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Business In The 21St Century Essay Research

Business In The 21St Century Essay, Research Paper 1. Introduction So where do you want to go tomorrow? This is the question business people are asking each other these days. Well, they are right, because not a whole lot of time left before the end of the millennium and the anxiety surrounding this big event is affecting everyone including the business people of today.

Business In The 21St Century Essay, Research Paper

1. Introduction

So where do you want to go tomorrow? This is the question business people are asking each other these days. Well, they are right, because not a whole lot of time left before the end of the millennium and the anxiety surrounding this big event is affecting everyone including the business people of today.

While I was doing my research on this topic, on the question of where we want to be tomorrow in the new millennium, I have come across with many books, many websites, many articles dedicated to this question. With the way technology has changed our lives drastically in the last fifty years, we are anxious and may be even a little worried about what is going to happen in the future to our businesses as well as our lives. It was not long ago that books on the future of business warned of worldwide recessions. Now the news is the wealth of opportunity to be found as emerging nations embrace capitalism and as technology brings the world closer.

Bill Gates, in his new book: Business @ Speed of Thought, which I will often be referring to throughout this paper, suggests that, Business is going to change more in the next ten years than it has in the last fifty. (Bill Gates, p.13) This is quite a strong but nevertheless a true statement, thus he probably named his new book; Business at the Speed of Thought. However, because it is the future we are trying to analyze, we have no data and all the talk and argument is hypothetical. But for the time being, we have to accept the fact that technology is improving in every aspect and in every field on a daily basis at an incredible speed; at the speed of thought.

Since the topic of my paper is about business in the 21st century and how to create the ideal organization of the 21st century, I will explain what I mean by that. Imagine the organization of the future: picture the Firm, a large American enterprise in the year 2050 Sounds like a scene from a futuristic movie, doesn t it? Well, it is 1999 and it is only 51 years ahead of us, the year 2050. Every morning entire families go to the Firm – the children to the school; the parents, to work, and at lunch they all get together at one of the many cafeterias of the Firm. Probably the CEO of the Firm is a woman and there is no single dominating majority group in the Firm unlike the domination of the white male in today s business world, these are people from all over the world taking a part in the success of the Firm. Too imaginary? We will see about that

This scenario is not a utopian dream; it is actually quite a realistic prediction based upon the situation today. So, in this paper, I will try to examine the different aspects and implications of trends that are shaping the way organizations may evolve in the long-term future. During this evolving, many aspects will have to be taken into consideration such as technological, economic, social, and global. The change will not only occur in North America, but all around the world as it has already gained speed. The societies around the globe will face with new versions of old problems, such as population growth, environmental pollution, social distress and so forth. Also, with the economies around the world already having started to widely accept the capitalist movement, in the very near future, there will not be one single country that is run on a different economic system than Capitalism. And of course, this will cause problems such as the gap between rich and poor getting larger and larger. So, this is just an overall picture of what things may be like in the future, and we have to know this in order to examine how the business structure will change in the 21st Century. However, in this paper I will focus on some organizational and technological specifics of this change in the business arena. While doing this, I will use Bill Gates new book along with other sources as reference points.

2. Why is it important to understand the change in business in the 21st Century?

If the 1980s were about quality and the 1990s were about reengineering, then the 2000s will be about velocity. (Bill Gates, p.13) suggests Bill Gates. Organizations must change in order to be effective in the future. This time though, compared to the change in the nature of business in the second half of the 20th Century, the change will be very rapid and in greater volumes. How information access will alter the lifestyles of consumers and their expectations of business are going to be the issues of 21st Century living. The quality improvements and business process improvements will occur far faster. Velocity along with viscosity as we have discussed in chapter 5 of the book Working Knowledge is a very important pair that will play a large role in tomorrow s company. Naturally, when the increase in velocity of business is great enough, the very nature of business changes. (Bill Gates, p.13) However, in order to compete in the business arena, the richness (viscosity) of the information that is being transferred also has to be high in the 21st Century Company, because what enhances velocity may thin the viscosity.

It is a true fact that, the Internet is the fastest growing, explosive market in the world. Bill Gates has stated, “There will be two types of businesses by the year 2000

those that are on the Internet, and those that are out of business.” If you don t know anything on what e-commerce is all about today, and all different kinds of goods and services you can buy over the internet, from an 18th Century oak table to a used Toyota truck, then you may be surprised with this statement of Bill Gates. But, it is true; classical way of doing business is changing and in order to keep up with this change, going on-line seems to be the only solution. With the help of the Net, increasingly in the future, businesses will have the ability to be more responsive, and customers (both business customers and consumers) will expect them to be more responsive. Those who are technologically competitive and responsive will prosper, and those who aren’t will lose out.

