38 posts categorized "Industries"

April 09, 2014

Talent: the first step to innovation?

Post WEF LATAMBuilding innovation is one of those hot topics that yield all sorts of discussion about disruptive technology—the cloud, 3-D printing, social media, digital infrastructure, et cetera. But what spurs innovation may come down to something much more basic: talent. And at the World Economic Forum on Latin America  (WEF LATAM) last week, it was clear that participants from this region agree.

Two sessions at WEF LATAM were completely devoted to the topic of talent and it came up often throughout the event, including during the session I participated in, “Innovating for Competiveness.” When the moderator asked a panelist, a minister for information technologies and communications  from Colombia, what three areas he would invest in to build innovation in his country he answered: “Talent, talent, and talent.”

Talent, according to the World Bank, is one of the major challenges to building innovation-driven businesses in the region. There appears to be plenty of entrepreneurship, but of these, very few are innovation-driven—and that’s where the real quality of growth comes from.1 

Many Latin American countries have improved in terms of education over the past decade. Their levels of investment into education and graduation rates are steadily improving.2 But as the President of Costa Rica said in one session on talent, the number of graduates is not so important as what students are graduating in. Are they graduating in engineering, the sciences, the all-important information communications technology fields? And are the institutions that educate students aligned with what job markets really demand? According to The Economist magazine, “Countries with the lowest youth jobless rates have a close relationship between education and work.”3
 
Talent as it relates to innovation also has an impact on competition. For those companies competing for limited talent resources in these markets, having an innovation edge is critical. That’s particularly true with millennials: eighty-nine percent of these in Latin America are strongly influenced by how innovative a company was when deciding if they wanted to work there, says Deloitte’s Millennial Survey. So it’s a virtuous cycle: the right talent creates innovative cultures within a company and, therefore, can attract more of the best talent.

Undoubtedly, when discussing how to build innovation, the conversation needs to be broad and deep. This is especially true when it comes to a region like Latin America that is only just embarking on innovation-driven growth. But talent is a good place to start—and  it may be the only place.

1 Latin American Entrepreneurs: Many Firms but Little Innovation, World Bank Latin American and Caribbean Studies, 2014; 2 Is the Glass Half Empty or Half Full? School Enrollment, Graduation, and Dropout Rates in Latin America, Inter-American Development Bank, 2013; 3 “Youth unemployment: Generation jobless,” 27 April 2013, The Economist.

 


Dttl_garycoleman_56x56 Gary Coleman is Managing Director, Global Industries, of Deloitte Touche Tohmatsu Limited. He is a member of Deloitte’s Global Markets Committee and is the lead partner in Deloitte’s strategic relationship with the World Economic Forum. Follow him on Twitter @gcoleman_gary.

April 07, 2014

Japanese manufacturers focused on high performance

Bzi_gro_glb_ho_1918A few weeks ago, I had the opportunity to return once again to Japan to visit with a number of Deloitte Japan manufacturing clients. One of the many highlights of my trip this month was the opportunity to meet with several manufacturers in Nagoya. Japanese manufacturers have been long admired by many for a relentless focus on continuous improvements to their business. So it is not surprising that during my visit we had rich discussions around best practices of leading manufacturers to sustain top performance.  

During several of these conversations, I referenced a point of view written by my partner Craig Giffi, Deloitte United States (Deloitte LLP) and others entitled, Cracking the genetic code of high-performing manufacturers. Hot off the press, the article provides great insight on the set of game changing capabilities that high performing manufacturers have in areas of brand image, leadership and management, business strategy, research and development, delivery speed, manufacturing processes, and supplier networks.

During my visit with several Deloitte Japan clients in Tokyo, we also had a wide ranging discussion on business models. While many of the best companies in Japan are role models as best practice companies, they are always looking increasingly outside their industry for ideas for business model innovation, as they strive to have the most efficient support structure. In all of my visits, I found a real thirst for insight on what others were doing to drive efficiency and high performance. It is this relentless focus on high performance that allows these companies to be truly viewed as world class.

