Difference between revisions of "Scenario 4 - Empire with Walls"

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==Overview==
It is 2010 and the world is still battling to recover from the global recession. Most western economies are battling several financial challenges that are occurring simultaneously; deficits, trade imbalances, rising unemployment, company fold-ups and bail outs. At the same time emerging economies like Brazil, China and India are expanding with previous year growth for China at almost 10%. With the suspected likelihood of a second global recession, developed countries establish new regulations, some out of desperation with globalization taking a back seat. Governments intervene in society to provide bailouts for companies, implement tighter financial regulations to prevent another recession and take greater roles in other areas that used to be less government interventionist i.e. the U.S. exercising greater control on health care reforms is being viewed by many as more socialist that capitalist. <br>
[[File:IP.jpg|120px|right]]
<br>
<b>5 words define this world:</b><br>
<br>
* Era of Protectionism<br>
The new opportunities on the African continent and the effect of the financial crisis on companies influence a change in approach on innovation; innovation is now approached from a cost perspective with investment based on expected profit and several cost-cutting measures are put in place. The continuous decline of lack of financial assets by companies also influence this change in approach because new investment opportunities in Africa and research programs on the development of new ideas requires funding which most companies do not have. Raising funds from external forces do not work as banks are still not loan friendly, and consumers have become spendthrift and with society gradually evolving to a saving culture.<br>
* Intellectual security<br>
The increase in activities like exploration, manufacturing, production, refining and construction leads to a rise in pollution levels round the world, especially in regions where regulation is lax like Asia and Africa. Regulatory authorities in the West enact stricter measures on emerging markets to comply with carbon emissions regulation, with penalties to be applied on exports from those countries through increased import tariffs. Although the concern is genuine, the approach is viewed by some as an opportunity to ensure survival and competitiveness for Western corporations.
* Effective Globalization<br>
* High Risk<br>
* Environmental compliance<br>


[[File:new order.jpg|300px|right]]


''''''<br>
'''2030''' - The global economy has experienced major transformations over the last 20 years. The BRIC (Brazil, Russia, India and China) have become mainstay economies rivalling western traditionalists and have produced some of the largest multinationals in the world. Initially deemed as threats to the likes of Apple and Google, they now operate on the same competitive platform as these companies and both sides of the divide share mutual interest in the protection of intellectual property, as a means to their eternal survival. <br>
The eastern companies discover a loophole in the new carbon emission regulation and exploit it. Apparently, the regulation only covers companies that export to the West not companies that produce, manufacture and sell in other market economies. To bypass this, the companies set up joint ventures in these markets, subsidiaries and partnership with local entities and continue with their investment and expansion activities. The strategy allows them to establish operations in such markets faster and with less bureaucratic challenges, allowing them to easily utilize on existing supply chain/distribution channels without spending to create new ones. With a reputation for offering affordable pricing, consumers in these markets gradually shift loyalty from the traditional Western providers, to the emerging players. Ghana, Uganda, Sudan, Rwanda, Kenya, Nigeria and South Africa are amongst the many countries experiencing massive investment and growth opportunities influenced by companies like Bharti Airtel, Tata, Godrej group, CNPC and Industrial & Commercial Bank of China. These economies begin to benefit from the inflow of investment through employment and increased productivity and thus begins a burgeoning middle class and upper middle class. As these benefits continue, governments in these markets implement strict financial laws to ensure economic sustainability for their country but the growing needs (basic) of the populace means environmental regulation is still lax.<br>
 