More and more, we’ll be expected to use the “information superhighway” for business purposes. Whether by phone, videophone, voice mail, e-mail, Internet teleconference, or satellite uplink, business people will never be out of touch with each other, their clients and the entire world.

In 1998, thousands of businesses failed due to emerging competition on the Internet. One thing we learned from this new competition is that, if you want to remain in business or start a successful new business, you must be on the Information Super Highway. In 1994, less than 1000 businesses marketed their products on the Internet today, there are millions, and it is estimated that a new web site is uploaded to the Internet every five seconds! In addition, the Internet has grown from 2 million users in 1993 to over 75 million today. Experts project that there will be more than 500 million

users by the beginning of the new Millennium.

As we can already see today, television and the Internet are merging and before

long, I am sure that every American will have easy access to the Internet through their TV sets. This historic merger of technology is bringing a revolution in Communications, News, Entertainment, Education, and Business. And, this new technology revolution allows businesses on the Internet to reach consumers in ways never before possible.

These rapid changes taking place in the world of business today are having their

impact on virtually every industry and organization. It is important that every business owner and manager stay abreast of these changes and continue to explore them, learn

about them and evaluate them. Never has there been a greater need for continuous research and learning on the part of business owners, managers and employees. In today’s world, Old dogs must learn new tricks to survive, and young pups must develop an affinity for lifelong learning and adaptation (and a little knowledge of Japanese wouldn’t hurt). Only then businesses can respond to growing demands of their customers in this global communication age.

U.S. Commerce Secretary William Daley stated the importance of this reform in business in a very profound and accurate way; Technology is reshaping this economy and transforming businesses and consumers. This is about more than e-commerce, or e-mail, or e-trades, or e-files. It is about the e in economic opportunity. This is a revolution, a dream coming true. Internet is helping to create Adam Smith s ideal marketplace, in which buyers and sellers can easily find one another without taking much time or spending money.

As the words business and economy are being redefined as a result of these changes, also the organizational infrastructure is taking a new shape too. With the new millennium: management, marketing, human resources, research and development departments of corporations will be taking on new responsibilities. I will address these problems and how the companies will have to reinvent the way they work using digital tools, in the following sections. However, I would like to point out the fact that if this problem is not addressed and if businesses do not take the necessary precautions and steps to adopt these new ways of doing business, it is clear that they will not be able to survive in the 21st Century.

3. The New Rules of the Game

Almost all of the books we have read and studied this semester in class were about change and reform; the change from being the head buffalo to lead goose, the change in shared vision, team learning, change in the way we lead and learn, the change in the way knowledge is transferred and so on. Many of these writings dealt with the problems of evolving markets, and preparing business people for the future. It is true that, In the 21st century, taking care of business means, taking care of your intellectual capital, and the portion of corporate assets defined as intellectual capital has been increasing more than ever. Thus, managing the intellectual capital will be one of the core values of tomorrow s business mentality.

A. Anticipation, Innovation and Excellence

In the book Paradigms: The Business of Discovering the Future, Joel Arthur Baker presents three key principals that should be taken seriously for any organization, that wants to participate in the twenty-first century. These three key principles are: Anticipation, Innovation and Excellence, and without even reading his explanation on each of these principles, I came to realize that many of the readings we have done in class were somewhat parallel to these principles. We discussed how Johnsonville Sausages set a great example of excellence as well as innovation in the work place with the contribution of everyone involved from the line workers to top managers. In the book Fifth Discipline, we learned extensively about the learning organization and how continuous learning is crucial for a company. Also again, in Flight of the Buffalo, we learned about the importance of anticipation and foresight, as when the author talked about how leaders should proact, not react.

Of these three principles however, I agree with Joel Baker on the fact that excellence is at the base of the list. The main reason for this is because 21st Century is going to be the century of excellence, where errors will not be tolerated in the business arena, because it will be the necessary price of entry into any market.

So, in the twenty-first century market place, if an organization does not have all the requirements of excellence statistic process control, continuous improvement, benchmarking, the constant pursuit of excellence, the capability of knowing how to do the right thing the first time, then the organization will not even be able to enter the market. So, it is true to say that Innovation and Anticipation are going to be the determinants that will give organizations the competitive edge.

In the twenty-first century, anticipation which provides the information for the company to be in the right place at the right time, combined with excellent innovative products and services will make it possible for any organization to survive as well as succeed.

