Looking Forward 2017
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1 CHICAGO, IL Suite East Wacker Drive Chicago, IL Telephone: WASHINGTON, DC Suite I Street, NW Washington, DC Telephone: ONLINE Looking Forward 2017 An Environmental Scanning Presentation and Discussion for the Association of Boards of Certification January 2017
2 Contents Overview of Influences on the Business Environment... 3 Macro Business Influences on the Member Environment... 3 Impact of Business Environment... 7 Conclusion... 8 ABC Discussion Worksheet... 9 Overview of Association Environmental Scanning Project About Association Laboratory Principal Authors Association Laboratory Inc Page 2
3 Overview of Influences on the Business Environment Macro Business Influences on the Member Environment What Is the Internet of Everything (IoE)? According to IoT News 1, disruptive technologies of tomorrow usually lack widely accepted definitions and are often invented by individual entities not necessarily responsible for formulating and enforcing industry standards that govern the technology evolution. Expanding on this concept, IoT News explains that the term Internet of Things, coined by British entrepreneur Kevin Ashton in 1999, is often now largely overlapped, confused and even mystified with the term Internet of Everything (IoE). The IoE is comprised of four key elements including all sorts of connections imaginable: People: Considered as end-nodes connected across the internet to share information and activities. Examples include social networks, health and fitness sensors, among others. Things: Physical sensors, devices, actuators and other items generating data or receiving information from other sources. Examples include smart thermostats and gadgets. Data: Raw data analyzed and processed into useful information to enable intelligent decisions and control mechanisms. Examples include temperature logs converted into an average number of high-temperature hours per day to evaluate room cooling requirements. Processes: Leveraging connectivity among data, things and people to add value. Examples include the use of smart fitness devices and social networks to advertise relevant healthcare offerings to prospective customers. Association Laboratory, using this definition, explored whether or not a particular aspect of this ecosystem had more or less impact on individuals and companies in more than 20 business sectors. By understanding which aspects of the future environment have the most significant near term impact, leaders can prioritize their technology, workforce and operational investments to take advantage of or mitigate the risks involved with change inherent in the future environment. 1 Association Laboratory Inc Page 3
4 In addition, Association Laboratory added to this study, a test of high profile macro environmental factors considered to have the capability for industry or profession wide disruption over the next three years. These included the following. Virtual or augmented reality 3D printing Alternative forms of financing, such as bitcoin The following graph identifies respondent perceptions of the impact of each of these macro factor over the next three years on their membership. MACRO FACTOR IMPACT ON MEMBERS' ENVIRONMENT Processes Connecting Data, People and Physical Things Data Transformed into Useful Information to Enable Decisions 68% 66% Artificial Intelligence Machine-to-Machine Communication 52% 49% 3D Printing Virtual or Augmented Reality Alternative Banking or Financing 31% 36% 42% The following chart provides more detail into respondents opinions regarding macro factors impacting professionals across sectors. 10% 7% 19% 22% 35% 40% 31% 28% 18% 26% 30% 20% D A T A P R O C E S S E S M - M C O M M. I M P A C T O F M A C R O F A C T O R S Significant impact Some impact Minimal impact No impact 24% 25% 21% 30% 30% 12% 3 D P R I N T I N G 40% 25% 33% 26% 11% 28% 38% 6% 10% 14% A L T. F I N A N C E VR AI Association Laboratory concludes that while technologies that are consumer oriented and predominantly visual such as virtual reality are popular in media reports, it is the underlying data and the processes that transform this data into useful insights that are going to have more impact on operational and professional environments over the next three years. Association Laboratory Inc Page 4
5 3D Printing Respondent who identified 3D printing as having a significant impact were asked to identify the area in which this technology will have the most impact. IMPACT OF 3D PRINTING Product research, design, prototyping or development 67% Manufacturing or production 49% Customer use and experience Distribution or dissemination of products/services 21% 24% Service or maintenance Sales or marketing 15% 14% The following quotes highlight examples of how 3D printing might influence various industries and professions. 3D music instruments will affect the profit and productivity of a company. Making a 3D musical instrument play and sound like a real one could and is changing the industry and our members. Traditional metal casting processes can be replaced with additive technologies in some circumstances and can replace the need for traditional tooling manufacturing Some of my members are toy and game manufacturers. They will use 3D printing for prototyping allowing them to bring new products to market faster, with less expense. Most of our affiliates build cabinets for schools and hospitals. The ability to use 3D printing to provide a mock-up could be huge, saving them material and labor expenses, while simultaneously providing architectural firms with a visual representation of what cabinetry would look like in particular projects. Association Laboratory Inc Page 5
