This century will be shaped by the human world reaching Peak People, immediately followed by populations beginning to get smaller. The future never turns out as the experts predicted. The problems we will have throughout the rest of this century, and well into the next, will not be ones of over-population but managing shortages of people in human societies across the world. Our economies will find it immensely difficult to change from an outlook of ever-increasing growth to one of shrinkage. However, we are resilient, creative, imaginative, adaptable. We will find ways to make a different future work. We have to.
First Demographic – Shrinkage
This concerns the sting in the tail of Capitalism: under this socio-economic system, people choose to have smaller families. This is currently the demographic of all developed capitalist economies: ageing populations and falling birth-rates, combining to ensure a shortage of suitably qualified, adequately skilled, experienced workers in sufficient numbers to maintain growth in a country’s economy. Attracting, inducting, skilling, training, managing, motivating, rewarding, developing, retaining, promoting and leading enough suitable employees is the business megatrend for the rest of this century . . . and beyond.
Population shrinkage is not something which can be rectified easily, cheaply or quickly. Immigration can ease some shortages. AI and robots will mitigate the problem, not enough to solve it. Women, still busy with the hard work of achieving equality in developed economies, and having distant dreams of it in the developing world, are unlikely to want to go back to being baby machines for the sake of helping the economy. We will have to learn to manage economies which do not have, as their main feature, the aim of untrammelled growth. We will have to start focussing on improving quality, increasing productivity, depth, profundity and other measures which we do not yet use to measure
economic success. We will have to begin to consider the concept of economic maturity.
For Credit the implications are immediate: how and where will you source the Credit Professionals of the future? The profession must be made more attractive, more high-profile and transferrable skills must be emphasised.
Second Demographic – Managing
Generally, management is getting worse. There are, for starters, fewer managers, they are less well-trained and are not supported enough as they start out. The prevailing development model for managers nowadays is Sink or Swim.
New managers are often thrown into a supervisory, team leader or management position because they are either technically able or they have been there longer than others. There is less mentoring and learning from others with experience of the company, of the sector/specialism or, simply, with hard-won experience of good, and bad, management practise.
Organisations are far too stretched and pressured to spend time and money in planned training and development of their managers. And it is beginning to show in major ways around the globe.
In addition, social media has heightened an emphasis on presentation and the surface impression, rather than on depth of experience, competence, achievement, ability, credibility and authenticity. You can fool some of the people – and with a multitude of PowerPoint presentations and an assured social media presence – you can go on pulling the wool over their eyes for a considerable amount of time.
Education, development and training is expensive . . . until you try the alternative.
Credit should focus on the comprehensive training of managers who are both technically and behaviourally outstanding. The recognition that these Credit Managers are outstanding professional managers will help the reputation of the profession, will attract people to train as Credit Managers as a sure route to managerial excellence and will raise the profile of Credit as an integral part of any successful business.
Third Demographic – Geopolitics
The world is not becoming less complex. Increased media for communication has not meant better communication between countries, power blocs, political entities, corporations, companies, organisations, groups, families and individuals. As the speed and ease of communication has increased, and the media have proliferated, the quality, depth value and truthfulness has been compromised.
Globalisation has encountered unexpected problems and there are myriad difficulties involved in trading internationally, offshoring, governance, regulation, competition and trust. War, cyber warfare, nationalist movements and political populism have ensured that movements to Make Wherever Great Again have been on the rise, although cost, incompetence, corruption and poor delivery will give these a short (ish) shelf-life. They are a clear sign that people want competent leaders, able to solve problems and lead decisively.
There is a massive lack of these.
Political leaders are visibly struggling to know what to do and visibly use all their energies for their own political survival. While thus engaged they are failing to lead their countries effectively. Life is likely to become more difficult before it becomes easier. On the plus side, it’s harder than ever, in this brave new world, to be a dictator or authoritarian leader.
The realistic parallels with George Orwell’s 1984 are more clearly visible now than 40 years ago in 1983, or even 20 or 10 years ago. This should worry us. There is a geographical arc of potential conflict, actual conflict and/or political and economic instability running down through Eastern Europe, the Middle East, through the Indian sub-continent and continuing to the Pacific Rim. Shared Service Centres located in or near these areas may be at risk of future disruption of various kinds.
Credit should think carefully about where it locates itself geographically to ensure stability and to be in a position to leverage maximum influence over the responsible stewardship of successful companies which want to perform financially, deliver consistently impressive results, grow their products and services . . . and still be around in 50 years.
Copyright © 2023 Nick Kell – The author adopts a robust approach to any form of copyright infringement and will seek, at their election, appropriate remedies for breach of their copyright including injunctive relief, costs and a public apology.