B. Six trends that shape the organizations of the future

Furthermore, in the book The Twenty-First Century Organization, the author Guy Benveniste presents the six trends that will shape organizations of the future. These six trends are:

+ The international competition for ideas increasingly obliges firms and governments to become internationally competitive.

+ The persistent demand for access to education to better oneself can imbue the work force with professional ideas.

+ The feminization of the culture of organizations enhances organizations ability to cope with rapid change.

+ New technologies facilitate decentralization.

+ The consequences of rapid change can increasingly result in societal remedies.

+ The successful organization of the future is the one that can reduce the queuing time needed to transform ideas into action.

These six trends form the basis of the image of the future presented in Benveniste s book. It is true that there is a worldwide competition for new ideas and that American management practices are already blending with practices emerging from different cultures. However, the goal is not to reduce the standard of living, while adopting these new managerial ideas and practices. The second trend is the education of the work force. As levels of education rise, professionalism and quality of work life will also increase, and in parallel to this trend, managing this new expert workforce will be a challenge. With the feminization of organizational culture, as women achieve more equal levels of participation in the workplace, their presence will permanently alter some of the basic concepts of today s organization. As a result, today s concepts of careers and personal success will change for women.

Moreover, new technologies-particularly in communication and information will alter the way business is done in a very drastic manner and in very many different aspects. The change will be more than ever in the future as today s computer industry is a very good indication for that, so in the future me may see increased protection of especially organizations human assets. Also, in the future, the description of organization will take a whole new meaning, and the company of the future will need to be far more concerned with clients and far less with corporate protection and survival strategies.

The future is easy to predict, because it is already happening, says William Knoke in his book Bold New World. As we approach the new millennium, the businesses that succeed are the ones using innovative ways to create value for their customers. Thus in the new millennium, the customer will truly be the king.

“The 21st century will be the century of the consumer,” says Roger Blackwell, a professor of marketing at Ohio State University and the author of From Mind to Market: Reinventing the Retail Supply Chain (HarperBusiness). “Marketers will have to push their understanding beyond knowing what people buy to knowing why they buy.”

An analysis of government spending data indicates that some startling changes are already underway. Calculated with 1992 dollars, Americans spent $2.1 billion on computers in 1986, just 0.32 percent of the $614 billion they spent on food and beverages that year. But look ahead to 2006: According to the latest projections from the Bureau of Labor Statistics, computer expenditures will soar to $666 billion 84 percent of the $794 billion Americans will shell out for food and drink.

C. 10 Driving Forces of Change for the Next Century

If you want to beat your competition and gain an edge, Robert B. Tucker, the author of Managing the Future: 10 Driving Forces of Change for the Next Century suggests that companies have to learn what’s driving the change in how winning businesses operate. Some of these driving forces according to him are: real-time responsiveness, user friendliness, the issue of aging Baby Boomers and Generation Xers, mass customization, changing lifestyles, unbundled services, value differentiation, high service, techno-edge, quality perfection. It is true that businesses are trying to eliminate customer waiting, whether in line, on hold, or over time, also companies are rethinking their entire operations to make what they offer more accessible, and user friendly. Moreover, Baby Boomers, who are going to retire during the next two decades and the new Generation Xers, present the issue of reducing and making better use of labor. More sophisticated customers demand more options and have it your way solutions in both products and services, thus mass customization is inevitable. Another issue comes up as already thirteen million Americans are self-employed and work from home, and lifestyles are changing, so the businesses should take this into consideration in the future. Businesses nowadays, are rethinking what services they can eliminate from their lineup as well as lowering technology costs to give the customer a lower price and still make money (e.g. computers for less than $1000). On the other hand, some companies who can not lower their prices must add value to their products and services continuously,

creating excellent customer service, reaching quality perfection and using technology to be always on the competitive edge. Tucker concludes his discussion with the following lines:

The new millennium promises anything but “business as usual.” Company leaders need to proactively change with change, rather than react to change. Innovating and bringing new ideas to life must take place at every level of the organization. Resting on one’s laurels is not an option.

D. 12 Rules of Bill Gates for Succeeding in the Digital Age

Just like Tucker, Bill Gates is also predicting the future of business anything but usual and in his new book, Business at the Speed of Thought, he offers a 12-step program for companies wanting to do business in the next millennium.

For knowledge work:

1. Insist that communication flow through the organization over e-mail so that you can act on news with reflexlike speed.

2. Study sales data online to find patterns and share insights easily. Understand overall trends and personalize service for individual customers.