6 Virtual or Augmented Reality Respondents who identified virtual or augmented reality as having significant impact were asked to identify in which area this technology will have the most impact. IMPACT OF VIRTUAL OR AUGMENTED REALITY Communication or presentations 56% Meetings and face to face activity Decision making via simulations Product research, design, prototyping or development 34% 37% 36% Workforce training and development 30% Retail or product sales or the customer/user experience 25% Virtual/remote workforce recruitment or management 22% The following highlights some examples of how virtual or augmented reality might influence various industries and professions. In trade events, augmented reality would allow for more materials to be presented with less physical booth space required and in presentations, linked resources and expanded materials can be available to the attendee during and post presentation. The ability to care for and communicate with patients all over the world without direct access to caregivers. Enabling one to see how proposed design or equipment changes will look and feel is a big benefit of augmented reality. Our members apply the science of psychology to the workplace. The use of augmented reality in training and development could impact the talent needs of organizations, which would result in our members having to address new challenges in their work in the talent management, performance management, selection and assessment, and coaching spaces. Association Laboratory Inc Page 6
7 Impact of Business Environment Looking Forward investigated 57 different potential business environmental factors influencing organizations and professionals. Factors were linked to five key domains identified through qualitative research: Economy, Technology, Workforce, and Government and Global Activity. Unsurprisingly, following a Presidential Election, respondents were concerned about the impact of new policy leaders at the state and federal level, identifying substantial changes in relevant laws or regulations (48%) and corresponding increases in regulatory or compliance costs (41%). Related to this was underlying concern about the economy. In addition workforce issues, specifically challenges identifying recruiting or retaining qualified staff and technology issues, specifically investing in technology infrastructure rounded out the top 5 most significant factors. The business environmental factors with the most impact and selected by at least 30% of respondents in 2017 are shown in the chart below. FACTORS WITH THE MOST SIGNIFICANT IMPACT ON MEMBERS Changes in laws or regulations ID, recruiting or retaining qualified staff Investing in technology infrastructure Uncertainty about the US/Non US economy Increased regulatory or compliance costs Data analytics and capture/use of information Managing a multi-generational workforce Ensuring the privacy and security of data Changing scope of profession Reduced govt spending or investment Changing international policies or regulations Building strategic relationships with other organizations Managing digital or mobile communication and content Education in new technologies Changing market access regulations, or taxation laws 48% 47% 42% 41% 41% 39% 38% 36% 35% 34% 32% 32% 31% 31% 30% There was no substantial differences among respondent groups not readily explained by the makeup of the sample. Association Laboratory Inc Page 7
8 Conclusion Steve Rivkin, noted author, consultant and speaker once said, The more unpredictable the world becomes, the more we rely on predictions. We see this every day in the industries and professions Association Laboratory serves. A growing focus on environmental scanning techniques and the use of data analytics to help us understand the world within which we, our organizations and stakeholders will need to operate successfully. Association Laboratory s goal? Minimize our risk and take advantage of our opportunities. Unfortunately, we often discover that our best predictions, backed by the best data and most experienced experts fail to predict the future we re destined to inhabit. The result? We spend too much time adjusting to our inability to understand fast enough, how the world will impact our lives and we waste time, money and energy attempting to catch up. In 2016, the Harvard Business Review published a study of 30,000 publically listed companies over a 40 year span that identified a striking conclusion. Companies are dying at a faster rate than ever before. The reasons, according to the research? Organizations are dying younger because they are failing to adapt to the growing complexity of their environment. 2 Looking Forward 2017 provides leaders with the most up to date information on what environmental factors are most significant across sectors. If we are to avoid the risks and take advantage of the opportunities, we ll need to use this and other information to improve our understanding of the future and mitigate the risk to our organizations and their staff. A difficult, but necessary priority. To conclude, perhaps a character in the book The Betelgeuse Incident, written by noted Indonesian author Toba Beta, sums up the concepts of threats and opportunities more eloquently. Risk means shit happens or good luck 2 The Biology of Corporate Survival, Harvard Business Review Jan/Feb 2016 Association Laboratory Inc Page 8
