Why we must address the challenges facing the industry
EDITOR’S COMMENT: Property needs to get closer to occupiers. It’s a familiar refrain. So EG went to the CBI conference this week to do just that. Here are the top 10 topics discussed on stage and off – they are dominating thinking in UK plc and should shape yours too:
- Productivity. It takes the UK five days to produce something that takes just four in Germany and the US. Theresa May wants to close the gap. Jeremy Corbyn wants to close the gap. There are no quick fixes, but there is a consensus that technology can improve productivity among workers. How can the workplace help close the gap?
- Disruption is rife, but never uniform. Slower-moving industries, like this one, appear more stable and immune to “big bang” disruptions, but gradual, harder-to-spot “compressive disruption” is a far greater threat, eroding operating profits and revenues. Accenture chief strategy officer Omar Abbosh warns of the consequences of getting stuck focusing on the core business and ignoring innovation: empty growth, decay, false hope and decline. “CEO courage” is a large part of the solution.
- Industries built on intermediaries are ripe for disruption, says UK Treasury special envoy for fintech Eileen Burbidge. She was talking about insurance; she could have been talking about real estate.
- We need an industrial strategy that looks at UK plc’s skills base. With an old photo of a lift and its operator on the screen behind him, Microsoft president Brad Smith told the audience how we look back with incredulity that a lift was something with a job inside it. Soon, he said, we’d be asking: “You mean there was a time when taxis had a job inside them?” But new jobs were already emerging, with different skills required.
- Even disruptive forces are being disrupted. The notion of the sharing economy emerged in the early 2000s, but mainstream awareness is perhaps just two years old. In recent months its reputation has shifted from something that benefits consumers to one where many players exploit workers and avoid tax. What will the fallout be?
- Reputation matters – on tax and harassment at work. “All businesses and their leaders must take an honest look at how their tax affairs operate to ensure that we are all doing the best we can to build and maintain trust in the business community,” said CBI director general Carolyn Fairbairn. “Sexual harassment in all forms is unacceptable. The harm done to people’s lives, self-esteem, confidence and dignity is profound. We must work together to stamp it out.”
- Compete and cannibalise. Aviva chief executive Mark Wilson describes how he is changing a 300-year-old business: competing with the market and using innovation to cannibalise his own business. Oh, and don’t forget culture eats strategy for breakfast: the best-laid plans will amount to nothing unless everyone buys in.
- Don’t count on politicians. May was distinctly underwhelming. Corbyn, who preceded her, was better received but his message less welcome – higher taxes, more state control.
- Yet they need to step up. Brexit is 500 days away. CBI president Paul Drechsler warned that most UK firms will move staff or slow recruitment unless politicians halt the Brexit “soap opera”.
- London is moving east. Symbolically, CBI members, more used to meeting on Park Lane, gathered in a hotel next to the O2 Arena. The backdrop was Canary Wharf. It was as if to say to the prime minister: “This is what’s at stake.”
To send feedback, e-mail damian.wild@egi.co.uk or tweet @DamianWild or @estatesgazette
EDITOR’S COMMENT: Property needs to get closer to occupiers. It’s a familiar refrain. So EG went to the CBI conference this week to do just that. Here are the top 10 topics discussed on stage and off – they are dominating thinking in UK plc and should shape yours too:
Productivity. It takes the UK five days to produce something that takes just four in Germany and the US. Theresa May wants to close the gap. Jeremy Corbyn wants to close the gap. There are no quick fixes, but there is a consensus that technology can improve productivity among workers. How can the workplace help close the gap?
Disruption is rife, but never uniform. Slower-moving industries, like this one, appear more stable and immune to “big bang” disruptions, but gradual, harder-to-spot “compressive disruption” is a far greater threat, eroding operating profits and revenues. Accenture chief strategy officer Omar Abbosh warns of the consequences of getting stuck focusing on the core business and ignoring innovation: empty growth, decay, false hope and decline. “CEO courage” is a large part of the solution.
Industries built on intermediaries are ripe for disruption, says UK Treasury special envoy for fintech Eileen Burbidge. She was talking about insurance; she could have been talking about real estate.
We need an industrial strategy that looks at UK plc’s skills base. With an old photo of a lift and its operator on the screen behind him, Microsoft president Brad Smith told the audience how we look back with incredulity that a lift was something with a job inside it. Soon, he said, we’d be asking: “You mean there was a time when taxis had a job inside them?” But new jobs were already emerging, with different skills required.
Even disruptive forces are being disrupted. The notion of the sharing economy emerged in the early 2000s, but mainstream awareness is perhaps just two years old. In recent months its reputation has shifted from something that benefits consumers to one where many players exploit workers and avoid tax. What will the fallout be?
Reputation matters – on tax and harassment at work. “All businesses and their leaders must take an honest look at how their tax affairs operate to ensure that we are all doing the best we can to build and maintain trust in the business community,” said CBI director general Carolyn Fairbairn. “Sexual harassment in all forms is unacceptable. The harm done to people’s lives, self-esteem, confidence and dignity is profound. We must work together to stamp it out.”
Compete and cannibalise. Aviva chief executive Mark Wilson describes how he is changing a 300-year-old business: competing with the market and using innovation to cannibalise his own business. Oh, and don’t forget culture eats strategy for breakfast: the best-laid plans will amount to nothing unless everyone buys in.
Don’t count on politicians. May was distinctly underwhelming. Corbyn, who preceded her, was better received but his message less welcome – higher taxes, more state control.
Yet they need to step up. Brexit is 500 days away. CBI president Paul Drechsler warned that most UK firms will move staff or slow recruitment unless politicians halt the Brexit “soap opera”.
London is moving east. Symbolically, CBI members, more used to meeting on Park Lane, gathered in a hotel next to the O2 Arena. The backdrop was Canary Wharf. It was as if to say to the prime minister: “This is what’s at stake.”
To send feedback, e-mail damian.wild@egi.co.uk or tweet @DamianWild or @estatesgazette