3. Use PCs for business analysis, and shift knowledge workers into high-level thinking work about products, services, and profitability.

4. Use digital tools to create cross-departmental virtual teams that can share knowledge and build on each other s ideas in real time, worldwide. Use digital systems to capture corporate history for use by anyone.

5. Convert every paper process to a digital process, eliminating administrative bottlenecks and freeing knowledge workers for more important tasks.

For business operations:

6. Use digital tools to eliminate single-task jobs or change them into value-added jobs that use the skills of a knowledge worker.

7. Create a digital feedback loop to improve the efficiency of physical processes and improve the quality of the products and services created. Every employee should be able to easily track all the key metrics.

8. Use digital systems to route customer complaints immediately to the people who can improve a product or service.

9. Use digital communications to redefine the nature of your business and the boundaries around your business. Become larger and more substantial or smaller and more intimate as the customer situation warrants.

For commerce:

10. Trading information for time. Decrease cycle time by using digital transactions with all suppliers and partners, and transform every business process into just-in-time delivery.

11. Use digital delivery of sales and service to eliminate the middleman from customer transactions. If you are a middleman, use digital tools to add value to transactions.

12. Use digital tools to help customers solve problems for themselves, and reserve personal contact to respond to complex, high-value customer needs.

The essence of these 12 rules can be explained in one sentence; use digital tools , and it is true that these rules are important in transforming the companies for the new millennium. His book s premise is: Thanks to technology, the speed of business is accelerating at an ever increasing rate, and to survive, it must develop an infrastructure what Gates calls a digital nervous system that allows for the free movement of information inside a company, and being easily available to everyone throughout the company. Gates writes that The most meaningful way to differentiate your company from your competition is to do an outstanding job with information. How you gather, manage, and use information will determine whether you win or lose.

After reading these 12 steps, I came to realize that there were some overlaps with the materials we read in class as well as some of the other rules I mentioned earlier. This is mainly because the solutions for bettering the future organization is not a secret to anyone. If one were to examine and study the trends and just take a closer look at what is happening at today s business world, one would come to realize these steps, or key elements for success in the 21st Century.

In the chapter Knowledge Transfer of the book Working Knowledge by Thomas Davenport and Laurence Prusak, authors mention the importance of what they call the water cooler talk , the spontaneous meetings of workers at unexpected places; that is the importance of knowledge and information transfer inside the company. Gates talks about the same issue in his second step, and emphasizes the significance of gathering data at every step of the way and in every interaction with the customers. Davenport and Prusak explains this as; In a knowledge-driven economy, talk is real work.

Since the 21st Century businesses are going to be mainly knowledge-driven , talk across the different departments of the company is going to be crucial. Some companies like British Petroleum has already taken some steps towards maintaining information and transferring data across different departments.

The BP Virtual Teamwork videoconferencing system is essentially a tacit knowledge pipeline, a mechanism for linking the people with knowledge to the people who need it. Another use of technology to transfer tacit knowledge can be seen in efforts of several organizations to record the stories and experience of its senior practitioners on video or CD-ROM before they leave the company.

To be part of a network, and to be able to effectively exploit the information that circulates in the network, has become even more valuable than being able to generate new knowledge autonomously. Gates mentions this in his fourth step and gives examples that run from Coca-Cola s ability to download sales from vending machines to Microsoft s own internal practices, such as its reliance on e-mail for company wide communication and conversion of most paper processes to digital ones. Microsoft has reduced the number of paper forms from more than 1000 to a company-wide total of 60 forms.

Most writers on organizations have long realized that to be adaptive and able to respond rapidly, most organizations have to decentralize. This is not a new idea, but with the new technologies it is more possible than ever.

Also the importance of education and highly skilled workers with high IQs is

another factor that Gates keeps in mind in his company s hiring process, and the word Bill clones came out of this.

Furthermore, Gates also sees the importance of a more sophisticated range of customers in the new millennium and reconfirms the significance of the Customer is the king theory and the importance of just-in-time business processes. Overall, Mr. Gates agrees with everyone else on the notion of change; the redefining of business and economy in the next millennium.

4. Conclusion and Final Thoughts

Any time there is change, there is opportunity. So it is paramount that an organization get energized rather than paralyzed says the CEO of General Electric.

To get you organization energized, but not paralyzed; this is the challenge for the manager of the new millennium. It is true that historically speaking at least, people get excited and at the same time worried at the turn of every century. However, this is a unique one, not only because it is the turn of a millennium, but also history of humanity has never seen such advancements in so many fields, as the ones that have occurred this last century.

