Inarticulate ramblings of a management consultant

the day to day experiences of a consultant operating in weird and wonderful client situations

The great unravelling

Dear friends (those of you who have signed up to this blog are almost inevitably that!), it’s been a while and I realise that I have broken the cardinal rule of blogging… that is regular, predictable and interesting pieces of short, concise and opinion filled content!

Many of you will know that I and my family have been through a process of ‘re-potting’ as it’s described these days…a return to the old country after 8 years in the gloriously crazy, massively contradictory, infuriating and enervating environs of South East Asia. There’s probably a whole host of material to write about in that experience, from the extraordinary ability of children to adjust physically and psychologically to a new world, to a sense of unease and uncertainty as both the ‘repotees’ and those who form the core network adjust to the changing social world. But that is for a different time.

Today I wanted to reference an extraordinary speech made by Sir Christopher Meyer at an excellent EY networking event in October. Sir Christopher talked extremely eloquently about the consequences  of the ‘post factual’, growingly nationalist world, in terms of the increasing marginalisation of the great multinational institutions (the EU post Brexit, the UN, the IMF, Worldbank -increasingly challenged by other more regionally, or indeed nationally focused institutions such as the AIIB). He described this as the ‘great unravelling’ and described diplomacy as going back to the world of the 19th and early 20th century where ‘spheres of influence’ were the areas of interest

My question is whether we see a similar process taking place in the world of multinational corporations. Two examples: InBev’s divestment programme is perhaps a footnote as it tries to absorb the behemoth SAB Miller and in so doing sheds a number of previously cornerstone assets (Coors, Grolsch, Peroni); the rather smaller but perhaps significant example of Mondelez selling the iconic Vegemite brand and production capability back to a new set of owners in Australia….what Trump might describe a re-nationalisation of a core, beloved brand!

The same unravelling process can also be identified in Financial Services as the number of global banks shrink (under pressure local and regional regulators local forcing local incorporation, minimising off shore transaction capability and capitalisation at a branch or national level with the subsequent regulatory requirements) and we move back to an age of ‘correspondent’ banking for cross border transactions. Even for those Chinese integrators, once again leading the market in terms of volume and value of transactions, their acquisition ambitions are perhaps a reflection of pent up demand rather than global dominance…or am I being naive?

What then are the consequences of global unravelling in the corporate world? What happens to the global supply chain if we find ourselves in a situation with increasing disparate political institutions where trade / access to markets is used as a weapon to exert influence? What influence does the corporate lobby actually have in the political chambers of the larger nations of the world to prevent / change this from happening, given the political ‘mandate’ on which the wave of populist politicians have been elected?

More questions than answers this week. As ever I’d appreciate your thoughts and ideas. You can reach me via the usual channels of Linkedin or through the comments section below.

Categories: C suite leadership, Mergers & acquisitions, Post merger integration, Strategy, Transformation

Tags: , , , ,

2 replies

  1. Good to have you back blogging again!

    Like

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