The new players are expanding into territories where entry rules are less stringent and lax environmental regulations and copyright laws allow for IP violations. Some of these territories bring them into direct competition with the traditional Western corporations becoming a direct threat and companies are swallowed up by the large multinationals, which begin to integrate vertically to drive cost-efficiency and stream line operations, focussing on their core speciality. The survivalist thinking also sees IP as sacred and as competitive advantage through protectionism. Pressure begins to mount for stronger regulations to be implemented for IP protection for companies round the world and the need for new effective global legal framework(s). Though developing economies offers fresh investment opportunities, the lack of IP protection stills makes the region somewhat risky for some Western corporations in certain sectors i.e. technology.<br>
Innovation is controlled by a walled empire of a few Multinationals that survived the last global recession, through acquisitions, mergers and joint ventures. We now live in a business world where companies are protected by the strictly applied rules of IP compliance. <br>
The expansion drive of the new players across regions involves recruitment of staff of different nationalities and cultural backgrounds, offering the companies a mix of creative talent and skills. They are able to tap into a new pool of cost-cheap knowledge and potential on which they leverage on, using their own technical expertise and experience to shorten production cycles and deliver products and services quicker to the consumers. It is a recruitment strategy rapidly advancing in the developed world as part of smart acquisition and as strategic response to the emergence of the of the of psychometric testing is being increasingly employed as a recruitment tool. It serves to evaluate brain activity during tough decision making process and is believed to help determine the right minds to employ for different roles and responsibilities undertaken, in any part of the world. Accenture with a quarter of their workforce from India is an example of employing a global workforce.<br>
 
Even though the global economy is relatively stable, companies in the West are still struggling somewhat in business due to several factors; the advancement in living standards means an increase in life expectancy and a declining work force, reduced spending and decreasing tax revenues. People are becoming more like the Japanese and saving more because the last recession was one too many and there is an erosion of trust in their respective governments. The financial recession also gave fuel to the cries from people for sustainable ways of doing business to ensure history does not repeat itself and increased awareness on environmental protection, things that can only be driven by innovation and creativity. There is far more concern about where goods and products are manufactured and the requirements of low emissions stamps on products. This breeds a change in the demographic perception of the customer beyond traditional metrics like age, sex, location etc. It has become more about lifestyle, influences and it seems to begin a change to consumer power.<br>
Countries and organizations that violate such laws are heavily fined and by these companies so they retain the rights to such ideas. The same thing applies to forums and platforms for idea sharing. Individuals that are found to be guilty of IP theft are prosecuted, fined and sometimes jailed. <br>
 
'''2020
These Global Organizations have tapped into the full commercial potential of emerging and developing markets by mastering the complexity of global value chains, rethinking value propositions, globalizing research and development, tailoring talent management and managing risks. This has ensured their success in the area of innovation and more guarantees to the quality of goods produced and the equitable distribution of such goods between the various markets. <br>
There are 2 new Sheriffs in town; China (the 2nd largest economy) and India (who are on the way to becoming the 3rd largest economy). They have taken the world by storm and have become major power brokers on the both economically and politically. Their corporations rival the Western traditionalists and half of the Fortune 500-listed emerging companies are from both countries alone. They have established themselves on strategic locations around the globe particularly in developing regions like Africa, Asia and South America. The penetration strategy is a bundle of low cost and customized innovation specific to the societal challenges in these operating environments. They do not present pre-conditions to doing business and do not interfere with domestic politics although their actions influence local policy decisions. They bring a lot of technical expertise, knowledge and skills which is acquired overtime by the local workforce through employment opportunities, training programmes and trade-free zone management established by these companies, thus establishing a transfer of knowledge process. The continent benefits from economic and infrastructural development and skill growth. However, this success has also becomes a threat; the invasion of the deputies.<br>
 
