Top Business Trends for 2016
Each January we ask Wharton faculty to share a glimpse of what’s on the horizon for the new year. Their takes on leadership, careers, and marketing are insightful — and surprising.
Leadership: A need for strong leaders in the C-suite and the board room
Volatile, unpredictable, complex: today’s whitewater business environment puts leadership at a premium. Companies need leaders who can make “good and timely decisions,” says Wharton management professor Michael Useem. The academic director of The Leadership Journey: Reinvigorate Your Leadership explains, “When uncertainty and change are very much in the air, the key decisions of company managers have greatest impact — for better or for worse — as management experience and university research both confirm. Given the increasing uncertainty and change in virtually all major markets, now is a good time to strengthen management capacities for decision-making. Growing political uncertainty in China, Western Europe, the U.S., and elsewhere is sure to add to that leadership imperative.”
That imperative, says Useem, also extends to the board room. Citing a recent Wall Street Journal headline regarding the merger of two of America’s largest chemical companies, “Dow, DuPont Deal Cements Activists’ Rise,” he says, “With the growing support of institutional investors, activist investors have been prodding publicly-traded directors to streamline operations, change strategies, replace executives and, in this case both merge — forming the country’s largest chemical company — and divide — once together, the new DowDupont combine will be broken into three new companies.” Useem, who directs Boards that Lead: Corporate Governance that Builds Value, calls on directors to act pre-emptively and proactively. “Now is a good time for directors to step back, think like activist investors, and then step forward to actively lead the company in partnership with the executive team before investors and analysts press for it.”
Careers: Finding meaning in work
Wharton professor G. Richard Shell, author of Springboard: Launching Your Personal Search for Success and chair of Wharton’s Legal Studies and Business Ethics Department, sees 2016 as a time when professionals will accelerate their search for deeper purpose in their daily work. "In times of financial crisis," he says, "it is enough to have a job and be grateful for it. But as the labor market opens up and professional options become available, there are increasing pressures on employers to provide opportunities for meaningful personal growth as part of the employment contract. This can take many forms, from helping employees to understand the good their product or service delivers to the larger world and rewarding employees who serve their communities, to providing the training it takes for people to learn and grow on a personal level."
Shell notes that he sees this drive toward more meaning in the work experience at every age level in business. "Our MBA students founded an organization in 2013 called Purpose, Passion, and Principles (P3 for short) that facilitates a 9-week peer program of small-group discussions on family, identity, happiness, work, and long-term goals," he says. From 60 students in its first year, P3 now serves over 400 Wharton MBAs, many of whom have carried the program beyond Wharton to their first jobs after school. "I am seeing the same trend in our Advanced Management Program in Wharton Executive Education," says Shell, "only the participants are 45-50 years-old instead of 25-30."
He leads AMP executives in an exercise that asks them to look 15 years into the future to envision their legacies. Commitment to this exercise has intensified in recent years, Shell notes, as senior leaders consider the meaning and purpose in both their own work and in the work of the organizations they lead. The comments they leave behind say it all: "A cornerstone...The lighthouse effect of this part of the program will remain for a long time to come!" said one 2015 AMP participant. "Incredibly powerful," stated another. "In 2016," concludes Shell, "I expect more and more executives to make the workplace a platform for making positive differences in the world."
Marketing: Rethinking Tradition
Wharton marketing professor David Bell, author of Location is (Still) Everything: The Surprising Influence of the Real World on How We Search, Shop, and Sell in the Virtual One, says 2016 will bring a greater need to rethink and innovate around current marketing strategies (hint: even billboard advertising is still relevant).
“Bricks and mortar are still there,” says Bell, “but they’re being used in new ways, to create fresh new experiences. Smaller pop-up shops are giving shoppers an exciting encounter with products, and there is the opportunity for retailers to further build out that experience through social platforms. It’s a more creative use of the physical space, and it presents opportunities to get much more mileage out of the square footage.”
Bell says the need to remove friction between thinking about and making a purchase will continue, as companies innovate around ease of payment. There are mobile payment options, including Apple Pay, Google Wallet, and Android Pay. Amazon’s internet-enabled Dash, Tide, Hefty bag, and Bounty buttons allow you to reorder frequently-used household items from anywhere in your home. When you are running low on detergent, just press the Tide button on your washing machine and it will be delivered to you.”
Bell’s final trend is one he describes as unexpected. “With the proliferation of mobile and social platforms, the new creative uses for traditional media are really interesting.” Snapchat’s recent yellow billboards with its ghostly logo in white are in New York, Seattle, and San Francisco. The old-school signs are getting plenty of attention, leading directly into the digital space as passersby take pictures of and Tweet about the billboards.
Another tradition-with-a-twist example is the traditional TV advertising being done by new online retailer jet.com. Bell says the “hottest e-commerce startup,” with a current value of over a billion-and-a-half dollars, is on television just months after its launch — compared to the 18 years it took Amazon to run a commercial. While the ads are only one part of their marketing strategy (an online video series depicting consumers’ carts at checkout is also popular), it’s an interesting move by a company seeking to revolutionize e-commerce.