21 Sep September 21, 2020 – Wharton’s Flagship Professor Mauro Guillen and Hook Point Brendan Kane
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Mauro F. Guillén – Zandman Prof. of International Management at Wharton School – Read interview highlights here
In a lot of these tragedies, I see opportunities, especially for
entrepreneurs. We are going to turn all these tragedies
into opportunities.
Mauro F. Guillén is one of the most original thinkers at the Wharton School, where he holds the Zandman Professorship in International Management and teaches in its flagship Advanced Management Program and many other courses for executives, MBAs, and undergraduates. An expert on global market trends, he is a sought-after keynote speaker and former Guggenheim and Fulbright Fellow. He combines his training as a sociologist at Yale and as a business economist in his native Spain to methodically identify and quantify the most promising opportunities at the intersection of demographic, economic, and technological developments. His online classes on Coursera have attracted over 100,000 participants from around the world. He has won multiple teaching awards at Wharton, where his presentation on global market trends has become a permanent feature of over fifty executive education programs annually. In his forthcoming book, 2030: How Today’s Biggest Trends Will Collide and Reshape the Future of Everything, which has just hit the WSJ Bestseller List at #5, Prof. Guillen encourages us to consider the dynamic interplay between a range of forces that will converge on a single tipping point, 2030, that will be, for better or worse, the point of no return.
Brendan Kane – Outside-the-box Thinker and Best-Selling Author of One Million Followers
Our definition of a hook point is grabbing attention,
winning that first 3-5 seconds.
Brendan Kane is a business and digital strategist for Fortune 500 corporations, brands, and celebrities. He helps brands find and engage new audiences, which reward relevant content, products, and services with attention and spending. Starting his career at Lakeshore Entertainment, Brendan oversaw all aspects of their interactive media strategy and worked on 16 films that generated a worldwide gross of $685 million. Brendan then went on to build applications, platforms and campaigns for celebrity clients, which have been accessed by more than 50 million people worldwide. He is known for creating an innovative application for Taylor Swift and Rihanna that can automatically turn any Facebook profile into a website in less than 60 seconds. Brendan is most recently known for generating one million followers in over 100 counties in less than 30 days. He then went on to publish the best-selling book One Million Followers, which breaks down how he was able to achieve such a feat. Brandon’s most recent book, Hook Point: How to Stand Out in a 3-Second World, breaks down the most effective strategies to generate new opportunities and scale businesses to ensure that they thrive in the new micro-attention world in which we live.
Highlights from Mauro’s Interview
I agree that we have been successful at addressing some really important problems over the last 20 years or so and the world is becoming a better place. The pandemic, of course, creates huge challenges. As you know, it increased poverty in many countries, including the United States. Unfortunately, we have more children going hungry right now than we did before the pandemic. But I also see in all of these strategies, opportunities, especially for entrepreneurs, to try to figure out how do we address some of these problems. Because surely, there are solutions to them. So I prefer always to put an optimistic, you know, spin on things and we can put in all of these challenges into opportunities.
I think from an economic point of view, which is my area of expertise, we need to figure out how to instill enough confidence in consumers, and also how to get people back to work. I think as those things happen, we’re going to gain confidence and the economy is going to recover more solidly. But I don’t think the recovery is right around the corner yet, I don’t think that the economy will grow back in October or November, unfortunately. I would prefer it to be so, but I think we’re looking more in the first half of 2021. So we’re going through now the final days of this summer of misery, but we’re going to have to go through the autumn and the winter, which hopefully will not be as bad as the last few months have been.
Let’s talk about some of the macro trends mentioned in the book 2030. I begin the book by saying we need to follow the babies, because if you’re trying to forecast the future, especially when it comes to markets and opportunities in markets, one very good way of going about doing that without making mistakes is to see who are the babies being born nowadays, and the ones that are going to be born in the next few years because they’re going to be the consumers of tomorrow. So what we see there is that fewer babies are being born, that’s true, but they will be better educated than previous generations in most parts of the world.
Then, of course, at the same time because we have fewer babies, that means that the population above age 60 is going to become more important. I see that as an opportunity. By 2030, I think it’ll be very important. That consumer group above the age of 60 is going to be the largest consumer group for the first time in American history, and that’s going to change quite a few things. But I see them as an opportunity because that group of people are going to live longer and longer, because our life expectancy is growing. So I’m optimistic about that as well.
