April 19, 2005
Advice for Future Managers? Plan for Career of Change, Says Huber
by Niti Dalal

An accelerating flow of scientific discoveries and technological advances, such as the Internet, have made the business world increasingly more complex. And it’s not about to stop.

How will the pace of change affect corporate management—and the careers of students who want to become executives?

To survive in the future, business leaders will have to be faster afoot, instituting strategies that anticipate change for their companies and for themselves, according to George Huber, a professor of management at McCombs and author of the acclaimed book, The Necessary Nature of Future Firms.

In a faculty research presentation to undergraduate students April 12, Huber stressed the importance of understanding the business environment of the future.

Huber is a highly referenced management researcher. He considers change from an historical perspective, not the quick take of the business press. For example, while business journalists tend to focus on the Internet’s role in today’s “rapidly changing environment,” Huber reminds us that that the biggest drivers of change are advances in science and improvements in technology.

“Science leads to new technology, which leads to new products, new markets, new suppliers,” he said.

Scientific advancements have historically grown at an increasing rate. In the 1660s, Huber noted, only two scientific journals existed. By 1750, 10 journals were being published. The number grew to 100 in 1800, 1,000 in 1850 and more than 10,000 in 1900.

Will science continue to grow at an increasing rate?

Why not, Huber asked. “Knowledge feeds on itself. Communication technology will allow scientists to learn more from each other more easily. There are thresholds, but we’re a long way away from these in the scientific arena.”

Of course, predicting a future that is dramatically different from what people have experienced is difficult, he said. In 1899, for example, the director of the patent office recommended shutting the office down, claiming that everything that could be invented had already been invented.

Understanding and expecting change is going to be important for companies in the long term. As the environment grows more complex, due to technologically enabled growth in the variety and number of products, customers, suppliers, competitors, and regulators, there will be an increase in problems and opportunities, and they will be generated faster. Surviving in this environment will be difficult.

Huber predicted that there will be a greater variety and intensity of competition. Companies will be able to enter the market faster and more easily, and the amount of time that a product will stand as the best in the market will decrease.

So how will this affect management practices?

Managers will have to become better sensors and interpreters of the environment, Huber said. Signals of change will come faster, which will require managers to interpret them more quickly.

Furthermore, the problems and opportunities that come tomorrow will be novel compared to the ones yesterday, forcing companies to invest more resources, and find creative new ways to monitor and interpret business environments. For every important sector, Huber said, people will have to be responsible for finding signals of change in the environments associated with their regular work, and companies will encourage everyone to be an environmental sensor.

“Firms that do not put together an infrastructure and culture to deal with change will not survive,” Huber said.

Although the business environment will be more complex, Huber does believe that leaders will be able to successfully manage the change. As accountability for decision making increases, decision making will become more rationalized and yet more rapid, helping companies to better cope with the competitive environment.

Because of heightened competitiveness, however, and the consequent fear of job loss or death of the firm, Huber said that corruption is likely to increase.

As an example, Huber cited a recent New York Times investigation into the marketing of salmon. In the investigation, a reporter ordered “wild salmon” from eight different restaurants and had the fish analyzed. Of the eight, in only two restaurants was the fish sold actually wild—in the other six the fish were farm-raised. Wild salmon sells for as much as six times the price as farm-raised.

The complexity of the future holds important implications for current students, Huber said. Students will have to retain their business and industry competence and keep up with their networks. He cautioned students not to spend more than they earned because continued employment with one firm will be unlikely. As firms become more specialized, they will need more people with expertise, but the kinds of expertise will change and keeping specialists on board is expensive.

The bottom line for future employees, according to Huber? Be ready for work lives that are more subject to shock.

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