FEATURE | WINTER 2010/2011 EFFECT

Futurists Share Their Visions of Tomorrow’s Business World

by Andy Steiner 

Every Saturday morning, members of the nation’s oldest chapter of the World Future Society gather at the Knights of Columbus hall in Bloomington, Minnesota. A group of deep thinkers, intent on discussing societal trends and their impact on the fate of the planet, they conduct far-ranging and intense debates that touch on everything from energy policy to demographic shifts to health care innovations.

The group’s membership is eclectic, says Chapter President David Keenan, an engineer and nanotechnology consultant. “They are focused on researching and debating the issues, and their insights are generally right on target. They’ve done their research because they want to know where the world is heading,” he says.

This intense interest in where the world is heading isn’t limited to Keenan’s committed crew of volunteer intellectuals. There’s also a worldwide network of professional futurists who study societal trends and predict how they will develop in coming years.

Governments, businesses, and professional associations increasingly turn to professional futurists for their insights on how the world—and its citizens—will operate, says Joyce Gioia, president of The Herman Group, an Austin, Texas-based firm of strategic business futurists concentrating on workplace and workforce issues. “Futurists provide essential, informed guidance to their clients on how to structure current business practices or employee relations in order to best succeed in the future,” Gioia says.

She explains that professional futurists aren’t random predictors who draw their prognostications out of thin air. Rather, they are voracious researchers whose informed, bird’s eye view and curiosity about world events provides helpful synthesis and direction for clients.

“A good futurist looks at the future to help guide client behaviors in the present.” Gioia says. Her firm’s client list is diverse, including such organizations as the U.S. Environmental Protection Agency, the U.S. Department of Defense, the City of Phoenix, AARP, and the Texas Hotel and Motel Association.

So, what do some of the nation’s top trend spotters consider to be the key issues that will impact business in the next 20 years? In order of influence, here are the top five trends that may shape the future.

1. Climate change

Far and away, the futurists we interviewed believe climate change will have the biggest effect on world business in the next two decades. While not everyone agrees on why the world is getting warmer, futurists understand that business leaders will have to address this issue if they want to thrive—or even survive—in the marketplace.

“We tend to agree that global climate change is occurring,” says Keenan of his futurist colleagues, “though we are not all certain that it is a direct cause of man-made activity or if we are riding along on some solar cycle. … We agree that citizens and businesses are going to have to learn to cope with this environmental impact—and we’re going to need to invent new technologies that leave less of a mark on the planet.”

Because members also agree that the worldwide supply of fossil fuels has peaked, Keenan says future-focused investors might look to companies that invest in or create renewable energy as “a central agent of economic progress in the future.”

Keenan reports that the forms of renewable energy that particularly excite his members include, “materials that are derived from life systems, like algae-produced fuel or crops that are grown specifically for their energy harvest. We are also intrigued by companies that are creating larger and larger energy-collecting structures like wind turbines and solar panels. These forms of technology benefit from emerging nanotechnology—which will be another fairly significant area of business development in the next 20 years.”

Futurist Michael Rogers, author of MSNBC.com’s “Practical Futurist” column, agrees the future influence of climate change on business is undeniable. Rogers says, “not so much through physical results—although those will also increase—but also in how regulation and legislation change the playing field for business, with things like carbon taxes.”

Because scientists connect global warming with increasingly volatile weather, Rogers predicts over the next two decades, natural disasters like Hurricane Katrina or the deadly floods in Pakistan will affect the way businesses operate domestically and internationally. He advises companies to make contingency plans for unexpected weather events.

“As happened during Australia’s great drought a few years back, a climate disaster can rapidly change public sentiment and change government policy,” Rogers says. “A Katrina-class hurricane hitting Miami, for example, could arguably bankrupt the increasingly self-insured state of Florida. And climate change is a Millennial issue, not a Boomer issue. As the Millennial generation gains more political representation, climate change will increasingly be on the radar.”

Pressure from a new generation of consumers increasingly motivated by “green” values may also encourage employers to change their practices, says futurist Joan Foltz, founder of the Chandler, Arizona-based future-consulting firm Alsek Research and publisher of Edgy Economics, a newsletter analyzing underlying drivers of the global stock markets.

