Whichever way you measure national productivity, it’s growing at a snail’s pace both in absolute terms and compared to past growth rates. (See Sidebar.) And that’s not a good thing as increases in productivity improve our standard of living. SIDEBAR: Measures of Productivity Labor productivity, the measure most often cited, captures the amount of goods and services produced (output) with the number of hours worked to produce those goods and services. Multi-factor productivity compares output to the amount of combined inputs (labor, capital, energy, materials, and purchased services) used to produce that output. Economists argue this measure better captures the impact of technology advances. Not all experts agree productivity is an issue. Bloomberg blogger and investment expert Barry Ritholtz argues that productivity is higher than we think because our current measures fail to capture innovations in the digital world that have changed how…
Trends That Should Shape Business Model Strategy
In the 1980s I had the privilege of working closely with consultants from McKinsey & Company, strategy partners to many Fortune 1000 firms and global non-profits. McKinsey’s value promise in a nutshell is, “We’ll help you reshape your industry to your advantage.” McKinsey recently released a report on mega-trends that will shape markets. It’s essential reading for leaders of businesses of any size as they evaluate their organization’s business model strategy. In today’s economy, “status quo” is any company’s weakest strategic direction as the world is changing more rapidly and unpredictably. While forecasting the future is impossible, understanding dynamic trends and their implications for your organization’s risks and opportunities is paramount for making solid business model strategy decisions. In McKinsey’s words: “Managers must also gain an understanding of deep external forces and the narrower trends they can unleash. In our experience, if senior…