Lessons From the Future

Wolfgang Grulke is a futurist,  author of "Ten Lessons from the Future."  It’s only appropriate that he’s speaking at the Urban Land Institute’s Real Estate Trends Conference, although he’s formerly from IBM, because technology will influence every message he gives this audience.

A dear friend of mine, Chris Cole, sponsored the lunch. I’ve known Chris for over twenty years, through real estate upturns and downturns, and he has always been one of the most intellectually curious men I’ve known in real estate. (He’s introducing Wolfgang Grulke by saying that real estate is 1/3 of the world economy. Of the $6 trillion net worth of America, 40% is in real estate. And more will come as the Baby Boomers age and look for income and value. Real estate as an asset class, he says, is in its infancy.)

Grulke is a citizen of the world who works globally. He says it’s way more important to learn from the future than from experience, because breakthrough innovations always come from left field.

Exploring the future:

Culture will be determined by economics:From the 1970s to now, there have been major changes. In our lives, every step change — birth, growth, death –is a major surprise.  That’s also true about society, and about business. We can never plan for the future. What are the things you DON’T know?

In 1969, we sent a man to the moon without microprocessors. We changed our entire idea of music: Woodstock occurred. Students were no longer docile. Woodstock was a mirror or a nation at war with itsekf. It was the start of individual rights, civil rights, women’s rights, environmental rights, and consumer power. Within the course of 18 months, everything changed, but we only see the change in all those rules in hindsight. That was the start of the culture of the individual. (This has now progressed to YouTube).

The Baby Boomers invented the idea of growth every year. Parents of Baby Boomers wanted one job with a large corporation for life. They were the Silent Generation. The next Generation, Generation X is as different from the Boomers as the Boomers were from the Silent Generation. These generations are not about when you were born, but what kind of economy you were born into.

Kids born into a flat economy will behave the way the Silent Generation did. What behavior they will exhibit will reflect the economic conditions around them.

New Values and New Attitudes come from the economy. There are 25-year-old Baby Boomers in Bangalore, because the economy is booming. The culture of the individual comes from affluence. "Life is short. Play More!"

Generation X has never known a world in which the product is important. The idea that quality is a differentiator is gone forever. This generation isn’t about quality; it’s about spirit.

Technology is everywhere. Changes in technology will take many companies out of business. Survivors of the last period of technology change will miss the next wave. SONY and Phillips, who pioneered the personal radio, missed downloadable music even though SONY had the techn ology before Apple. Retailers will be displaced by downloadable everything. "Eat yourself before someone else eats you."

Connectivity and the ability to communicate with everyone on the planet is becoming a basic human right and is given away for free. By 2020, there will be no TV channels, newspapers, or magazines. There will also be no consumer appliances. Appliances will be replaced by services.

You will no longer need a device to connect with the infrastructure. (No Blackberry or laptop). You will not have a washing machine. A new wardrobe, with a device made of nanotechnology, will take the dirt and grime out of your clothes, and because the clothes are made out of smart fiber they will return to their original shape. This wardrobe will be given away free. You can’t compete.

Handheld computing devices will also go away.An invisible chip will store more than you can read in your lifetime. These devices will be implanted under your skin and connected to your nervous system. "In 2020, when I send you an email messge, you will really get it. The email message goes right to your visible cortex." The cost of the network? Free.

There are already twelve scientists in the UK who are wired up this way and can communicate with each other directly.

"Neither you  nor I will ever feel comfortable with this level of technology, but our children will never know a world without it."

In biotech, we will have better foods, new drugs, new materials, and longer lives. .But advances in genetics are not about biotech at all,  but about information technology. We are now in the Second Information Revolution.

Clothing will not be manufactured, but will be printed out by a 3D printer. Today a printer can do this, but it cots $40,000. By 2015, the cost of this printer will be $40, and by 2020 it will be zero. Even food is being printed now.

Business will be changed completely:  Eat yourself before someone eats you first. In a business cycle, companies start up with a concern for customers. Then, in the second half of the cycle, most of the energy is spent internally. Innovation is always revolutionary, but sustaining innovation is evolutionary.

Successful companies never innovate. They try to maintain the status quo. That’s why the cell phone was not invented by the phone companies. Businesses don’t innovate because they are afraid their existing business will be cannibalized.

You can’t run your business tomorrow with the same people and systems you have today. All products, services, and infrastructure are becoming commoditized because of a boom in technology. Every business plan should assume that things will be cheaper every year.

Automating their economy to stay competitive will mean that China will have an incredible unemployment problem in ten years.

In the future, fewer people will be employed by large corporations than now. One person businesses will dominate, everything becomes fractal, and leadership changes from command to "invite." Anyone can be anyone’s business partner when the world is networked. The differentiators are not products now, but services. Information is more important than your business. Networks are your most important assets. Relationships are the most important assets.

This world is full of new opportunities. Your future will be very different.