Small Business Labs

Scarcity and Abundance in a World of Atoms and Bits

One of the main themes running through the recently released Intuit 2020 Report is that the next decade will be characterized by scarcity and abundance. 

This sounds contradictory, but it's not. 

Because of the Great Recession, we start the decade with economic abundance.  Manufacturing capacity, logistical capabilities, raw materials, commodities and labor are readily available, and in some cases, in excess supply.

But economic recovery in the developed world, coupled with rapid growth in the developing world, will change this. 

Energy, resource and raw material demand will stretch supply.  Logistics will become more expensive and qualified talent harder to acquire and retain.  Prices for many commodities and physical goods - things made of atoms - will be volatile, and in some cases shortages and supply disruptions will occur. 

At the same time, the next decade will see digitial technology continue to show price/performance improvements.  Digital products and services - things made of bits - will be abundant and, on average, cheaper.   

The growing array of products and services embedded with digitial technology will also see declining prices, performance improvements and increased accessibility.

The dichotomy of scarcity and abundance means the business environment of the next decade will be complex, volatile and uncertain. 

For more on the 20 trends that will shape the next decade, click here for a copy of the Intuit 2020 Report. 

The Intuit 2020 Report - 20 Trends for the Next Decade

The Intuit 2020 Report explores the demographic, social, economic and technology trends that will affect consumers and small businesses, and those who serve them over the next decade.

The report covers 20 key demographic, social, economic and technology trends. 

Much of the work behind this report was done as part of Intuit's annual planning process.  This included creating a 10 year vision for Intuit and its business units.  The trends contained in the report were used as inputs to the visioning process.  Emergent Research (that's us) partnered with Intuit on this project and report. 

Intuit is releasing this report so their customers, partners and others can use this information to inform their strategic thinking and business planning. 

This report is the first in a series of Intuit 2020 research and forecast reports.  Future reports will provide deeper dives and industry specfic outlooks. 

We will be covering the report in more detail over the next couple of weeks. 

Gartner's Hype Cycle for Emerging Technologies

One of my favorite technology trend analysis and forecasting efforts is Gartner's annual Hype Cycle report.  

Gartner analyzes hundreds of technologies and forecasts which will - and will not - enter the mainstream over the next 2-5 years.   

The Gartner chart below summarizes the analysis for 2010. 

 
As you review this chart please keep in mind that Gartner mostly takes an enterprise viewpoint on technology. 

For example, they have public virtual worlds being 5-10 years away from the mainstream.  I agree with this assessment in terms of enterprise use.  But with roughly 1 billion users worldwide (most under the age of 15), many outside of the enterprise segment consider them mainstream. 

If you want more information on the Hype Cycle, Gartner provides an excellent description on their website.  They even have a book on it. 

Newsweek Sold for $1

The Washington Post disclosed they sold Newsweek for $1.  Actually, they sold it for a lot less than $1.  As part of the sale, they agreed to pay $10 million in post acquisition costs and cover employee pension liabilities.

In other words, they paid millions of dollars to get rid of Newsweek. 

Ironically, AOL just paid $40 million (or more) to acquire new media company Tech Crunch.  Such are the fortunes of new versus old media these days. 

We offered to buy Newsweek, but The Washington Post Co. never responded to our bid. 

I think at this point they would have some explaining to do to their shareholders. They left at least $49 on the table by not selling to us.  And we probably wouldn't have been smart enough to get them to pay for employee pensions.   

PWC's 2040 Industry Cluster Forecast

PWC's Top Industry Clusters in 2040 report forecasts which cities will have the largest clusters for 5 industries: pharma, auto assembly, asset management, filmed entertainment and tertiary education.

Industry clusters are place where there is a concentration of companies and services related to a particular industry.  The best know example is the tech industry cluster in Silicon Valley.  

The chart below shows PWC's 2040 forecast of the largest clusters by industry.

 

Clusters are important because they create jobs and economic growth. 

While the PWC analysis focuses on 5 big industries, clusters can be large or small. 

Lafayette, CA, a small San Francisco suburb has created a restaurant cluster called Restaurant Row .  This dining cluster has been very successful in attracting new eating establishments, bringing in diners from outside of the community, and increasing local tax revenues.  

Data and Analytics Help Macy's Go Local

Atlanta Socks, Seattle Hats, Macy's Goes Local from the New York Times covers Macy's efforts to increase sales by offering goods targeted to appeal to local tastes.  

Macy's is able to do this because they've developed the data and analytical systems to understand and serve customers on a store level.  Interesting quote from Macy's CMO on the role of data and analytics highlights this:

"... what makes this attempt at localization — known within the company as My Macy’s — different from running a local department store has been the systematic collection of information."

Another interesting quote is on their efforts to better understanding local customers: "Macy’s requires sales clerks and store managers to examine the local population almost like anthropologists...

According to the article, going local has been very successful for Macy's:

"While many national retailers continue to see sales declines in a sour economy, Macy’s says its first full year of “going local” has helped increase sales significantly and “lifted the entire Macy’s performance,” according to its chairman and chief executive, Terry J. Lundgren."

This article nicely illustrates the enabling role data and analytics are playing in the broader "new localism" trend. 

A Detailed Look at U.S. Self-Employment Data

Self-employment in the United States takes a detailed look at U.S. self-employment data.  The article is from The Monthly Labor Review, a U.S. Bureau of Labor Statistics (BLS) publication.  The article's author is BLS Economist Steve Hipple. 

We're still wading through all the data, but a couple of interesting things jumped out at us:

1.  15.3 million Americans were self-employed in 2009. 

2.  The self-employment for 2009 rate was 10.9%.  This mean 1 out of 9 workers were self-employed.

We'll have more on this report over the next few weeks.