, at least according to an index of 72 countries by A.T. Kearney, a consultancy, and Foreign Policy magazine - to see a graphic of the 2005 index, click MORE below, or follow this link.

Their index uses 12 measures which cover economic integration, personal contact, political engagement and technological connectivity. As The Economist said, a little disparagingly, actually, “The index may be most useful for starting debates.” But, for what it what’s check it out below…

Continue reading ‘Small is beautiful - and connected’

The Lion and the Dragon

This past week, ICBC, the world’s most valuable bank (valued at $319 bn) took a 20% stake in Standard Bank, Africa’s largest bank by assets. The deal is worth $ 5.5bn.

This is the largest foreign investment by a Chinese bank anywhere in the world. And it is the the largest ever foreign-direct investment in South Africa. The transaction is the latest example of China’s growing interest in Africa, and also illustrates the expanding web of trade and investment that links together emerging markets and their growing weight in the world’s economy. Other deals are now in the pipeline, with China’s mobile industry looking at African heavyweights, such as MTN.

Where are the American banks and telecomms companies? They seem to be focused on the Middle East - a much higher-value-per-person market. But, the future is likely to belong to those companies that seek the “fortune at the bottom of the pyramid“.

The Economist concluded,

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The Airbus A380 is delivered - but will it deliver?

Singapore airlines Airbus A380The long awaited monster passenger plane, the Airbus A380, is now ready for delivery. In fact, Air Singapore today took delivery of their first plane with much pomp and ceremony. Read about it here at the international airlines news, and read about the financial details at Forbes.com.

Some people have said:

  • The plane is too late - the market has moved on, and there won’t be enough orders to pay for it.
  • Given the delays and increases in development costs, they need to sell almost double the estimated number of planes to turn a profit.
  • Its unlikely the market will be able to absorb the additional planes they need to sell.
  • The plane will become obsolete before they sell 400 units.
  • The plane is too big - no-one wants to fly with that many people.

In fact, these things were all said of the Boeing 747 when it was introduced to the market in 1970. Some people are saying very similar things of the A380 today. They have obviously not looked at the past and learnt from it. That’s a problem everywhere today, isn’t it?

Shinsedae - a new generation in Korea

A frequently asked question when we present “Mind the Gap” - a presentation about different generations - is whether these generations can be found all around the world. People battle to believe that the elegant simplicity of the generations model applies in different countries and across multiple cultures.

Of course, the generational model is not applicable to every single individual everywhere (which model is?), but it IS exceptionally robust. And more and more research around the world is showing this to be true. The latest piece of research I picked up comes from one of the students my colleague Keith had contact with at the Asia Pacific Leadership Programme he teaches at every year at the University of Hawaii (read more about this amazing program at Wikipedia).

The title is: Shinsedae: Conservative Attitudes of a ‘New Generation’ in South Korea and the Impact on the Korean Presidential Election, By Park Sun-Young - click here to read it in full.

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Democracy, cellphones and China

The Economist recently reflected on the growing use of cellphones in China, and how this is impacting a generation of young people to think about - and get a taste for - democracy. Here is an extract of the article. The original can be found here (subscription required).

Mobilised by mobile
Jun 21st 2007 | BEIJING AND XIAMEN
From The Economist print edition

Organised by text messages and internet chats, China’s middle classes are daring to protest, and giving the government a fright

INFORMATION technology in China is once again making political waves. In the tropical seaport of Xiamen citizens still talk excitedly about how an anonymous text message on their mobile phones last month prompted them to join one of the biggest middle-class protests of recent years. And in Beijing politicians are scrambling to calm an uproar fuelled by an online petition against slave labour in brick kilns.

Chinese officials have had reason to worry before about the rallying power of the internet and mobile phones. Two years ago they helped activists organise protests against Japan in several Chinese cities. But the government, at least initially, sympathised with those protests. By contrast the demonstrations in Xiamen were directed at officialdom, and the slave-labour scandal embarrasses the government. It involves allegations that officials ignored kiln-owners’ use of abducted boys to perform dangerous work. This has triggered a heated online debate about the political flaws that allowed such horrors to happen.

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Gap Between Rich And Poor Widens in the UK

Sky News reported on Tuesday that the gap between rich and poor in the UK has reached its highest level for more than 40 years.

Gap between rich and poorThere has been a rise in the number of households living below the poverty line over the past 15 years. At the same time, households in already wealthy areas have tended to become disproportionately wealthier, with many rich people now living in areas segregated from the rest of society. The widening gap between rich and poor had led to a fall in the number of average households, which were classed as being neither rich nor poor.

History tells us that when the wealth gap widens sufficiently, a correction occurs. This NEVER favours the rich. More and more super rich people around the world realise that their wealth has responsibilities built in - there is a growing philanthrophic movement growing. It must grow even more if we are to secure the future.

Travel Tips: Power, Phones and Tipping

For those who travel regularly to different cultures, you know the nightmare of arriving in a new country and realising that you don’t know some important local customs. I’m not talking about the customs officials at the airport, but rather issues like do you tip the taxi driver, and if so, how much. Do you tip the porter at the hotel, or the waitress at the restuarant?

Then, you probably also know the frenzy of trying to work out the power adaptors and trying to get your laptop juiced up (its battery-life died somewhere over the Indian Ocean, right in the middle of an important email).

OK, so maybe you don’t care, but I have just found two great websites, and need a place to put them so I can remember them:

While doing the research for the above sites, I came across a great one that seems to list everything in one place: http://www.kropla.com/.

In flight education - consumer value shifts

A nice innovation is being experimented with by Air France, JAL, Singapore and Virgin airlines. They will now be offering in-flight language tutorials on selected routes, helping passengers to learn a few key words and phrases of the language of the country of their destination. This is based on an interactive audiovisual language program developed by Berlitz, the company that supplies many in-flight entertainment screens. The system currently supports 23 languages.

This is an example of a massive trend - consumers are demonstrating a value shift from passive consumption to mastering skills. The smartest companies are offering their customers the opportunity to add to their skill set, not just consume a service or product.