Beyond the Economic crisis - Massachusetts Institute of ...web.mit.edu/psgleadership/pdf/2009/Partha...
Transcript of Beyond the Economic crisis - Massachusetts Institute of ...web.mit.edu/psgleadership/pdf/2009/Partha...
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Beyond the Economic crisis:Towards a New State of
consciousness
Partha S Ghosh
The Boston Pledge
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2020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Two points:1. Where are we? The Challenges and
Possibilities Ahead
2. Uncovering the Next Economic Paradigm? Towards a new state of consciousness
Today:
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3020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
The last three decades
Liberalization & Globalization
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4020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
The Challenge of “Globalized Financial Markets”
iThe Emerging Environment
Past Present
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5020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
The current crisis is unprecedented
LocalizedLocalized GlobalizedGlobalized
Linear Linear ComplexComplex
Early Stage Early Stage ConstraintsConstraints
1929 1929 2009 2009
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6020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Power of Global Human Intellect is more compelling
Classical and Keynesian Economics Fuzzy Economic Paradigm
Industrial Revolution
Land reforms
Capital
Natural ResourcesLabor
Knowledge
Natural ResourcesLabor
Capital
HumanIntellect
Expanded scope of trade
KnowledgeRevolution
1929 1929 2009 2009
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7020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
How about three World scale Tornados at the same time?iTurbulence x Turbulence x Turbulence = T ³
Tornado 1=Over engineering of Economic systems
Undermining of ethics
Tornado 3=Imbalance of 3Es
Tornado 2=Clash of Perspectives
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8020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Changing Ecology
Finite Resources
Increasing Sea Level
65 Billion Tons of CO2
Rising Temperature
Increasing Population
Powerful Forces at Work? Require long-range thinking
Equity
Deforestation
Changing Ecology
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9020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Changing Ecology
Finite Resources
Wall Street Expectations
Increasing Sea Level
65 Billion Tons of CO2
Rising Temperature
Increasing Population
Instincts are short, Challenges are long: Clash of Perspectives?
Digitization requirements
Equity
Deforestation
CO2
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10020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Geo-Political Alliances are In Transition as well
Paradigm Shift
USSR
EC
NATO
Cold War
PastPastPast FutureFutureFuture
Bond by ColdWar Forces of Alliances
ExpandedEC China
Asia?ROW?“New and
IndependentIdentity”
Reconfigure
WTOIssues
Single MarketPolitics
Deconstruction of PastGeopolitical Architecture
Uncertainties
ROW
U.S.
Japan
Asia
?U.S.
?
Reconfigure New Role?
Middle East Uncertainties
Russia
OPEC
OPEC
Japan
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11020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
0
20
40
60
80
100
120
140
0 5000 10000 15000 20000 25000 30000 35000 40000 45000GDP / Capita (US$)
Ene
rgy
Con
sum
ptio
n (‘0
00
KW
Hr /
Cap
ita)
Energy Consumption per Capita vs. GDP per Capita (2004)1
Most of the world is still in the early stage of Economic development
Ukraine
Russia
US
Kazakhstan Czech Republic
Malaysia
TurkeyBrazil
RomaniaThailandChina Egypt PhilippinesIndonesia
India
Italy
FranceGermany
UKJapan
Canada
80% of Global Population
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12020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
0.0
2.0
4.0
6.0
8.0
10.0
12.0
0 200 400 600 800 1000 1200
Japan
US
UK
Canada
GermanyFrance
ItalyMexico
Malaysia
Brazil
China
IndiaIndonesia
Pakistan
Nigeria
Bangladesh
Population Density v/s Primary Crop Yield per Ha (2003)1,2
Population Density in Persons/ sq. km of Land Area
Prim
ary
Cro
p Yi
eld
(100
0 M
t/Ha)
Boston Analytics Research1. Food and Agriculture Organization of the United Nations (http://www.fao.org/)2. CIA World Factbook, 2003
Land is dear but productivity (yield/Ha) still remains low, in recent years declining
Unhealthy Equation: High population density but low productivity of land
3 Times
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13020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Super Turbulence…The Journey forward ?
??