Adds Gioia: “Generation X-ers place great importance on taking care of the environment. Millennials have been raised with those values. Businesses are going to want to be green, to directly address the issue of global climate change, because customers and employees will be making decisions based on the degree to which companies are environmentally and socially responsible.”

2. Alternative energy

Many futurists believe that researchers and entrepreneurs focused on alternative-energy creation will play a great role in shaping the business environment of the future. But don’t put all your money in solar, advises Foltz.

“Alternative energies that will create long-term businesses will be developed based on cost efficiency,” she says. Though alternative energy sources widely in use today—like solar, geothermal, and wind power—are rapidly gaining market share, new sources are on the horizon. And these developments appear to be even more promising than their predecessors. “Fuel cells and natural gas will likely be the replacement energies,” she says. “The alternative energies you see today, such as wind and solar, will likely not be a significant part of the mix in 20 years.”

But in order for alternative energy innovation to really take off, Foltz believes research and development need strong economic support. Because of this, our green future depends largely on the state of the world economy.

“The pressure to recognize environmental issues will be muted if the world markets do not perform and personal income continues to deteriorate,” Foltz warns.

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Foltz also says she has observed an increasing commitment by governments to fund the development of new energy technology. In the next two decades, she predicts a “green arms race,” where nations vie for the honor of being the creator of the perfect alternative energy source. First step is to reduce the worldwide influence of oil and oil companies. That shift is slowly happening, she says, and will continue over the next decade.

“Reducing the profitability of oil products through moratoriums and stringent drilling requirements could shift energy development to natural gas and fuel cells,” Foltz says. “Until then, it would be hard to sanctify a replacement to the oil industry with one that does not generate the huge capital creation that oil does.”

What alternative energy will be the dominant force in the year 2030?

“Over the next 20 years, we will move away from oil-powered vehicles to hybrid to electric vehicles and ultimately to fuel cell-powered vehicles,” Keenan says. “By 2030, fuel cell technology will finally come into its own and represent a significant share of the market.”

For several years, the promise of fuel cell technology has been all the talk in futurist circles, but it has yet to truly take off in the marketplace. Keenan and his fellow futurists blame that on the questionable strength of the U.S. electric grid. “For so many electric vehicles to be on the road, we have to have a strong grid,” he explains. “This will be developed over the next two decades.”

Keenan is not ready to predict if fuel cells this will develop into a new industry—or be folded into an existing one.

“It is not clear whether fuel cell technology will rise as a stand-alone industry or if it is going to be the transformation of the traditional energy companies,” he says. “There is some indication that the existing companies are going to scramble and be able to be something for everybody.”

And if energy companies don’t pick up the slack in the grid, Gioia says that individual consumers will. In the next 20 years, “people are going to have to be more crisis aware than we ever have before. We’ll have to create contingency plans. We’re talking about more generators and more backup systems. Maybe people are going to start getting smart and buying or renting their own solar panels and windmills to generate their own electricity. Increasingly, consumers may take matters into their own hands. It’s a D.I.Y. world,” she says.

3. Aging population

At 79 million strong, the Baby Boom is the largest single generation in American history. In 25 years, this massive group of citizens will have fully reached senior status. All areas of American society will be impacted by this demographic earthquake.

Futurists predict a large segment of the marketplace of tomorrow will be focused on caring for and providing services to the country’s massive senior population. And because the U.S. birthrate has dropped over the past few years, the pool of workers available to assist this notoriously demanding generation may be small.

This population shift will bring increased demand for health care workers and development of pharmaceuticals and other products and services designed to ease the aging process.

Keenan says, “This is a generation that is not interested in going to nursing homes. Companies that acknowledge this fact and come up with other solutions are the ones that are going to succeed.”

But it will still be several years before most Baby Boomers need to start thinking about long-term care. In fact, futurists predict many will Boomers want to—or have to—work well past retirement age, thanks to stock market instability. This means that the workplace of tomorrow will be made up of a mix of workers from three generations: Boomers, X-ers, and Millenials. These three groups will need to learn to get along, says futurist Jim Rice, executive vice president of Integrated Healthcare Strategies, a Minneapolis-based health care consulting firm.

