Buss3500 Lecture 2

Pest: when youre trying to understand macro env, you have to anchor it in a
particular economy etc?
- say rise in aus dollar

global gigatrends:

Climate change:
- If you think about the threats to business, look at elements of climate
change
o Sea levels
Say if you want to go to Mauritius to dive, you better go fast
because in 20 years, it wont be there anymore
There will be climate refugees
Linked to border security
Biggest employer in the UK is NHS, and the biggest private
sector employer in the UK is G4S a private security
company
Running some of the detention centers in Australia
o Weather
Skiing Australia has a plan to redeploy their resources in a
time where in 20 years, there will be not enough snow in
Australia
In UK, theyre starting to grow grapes for wine
Red wine is usually bad in Australia
Have a huge water problem
Shifting to crops like Olives, because its less water
intensive
Plus once they start fracking, there will be a huge
competitor
o Human health
o Migration
o Security
o Species extraction

Energy Depletion
Less money to spend on online shopping
Real medium and long term threat to online growth from
increasing energy prices
But if we continue to burn coal to have affordable energy
prices, we will be in trouble
Goldwater conundrum
Huge economic impacts
Fracking is happening in UK and QLD
Long term energy costs are going up
We are way behind clean energy progress


Power shift rise of the BRICS?
- Brazil, India, Russia, China, States
- There is a demographic time bomb, with the 1 child policy
- Also a health care time bomb, with the level of toxicity in the air
- Also a country that will be badly impacted by climate change
- Chinese govt are mostly scientists and engineer and have huge resources
- It will be interesting to see how it works out

Deomographics I: The genomics Revolution
- Radical improvements in health and lifespan
- Markets as primary allocation mechanism
- Bimodal life expectancy impacts
- E.g. Japan has a huge Dementia problem with their aging population
- But Philippines has a very young population
- Will Ems get old before they get rich?

Demographics II: Urbanization
- 15 OF 15 megacities in Ems
- 60% of the global gdp from cities particularly EM middle weights
- Global population set to top out at 9 billion in 2050
- 600 cities to generate 60% of global growth over next 15 years
- By 2025, most middle class customers in EM cities
- Average household size declining
- These big companies are learning how to do business in overseas markets
and these third world markets

Fiscal cRISIS OF THE sTATE
- THE more advanced, richer countries are broke
- Government liabilities in healthcare and superannuation are going broke
and if there isnt some changes, the government will go bankrupt
- Takeaway is that we can forget about retirement and we should save a lot
- Some emerging markets (EM) are building superannuation systems (E.g.
China)
- More developed countries are moving in the opposite direction

A new long wave?
- Understanding Kondratief Cycles
- Back to Marx the forces and relations of production
- From isolated technologies to ecosystems/socio-tech/complexes/etc.
- The net, digitization, enforced localism, and virtuality, 3D printing, access
over ownership, transhumans

Profitability of selected US industries

5 forces industry analysis Model
- each industry at a given point in time will have a unique makeup of these
5 forces and will have a unique level of attractiveness
- Porter thinks that competition is a bad thing
- Nobody wants more competition as it drives low profits
What are some strategies in order to manipulate the forces to your advantage
-Beyond Porter
- New types of cooperation and competition

Competitive analysis sequence
war gaming and game theory
Difference btween the two