SF Chronicle Reports on Eamonn Kelly’s Alliance Keynote Discussion

March 22, 2009

Hunkering down, cutting and conserving, snapping up opportunities that others may miss. All the standard nostrums for surviving the Great Recession make sense, but they're not sufficient to cope with the new economic order that's coming.

That's what Eamonn Kelly, CEO of San Francisco's Global Business Network ( www.gbn.com), is telling CEOs of the Fortune 100 companies he advises. At a recent gathering of the Alliance of Chief Executives ( www.allianceofceos.com), an organization of Bay Area CEOs headquartered in Walnut Creek, Kelly outlined some of the coming challenges:

-- The era of Western-led innovation and globalization is finished, as China and India lead the shift to the East and begin to make their own rules. Henceforth, businesses will be operating in a world of "multiple models of government-private sector relations."

-- In the United States, "government is back," ending the private sector's "untrammeled permission to play." In addition to the state, the nonprofit civic sector - environmental organizations, for example - will become increasingly visible stakeholders in private enterprises.

-- Western consumption patterns are unsustainable. In fact, they are "structurally broken."

What does all this mean? Kelly believes - and this is a Fortune 100 adviser, mind you - that material consumption is being replaced by, for want of a better word, spiritual consumption. In a nutshell, quality supersedes quantity, a trend I believe we are already starting to see. For companies, that implies "a massive emphasis on co-creation with consumers," evolving into what Kelly calls the "prosumer economy."

It also presages, he believes, a transition from traditional models of competition to shared "webs" of innovation. "Companies are going to have to be more agile, more collaborative." Which, he acknowledged, "puts corporate executives in a very hard place. How do you manage that tension between dealing with the current recession and needing to adapt to these fundamental changes?"

by Andrew S. Ross