“We’re talking about three groups of people with distinctly different ways of looking at the world of work,” Rice says. “The challenge for employers will be to answer the question: ‘How do we manage multiple generations in the workforce with different styles and work ethics?’”

Gioia believes that Boomers’ reluctance to leave the workforce will have the most negative impact on Generation X, the generation that’s grown up in their shadow.

“There are significantly fewer Gen X-ers than Baby Boomers,” she says. “Boomers are taking their time leaving the workforce, and when they finally do, the Gen X-ers will have to take their places. And because this group has spent years waiting in the wings, we’ll see a huge a leadership deficit. Generation X-ers haven’t been given the opportunities they need to effectively lead organizations.”

The sheer size of the Baby Boomers often diverts attention and services away from other citizens. Foltz predicts in the years to come the aging Boom’s demands for care may negatively effect funding for other key social services.

“Currently, the full impact of Baby Boomers entering retirement has not yet been realized,” she says. “The focus on environmental and other social agenda issues can swiftly shift to solely health and income preservation, which will deter monies going towards programs benefiting younger generations. Social programs for the young could be significantly jeopardized. Schooling, programs for foster children, and other nurturing development programs are already getting impacted.”

4. Health care innovation

Despite this years’ landmark legislation, America’s health care crisis continues to be a big tangle that is far from being solved—and it may take decades to develop an equitable system for providing care for all citizens.

“The current administration has at least broken the stalemate on health care,” Rogers admits. “However, the present solution is a stopgap, and doesn’t really address the incredibly inefficient infrastructure we have. That will take a long time—another decade, at least—but some of the burden of health care costs must be taken off business sooner or later if we are to remain globally competitive.”

Rice agrees, adding it is hard to predict how businesses will continue to shoulder the burden of increased health care costs going into the future.

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“All the health reforms are eventually going to make for better care, but it will be more expensive,” he predicts. “It will be another drain on businesses to cope with the costs, and until a new system is developed, the focus will need to be on cost reduction and developing efficiencies in health care service delivery.”

Lars Oddsson, director of research at Sister Kenny Rehabilitation Institute in Minneapolis, is a future-thinking health care entrepreneur. He works with a research team to develop new products that will deliver health care services to patients.

With health care costs skyrocketing, a sector that will have great influence over the marketplace of the future will be focused around wellness promotion and injury prevention, Oddsson predicts.

“In order to bring down costs, we’ve got to keep the United States’ aging population healthy and aware of their health,” he says. “In order to do this, we’ll need to invent technology that will help them be able to maintain health while retaining their independence. Companies that produce products that achieve that will be influential players.”

For instance, Oddsson and colleagues from Boston University are developing a pair of sensor-embedded socks that will help elderly wearers stay steady on their feet and limit falls. He predicts that, in the next 20 years, consumers will see other similar wearable health care aids emerge.

He also believes that small medical robots designed to assist homebound and injured people with medicine dosing and basic health monitoring will be commonplace in the future.

“In medicine, we are truly moving in that direction,” Oddsson says. “Telemedicine and its many offshoots will become widespread, accepted in part because of their remarkable ability to improve care and reduce costs.”

5. Globalization

Many of the futurists we spoke with predict that in the next 20 years, globalization will continue to thin borders and increase worldwide economic integration. In order to survive, business owners and entrepreneurs will have to learn to look beyond their region or country of origin. To thrive, futurists predict, businesses will need to work with suppliers, producers, and business partners from other corners of the planet.

Rice says, “Businesspeople are going to have to be citizens of the world. … We live in a big world and businesses are going to have to learn to operate seamlessly within it.”

He also believes that while business owners and managers will need to learn to embrace the global marketplace, they will also need to open their eyes to societal inequities.

It may be as basic as making sure everyone has enough to drink, says Rice. “In the next 20 years, unequal access to water will be a bigger issue than unequal access to petroleum. Water and food shortages will be a destabilizing force, unless someone finds a way to set up and meet the water and food needs of 20 million people.”