The deputies are rising players from other emerging markets like Indonesia, Russia, Malaysia, South Korea, Brazil and Chile. They bring with them everything that China and India have to offer but with a difference; lower cost, more opportunities for local start-ups and employment. The original emerging players have become global empires and smart innovation, strategic thinking, knowledge provision and the creation of a multinational workforce of brilliant minds and creative personnel, some of them from the local population. They are now large hierarchical organizations with a huge workforce some of whom seek bigger career opportunities or the possibility of starting their own companies through joint-ventures or partnerships. The of the knowledge and expertise they have acquired working with the Chinese companies. Operating in regions with lax laws on IP protection, they present a threat to the new players. It is difficult for the Chinese companies to seek individual assurances of IP protection from the different governments, because of the various local interests involved in bringing some of these companies into the region, to exploit the vast opportunity that abound.<br>
==2010 - 2015==
Rising emissions and environmental pollution become by-results of the torrential economic activity and development, and has caught the attention of the International community. Consumer groups and environmentalists put pressure on International regulators and Western government to clamp down on countries violating emissions compliance. The influence of these groups have increased in the last decade, as there is more awareness and concern over their source and increased clamour for companies to take absolute responsibility for the end-to-end supply chain process. International regulators implement measures to force compliance from these regions from the new Multinationals to local businesses that are and have established business relationships with the developed countries. The policies range from penalties and fines levied on the government aid and donor packages to high tariff and outright ban on products exported from these regions. Though not very effective in the first decade especially on Chinese companies, the threats of IP violation by smaller but fast emerging entities force China to make a re-think and corporate more in environmental control.<br>
[[File:Enviromental pollution.jpg|200px|right]]
The world is still battling to recover from the global recession. Most western economies are battling several financial challenges that are occurring simultaneously; deficits, trade imbalances, rising unemployment, company fold-ups and bail outs. At the same time emerging economies like Brazil, China and India are expanding with previous year growth for China at almost 10%. With the suspected likelihood of a second global recession, developed countries establish new regulations and governments intervene in society to provide bailouts for companies, implement tighter financial regulations to prevent another recession and take greater roles in some private sector areas i.e. health care<br>
As the Eastern powers emerge, western companies begin to consolidate their businesses and , with focus on smaller companies who because of the agility of their operations, have begun exploring opportunities in emerging markets with using smart innovation. Competition is still fierce and many of the companies are resistant to acquisition, breeding more collaborative and joint ventures prospects than straight-out acquisitions.  <br>
The stifling economic climate and saturation experienced in the West fuels the thirst for new , beaming the searchlight on the African continent as the new hub of economic activity. Several discoveries of natural resources have been made on the continent, but there is a lack of the technical expertise and knowledge to refine these resources. This attracts Multinationals and to $73billion in 2007. Thus begins a new wave of
[[File:risk.jpg|150px|left]]
The Major companies begin to explore opportunities in these economies. The smart acquisition and learning environments are engineered by a strong mix of global culture and backgrounds and thus begins the focus on global staff recruitment, used to draw the best of what the world has to offer. Some of the of social platforms and networks promoting open innovation, who have been unable to find outlets to export their ideas and talent because of the struggling economies, where companies are not willing to take risks on untested technology. This is seen as a key platform to drive market-tailored innovation in these markets. Researchers have begun working with organizations to test the feasibility of using Functional brain imaging as a best-fit recruitment tool on a commercial level. <br>
There is a contrasting view to the approach to innovation; the lack of financial assets by western companies means innovation is temporarily taken from a cost effective approach i.e. several research and development centres are moved to emerging economies where wages and set-up costs are cheaper (Oracle and GE in India, Microsoft and Xerox in China). The emerging companies who have the financial wherewithal begin to invest in innovation projects that concentrate not only on price cutting but on strip-down re-modelling processes that produce goods and services that meet the needs of these markets.  The western companies rely on government to raise funds to finance innovation projects as banks are still not loan friendly, and consumers have become spendthrift, with the gradual evolution of society to a saving culture. <br>
 