Then we have countries who have negative birth rates or birth rates that don’t replace the current population. That number has to be a little bit above two to reproduce or replace the current population, because presumably each child has a father and a mother. So we need a little bit more than two. I don’t know whether you remember when Nixon was president in this country, but that was a long time ago. Since then, that number has been below two in the United States. So our population would have shrunk if it weren’t for immigration. Of course, I realize that there’s a lot of people who don’t believe in immigration, but I think it’s important to remind ourselves that we need some orderly flow of immigration in order to make up for the shortfall. Otherwise, we would have a constantly shrinking population. So I’m not advocating for massive amounts of immigration, but I think it’s important to recognize the role that it plays in balancing things out. But we do need to have babies if we want to replace ourselves, that’s the bottom line.
Then there are countries like Japan which are in a very difficult situation, because they’ve been stagnant for 30 years. Japan is a country that is very competitive in making certain things, but those things no longer command the imagination of the consumer. So they’re very good at making good cars and good electronics products, but they’re not very good at the new industry or the 21st century. So the first thing I would do as Prime Minister of Japan, which I would do almost in any other country is, I would tell citizens, we need to have a conversation about where do we want to be in 10 or 20 years from now because things are not going the way they should go? I think it’s very important to have that conversation. The prime minister who just resigned, apparently because he had some health problems, he tried to change things but there was so much resistance to it. He couldn’t quite implement new policies because somebody will object and there was a lot of opposition. So that’s why I think we need to realize that there’s a lot of change in the world and the only constant is change itself. So we need to have a national conversation about how do we want our society and our economy to change to be more successful.
US spending levels have now for the first time gone over, our debt is greater than the entire size of the economy by every measure. I think it is a reminder that obviously we cannot continue down this path forever. So no matter what happens, we were talking a few minutes ago about the recovery and how quickly it may happen, we all need to do things that will be conducive to an economic recovery, we need to get this economy going again. The national debt has exceeded 100% of our GDP, so it’s about the same size now. If the economy grows, it’ll bring that percentage down automatically, as long as we don’t add any more debt. I think that long term, that’s what we need to do. But first of all, we need to get out of the problem that we find ourselves in now with high unemployment and in the middle of a recession. Sometimes the government needs to step up to the play and spend more money, but also we need the government to step out of the way as the economy recovers and markets and consumers and investors and workers begin again to play the fundamental roles in the economy. So the government should step up to the play, but also step out of the way as the economy weakens.
So first of all, from the observation, raising a larger family is increasingly unusual in this country. But you should have a rule for all of your children to graduate debt-free, no matter what. So I agree that every student right now going to college, before making the decision as to which college to get in, should do a cost-benefit analysis. It doesn’t pay most of the time to take on enormous amounts of debt. I work for a college and I tell my students the same thing. You should look for the best deal, just as if you were a consumer. That best deal may not be necessarily the most prestigious college that charges you an enormous amount of money. Because you can get good education in many colleges in the United States, not just the top 10% or the top 20%. I think that’s a lie, you can get a very good education from many colleges. So go to the one that offers you a good financial deal, so that you can graduate without debt. I think that’s a very good goal.
I don’t completely agree with focusing only on technical degrees. So I think that we need to define technical in a broader sense. Sure, engineering degrees, degrees in science, all of that, I think they’re great. I have two daughters, one of them is majoring in math, and the other is majoring in the humanities. I think also the humanities train you to be a good thinker and to be a good writer, and a lot of companies hire those kinds of people. Now, having said that, this idea is true in one respect, which is that people with a technical degree do tend to get higher wages when they finish college and they get their first job.
I think this time is absolutely an entrepreneurial moment. Because whenever we have big problems, each of those problems can be turned into an opportunity. There’s no question about it. I think this moment in particular where we’re at Crossroads as a country, I think we need people to think outside of the box. So I do admire entrepreneurs and I think we need more of them in this country. For example, with restaurants, just to illustrate this point, there are some entrepreneurs now that are thinking about restaurants as a kitchen that can deliver to people some dishes every day of the week for a subscription. So they’re charging a monthly subscription, and then they’re pre-cooking your meals every day and they send it to your home. Well, that’s a different concept of a restaurant that’s innovative, that plays to what’s going on right now that people are spending more time at home. Yes, we need that kind of transformation. So I think the restaurant business will be different, even if we go back to normal after we have a vaccine.
