What will big businesses look like in 10 years?

imgresThere was a time when big businesses started acquiring and building verticals that made them huge organizations.  General Electric was one of them.  GE was founded by Thomas Edison and one of the first companies ever traded on the Dow.  Fast forward 118 years it is fascinating to read about the acquisitions that GE has made.  Starting out as a company about electrical properties it has an investment, transportation, healthcare, oil and gas, home and business solutions, aviation, and global research vehicle.  Due to many of the regulations that have been put into place after the last financial crisis, GE has opted to get out of the banking business.

I was talking to a someone the other day who told me that Goldman Sachs is having a hard time hiring kids out of school.  There was a time when recent undergrads and grad students flocked to the jobs at Goldman Sachs but no longer.  Another company that was founded in 1869 and evolved into one of the largest global investment banks in the world.  Will regulations and lack of interest in the next generation to work there change the empire?

Then I saw a business that wanted to change schools with a new curriculum that would turn every person into an entrepreneur.  Where are the artists, the writers, the teachers?

We are entering a new world.  The new college graduates that I speak to want to be part of the new technology economy.   They want to do something that makes them happy.  They want to be able to make a difference in the world.  The jobs are shifting and will continue to shift in the next decade.  More people will graduate with computer science degrees.  Technology will take us to places that we are just starting to think about.  Soon every business will have been disrupted by technology.  A huge percentage of the population will be a freelance worker.

I can’t help but wonder what will these big businesses that have been the economic backbone of our economy for hundreds of years look like in a mere decade?

Comments (Archived):

  1. William Mougayar

    Funny I wrote this on my Tumblr yesterday:”There is a new world that emerges roughly every 10 years, driven by overlapping changes in technology, business, political and social trends.”The key part is these trends are overlapping, and they each advance at their own pace and cycles, but together they make change happen.I’ve had the good fortune to have worked from x-large to x-small companies, and seen the spectrum over the years. There are challenges on both sides. Big Cos need to continue being nimble and flatter in order to survive, and the startups need to grow and become viable medium size, and some of them will become large companies.Big Co. vs. Small Co. are 2 very different worlds, and the bridges between them are thin.

    1. Gotham Gal

      great piece!

  2. Erin

    The idealism of youth will ensure there will always be teachers, but their careers won’t be as long in the field. That’s my prediction. When they see how overworked they are and forced to stretch their resources compared to their corporate counterparts (Facebook gives valuable glimpses into others’ worlds), and they see how easy the move is to entrepreneurship, many will be jumping ship in their 30’s and 40’s.And the “artists” (if you’re talking in the traditional sense) will be UX designers and the like. Tech is the best thing to happen to the art world because wages have gone up to rival that of engineers.And I also think there will always be people looking for job security in a big corp, but maybe not the type of people Goldman Sachs is looking for. (?)

    1. Gotham Gal

      I totally agree with you on the teaching front. Many careers for this next generation.

    2. Matt Kruza

      See the bad thing about education is how pensions are structured. Average starting salaries are between $35-50k cash, with pension “actuarial” values being anywhere between $10-20k. By the time someone has been there say 15 years the effective actuarial values of the pensions can be $25-50K+ per year in some cases. THis is why many teachers leave after 5 years or less, but few do after 10 or 15 (unless they have an extremely high earning spouse). This is a huge impediment to real teacher quality for those who actually care and for the students and community. I have some pretty complicated spreadsheets that explain this math (most pensions work the same in each state.. not totally true, but basically. So there are 50 or so different calculations and obscurements). So I do think long-term many people will teach for 5-10 year stretches (in my opinion even more often by those 40-50 who have already saved a lot of money from working in industry) but the transition point will be insanely messy because of the pension issue.

      1. Erin

        That’s true, people will still stay for the pension. Just like people still stay with their spouses for the financial security…

        1. Matt Kruza

          Yep they will.. but dealing with local pensions will be the nastiest issue bar none over the next 20 years. the federal govt. can print money to ease “funding shortfalls”, but state and local govt. can’t.. not going to be pretty. Will require some really great politicians and advocates to explain options and choices… that shouldn’t be a problem for the US huh? 😉

          1. Erin

            If only people didn’t live so long, right? 🙂 That’s the draw of entrepreneurship- you can write your own terms for retirement. Yes, it will be suspenseful to see how it all pans out in the shuffle.

  3. awaldstein

    FunnyI”ve always been the tough focused worker and leader. No nonsense.The right to insist on being happy and in control of ourselves is a change agent that is a world mover.From the core of the $2T wellness market to how I see teams getting built in my accounts.Transparency. Flexibility. Empowerment. Authority mixed with responsibility. These are the building blocks of our new world and will be what colors what new business will look like.

