Tag Archive: U.S. demographics

Leveraging Social and Demographic Trends

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Understanding the behavior of investors, employees, and consumers is a critical success factor for all companies. This can be difficult for corporate directors, however, as America’s demographics are constantly evolving. At this year’s second Directorship 2020® event, NACD partnered with Broadridge Financial Solutions, KPMG’s Audit Committee Institute (ACI), Marsh & McClennan Cos., and PwC to provide an in-depth look at today’s social and demographic trends and how boards can harness the opportunities these often-disruptive forces create.

Doodle_D2020ATL_Demographic Trends_645x281_borderIn his keynote address, Scott Steinberg, CEO of TechSavvy Global and author of Make Change Work For You, affirmed that change is the “new normal.” He emphasized that companies must constantly innovate in order to survive in today’s volatile business environment. Some companies, such as Apple, Amazon, GE, and Samsung, have maintained their competitive edge by mastering the art of “sustainable innovation.” Steinberg pointed out that these companies foster highly collaborative relationships with their employees, who also represent the company’s customer base. By creating avenues for employees to share their observations on emerging threats and opportunities, these organizations are simultaneously constructing platforms to prototype new business products. These collaborative relationships thus enable management to harness the full range of talents that allow an enterprise to continually adapt and grow.

In the second keynote speech, Paul Taylor, former executive vice president of  the Pew Research Center and author of The Next America, focused on two major demographic trends that are happening in the United States. First, the bulk of the country’s population is aging. Older generations have always needed the younger ones to drive the economy; the millennials, however—the youngest generation in today’s workforce—are collectively experiencing great difficulty in launching their careers and remain largely dependent on their forebears. Taylor observed that businesses need to mimic these new domestic norms and similarly nurture and invest in millennials to ensure the success of their firms’ future leaders.

Second, Taylor pointed out that by 2050, immigrants will comprise the largest-ever share of the American population: while 20 percent of Americans were of immigrant descent in 1960, that proportion is projected to climb to 37 percent. Not only will this expand the workforce and brainpower of the American economy, but it will also change the demographic complexity of the country’s consumer base. Furthermore, this modern immigration wave has begun to alter traditional attitudes toward racial and ethnic boundaries. For example, children of immigrants are more likely to marry someone of a different race or ethnicity. These trends are already driving business behavior, as contemporary television commercials clearly demonstrate: in an ad for Coca-Cola, the anthem “America the Beautiful” is sung in several languages; and two recent Cheerios ads featured a multi-racial family.

The presentations and discussion in Atlanta generated three key takeaways for directors:

  1. Assess your corporate culture. Corporate culture can often be a significant roadblock to innovation, and many companies stumble because they fail to periodically rethink their identity. A corporate culture that allows for evolution is, by definition, resilient and adaptable. Regard your employees as a wellspring of innovative ideas, because they have the most direct interaction with your customers. Their insights into evolving consumer demands can, in turn, generate your business’s next game-changing idea. A big challenge for many firms is how to encourage employees to speak up, especially at established companies where a the corporate culture has been in place for some time. (FedEx, for example, has a 40-person team that is charged with driving innovation throughout the entire organization.) By contrast, the smaller size and absence of inhibiting precedents at start-ups enable them to be more adept at mining creative solutions from their entire employee base. Spurring and sustaining innovation is about institutionalizing a love of change within your organization. Create forums through which everyone—from the mailroom to the boardroom—feels free to share ideas.
  2. Make educated bets. A lack of risk tolerance is a major barrier to innovation. For companies that are doing well, staying the course may seem like a safe bet; but as the competitive landscape shifts, this approach will ultimately cause the company to falter Create systems that allow the company to take smart risks. In line with the company’s established risk appetite, it’s acceptable—and expected—that a company will have to weather some level of failure. The board can openly discuss unsuccessful ventures with management, leveraging those experiences as learning opportunities instead of viewing them solely as a misstep.
  3. Embrace diversity of all types. According to the Report of the NACD Blue Ribbon Commission on The Diverse Board:

[A] company’s ability to remain competitive will rely on its understanding of global markets, changing demographics, and customer expectations. Diversity is a business imperative, not just a social issue. The new business landscape will require boards to cast a wider net to find the very best talent available. As a natural corollary, the board’s mix of gender, ethnicity, and experiences will likely increase.

In his speech, Paul Taylor addressed the issue of age diversity specifically. Younger directors with relatively little board experience may be passed over for a directorship because seasoned directors perceive them as lacking the experience and credibility necessary to be effective. However, seeking out non-traditional director candidates (whether that status is determined on the basis of age or other criteria) can be critical to effectively managing a board’s talent pipeline. Established directors have the ability to mentor and develop the next wave of board leadership and, in turn, benefit from the perspectives of new directors who bring varied backgrounds and skill sets into the boardroom.

Look for full coverage of this NACD Directorship 2020 session in the May/June 2015 issue of NACD Directorship magazine.

U.S. Demographics, Hispanic Outreach, Board Service—and You

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 Our host was Mike Gonzalez and Sylvia Garcia, director of Hispanic Outreach for Newt Gingrich, was one of the attendees. I met Juan and Romanita, Gustavo and Hector, Octavio and Ana Maria, and at least three men named Manny. Jeb Bush, Jr. introduced his new wife, Sandra Algudady. The occasion was a dinner at the Heritage Foundation to celebrate the launch of Libertad, the conservative think tank’s brand new Spanish-language website.

You can read here why Heritage believes it is important to offer Hispanic audiences the opportunity to explore conservative thinking in Spanish, but the takeaways from an evening of lively discussion resonate far beyond those who would like to see not only a Republican president in the White House, but someone with at least as much affinity and respect for Latinos as presidents “41” and “43,” both of whom were lauded by the group of 30 conservative thought leaders from the world’s of business, journalism, advocacy, policy and politics.

I was at the dinner at the thoughtful invitation of NACD member Pablo Schneider, who, as a contributing editor of Latino Leaders magazine, involved NACD in producing a board edition of the publication earlier this year. The magazine is produced in English, which is good because the Irish (that’s me) may be great talkers, but we are certainly not great linguists. Latino Leaders encourages Hispanic executives to consider board service, making sure that American businesses have access to directors who will match their customers of the future.

Already, U.S. Hispanics are the country’s largest minority and have $1 trillion in purchasing power. By 2050 they are likely to be 30 percent of the U.S. population.

 Pablo and fellow NACD member Charlie Garcia, a director of Winn-Dixie and a great contributor to American society through his military and public service, will be among the directors facilitating discussions at next week’s NACD Director Professionalism®—The Master Class in Tampa, FL. They’ll be helping committee chairs and lead directors consider their own board composition and the skills and experience they may wish to consider accessing as they prepare for the future.

 Here at NACD we are practicing our language skills. The session is titled Su Mesa Directiva, Su Empresa, Y Los Mercados Hispanos, but old-school Anglophones need not worry; the discussion will be in English.

Charlie Garcia (front right) with Jeb and George Bush, 2006. Reproduced with Mr Garcia's permission