Japan is a country of many challenges with the aging population and limited natural resources. Yet the best companies are prospering and are increasingly looking to invest where their customers will be in the years ahead. Among the locations of interest are the fast-growing economies across Southeast Asia, which represent very attractive customer markets for many Japanese companies. Japanese manufacturing investments in research and development, manufacturing plants, and to establish sales and distribution operations in these growth markets is expected to continue in the years ahead.


Tim HanleyTim Hanley is the Global Leader of the Manufacturing Industry group of Deloitte Touche Tohmatsu Limited (DTTL). In his global industry leadership role, he directs strategic initiatives and investments to grow Deloitte member firm market share within the manufacturing industry. During his distinguished 35-year career, Hanley has led teams serving all business aspects, including consulting with top management regarding organizational financial strategy development and execution, acquisitions, and market development.

February 24, 2014

Connectivity and innovation underline 2014 for automotive industry

Auto showA few weeks ago I had the opportunity to join thousands of global automotive industry executives in Detroit for the North American International Auto Show 2014. The show continues to be a striking demonstration of the dynamic innovation happening in the sector. Original equipment manufacturers (OEMs) use this event to kick the year off with an outstanding showcase of new vehicle designs, many of which feature innovative technologies to help consumers stay connected. (Read Deloitte views on connected vehicles), What was also striking to see this year was the further integration of advanced materials in some of the new models. (Read more on Advanced Materials Systems trends).

During the auto show, the Deloitte U.S. member firm released the 2014 Global Automotive Consumer Study: Exploring consumers’ mobility choices and transportation decisions, sharing perspective on Generation Y consumer trends. Based on a survey of almost 700 U.S. Gen Y consumers, around 60 percent expect to buy or lease a car within the next three years. Not surprisingly affordability and high operational and maintenance costs had been top reasons preventing ownership. But as explained by graduate school students during the annual Deloitte U.S. Gen Y event, as their purchasing power grows, vehicle ownership is more in reach. (Read the Deloitte U.S. press release).  Please stay tuned over the next several months, as Deloitte member firms worldwide launch the local findings of a broader mobility survey of more than 23,000 consumers across 19 countries.

Like in many other countries, the automotive industry is a vital engine for economic growth in the U.S. Given industry sentiment that 2014 is expected to bring growth in production of new passenger and light commercial vehicles, this certainly is a positive sign for the U.S. economy and local industry.


Tim HanleyTim Hanley is the Global Leader of the Manufacturing Industry group of Deloitte Touche Tohmatsu Limited (DTTL). In his global industry leadership role, he directs strategic initiatives and investments to grow Deloitte member firm market share within the manufacturing industry. During his distinguished 35-year career, Hanley has led teams serving all business aspects, including consulting with top management regarding organizational financial strategy development and execution, acquisitions, and market development.

February 11, 2014

Impact investing: An investment approach starting to interest mainstream investors

This article was co-written with Erik Classon

Blog_tree_money_300x200Since the term, ‘impact investing,’ was first coined in 2009 by the Monitor Group ("Investing for Social & Environmental Impact: A design for catalyzing an emerging industry"), a great deal of interest has grown around this concept. Initially the dialogue around impact investing was concentrated among a niche set of players identifying themselves as impact investors (e.g., social entrepreneurs, foundations seeking to expand beyond grant-making, focused impact investing funds and public sector/supranational organizations). 

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January 22, 2014

Safeguarding aviation and travel value chains

PACI blog imageCorruption is recognized as one of the most significant obstacles to economic and social development. It is identified in the World Economic Forum’s Global Competitiveness Report as one of the top five impediments to doing business in 58 percent of the 144 countries analysed.

