globalisation: is the world getting smaller?
TRANSCRIPT
GLOBALISATIONIS THE WORLD GETTING SMALLER?
Globalisation: Is the world getting smaller?
The Diverse views of participants to our inaugural
Typhoon Survey reflect the prevailing global political and
economic uncertainty for 2017 and beyond.
To some, the political events of 2016 such as the US
Presidential Election and the UK’s Brexit vote,
represented a shift in public appetite for globalisation.
Typhoon’s first global survey, on the subject of
globalisation assessed business sentiment in the wake of
2016. Is it all change, or business as usual?
The survey covered a broad spectrum of industries and
regions, with particularly strong representation from CEO
and Director level participants across geographies to
provide rich insight into boardroom agendas.
Divergent views
There was little consensus on respondents’ views on the
challenges in 2017 and beyond. Threats to globalization
were noted as well as potential opportunities. These
included:
� Opening of new markets following changes in the US –
Russia relationship
� Increased M&A activity in the Technology sector
� The threat of American and Chinese protectionism
� Increase in trade barriers from Brexit and the potential
disbandment of TPP
’Wait and see’ on investment
The majority of respondents (53%) noted that their
organisation’s approach to investment would remain
active, with their company looking to invest in the near
term. However, a significant 36% described their
investment approach as “wait-and-see”. The remaining
minority of companies (11%) noted an intention to scale
back on current investments.
Focusing on the next six months, we asked participants
for their expectations for global investment in their
organisations. 55% expect investment to be broadly
maintained with 30% projecting an increase to
investments over the near term.
53% OF RESPONDENTS DESCRIBED THEIR ORGANISATION AS
LOOKING TO INVEST SOON
Transformation a key Boardroom agenda item
Looking to the longer term, 30% of participants told us
that they expect minimal change to Global
Transformation initiatives. However, 35% expect a slight
or significant increase to such projects. Whilst there is
significant uncertainty which may impact investment
decisions such as location strategy, areas such as
technology spend continue to be high priority and must
continue as industries such as banking search for
innovation and efficiency to compete effectively.
Centralisation vs. localisation
When questioned on organizational strategy, participants
provided mixed responses, with 30% stating their
organisation was trending towards global standardisation
and 21% noting a move towards more local autonomy and
decision making.
35% OF RESPONDENTS
EXPECT A SLIGHT OR SIGNIFICANT INCREASE
TO GLOBAL TRANSFORMATION
PROJECTS
49%
21%
30%
0 20 40 60
Balanced between local and global
Localisation: more autonomy and decision making made on a localor regional basis
Global integration: more standardisation with decisions made atglobal level
Localisation: more autonomy and decision making made on a local or regional basis
Global integration: more standardisation with decisions made at global level
Balanced between local and global
Do you see your organisation trending towards…
Capital flows to remain broadly unchanged
With regard to cross-border capital, responses were
mixed, reflecting a level of uncertainty. 45% of
participants predicted a slight or significant decrease,
where 39% expected a slight or significant increase.
Geo-political events will bring change in 2017
As well as the wider economic climate, our survey also
covered participants’ views on three major geo-political
events of 2016/17. We found that 53% of contributors
expect the upcoming change in US President is likely to
have at least some impact on their business. To further
underline the uncertainty mentioned previously, 30% of
respondents considered the effect of both Brexit and the
change in President to be uncertain at this stage.
17
21
17
30
30
50
36
32
28
17
17
4
0 20 40 60 80 100 120
The potential disbandment of Trans-Pacific Partnership
Brexit
The change in U.S. PresidentThe change in U.S. President (%)
Brexit (%)
The potential disbandment of Trans-Pacific Partnerships (%)
Do you think your organisation’s strategy will be influenced by...
Unlikely to have an impact Unclear on things at this stage
Likely to have some impact Likely to have significant impact
In addition to these events, contributors also cited rising
European and US isolationism / protectionism as
significant concerns to their industry and business.
Specific worries included trade tariffs, an increasing focus
on localisation and the possible withdrawal from existing
trade agreements.
ISOLATIONISM LEADING TO TRADE
TARIFFS, AND WITHDRAWAL FROM
EXISTING TRADE AGREEMENTS WERE
SOME OF THE CONCERNS NOTED
As the implications of certain events, such as Brexit and
the Trump Presidency, become clearer in the first few
months of 2017, there is hope that this uncertainty will be
temporary. However, with the rise of populism,
dissatisfaction of voters in the West with the
establishment and noteworthy upcoming geo-political
events (such as China’s leadership reshuffle at the Party
Congress in Autumn), it could be the case that
uncertainty is the new normal.
This is first in a series of surveys to measure business
attitudes towards the state of globalization and identify
trends and possible implications for Typhoon’s global
clients.
The survey received 47 responses from contacts based in
Asia-Pacific (49%), Europe (39%), The Americas (9%) and
Africa (4%).
64% of contributors disclosed their role in their
organisation as CEO/Owners or Director level.
Respondents tended to be from larger organizations with
over 1,000 employees (49%) or between 100 and 1,000
staff (26%). The remainder worked for smaller companies
with fewer than 100 employees.
This survey was conducted by Typhoon Consulting
across offices in Hong Kong and London. If you would like
further information, or would like to participate in future
surveys of this nature, please contact:
David Powell (Asia CEO); T: +852 9685 6951 E: [email protected]
Kyle Durrant (UK Manager)T: +44 (0) 7889 336 388E: [email protected]
Vanessa Roguska (Head of UK Consulting): T: +44 (0) 7748 166 762E: [email protected]
Robert Chapman (HK Manager)T: +852 6012 4507E: [email protected]