the future of industry: sector convergence & 2017 outlook
TRANSCRIPT
The Future of Industry: Sector Convergence & 2017 Outlook
February 1, 2017
Sector Convergence | Industry Disruption and Redefinition
Trump Administration Impact on Industries, Tax, Regulation
Technology Transformation | Digital Innovation
Fourth Industrial Revolution: Convergence of AI, IA and IoT
Risks and Growth in an Uncertain Environment
Nichole JordanNational Managing Partner
Clients, Markets and Industries
@NicholeJordan26
www.linkedin.com/in/nicholeajordan
The Future of Industries Series
How should companies respond to the challenges and
opportunities presented by this disruption? Questions to consider…
1. How are you investing in your future?
2. Are you developing new alliances across your business to keep pace with the changes?
3. How are you creating your revenue streams of the future? How are you avoiding commoditization
of your business?
4. Are you setting up a separate company to innovate and support new ideas?
5. Do you have an outcomes focused business model or a products focused model?
Sector convergence
Convergence Information Technology, Media and Telecommunications
Blurring of the traditional lines among Tech sectors and other industries
• Driven by technological change and, in some cases, deregulation
• Yet, the principal driver is still entrepreneurial creativity
• Convergence at the device level
• Convergence among and across the sectors of the Technology Industry
• And increasingly the blurring of industry lines
• Digital goods transformation is well along
• Sharing economy - Transportation, Lodging
• Competition with traditional industries – Automotive, Industrial
Learn more about
The State of
Information
Technology
Steve PerkinsNational Managing Director
Technology Industry
@StevePerkinsGT
www.linkedin.com/in/steven-perkins-56332211
Convergence Manufacturing
Advanced manufacturing technologies transform the landscape
• Internet of Things, sensors and big data – are creating connected products
• Impact on the business model: John Deere moves from product business model to hybrid business
model using data from connected devices to create profitable services to help farmers improve yield
• GE Energy will be using drones to sniff for methane gas emissions at well sites.
The drones will have customized software to develop a flight path and analyze
the captured data line.
Jeff FrenchNational Managing Partner
Consumer & Industrial Products
@jfrenchgt
www.linkedin.com/in/jefffrench1
Convergence Manufacturing
Automotive companies become software companies?
• "Whether the car companies like it or not their industry is becoming a tech industry. Virtually all powerful
tech companies are in a race to see who can provide the best solutions for autonomous driving, in-car
entertainment, and even propulsion." – IT World
• Ford seeks, much like Facebook or Twitter, to integrate its products into its customers’ lives
• Bill Ford - “Now he worries—what if we only made more cars? Just making more cars
is not our future." They are making "computers on wheels" – Forbes Magazine
• When we moved from horses and buggies to cars there was a massive purge of
firms that just didn’t want to change fast enough – IT World
Learn more about
The State of
Manufacturing
Convergence Real estate
Innovation fueled by technology and changing needs of customers
push convergence into real estate sectors
• Hotels: The "alternative accommodation model" Air Bnb. The decline during 2016 in the number of
compression nights at U.S. hotels could indicate a threat from alternative accommodation providers.
• Restaurants: Online meal delivery kits, Blue Apron – rise of "grocerants" grocery
stores that provide meal kits and even in-store dining and entertainment, a threat
to restaurants?
• Residential and commercial: The wired home and office. The first
"digitally native" generation buying homes and taking over the workforce
Learn more about
The State of
Real Estate
Alvin WadeNational Managing Partner
Construction, Real Estate, Hospitality and Restaurants
www.linkedin.com/in/alvin-wade-b8ba957
Convergence Not-for-Profit
Technology changes how students learn and how non-profits
communicate and raise funds
• Learning: The evolution of online learning through Massive Open Online Courses (MOOCs). Four
universities now offering degrees – and charging tuition – based on MOOCs
• Technology development: University IT departments incorporating “crowdsourced” technology
• Communicating: Not-for-profits are communicating and engaging via social media
• Fundraising: Not-for-profits are finding alternatives to direct mail and phone calls.
Changes include texting for donations and technology enabled special events
(#GivingTuesday).
Learn more about
The State of
Not for Profit
Mark OsterNational Managing Partner
Not for Profit
@mark_oster
www.linkedin.com/in/mark-oster-5722278
Prospects for regulatory change
We are beginning to see President Trump's intentions
to change regulatory requirements
• Already, the Trump Administration issued more presidential directives than any president in modern
history, addressing many of the promises made on the campaign trail.
• The freeze on regulatory action is standard practice for a new administration. The directive on the ACA is
more unusual and there still isn't clarity on what it requires. Both fulfill promises made on the campaign trail.
