Business management

An interview with Stephen Blackman

Stephen Blackman, group principal economist at NatWest, has identified the megatrends that are changing our life, work and society in a post-pandemic world.

What was the origin of the Futurefit project?

“As group principal economist for NatWest, my role is always to analyse the world we live in, discover the most important trends that are affecting our customers, and then we can build an organisation that can best respond to them. Because the impact of Covid-19 will be so huge, for this project I tried to use the insight of as many people as I could. Crowdsourcing this information helps us to discover the megatrends that will be affecting businesses for a generation.”

Many businesses are struggling just to stay open at the moment.

Why do you think they should be thinking about the long term?

“A lot of businesses are firefighting on a daily, even hourly, basis. But having a good plan is a frame of reference, and tapping into those wider powerful trends enables your business to adapt along the way. That’s why it’s important for all businesses to think about the medium and long term too.”

How much confidence can we put in any forecast of more than a few weeks at the moment?

“No one knows the future. We know more than we did back in March 2020, but we still don’t know very much. But what we do know provides us with a set of reasonable possibilities for important questions, like who my future customers will be, or what’s happening to digitisation. All those things, combined, will guide us to make better decisions now.”

Your argument is that many of the changes are a speeding-up of existing trends. But for individual company strategies, or in some sectors, everything has changed. How do you reconcile the two?

“Clearly, we have to distinguish between the general and the specific. There are some sectors and locations that serve a particular demographic that are going to be hit more by these dislocations and need to deal with that. But we can all step back in this chaos, identify these pre-existing trends and think, ‘Where do I need to upgrade? What do I need to focus on?’ and, importantly, ‘What can I leave for another day?’”

We see the government becoming more involved in our lives. Is this closer relationship between governments and individuals, businesses and sectors going to be a permanent change?

“I think so. A crisis like this requires a different way of thinking. The specific requirements of managing Covid-19 show the need to share more information with each other, between ourselves and businesses, and between ourselves and government. But that trend was happening anyway: we see from research that younger people already tend to look for more activist government.”

So are big tech companies going to play a more integral role in our lives?

“I believe they have been already. This is a good example of Covid-19 being an accelerant because the need to get this right has intensified. If we have to live with the virus for a long time, we need much better sources of information to manage it and live our lives at the same time.”

If more people want to work flexibly, or from home, can this be a good thing for some businesses?

“More people working from home is generally a good thing for both employees and employers. It’s about adapting on both sides. Clearly, firms need to ensure physical health, good mental health and good attitudes. But they can look at their physical presence and say, ‘What do we need now?’ The knowledge economy has tended to take place in city centres, clusters, places where people get together to exchange ideas. If it can be replicated in the digital space, I think those physical spaces will become much more social spaces. I am certain there is plenty of research that can be done into ensuring digital space better replicates the benefits of physical presence.”

A lot of businesses are firefighting on a daily, even hourly, basis. But having a good plan and tapping into those wider powerful trends enables your business to adapt along the way

Stephen Blackman
Group principal economist at NatWest

“For employees, it does open up inclusion and diversity, enabling those people who may not be able to go to the office every day because they are carers, have a disability or other responsibilities. They’re now able to play a full part in the workforce, and maybe work in types of jobs they weren’t able to do before. So, this is a great opportunity for individuals to participate more in the economy.”

There is never a good time to have a crisis, but this is spectacularly bad: businesses have Brexit and climate change to think about, too. What influence will they have on these trends you have identified?

“The impact of climate change is clearly a trend, whereas Brexit is perhaps more the result of an overlaying of other trends, such as technology and globalisation. In both examples, we need to ensure that individuals are equipped with the right tools, training and information so that they can participate and reach their potential.”

You talk about a model for business in future being resilient, adaptable, flexible and modular. A CEO might say: “We were doing that already.” Are you saying that they have to do better?

“Firms clearly have to rethink how they can best use their assets. Location becomes more important: if you’re only going to have one super office, you’ve got to choose the best location for that. But there are other amazing opportunities if this is done well – creating pop-up offices that are in walking distance of where people live, or the modularisation of teams.

“We talk about this as a ‘hyper-specialised’ age, but we all know that in our daily lives we’re actually doing more tasks: we do our own email, book our own travel (or used to), for example. So how do I reconcile those two things in the workplace? We need to become modular, bespoke, adaptive. In the future we’ll almost all be independent workers, deploying our specific skills depending on what our client wants. It’s a kind of modularisation of human capital, using the assets we each have. This requires more universal protection, which links to the point about changing relationships I made earlier.”

You are optimistic about people rediscovering a sense of purpose in their lives. Can businesses help that happen?

“When you ask people, particularly younger people, they say they want to identify with those brands, those businesses, they feel an affiliation to. This will be based on shared values, shared goals. Covid-19 has shown us we live in a network. Businesses cannot just focus on one thing any more. The strength of any network is when everybody participates.”

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