No Ordinary Disruption ─ The Four Global Forces Breaking All the Trends

Our intuition on how the world works could well be wrong. We are surprised when new competitors burst on the scene, or businesses protected by large and deep moats find their defenses easily breached, or vast new markets are conjured from nothing. Trend lines resemble saw-tooth mountain ridges.


The world not only feels different. The data tell us it is different. Based on years of research by the directors of the McKinsey Global Institute,No Ordinary Disruption: The Four Forces Breaking all the Trends is a timely and important analysis of how we need to reset our intuition as a result of four forces colliding and transforming the global economy: the rise of emerging markets, the accelerating impact of technology on the natural forces of market competition, an aging world population, and accelerating flows of trade, capital and people.


Our intuitions formed during a uniquely benign period for the world economyoften termed the Great Moderation. Asset prices were rising, cost of capital was falling, labour and resources were abundant, and generation after generation was growing up more prosperous than their parents.


But the Great Moderation has gone. The cost of capital may rise. The price of everything from grain to steel may become more volatile. The world’s labor force could shrink. Individuals, particularly those with low job skills, are at risk of growing up poorer than their parents.


What sets No Ordinary Disruption apart is depth of analysis combined with lively writing informed by surprising, memorable insights that enable us to quickly grasp the disruptive forces at work. For evidence of the shift to emerging markets, consider the startling fact that, by 2025, a single regional city in ChinaTianjinwill have a GDP equal to that of the Sweden, of that, in the decades ahead, half of the world’s economic growth will come

from 440 cities including Kumasi in Ghana or Santa Carina in Brazil that most executives today would be hard-pressed to locate on a map.


What we are now seeing is no ordinary disruption but the new facts of business life facts that require executives and leaders at all levels to reset their operating assumptions and management intuition.

Richard Dobbs is a director of the McKinsey Global Institute (MGI), McKinsey's business and economics research arm, and a director (senior partner) of McKinsey based in London. From 2004 to 2009, Richard co-led McKinsey's Corporate Finance Practice, where he was also responsible for research and development. He has served clients around the world in a variety of industries, ranging from high tech and financial services to petroleum, utilities, and the public sector.

Richard has written numerous articles about the implications of the financial crisis for companies and managing in a downturn. At McKinsey Global Institute he has led research on global economic trends, including urbanization, resource markets, capital markets, and productivity and growth. Other research has focused on performance management and measurement, mergers and acquisitions, valuation, capital markets strategy, and utility regulation. He was a co-author ofValue: The Four Cornerstones of Corporate Finance, and his work has appeared in several books, includingValuation: Measuring and Managing the Value of Companies; in other business and academic journals such as theMcKinsey Quarterly, McKinsey on Finance, and Corporate Finance; and on the opinion pages of leading newspapers and business publications

James Manyika is a director of the McKinsey Global Institute (MGI), McKinsey & Company’s business and economics research arm, and one of its three global co-leaders. James is also a director (senior partner) at McKinsey, where he is one of the leaders of McKinsey’s Global High Tech, Media and Telecom Practice. Based in Silicon Valley, for the past 18 years he has worked with many of the world’s leading software, systems, Internet, media, and communications companies on a variety of issues, including strategy, innovation, and helped companies outside of the tech sector fully leverage technology for business transformation. James was appointed by President Obama to serve on the President’s Global Development Council and to serve as the vice chairman of the Council. James is a non-resident senior fellow of the Brookings Institution and a member of the Council on Foreign Relations.

Based in Shanghai for more than 15 years, Jonathan Woetzel has been instrumental in establishing and scaling McKinsey's presence in China. He works with Chinese businesses to develop strategies, organizations, and operations for global growth, and with city, regional, and national authorities on energy, sustainability, and economic development. Published widely in both Chinese and international publications, Jonathan has written three books on China, includingCapitalist China: Strategies for a Revolutionized Economy (Wiley & Sons, 2003). He also co-authored with Jimmy Hexter the book,Operation China: From Strategy to Execution (Harvard Business Press, 2007).