The Global Trends 2030 report builds on the precedent set by earlier editions of Global Trends in identifying four possible future models of the world out to 2030 – but takes this alternative world futures analysis to a new level. It presents these models with a caveat, by noting that “none of these alternative worlds are inevitable and in reality, the future will probably consist of elements from all the scenarios.”
Based upon what we know about the megatrends and the possible interactions between the megatrends and the game-changers, GT2030 has delineated four archetypal futures. The four posited “worlds” that could present themselves as we move toward 2030 are:
Stalled Engines, the most plausible worst-case scenario, is one in which the risk of interstate conflict rises due to a new “great game” in Asia. Although the National Intelligence Council does not foresee a “full-scale conflagration” along the lines of a world war, this scenario is still a bleak one, with the U.S. and Europe turning inward and no longer interested in global leadership; a euro zone that has unraveled; and a global pandemic and recession causing a retrenchment from globalization.
The substantial number of game-changers and complex interactions among them suggest an endless variety of scenarios. We have sought here to delineate four archetypal futures that represent distinct pathways for future developments out to 2030. In reality, the future probably will consist of elements from all the alternative worlds
– Global Trends 2030, Chapter Three Introduction
Fusion, is a scenario at the other end of the spectrum, representing the most plausible best case scenario. The U.S. and China successfully manage their relationship and together halt spreading conflict in South Asia. GDP accelerates in both developing and advanced economies, and technological innovation mitigates resource constraints.
Gini out of the Bottle is a world of extremes, in which inequalities within and between countries dominate and major powers remain at odds, raising the potential for conflict. Economic growth is far below the Fusion scenario, but not as grim as in Stalled Engines.
In the last scenario, Nonstate World, new and emerging technologies (such as ICTs – information and communication technologies) spur the increased power of non-state actors, including NGOs, multinational businesses, academic institutions and wealthy individuals. In addition, subnational units such as “megacities” flourish. These networks manage to solve some global problems, but security threats, such as the increased access to lethal technologies, pose an increasing challenge.
For industry, this part of the Global Trends 2030 report is where the “rubber meets the road.” Why? While the tectonic shifts and mega trends GT2030 identifies are somewhat predictable and the National Intelligence Council’s game changers and black swans will provide some signposts before they hit with full force, that is not the case with these alternative futures.
Without putting too fine a point on it, for the defense industry attempting to provide the platforms, systems, sensors and weapons it anticipates the military may need in the future, leaders can do little more than watch tectonic shifts, mega trends, game changers and black swans. But they can take action and do something about these alternative worlds. Forward-thinking defense industry leaders can make a thoughtful analysis of which of these alternative worlds will predominate and then devise hedging strategies for their individual companies to adjust their strategy as needed.
Clearly, for defense industry firms that do a substantial amount of international business, this analysis and these hedging strategies are even more imperative. While no one wants war, a defense industry executive whose internal analysis tells him or her that a Stalled Engines scenario is looking more likely must anticipate many nations, especially those in the Asia-Pacific region, will have an increasing – and even urgent – demand for the platforms, systems, sensors and weapons that might be needed should interstate conflict occur.
Conversely, a defense industry executive who sees a Fusion Scenario developing would likely anticipate less demand for high-end platforms, systems, sensors and weapons that might be needed for interstate conflict but might shift R&D dollars toward those platforms, systems, sensors and weapons that help major powers deal with what are sometimes thought of as second-tier threats, illegal immigration, fisheries encroachment, homeland security and the like. And clearly, there is no “one size fits all” solution for individual countries or even regions, but each solution must be tailored to a particular nation’s needs – including what it considers an acceptable level of risk.
On a personal note, during my time in uniform, the Navy was kind enough to select me for a mid-career educational opportunity, a three month stint at MIT’s Sloan Management School’s Program for Senior Executives. As the only military person in the class of 51 (34 of whom were from countries other than the United States) these were precisely the kind of issues this program was designed to help these executives deal with. We were taught ways of developing hedging strategies to help companies – on all the continents represented in our class – stay ahead of the competition.
If we learned one “mantra” at MIT Sloan, it was that our job was not to manage change, but to manage surprise. Our faculty mentors made it clear that if we were unable to manage change our careers would have plateaued long ago and we wouldn’t be there in MIT Sloan’s high-end program. If we were going to help drive our organizations to success (and for my industry colleagues, profitability) we were going to have to manage surprise. And this is precisely what Global Trends 2030 is designed to help us do.
In future posts we will deep dive into these alternative worlds and identify the key themes that drive each of them.