9 ABC Discussion Worksheet Instructions This worksheet is designed to help you organize your thoughts and ideas before discussing your views with your colleagues. Do not complete all the questions since your response will be based on the small group discussions and decisions. First, based on the presentation and your personal experiences, quickly identify the most important force impacting the water and waste water industry. There is a place at the end to add in an additional issue. Second, once you have selected your issue, compare with your colleagues to identify the 3 issues you believe are most critical. Description of Issue Substantial changes in relevant laws or regulations. Difficulty identifying, recruiting or retaining qualified staff. Investing in technology infrastructure (hardware, software, networks, etc.). Uncertainty about the US economy. Increased regulatory or compliance costs. Data analytics and the capture and use of information. Managing a multigenerational workforce. Ensuring the privacy and security of data. Changing scope of professional practice requiring new competencies. Reduced government spending or investment. Changing international policies or regulations. Building strategic relationships with other organizations in the industry. Managing digital or mobile communication and content. Education in new technologies to improve personal or organization performance. Changing international market access regulations or taxation laws. Other: [Insert] Select 1 Issue Why is this an issue? Association Laboratory Inc Page 9
10 Overview of Association Environmental Scanning Project Looking Forward is the nation s longest running and most comprehensive environmental scan of the association sector. Incorporating information from hundreds of association leaders representing dozens of industries, and thousands of individual members and member companies, the study provides leaders with unparalleled insight into the future business environment. To obtain data for Looking Forward 2017, Association Laboratory reviewed historical Looking Forward environmental scanning research, led two online bulletin boards of trade and professional association leaders and conducted a global online survey targeting association CEOS and senior executives from multiple business sectors. Participants identified the trends of most concern across a range of topics from the perspective of their association s members. Initially, respondents assess Macro Factors. Macro Factors are identified as having substantial impact regardless of industry or professional sector and relevant to the underlying forces impacting the business environment in its entirety Since Macro Factors are hypothesized to change slowly over time, respondents were asked to identify the level of impact over the next three years. In addition, previous environmental scans and primary qualitative research identified five distinct grouping within the business environment. The following summarizes each of these groupings. Economic Factors identified as having substantial impact on the industry and professional structure of association members. Technology Factors identified as having substantial impact on the technology underpinning industry and professional activity. Workforce Factors identified as having substantial impact on the movement, use and competencies of individuals. Government Factors identified as having substantial impact on the impact of and relationship between association members and local, state and federal governments. Global Factors identified as having substantial impact on relationship between individuals, companies and governments across international boundaries. The presentation and participant discussion is based on the top line overview from this study. Association Laboratory Inc Page 10
11 About Association Laboratory Principal Authors Looking Forward 2017 Principal Authors Dean West, FASAE, President Carol Wolinsky, Vice President of Research Joe Bates, Vice President of Research Main Line: Chicago, Illinois Dean West is a futurist who has been conducting environmental scanning within the association community for nearly 20 years. He is Fellow of the American Society of Association Executives and a former association CEO. He has served as Chairman of the ASAE Professional Development Council and as a member of the ASAE Membership Council. He is also a former member of the Board of Directors of the Association Forum of Chicagoland. cwolinsky@associationlaboratory.com Main Line: Washington, DC Carol Wolinsky is an award-winning senior executive researcher with more than 25 years experience leading integrated research projects for corporations and trade and professional associations. jbates@associationlaboratory.com Main Line: Washington, DC Joe Bates has more than 25 years of experience leading corporate and association research projects. He has special expertise in data analytics and global research. Association Laboratory helps association leaders make better strategic business decisions through collaborative engagements led by experienced executives and informed by state of the art research designed to achieve measureable outcomes. The company serves a client base of leading state, national and global professional and trade associations through offices in Chicago, IL and Washington, DC. Association Laboratory provides integrated strategy in membership, education, meetings and provides strategic planning; all informed by qualitative/quantitative research. You work with recognized industry leaders. Association executives and researchers with decades of practical experience in association domains including continuing education, publications, meetings and membership. This provides you with real world insights and ideas. Practical insights mean workable solutions. Your engagement is designed around you and your desired goals so that the learning from the research and strategy discussions resides in your association. By developing informed, consensus-driven decisions, we ensure that you and your leadership move forward together. Association Laboratory Inc Page 11
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