Agribusiness Conference 2017
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1 Agribusiness Conference 2017 Agribusiness Thinking the Future Global Scenarios, Flags and Consumer Leadership CHANTELL ILBURY Independent Scenario
2 The mind of a fox The fox knows many things, the hedgehog one big one Archilochus c.650 BC
3 CONTROL 3 4 UNCERTAINTY CERTAINTY 2 1 ABSENCE OF CONTROL Copyright Chantell Ilbury & Clem Sunter -
4 Globalisation Driving Forces Creating New Normals
5 Globalisation Characteristics Economic power shift Economic interconnectedness Complex trade and investment relationships Greater risk for international economic and financial events Declining barrier to trade 2020 BRICS and Mexico in top 10 largest global economies Leadership Characteristics Strategic thinking and cognitive skills Strong conceptual and contextual thinkers Collaborative Ability to lead diverse teams with no direct authority Think global, act local
6 Digitalisation Characteristics By 2020 an entire generation would have grown up primarily in a digital world Generation Y s social skills are developed through social media rather than direct interpersonal connections Technology is shifting the balance of power away from organisations and their leaders and towards the consumer Social media is eroding the boundaries between private and professional life Together with technological conversion it will enhance disruptive innovation Leadership Characteristics The ability to embrace creativity, curiosity and open minds Agility through social media Integrity and digital wisdom Agility Content creators The real impact of choice Power shift to consumer-driven business models
7 Individualisation Characteristics Corporate power shifts to individual power Increasing middle-class leads to increasing wealth Increasing knowledge/education Diversified needs, choice and tailor-made offerings Lifestyle and technology shifts Leadership Characteristics Boss, mediator and coach Loyalty and retention Need to build relationships with flexible rules within a structured format Relinquish own power in favour of collaborative approaches Talent appreciation and development Empowered consumer Building identity Driving authenticity Looking for accountability
8 Technological Conversion Characteristics Advances through biotechnology and nanotechnology Disruptive innovation Smartphone becomes smarter Leadership Characteristics Companies will need to adapt to survive Need to understand converging markets Value-add more of a priority Visionary ideas and investment in R&D Producing new products in new ways Consumers looking for convenience/efficiency Looking for novelty Expectations of innovation
9 Globalisation Rising Global Flags
10 Rising Global Flags The Religious Flag - red Prospects for the Middle East increasingly troubling Tension between Russia and US in Syria Historic rivalry Sunni (e.g. Saudi Arabia) vs Shia (e.g. Iran) Religious fundamentalism The Red Flag of Russia and China - red This has changed risk profile for US and Europe Russia s formidable nuclear arsenal poses existential threat China s interest in South China Sea increasing global tensions Trump threatening sanctions on Chinese imports The Grey flag - orange Ageing populations Dragging economies of Europe and Japan China feeling drag because of former one-child policy India and Africa offer hope
11 Rising Global Flags The anti-establishment flag - red/green Lower- and Middle-class restless about growing income gap with super-rich Driving disruption of economic and political status quo Big business is not safe Penalties for non-compliance with own governance codes likely to get higher More emphasis on better internal auditing and risk management processes The Green Flag - orange Climate change is a reality and its effects are wide spread: Increasing temperatures - fresh water conservation and water management to become critical disciplines for farmers, municipalities and companies Rising sea levels - dramatic consequences for coastal urban areas Increased frequency of extreme weather events - driven by heating of oceans Increased human migration - especially of those relying on subsistence agriculture The Porous Border Flag - orange Linked to Green Flag - human migration Will encourage (illegal) migration from developing countries to those that offer to close the income gap Food, energy and water will drive migration of people Increase in refugees and associated instability
12 Global Scenarios ONE WORLD Hard Times New Balls Please 5% U (2020) V (2017) 8-10% Forked Lightning Ultraviolet UV DIVIDED WORLD Copyright Chantell Ilbury & Clem Sunter -
13 Globalisation Rising South African Flags
14 Rising South African Flags The Geopolitical Flag - red Wide-scale governance failure Will impact country s global competitiveness Levels of trust between government and business Capacity to deliver a cohesive NDP The Social Flag - red Student protests and ability of government to deliver on expectations Simmering social and political instability Trade and labour strike action never far away Shifting skills demand The Economic Flag - red Credit rating adjustment Innovation is key Infrastructure, especially electricity and water
15 Rising South African Flags The Environmental Flag - orange Will fly high as long as drought and water restrictions in place Food security will become an issue Energy mix is a question - especially reliance on coal The Technology Flag - orange Cyberthreats Disruptive technologies and impact on traditional labourintensive operations Where is South Africa on the technology curve?
16 South African Scenarios COMPETITIVENESS POSITIVE X Premier League INTERNAL CONFLICT Relegation Zone INTERNAL HARMONY Failed State 2nd Division COMPETITIVENESS NEGATIVE Copyright Chantell Ilbury & Clem Sunter -
17 Scenarios for the SA Food Chain through the Lens of Climate Change
18
19 Current Position
20 Thank you and may the be with you
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