No Ordinary Disruption:
The Four Global Forces Breaking All the Trends
Richard Dobbs
Our intuition on how the
world works could well be wrong. We are surprised when new competitors burst on
the scene, or businesses protected by large and deep moats find their defenses
easily breached, or vast new markets are conjured from nothing. Trend lines
resemble saw-tooth mountain ridges.
The world not only feels
different. The data tell us it is different. Based on years of research by the
directors of the McKinsey Global Institute, No Ordinary Disruption: The Four
Forces Breaking all the Trends is a timely and important analysis of how we
need to reset our intuition as a result of four forces colliding and
transforming the global economy: the rise of emerging markets, the accelerating
impact of technology on the natural forces of market competition, an aging
world population, and accelerating flows of trade, capital and people.
Our intuitions formed
during a uniquely benign period for the world economy—often termed the Great
Moderation. Asset prices were rising, cost of capital was falling, labour and
resources were abundant, and generation after generation was growing up more
prosperous than their parents.
But the Great Moderation
has gone. The cost of capital may rise. The price of everything from grain to
steel may become more volatile. The world’s labor force could shrink.
Individuals, particularly those with low job skills, are at risk of growing up
poorer than their parents.
What sets No Ordinary
Disruption apart is depth of analysis combined with lively writing informed by
surprising, memorable insights that enable us to quickly grasp the disruptive
forces at work. For evidence of the shift to emerging markets, consider the
startling fact that, by 2025, a single regional city in China—Tianjin—will have
a GDP equal to that of the Sweden, of that, in the decades ahead, half of the
world’s economic growth will come
from 440 cities including
Kumasi in Ghana or Santa Carina in Brazil that most executives today would be
hard-pressed to locate on a map.
What we are now seeing is
no ordinary disruption but the new facts of business life— facts that require
executives and leaders at all levels to reset their operating assumptions and
management intuition.