There was this book by Thomas Friedman titled The World Is Flat. I think the book opened our eyes to the growing reality of globalization, but at the same time, I think it also exaggerated a little bit. The world is still rugged terrain, you have mountains in Georgia. Not everything is flat, like in Iowa. So I think we need to both recognize that there are certainly things in the world that have become flat, meaning that we’re all competing against each other and we’re keenly aware of what’s going on in different parts of the world. But at the same time, we continue to keep our local identities and people continue to live their lives in a locality, not in the global world. So I think the name of the game these days is to try to recognize that there is a balance that we all need to strike between these global forces, but also our local identities, and that they matter a great deal.
I don’t think America is the most racist country on Earth from a global international perspective, saying that actually makes me sad. Because I think racism exists in many parts of the world, unfortunately. I think it is something that prevents us from fully realizing our potential as human beings, both in the case of those who are racist and in the case who are not. I think the mindset that goes integrate system is extremely dangerous, of course. It’s something that we need to address. Now, in United States, I think it’s undeniable, of course, that there are problems that are long standing and it is an issue that has exploded this year for a number of reasons. For one, I recognize that we all have unconscious racial biases, including myself. I try very hard to avoid behaving that way, and I think we all need to make an effort to try to overcome prejudice. So I think for me, the way I would define racism is prejudice. I think prejudice is not the best human quality, so we should try to suppress it as much as we can.
Back to the book 2030, other than babies, there are a few more trends that run through the rest of the chapters. One is emerging markets, China and India, but not only China and India, many others around the world, including those in Africa as well. By the year 2030, the US consumer market won’t be the largest in the world anymore. So we need to adjust to that reality. That doesn’t mean that we’re going to live poorer lives, our standards of living can grow even. But we need to come to terms with that reality. By the way, going back to entrepreneurs, we also need to understand that some of the biggest opportunities in the near future won’t be in the United States but maybe somewhere else in the world.
Then the other thing is, of course, the adoption of technology. Let me just mention one example here. So I argue in the book that we’re going to see a world by the year 2030 in which we’re going to have digital money, not just the money printed by the government, digital currencies and cryptocurrencies. There’s a lot of entrepreneurs in that area, but they are only going to succeed if they are much more than just money. It will also incorporate other features. So those digital tokens should incorporate other features, they should encourage us to behave better to preserve energy. Maybe we can, even in the future vote with a digital token as they do, for example, in Estonia, which is this country in Europe. So in other words, I see a future that is not just about population changes, but it’s also about emerging markets and the middle class in those markets. It’s about the adoption of technology in ways that we can even imagine today.
As far as the actions of China and their military expansion, I wouldn’t use the word scare, but I would use the word vigilant, being vigilant about what China is doing. It’s a very big country and is becoming more powerful, and it is also becoming a technological powerhouse. But they do have a very different political culture than the one that we have. So I think it is a country that we need to monitor or that we need to watch. I think we can continue to have a good relationship with them if we can come to an agreement about the basic aspects of relationship. So rather than scared, I would say I fully recognize that in the years ahead, China’s going to be a very important player. You see, when you and I were born, China was not a player even in the world; nobody was really thinking about China. But now it is a reality, so we need to come to terms with it. But at the same time, we need to shape them and we need to influence them. We want them to become a country that has a positive impact on the world and I think the US is well-positioned to accomplish that. So we need to sit down with them and we need to talk to them, we need to be firm on our principles and what we want to get out of that relationship, but at the same time, I think we need to sit at the table within
Another very important issue is their economic transition, China being this strange communist capitalist society. Because we all thought that the free markets would eventually lead to political reforms in every country in the world, but China seems to be defying that conventional wisdom. So I think once again, we should adopt the old Ronald Reagan Doctrine, trust, but verify. So again, we should be in relationship with China, we should try to influence China to become a better country and a better contributor to world peace. That wouldn’t necessarily I think also mean that incredibly China from a political or a social point of view should also evolve in the same way that it has evolved from an economic point of view. So I think that there’s a role for the US to be constructed in terms of China’s evolution. Unfortunately, the last few months are not very encouraging. But that’s what we want to do longer term, we want to encourage China to evolve in the right direction.
You can visit my website www.MauroGuillen.com. You can Google me and that way you can also find it more easily. By all means, you can also find my email online. I’m on LinkedIn and on Twitter, please follow me, I’d love to hear from you.