==2015 - 2020==
[[File:IP 2.jpg|150px|right]]
The application is not effective in developing countries where regulation and rule of law is lax and business continues as normal, encouraged by growing middle class. In the past, big corporations have found it difficult to produce tailored-made products for emerging markets, preferring to transfer their current products and business processes, which offer lower margins than their primary markets. To counter this, the new companies expand on joint ventures set-up, establishing subsidiaries and partnership with local entities, allowing them to manage operations faster and with less bureaucratic challenges. Unconstrained by legacy investments in capital equipment, processes, and technology, the working environment in these markets stimulates innovations that begin to breed profit in the companies. <br>
They revamp their distribution channels to increase accessibility to middle class consumers and re-design every aspect of production, manufacturing, sourcing and delivery to reduce costs. They draw on their multicultural staff pool, and R & D activities are located in close proximity to their client base and suppliers. <br>
[[File:risk management.jpg|200px|left]]
The activities of emerging companies like Bharti Airtel, Tata and Godrej group benefit these economies through employment, increased productivity and a burgeoning middle class. The governments implement strict financial laws to ensure economic sustainability for their country but environmental regulation is still lax. <br>
The new players are expanding into territories where entry rules are less stringent and lax environmental regulations and copyright laws allow for IP violations. Some of these territories bring them into direct competition with the traditional Western corporations becoming a direct threat and competition is becoming stiffer. The and stream line operations, focussing on their core speciality. The survivalist thinking also sees IP as sacred and as a competitive advantage through protectionism. Pressure begins to mount for stronger regulations to be implemented for IP protection for companies round the world and the need for an effective global legal framework. <br>
The expansion drive of the new players across regions involves recruitment of staff of different nationalities and cultural backgrounds, offering the companies a mix of creative talent and skills. They are able to tap into a new pool of cost-cheap knowledge and potential on which they leverage, using their own technical expertise and experience to shorten production cycles and deliver products and services quicker to the consumers. It is a recruitment strategy rapidly advancing in the developed world as part of smart acquisition and as strategic response to the emergence of the . Functional brain imaging as a pivotal part of psychometric testing is being increasingly employed as a recruitment tool. It serves to evaluate brain activity during tough decision making process and is believed to help determine the right minds to employ for different roles and responsibilities undertaken, in any part of the world. Accenture with a quarter of their workforce from India is an example of employing a global workforce. <br>
The advancement in living standards means an increase in life expectancy and a declining work force, reduced spending and decreasing tax revenues. People are becoming more like the Japanese and saving more because the last recession was one too many, causing an erosion of trust in governments. It also gave fuel to the cries from people for the development of sustainable ways of doing business and increased awareness on environmental protection. There is now more concern about where goods and products are manufactured. This breeds a change in the demographic perception of the customer beyond traditional metrics like age, sex, location etc. It has become more about lifestyle, influences and it seems to begin a change to consumer power. <br>
 
==2020 - 2025==
[[File:IP .jpg|250px|right]]
There are 2 new Sheriffs in town; China (the 2nd largest economy) and India (who are on the way to becoming the 3rd largest economy). They have taken the world by storm and have become major economic power brokers. Their corporations rival the Western traditionalists and half of the Fortune 500-listed emerging companies are from both countries alone. They have established themselves on strategic locations around the globe particularly in developing regions like Africa, Asia and South America. The penetration strategy is a bundle of low cost and customized innovation specific to the societal challenges in these operating environments. They do not present pre-conditions to doing business and do not interfere with domestic politics although their actions influence local policy decisions. They bring a lot of technical expertise, knowledge and skills which is acquired overtime by the local workforce through employment opportunities, training programmes and trade-free zone management established by these companies, thus establishing a transfer of knowledge process. The continent benefits from economic and infrastructural development and skill growth. However, the success has also becomes a threat; the invasion of the deputies. <br>
. <br>
The International pressures placed on the governments in developing countries to curb emissions levels and the threat of fines, disruptive tariffs and outright bans on exports leads to local demonstrations supporting the calls. The environmental degradation suffered in these countries has given rise to local demonstrations by environmentalists and consumer groups established through an International network, to raise public awareness on these issues. The old GATT agreement for IP compliance is being reviewed to amend loopholes previously explored by its members. The government is under pressure and begin to design strict local laws for companies to abide by in terms of environmental protection. Countries who are quick to respond are those still dependent on International aid whose with high debt balances with the develop countries. <br>
The International pressures placed on the governments in developing countries to curb emissions levels and the threat of fines, disruptive tariffs and outright bans on exports leads to local demonstrations supporting the calls. The environmental degradation suffered in these countries has given rise to local demonstrations by environmentalists and consumer groups established through an International network, to raise public awareness on these issues. The old GATT agreement for IP compliance is being reviewed to amend loopholes previously explored by its members. The government is under pressure and begin to design strict local laws for companies to abide by in terms of environmental protection. Countries who are quick to respond are those still dependent on International aid whose with high debt balances with the develop countries. <br>


