For companies to succeed and stay relevant, they need to identify a purpose.
This becomes even more important to those firms with a global presence looking to invest in talent, according to Tim Ryan, vice chairman of PricewaterhouseCoopers, a firm that provides advisory, audit and assurance and other services throughout the U.S. and around the globe.
Ryan spoke about global "megatrends" and the impact of these societal shifts on business to an audience of business and economics students in the Rauch Business Center at Lehigh University in Bethlehem on Thursday.
As society rapidly changes with shifts in population growth, economic power, technology, urbanization and climate change (all identified by PwC as megatrends), companies that avoid paying attention to these issues run the risk of being irrelevant and lacking in purpose, Ryan said. Identifying a sense of purpose bodes well for a company's consumers and employees, he added. These employees will be more engaged and productive as a result.
"If they [companies] are going to win the war for talent, which will be your generation, they should identify their purpose," Ryan said.
The U.S. may not be the top economic power in the coming years, but it will share the global stage with other countries competing for business and should consider collaboration.
"Is the U.S. dead in the shifting of power? No way. We've applied for more patents here than any other country in the world," Ryan said. "To be clear, we are going to have to share that stage."
VALUE OF PUBLIC/PRIVATE PARTNERSHIPS
Public/private partnerships can solve some of these issues going forward, he added.
To study these societal shifts, or megatrends, PwC identified 26 people as future leaders from across the globe to look at these issues and how they will affect the business world decades from now. The firm selected teams to focus on the areas of growth and investment, human capital, business models and relevance.
The four teams met with a broader group of stakeholders to determine where the megatrends were going, Ryan said.
The accelerating rate of urbanization will affect businesses around the world in the next 25 years as about 1.5 billion people will move from rural areas to urban cities, Ryan said. This megatrend will impact everything from the auto manufacturing industry to infrastructure.
The population issue in two different parts of the world poses unique challenges and opportunities for everything from health care to hiring and product innovation as population is exploding in some parts of the world but declining in others, Ryan said.
TECHNOLOGY DRIVES CHANGE
Climate change and resource scarcity are two megatrends, but technological breakthroughs represent the megatrend that probably will have the biggest impact on business, according to Ryan.
"We see the adaptation of technology fundamentally changing the way we do business," Ryan said. "What is new is the pace of change that's affecting business."
Executives and directors in many other companies are studying these megatrends, Ryan said.
As an example, Citigroup is now defining its business strategy on 150 cities with significant critical mass around the globe, he added.
Another firm, Cisco Systems Inc., is building cities of the future that are smart, green and safe.
Ryan said PwC has the privilege of working with thousands of companies, and most are willing to adapt to change.
"Not withstanding all of our challenges, we are more optimistic about growth in our markets," Ryan said. "We will see explosive growth in emerging markets."