• The broad regulatory freeze may block late regulatory actions of the Obama administration that published in the
Federal Register. That calls into question the future of a new bailout-prevention rule the Federal Reserve completed
last month.
• Two leading bills to achieve cutting regulations: Regulations from the Executive in Need of Scrutiny Act (REINS Act)
and the Searching for and Cutting Regulations that are Unnecessarily Burdensome Act (SCRUB Act).
Health care Repeal and replace – plenty of uncertainty
• A budget resolution to repeal parts of the Affordable Care Act using the budget reconciliation process.
• The budget resolution passed last week would allow Republicans to repeal some of the ACA with 50 votes in the Senate, with
Vice President Mike Pence as the tie breaker. However, reconciliation comes with restrictions. Reconciliation does not allow for
provisions that do not affect tax revenue or government spending outside the 10-year budget window.
• Republicans are debating among themselves the best way forward. Leaders are generally calling for a delayed repeal that
would give Congress time to write ACA replacement legislation, while Trump and some rank-and-file members are pushing for
immediate repeal.
• Republican Senators Bill Cassidy and Susan Collins introduced draft legislation to replace ACA
if it is repealed – If States Like Their Obamacare, They Can Keep It.
• 20% tariff on imports from Mexico: US imports more medical, surgical, dental instruments from
Mexico than any other county.
Anne McGeorgeNational Managing Partner
Health Care
@beanrunner
www.linkedin.com/in/anne-mcgeorge-53480111
Health careRepeal and replace – plenty of uncertainty
• The impact to Providers -- potentially negative
• The impact to Insurers -- both positive and negative
• The Impact to Consumers -- potentially negative
• The Impact to Employers -- potentially positive
• The Impact to Investors -- potentially positive
• The Impact to Government Agencies and States -- potentially significant change
More about
ACA
Energy:An "America First" Energy Plan
• The American First energy plan as described on WhiteHouse.gov, indicates a major shift from the
Obama administration policies, by moving to eliminate climate regulations and boost coal, oil
and gas production.
• On January 24, President Trump signed an executive order reviving the Keystone XL and Dakota
Access pipelines. Keystone is expected to spin off 20,000 construction and manufacturing jobs, and
add $3 billion to GDP.
• Future of Department of Energy, EPA, and eventual impact on
energy companies
• Impact of border adjustable tax
Learn more about
The State of
Exploration &
Production
Kevin SchroederNational Managing Partner
Energy
@schro_kevin
www.linkedin.com/in/kevin-schroeder-9177aa27
Banking Future of Dodd Frank, Consumer Financial Protection Bureau
• Dodd Frank likely to be rolled back, as promised on the campaign trail
• Department of Labor (DoL) fiduciary rule faces uncertain future as Trump calls for
less regulation
• Future of the Consumer Financial Protection Bureau - is a fight on the horizon?
Will Trump replace current director Cordray with a Republican director
who opposes the agency's mission. Learn more about
The State of
Banking
Mark LastnerNational Managing Director
Financial Services
www.linkedin.com/in/mark-lastner-0466896
Private Equity Future of carried interest
• Can President Trump unilaterally end the "carried interest” loophole?
• He spoke against carried-interest during the campaign, labeling some hedge fund
managers “paper pushers” who are “getting away with murder.”
• To date, congressional Republicans have not targeted carried interest as a
priority action
• Changes in trade policy and tariffs may impact PE investing
Sal FiraNational Managing Partner
Private Equity
www.linkedin.com/in/sal-fira-01a984
Connect with our industry leaders
Nichole JordanNational Managing Partner
Clients, Markets and Industries
@NicholeJordan26
www.linkedin.com/in/nicholeajordan
Steve PerkinsNational Managing Director
Technology Industry
@StevePerkinsGT
www.linkedin.com/in/steven-perkins-56332211
Mark LastnerNational Managing Director
Financial Services
www.linkedin.com/in/mark-lastner-0466896
Jeff FrenchNational Managing Partner
Consumer & Industrial Products
@jfrenchgt
www.linkedin.com/in/jefffrench1
Alvin WadeNational Managing Partner
Construction, Real Estate, Hospitality and Restaurants
www.linkedin.com/in/alvin-wade-b8ba957
Kevin SchroederNational Managing Partner
Energy
@schro_kevin
www.linkedin.com/in/kevin-schroeder-9177aa27
Anne McGeorgeNational Managing Partner
Health Care
@beanrunner
www.linkedin.com/in/anne-mcgeorge-53480111
Mark OsterNational Managing Partner
Not for Profit
@mark_oster
www.linkedin.com/in/mark-oster-5722278
Sal FiraNational Managing Partner
Private Equity
www.linkedin.com/in/sal-fira-01a984
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