'''2025 2030'''<br>
==2025 - 2030==
Governments from the East and West discuss forming regional organizations and new policies to enforce IP emissions compliance. The seek Western backing to fight IP violators encroaching into their economic territories and the Developed countries want them to apply procedures that promote sustainability and focus more on developing innovative methods of doing business without exploiting natural resources. Local businesses in countries that are yet to cut down on emission levels have had most of their exports either refused entry rates making them unattractive in the selling market. The governments of these countries have been issued huge fines and had selected aid programs withdrawn, except for essentials like education and food. The Chinese and Indian companies are reluctant to fill the funding gaps because of their battle with IP violations, and they need the support of the International community to guarantee their protection.<br>
[[File:octopus.jpg|250px|right]]
Governments from the East and West discuss forming regional organizations and new policies to enforce IP emissions compliance. The seek western support to fight IP violators encroaching into their economic territories and the developed countries want them to apply procedures that promote sustainability and focus more on developing innovative methods of doing business without exploiting natural resources. Local businesses in countries yet to reduce
Governments begin enacting policies to control carbon emission and IP protection with only the strongest of the new deputies surviving under the new policy regime. <br>
The period of consolidation leaves the Western hemisphere with few global empires/big brands that have vertically integrated their operations, empires resulting from acquisitions, mergers and the collapse of non-performing corporations.  They have become financial stable, extremely wealthy with a vast range of assets and can begin to influence issues at the level they used to before the global meltdown. The smart acquisition strategy has left them with an international pool of brilliant minds and untapped ideas through which they can continue to power the innovation drive and expand market share. Towards the end of 2025, an embryonic level of collaboration between these companies on innovation and sustainability slowly begins to occur; there is now a sense of the need for high level partnerships and Government (s) support in areas of tax breaks for companies who re-focus on innovation aggressively and strict implementation of IP policies worldwide to ensure competitive advantage. <br>
 


The regional organizations form a stronger consolidated pressure force for compliance by the concerned governments and companies. The local governments start to give in and enact policies to force carbon emission levels and IP protection, applicable to both local and international businesses. Only the strongest of the new deputies survive under his new policy regime, some through political support and others through a strong financial base that allows them attract some of the smart people in the bigger companies. Their plan is to build a small multitude of brilliant minds that will leverage on the creativity and experience they bring, to someday blindside the large corporations by launching a form of disruptive technology that will not only gain market share, but threaten the existing status quo.
[[Future of Innovation Main Page]]
The period of consolidation leaves the Western hemisphere with few global empires/big brands that have vertically integrated their operations, empires resulting from acquisitions, mergers and the collapse of non-performing corporations.  They have become financial stable, extremely wealthy with a vast range of assets and can begin to influence issues at the level they used to before the global meltdown. The smart acquisition strategy has left them with an international pool of brilliant minds and untapped ideas through which they can begin to power the innovation drive and regain lost market share. Towards the end of 2025, an embryonic level of collaboration between these companies on innovation and sustainability slowly begins to occur; there is now a sense of the need for high level partnerships and Government (s) support in areas of tax breaks for companies who re-focus on innovation aggressively and strict implementation of IP policies worldwide to ensure competitive advantage.
[[Future of Innovation in 2030]]

Latest revision as of 18:15, 10 September 2010

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