Our state and nation’s social problems are nothing new. Thankfully, government, nonprofits and social enterprises have been working to address all manner of public need for years. Their efforts have often been heroic and their scale has been vast. South Carolina now has more than 8,000 organizations committed to the complex societal concerns facing so many of our citizens.
Despite the involvement of so many well-intentioned people and organizations, many issues are getting worse instead of better. Unfortunately, I believe this trend is going to further accelerate, and in a way that will impact your business. Navigating the changes ahead will require an unprecedented sense of organizational purpose and clarity of communication.
Household income has been basically flat for five decades. The gap between rich and poor has increased dramatically since the 1970s. Meanwhile, multi-generational poverty remains unchecked.
There are victories here and there, and businesses are doing what they can through grants, volunteerism and board service. What is about to be hugely relevant is technology’s impact on our state’s population.
Thus far, technological improvements have had the most substantial impact on those at the top of the economic pyramid. Corporations have been able to harness technology to improve efficiencies and their bottom lines. Take automated airport check-in for example. The airline saves money on personnel and bolsters their bottom-line. This change might not be good for the displaced airline’s employee, but it is good for the shareholder. Nevertheless, the impact is not yet far reaching.
More wholesale change is coming. We’re only a few years from vehicles that drive us. What will that mean for the 3.5 million truck drivers in America? Robots will soon be stocking supermarket shelves in addition to checking out our groceries. Diners are using electronic kiosks to place orders at casual dining restaurants. Both blue and white-collar workers will be affected. There is now software drafting legal documents instead of lawyers.
In short order, many low and middle-income jobs are going to be eliminated, and the pace with which these technologies are approaching is quickening. The industrial revolution moved the laborer from the farm to the factory. The knowledge economy moved the worker from the factory to a desk. This time, some believe the next destination will be unemployment.
Former American treasury secretary, Larry Summers, noted that in the 1960s one in 20 men ages 25-54 was unemployed. In ten years, it could be one in seven. So unless you own a Bentley dealership, this is going to impact your business.
Where there is chaos, there is opportunity. I believe that what will emerge is the creative economy.
In this economy, organizations that thrive will have two things in common:
- Purpose: They will have absolute clarity about why they exist and the impact they intend to have on the world around them.
- Positioning: They will be able to communicate clearly and succinctly the unmet need they fulfill and how they do so differently.
These concepts are not new, but they will be more essential than ever. Purpose and positioning demand that businesses assess the core business they are in, how they deliver their product or service, and the degree to which they fulfill an unmet need.
If you are in a commodity business that caters to the middle or lower-income customers, the impact will be more substantial. Evaluating your purpose and positioning will prove key to a sustainable business model. Those who identify and address newly unmet needs will lead the creative economy.
Nonprofits will see the need for their services increase while their donor base declines. This will demand more efficient back-office, service and delivery systems, likely leading to mergers. Increased competition for donors will require more intentional marketing and brand positioning. The best communicators will be the most sustainable organizations. In short, the nonprofits will learn to invest in themselves and behave more like for profit businesses.
While few would say they are eager for such changes, they are coming. Preparing your business earlier can only make the path ahead easier. It is time for each of us to up our game.
This post originally appeared as a column in Columbia Regional Business Report.