Having deep experience and expertise in the subject of corruption, prevention, and working with various industries and companies around the world, Deloitte has partnered with the World Economic Forum and their Partnering Against Corruption Initiative (PACI) as well as the Aviation and Travel Industry to explore the effects of corruption on the constantly growing and continuously expanding reach of the aviation and travel industry. Our experience in this arena, confirmed through our work with various industry sectors and companies during this project reveal the readiness of the aviation and travel industry to take another step in the fight against corruption and to work together towards leveling the global playing field through cross-industry and cross-regional collaboration with appropriate stakeholders.

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December 19, 2013

Manufacturers wait and watch India

Ind_er_glb_ho_785_hiAs you can imagine, India is an interesting place these days. As highlighted by Deloitte’s most recent global and Asia Pacific economic outlooks, the Indian economy has clearly slowed down and the promise for accelerated growth that seemed to be on the horizon a few years ago appears elusive.

There are a variety of potential reasons for the economic slowdown and falling value of the rupee in India. However, based on conversations with senior executives and industry observers during my recent visit to the country, most of the challenge revolves around the country’s inability to establish the reforms needed to attract more foreign direct investments. Many multi-national corporations (MNC’s) have been increasingly cautious about investment in India and most Indian business leaders that I talked with believe that significant reform may not come until after the elections in 2014.

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October 29, 2013

Awakening in the land of the rising sun

TokyoEarlier this month, I had the opportunity to meet with several manufacturing executives and also leaders of the Deloitte Japan manufacturing industry practice. On this return visit, I was very interested to learn more about the current strength of the manufacturing economy in Japan and to get a sense from Deloitte member firm clients on their views of the business landscape in the near term. An awakening was in the air with rising business confidence.

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September 30, 2013

Disruptive innovation: It's now the fast that eat the slow

Blog image fastDisruptive innovation is a subject we hear a lot about these days. But never have I heard its impact on the large versus the small quite so sharply represented as during a panel I recently moderated made up of business executives.

Let me set the stage. All of the panelists had experienced the perspective of the large, multinational enterprise. One panelist is currently serving as COO of a large bank with 40,000 employees. One had worked for large companies but now was the CEO of his own successful tech start-up. Another panelist was the former CEO and president of a multinational pharmaceutical company and is now a partner in a small private equity firm. Similarly, the last panelist had worked in large tech companies but is now a partner with a smaller enterprise.

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September 20, 2013

Growth again in Europe?

Munich 2Over the past several years, the global competitiveness of manufacturing in Europe has been challenged. It certainly has been acknowledged that the ability of European manufacturing economies to compete globally has been weakened both by the challenges in their respective economies, as well as an increasingly strong global competitive landscape.

Amidst these challenges in Europe, global competitors have also been clearly getting stronger, and the bar is rising. For example, in the U.S., the ability to extract shale gas has given the U.S. both a significant and relatively long term energy advantage. This advantage comes both in a secure source of energy through plentiful shale reserves, and also at a very competitive cost. In the emerging markets of Asia, both in the major market of China, as well as in frontier markets such as Thailand and Indonesia, capabilities continue to mature. Based on our recent Global Manufacturing Competitiveness Index, executives view China as the strongest in terms of global manufacturing competitiveness. The frontier markets also have very strong momentum, and are viewed as very important markets in the years ahead.

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September 19, 2013

Holding the banner high: Innovation, value chains, and competitiveness in a new era of global growth

Gary with Mayor of TianjinThe World Economic Forum’s (WEF) Annual Meeting of the New Champions (AMNC, or Summer Davos) in Dalian, China, last week centered on the theme of innovation. With China’s growth no longer in the double digits, innovation and the energy it can bring to the world economy is looming large. Indeed, Chinese Premier Li Keqiang was emphatic in his remarks at the event’s opening plenary: “Innovation is the running theme and spirit of the policies adopted by the Chinese government, and it is the banner that we will always hold high.”

But innovation in a vacuum is meaningless, and Premier Li recognizes this. “We live in a global village” said Li. “No country can live in isolation of others like Robinson Crusoe.” Nowhere is this more true than when it comes to global value chains (GVC). Value chains are now the ties that bind countries together and bring public and private innovation to the world.

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