    1. Gotham Gal

      Transparency. Flexibility. Empowerment. Authority mixed with responsibility. Bold!

      1. limabeannj

        Transparency ….is the new trend both in business and people’s boldness on social media; pros and cons of course. can a business be transparent in their earning, GM to their clients – and continue to be successful? I get asked this question a lot and work for a Fortune 100 company – be transparent – to what degree do we take this?

        1. Gotham Gal

          Good question. It is about honest and setting boundaries with clients on how transparent you should be or want to be

  4. pointsnfigures

    You are correct.Yesterday, I spoke at Notre Dame. It was sort of a keynote to their Entrepreneurship Week. Notre Dame is pretty conservative when it comes to occupational choices. Kids come from all over the world to attend, and have extremely high test score/grades.The audience I had was extremely diverse. More women than men. Around 200 people. I asked them to stand up if they wanted to run their own business. (In 1983 when a Prof asked my lecture hall this question, 2 of us stood up) Half the auditorium stood.I did a slide deck for all of 10 minutes, and then the entire room interacted over what it means to be an entrepreneur and work for a startup, how to find them, what you do etc. To members of the tech community this is easy stuff. To 19 yr olds being exposed to this world for the first time, it’s eye opening.At Chicago Booth’s MBA program, entrepreneurship is the leading major, over finance. Kellogg is seeing the same growth in interest.Chicago had a 101% increase in VC activity last year. First quarter, we had $174M invested (about $3.7M per deal) 101% incr doesn’t seem like a lot when compared to Silicon Valley which had an 86% increase on a much bigger base, or NYC which had a 59% increase on a bigger base. But it’s happening and it’s happening with local kids from Chicago, Northwestern, Illinois (maybe the best Engineering school in the country), Michigan, Wisconsin, Notre Dame, IIT, MSU, and the rest of the Big 10.

    1. Gotham Gal

      wow. 2 people. the world has seriously changed.i would have been interested in how many people want to go into the banking world.

  5. LE

    I was talking to a someone the other day who told me that Goldman Sachs is having a hard time hiring kids out of school.There are tons of people who would die to work at Goldman Sachs. And anyone who doesn’t take that opportunity is foolish and is chasing a dream and passing up an opportunity that may not ever come again. In making that decision they are focusing only on the upside and not the downside of passing up that job offer. Of course there are exceptions. But if the majority of VC investments aren’t big hits and wins, then there are a large number of people who will simply scrap by for years without any financial security from startup to startup. And then emerge in their 40’s perhaps with a job that isn’t anywhere near what a career at Goldman Sachs would be. (That assumes they can take the heat in the kitchen of course..) Entertainment business is similar to this in many ways.The new college graduates that I speak to want to be part of the new technology economy. They want to do something that makes them happy. They want to be able to make a difference in the world.Perhaps the new college graduates (not all but the ones that have identified the game) are looking for a lottery ticket win it’s that simple. [1][2] No need to look any further. The “change the world” stuff is just a bit of parrott-ing and brainwashing. And the “want to do something that makes them happy” doesn’t recognize that when you are successful at something and can earn a living it can be the first step to happiness and fulfillment.Here is a concept that has worked for years. Put in your time and work hard and in the end you might make out pretty well and end up doing something that you really like. You did that with your first job at Macy’s, right?[1] The lottery ticket win didn’t exist when I graduated college hence nobody was drawn or chased that dream. Was pretty much unheard of even if you graduated from Wharton you recognized it would be a slow process that took years and years.[2] In a similar way people went into medicine for many reasons but the largest driver was for sure the prestige, money and security of that career. Except in the case of medicine, that was more of a sure bet. Even today, despite all of the whining people do, Physicians make a good living.

  6. limabeannj

    Cash is King – everyone wants to make more money, not necessarily manage it – the shift from working at Goldman Sachs to a tech company / IPO is all about the idea that they can make money (yes be happy too). Entrepreneurs are investing their money in the internet and start ups – not investing in a traditional stock or mutual fund. Companies want to use Cloud to switch from Capex to OPEX, pay for what they use regarding technology, limit capacity so that they can increase their cash flow. Technology is changing so rapidly, it is no longer a commodity, the useful life is shortened for most. I’m not sure what was all behind the GE exit of their $60B financial portfolio, but CASH flow, was certainly a key factor and the shift as to how technology is acquired. Are people worried about the economy that is driving to this? Warren Buffet has commented on such – cash rich companies

    1. Gotham Gal

      cash is certainly king.