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14020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Clearly we are at the End of a Long Era?Pr
oduc
tivity
of S
ocie
ty
Economic Development Curves
Industrial Revolution 1 (Steam Engine)
Industrial Revolution 2 (Internal Combustion
Engine)
Information Revolution
Low
High
Time
2005 ~2010
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15020926-BWL-WKF-Slides (Revise II)
This information is confidential and was prepared by Bain & Company solely for the use of our client; it is not to be relied on by any 3rd party without Bain's prior written consent.
SEO Partha S Ghosh
Two points:1. Where are we? The Challenges and
Possibilities Ahead
2. Uncovering the Next Economic Paradigm? Towards a new state of consciousness
Today:
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16020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
New state of consciousnessNew state of consciousnessNew state of consciousness
Towards a New State Consciousness
X
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17020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Two fundamental RequirementsiInnovation Game Board
Scope ?
Low HighCourage to reconfigure
Normal
Abnormal
State of Consciousness
Rules?
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SEO Partha S Ghosh
Moving forward we have to avoid the danger of linear thinking
2008/9 2058/9
Socio-economic experiments
1. Economic Philosophy
2. Relationship of Human with Nature
3. Micro Economic business models
Freedom of Self Expression to Renaissance
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19020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Fundamental phase shift is required to develop the next generation Models
Resource Commitment
EconomicImpact Leadership for
Paradigm Shifts “Unpredictability, complexity & invisible assets”
X ism?“Predictable Dynamics”
Smith & Marx
Strategic Window
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20020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
The missing Vectors in Economic thinking
Market
Location of Power of Resource allocation
State
Single Dimension thinking of Economics
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21020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
The missing Vectors in Economic thinking
Individual
Market
Global
Systems
Content of Power
Engagement of Power
Location of Power of Resource allocation
Newtonian to Einsteinian SpaceAtoms to Bosons
Govt.
Expanding Strategic Space
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22020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Expanding Strategic Space
Japan?
?
?Conventional space
Strategic
China
Transactional
Our economic thinking has to transform along the Three Vectors
i More & Better of the Same?
or
i Fundamental transformation?
Government Market
Systems
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23020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Multiple assets in perspectives
Innovative IntegrationInnovative Innovative IntegrationIntegration
Technology
Diversity
From Exploitative
Relationship with Nature
To
EnrichingRelationship with
Nature
Values
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24020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Turbulent Times …The Journey forward ?
The Boston Pledge ?
X ism?
Smith & Marx
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25020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Scope of the Field?
Point Solution
Industry’s Future (?): Two Strategic Vectors
Perspective?Holistic/Integrative Solution
Conservation driven
Consumption driven
Balance?
Bal
ance
of E
colo
gy
Balance of Economic Advance
GraminBank
The Boston Pledge
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26020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
A Blueprint for Knowledge Based Economic Development
Nature
Conservation
Infrastructure
Grass Roots(30%)
Growth Avenues
Dynamic Economy based on High
“Social Intelligence at the Grass roots”
Bold Moves / CRASH Programs
Midterm Initiatives Long-term“Evolution” Programs
Renaissance
75
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27020926-BWL-WKF-Slides (Revise II)
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Last 5,000 Years… …..Future Possibilities..
Economics of Economics of Linear Linear MechanicsMechanics:: Extraction, Extraction, Exploitation & ExperimentationExploitation & Experimentation
Economics of Economics of Closed Closed Loop HarmonyLoop Harmony
Knowledge for Knowledge for Recovery/RecycleRecovery/Recycle
New Technologies
AgroAgro
Energyand PowerClean Clean
WaterWater
Bio MassBio Mass Solar , Wind Solar , Wind Fuel CellsFuel Cells
BroadbandBroadband Clean EnergyClean Energy
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28020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Macro Economy?
Fundamentals ?Various Critical Issues
Depleting resourcesLow Land Productivity
Widening Gap
EnergyDisappearing Ice caps
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29020926-BWL-WKF-Slides (Revise II)
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SEO Partha S Ghosh
Four fundamentals
Leap frog Ideas
Multiple Perspectives
Integrative Approach
Acceleration of Solutions
Vision of the Outcome
Net
Eq
uit
y
Bala
nce
Balance of EthicsNegative
Negative
Positive
Positive
Investment in Next generation Knowledge
Intensive inclusive programs
Bottom up Renaissance
Competitiveness based on values