It’s here: The GR Crisitunity of the Century
This blog is all about changing GR. You might ask why. Here is the paradigm we build our content on: We believe that within the next ten years the corporate environment will change more rapidly and fundamentally since the end of the Second World War — and with it the role of GR. We believe that these changes will also fundamentally redefine the role of GR — successful GR functions will thrive in this new environment, those who do not adapt will be sidelined.
Let us explain in more detail.
Change: Political megatrends
If you have the impression the world went crazy lately, you are certainly not the only one. Without going into a lengthy analysis, we recommend to apply a “megatrends” lens to look at recent developments. Three political megatrends stand out:
- The rise of China and the end of the unipolar world order. China is too big to be accommodated in the post-1990 world order. The truly unbelievable rise of China causes ripple effects in almost every part of the economy. For many corporations global growth already depends more or less on China. It also affects the direction in which technology is developing. The cracks in the global IT stack are already visible and might deepen quickly. Tech follows geopolitics, not vice versa (for more details check out this article by Ansgar).
- De-Globalization: Global value chains have shortened considerably over the last years. The reasons are manifold: Anti-trade populist parties gained tractions in many former free trade-champion states; international trade organizations like the WTO are under duress, cross-border data flows are more and more seen as a privacy and national security risk (“data localization”). We expect that this trend of a regionalization of trade patterns will continue, primarily driven by non-tariff trade barriers justified as matters of national security (e.g. Art. XXI GATT). Such NTBs are often very difficult to mitigate.
- Techlash: IT has changed too much too quickly, and often does not take responsibility for the negative externalities — this is a widespread perception of political decision-makers around the globe. It is a far cry from the tech optimism of the late 1990s, which established favorable regulatory environments like the platform liability privilege. If you are a tech company, expect much more intrusive regulation, especially in the EU and the US, and much less patience to wait out if a digital disruption is a net positive or negative.
Building muscle for a “new normal”
Companies need to build muscles to deal with the “new normal” of geopolitical complexity. This creates a “crisitunity” for GR functions. The problem is that the internal demand for geopolitical guidance rose steeply over the last months, while most GR functions struggle to adapt to these new demands. GR functions are often too far away from strategic corporate decision-making processes, engage too late to have impact on such decisions, and spend too much resources on less important, manual tasks.
Our GR Blog is therefore about only one thing: Building a GR muscle that is capable of meeting the new demand for strategic, geopolitical guidance. We are convinced that in order to raise to the challenge, we need to fundamentally rethink what GR is about: How we organize teams, design processes, and employ talent.
If you are interested in a deeper conversation about your specific GR function and how it could be developed — ping us! We might engage bilaterally.