Around 2000BC the Babylonians developed a highly sophisticated commercial society, complete with a monetary and credit system; and ever since, humans have shown that they are hard-wired for business. So it is a fair bet that business will still be around in 2100. But what will it look like?
“It will still be business, but it’s a question of what products and services will predominate in it," says
Over the past 50 years, says Ruthven, the developed economies have been transformed by businesses springing up to provide more and more of the products and services that households used to do for themselves.
“That has led to tremendous growth in the economy being devoted to services rather than goods. $300 billion of services each year are now supplied by businesses that used to be done in the home in the 1960s."
This domestic outsourcing trend was already under way when the internet arrived, says Ruthven, but the worldwide web has been a “massive enabler" for business. “We didn’t really have the internet until 1993, and for the majority of the population, full access to it did not arrive until this century.
“But it has had two major effects on business: clearly it is a tool for marketing and reaching the customer quicker and better and more effectively. What has been truly dramatic is that starting up a business in the services area has become much easier – you don’t need as much capital, and once you’ve started a business, you don’t need to spend as much money on marketing. It has totally changed the concept of business."
This outsourcing has not just been done in the domestic sphere.
“Corporations are like households, they’ve been outsourcing everything they can," says Ruthven. “They’ve got rid of about $550 billion worth of things they used to do themselves. Manufacturers don’t run their own trucks – they give it to Linfox or Toll or somebody. They don’t run their own computer networks or canteens. The economy is increasingly a services economy, and that will continue," he says.
“We have seen the impact of technology on the way we do business, just as every human age has, and different kinds of businesses come out of that."
It has been “amazing and extraordinary" to see how people have used the technology platforms to create new forms of retailing, for example, says Oliver. “Talented people have just become so empowered, in a great many different fields, and I see that continuing, with fundamental implications for businesses.
“I certainly don’t think everything will be done at home: I do think the individual will have multiple workplaces, but there will still be workplaces and organisations to create cohesive objectives for large groups of people. You will still need people in the one place, to make things or to create services. But I don’t know that you will need big workforces," she says.
Ruthven expects big companies to remain a feature of business – because the value of economies of scale is timeless – but says they may not be big employers. “We’ve had global companies for the best part of 150 years, and I think we will still have them, because if you want cheaper and cheaper services, and cheaper goods, you have to have size to do that.
“By the time a big corporation has outsourced its non-core activities, it will be left with the two most important elements a business will have to have – its intellectual property, that which makes it clever and unique; and its organisational culture, that which makes people actually want to work with them. The company will have to be a lot simpler an operation than it is today, leaving it with very little to do except being very clever, and having massive purchasing power and selling power."
Freedom and flexibility
Ruthven does not think the concept of “employer/employee" will exist in the middle of the century: instead, he believes individuals will contract to companies as “suppliers".
“Long before 2100 people will begin to regard themselves as businesses themselves, and they will enter into contracts with customers, to supply an output – not hours of service, as we do now. These individuals – the suppliers – will only contract to, and work collegiately with, organisations that they respect."
This will be driven by behavioural and demographic changes, he says. “People aged under 28 are the first of the human race to see freedom and flexibility as being the most important things in their lives. The term ‘employee’ will not exist in 2100 – it will be fading into history by the middle of the century. Our grandchildren will not believe that we were employees – they will think of that as slavery."
But business will still be driven by concepts that 19th-century business people would recognise – it will still be a case of building a better mousetrap, or more likely, providing a mouse-proofing service. “There will be many million more consumers, and good ideas – whether things or services – will be even more lucrative to the people that invent them," says Ruthven.
The end of the company?
But in the future, says Reimer, we might not have companies as we know them. “Brands and companies will probably still be the building blocks of business, they serve as an orientation device and also for people to have some identification, but the brands of tomorrow might not belong to large organisations.
“They might be ideas, forms of self-expression, and they might be owned by communities – even down to the individual as the unit that does business, because we have achieved decentralisation and co-ordination to the point where businesses as such are no longer needed. Decentralisation and the idea that people rally around ideas and communities more so than traditional big businesses is certainly something I would envision," says Reimer.
The difficulty with trying to peer ahead, says Reimer, is the human tendency to think that the time they are living in is “the best, most efficient and self-evidently optimal" way of doing business. “We always take that for granted, but technology can change that so quickly.
“I always find it helpful to remember that the chairman of IBM said, in 1943, that there was a worldwide market for maybe five computers. Now everyone has one in their pocket." And even five years ago, he says, no one would have predicted how a technology such as the iPhone/iPad would become so predominant for carrying our business practices.
“I think it’s quite useful thinking back 100 years, and trying to explain how we do business now, to someone in the 1900s, what we do and how we connect, for example Facebook and how we hire people through LinkedIn, and explain this to someone who has just electrified their shop floor or is just getting to grips with a production line – when computers are not even imagined. You would find that task near impossible.
“It’s also near impossible to imagine how things like Big Data and the cloud and super-fast connectivity through the National Broadband Network will change the way we do business – even in 10 years’ time," says Reimer.
The Australian Financial Review