Innovation Always Begins with Anticipating the Future

[Mal Fletcher answered interview questions emailed by the newspaper Diaro Economica, Portugal. Exceprts from this material, reprinted below, made up the finished article, by  Antonio Freitas de Sousa, which appeared on April 12, 2013]


As a commentator on social reality, what kind of transformations are currently occurring on the planet?

Social change is occurring on a number of major fronts simultaneously. For example, rapid urbanization is a wave that is here to stay. Already 100 cities in the world are responsible for 30 percent of its economic output and an estimated 90 percent of its innovation. By 2015, most of Africa will be living in cities and by 2030, 5 billion people will be urban-dwellers, including 60 percent of India. Among other things, this will likely boost the energy needs of these and other developing regions by a factor of three or four times.

Diaro Economica

Urbanization brings many benefits, of course - among them, cheaper health care costs because of volumes and better access to collaborative business opportunities. However, when combined with increasing digitization, the urban drive results in social isolation for many people. This will continue to pose challenges for social planners and politicians, especially in terms of building socially cohesive communities in which diverse groups of people feel a common sense of identity.

Another major challenge relates to the relationship between technology and the human being, especially as the sciences of biometrics and robotics will allow us to increasingly invite technology into our bodies. Meanwhile, rapid advances in medical science are allowing people to live longer, which will continue to raise questions about retirement ages and place greater pressure on already strained housing stocks. (The under-30 generation in Europe today has largely given up on ever buying homes of their own. It just doesn't seem to them to be a likely option, as older generations will live longer and hold onto their properties.)

Advances in genetics and debates about assisted death will also raise hugely important ethical questions. In fact, one profession that will do very well out of the next 10-20 years will be that of the trained ethicist!

In all likelihood these changes are not the same around the globe. What changes are taking place in Europe?

The changes I've cited here apply in Europe as much as they do in the USA and Asia. They are common across the developed world.

Of course, the challenges we face take on different emphases in various parts of the world. For example, the problem of water shortages is already beginning to bite in parts of Australia and the developed parts of southern Africa. By 2050, there may be as many as 1 billion people on the planet who have no access to clean water and not all of these people will be in under-developed countries. This is not yet as much of a problem in Europe as a whole.

For its part, Europe is likely to see increasing challenges in relation to social cohesion. The increase in globalization and immigration has given rise to a growing drive for tribalism in many regions. This is not always a bad thing. In the wake of social isolation, people naturally seek those who share their values and outlook, irrespective of their ethnic or racial background.

The internet has done much to provide a sense of 'tribe' for those of us who live in somewhat disjointed and disconnected urban centres. The challenge will be to find ways of turning 'cyber-tribes' into 'real-tribes', with a concrete, physical sense of identity and belonging.

Tribalism can, of course, take a negative form, too. In the French riots of a few years ago and recent events involving football-related violence, we see how racial stereotyping continues to threaten what is at times a fragile social order. This may be brought to the fore by economic difficulty, but economics alone are not the cause.

What do you think about the role of Portugal in Europe?

I won't comment here so much on the economic prospects for Portugal, as I'm not an economist. However, economics does not exist in a vacuum. Despite the way some economists speak, economics is an inexact science, in large part because it is hugely impacted by social factors.

On the social front, I think Portugal has both challenges and major opportunities. I've talked about some of the challenges above. Another one is the fact that the nation continues to lose many of its brightest and best graduates to overseas employment. This 'brain drain' will need to be turned around - and fast.

Thankfully, according to the EU's recent innovation survey, the number of non-Portuguese people studying here at post-graduate level is increasing. Much more needs to be done to attract overseas students - and to hold onto those who train here. Portugal offers a relatively high standard of living and is a very 'liveable' country in terms of natural and civic attractions. For the most part, its citizens seem outgoing and friendly. These are important factors in attracting outside interest. What is needed now is a deliberate, strategic plan to attract outside students and post-graduates.

Do you think that the whole of Southern Europe will need a bailout? Do you think that there really are 'two Europes’ – North and South?

I'm originally from Australia but have lived and worked throughout Europe for the last 18 years. (I was based in Copenhagen for a decade before we moved to London.) To be honest, I think there have always been a number of 'Europes'. I think the architects of European integration failed to take adequate account of this when they planned the Eurozone project.

There is a fundamental difference between structure and culture. You cannot facilitate a viable or lasting structure in any organization (or nation) if you don't first understand the factors - tensions and commonalities - that make up its culture.

The major problems besetting the Euro have arisen, in my view, not as a result of structural difficulties alone - they are as much the outcomes of cultural disparity. Differences in approaches to work, the payment of taxes, the length of vacations and many other issues vary widely across Europe. I suppose the difference is most marked when seen through the prism of the North-South divide, but even within regions there are differences.

What we've seen in the last few years is that no amount of paper - not even Euro-coloured paper - can cover over the cultural cracks. I don't believe the Euro is doomed - I'm more optimistic than that. But there are cultural issues that need to be discussed, openly and with an emphasis on reconciliation, if we're to move forward economically.

What role will entrepreneurship play in this new world?

We're currently in the middle of the fifth great wave of industry-led innovation to hit the world in the past 250 years. Each new wave has come on the back of exciting new general purpose technologies - that is, tools that can be used across a wide spectrum of society at once.

The wave we're in now is built on the word wide web and the internet; it is the digital economy, or the digital revolution. Only time will tell how far this will take us. At present, it takes almost full time research just to keep up with all the major innovations going on in communications technology alone. And we don't yet know how we will utilize some of our other major advances - especially in areas like nanorobotics and bionics.

However, another wave is about to break upon us. It will take effect from the early 2020s and will focus particularly on the life sciences (genetics, bionics etc) and the development of non-carbon fuels. These represent huge areas of opportunity for business leaders and technologists who are willing to do what innovators have always done - to push out from the shore in the pursuit of new oceans. In the proximate future (the next 10-20 years) innovation will become perhaps the key attribute of leadership across many sectors of society - alongside an understanding of ethics.

What will leaders of the future look like? What skills and knowledge will be required to lead?

Innovation will rate highly on the list of 'must-have' qualities for leaders - and the ability to understand and get the best out of other innovators. Another important skill will be the ability to relate the big picture narrative of an enterprise; to tell people not just what a company or organization does, but what it stands for. People increasingly need to know that what they're doing is making a difference beyond the corporate front door. The best incentive is work that matters!

I think the most successful leaders in all fields will be those who can keep asking one important question. What kind of city do I, my workers and my clients want to be living in 10 years from now - and what can I do now to set that in motion?