One thing is sure. The organizations of the next century are going to be very different from the ones which we knew in this one and much of the analysis and research done on this subject will be irrelevant. That leaves the business people of today with very many questions, and core challenges. I have talked about redefining the meaning of Business and Economy throughout this whole paper, and this is the challenge. We have to rethink what an organization is, conceptually, and why it exists, for what and for whom. It seems to me that this is a question and a task for a philosopher more than a researcher, or a business person. However, I believe that the main challenge for the 21st Century organization will be for entire firms to be involved in innovative transitions, while experimenting with new forms of organization.

As I have mentioned at the very beginning of my paper, all the talk and arguments on the future of the organization is hypothetical and based on inquisitive scenarios. These scenarios provide us with insights, but they do not provide facts. Yet, both the analysis and scenarios on this subject should be taken into consideration as we are entering into the new millennium.

In the book, The Organization of the Future, Charles Handy, who is also the author of the book Beyond Certainty, talks about the new science, new language and the new contract. According to his theories, everything will change in the way we do business. However, Bill Gates suggests the importance of what he calls the digital nervous system and how with the help of technology, and of course at this point, we should remind ourselves that Bill Gates is the one who owns a technology and computer giant like Microsoft, and he will be the one to benefit eventually we can increase the velocity of information, which will be the basic element of new way of doing business.

Furthermore, according to an article in USA Today, the defining business trends in the 21st Century will vary;

Eight in 10 opinion leaders (involved in three or more political and social activities in the past year) believe entrepreneurial activity will be the defining business trend in the 21st century. According to Roper Starch for Ernst & Young, 76% say technology is driving the trend, 53% say growth economy/low inflation, 45% say social factors (two-income families, etc.), 33% say globalized economy, 25% say big companies’ inability to innovate, and 22% say government deregulation.

However, whatever will define the business trends of the new millennium, I believe that my original question of where do you want to go tomorrow? will be the main question that every business person must ask themselves, before taking any further steps, or following any new trends. This may be tough for no standard answers will be possible and available. But as long as the organization knows where it wants to be in the future and for whom and for what it exists in the present, the organization will be able to determine its own destiny in the new millennium. After all, as Charles Handy says; we can not reject the future just because it is uncomfortable.

References

1. Barker, Joel Arthur Paradigms: The Business of Discovering the Future. New York: HarperBusiness, 1993.

2. Belasco, James A. and Stayer, Ralph C. Flight of the Buffalo: Soaring to Excellence, Learning to Let Employees Lead. New York: Warner Books, Inc. 1993

3. Benveniste, Guy The Twenty-First Century Organization: Analyzing Current Trends-Imagining the Future. San Francisco: Jossey-Bass Publishers, 1994

4. Davenport, Thomas H. and Prusak, Laurance Working Knowledge: How Organizations Manage What They Know, Boston, Massachusetts: Harvard Business School Press, 1998

5.Farmer, Richard N. Management in the Future. Belmont, California: Wadsworth Publishing Company, Inc., 1967

6. Galbraith, Jay R. and Lawler, Edward E. III and Associates Organizing for the Future: The New Logic for Managing Complex Organizations, San Francisco: Jossey-Bass Publishers, 1993

7. Gates, Bill Business @Speed of Thought. New York: Warner Books, Inc. 1999

8. Hesselbein, Frances and Goldsmith, Marshall and Beckhard, Richard The Organization of the Future, San Francisco: Jossey-Bass Publishers, 1997

9. Jamieson, David and O Mara, Julie Managing Workforce 2000: Gaining the Diversity Advantage, San Francisco: Jossey-Bass Publishers, 1991

10. Keen, Peter G.W. Shaping the Future: Business Design through Information Technology, Boston, Massachusetts: Harvard Business School Press, 1991

11. Senge, Peter M. The Fifth Discipline: The Art & Practice of The Learning Organization, New York: Doubleday, 1994

12. Blackwell, Roger The New Millennium; Century of the Consumer The Wall Street Journal, Dec. 9, 1997

13. Gates, Bill Bill Gates New Rules Time Magazine, March 22, 1999

14. Tucker, Robert B. Change for the Next Century Air Conditioning Contractors of America, Bulletin No. 171, 1996

15. Century of the Entrepreneur, USA Today, Dec. 29, 1998

16. Seiden, Michael J. Emerging Global Markets Call for Major Strategy Shifts by Businesses http://www.jewishaz.com/special/bizfin/global.html

17. http://www.Speed-of-Thought.com

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