I’m hitting the ground running this week, with an opening keynote presentation for a global legal firm, who are holding their annual shareholders / partners conference in Las Vegas.
I’ve got about 800 commercial lawyers in the room; many of whom are experts in very specific niches involving real estate, financial deals, intellectual property, commercial legal issues and other areas of commercial law. All of which are segments of the economy that are being impacted by high velocity change.
My talk is focused on one key trend: in order to keep at the edge of the curve, the firm will have to position itself where its clients are going. And increasingly, those clients are getting onto the globalization bandwagon — they’re focusing on the emergence of new markets, new opportunities and new economies.
And it isn’t just BRIC (Brazil, India and China) that they the are looking at, from the key trends within my keynote:
- Goldman Sachs has identified that the next growth sector will come from the “Next 11” economies — those that are going to see a rapid transition and growth. These are Bangladesh, Egypt, Indonesia, Iran, South Korea, Mexico, Nigeria, Pakistan, Philippines, Turkey, and Vietnam
- Almost a billion new consumers will enter the global marketplace in the next decade …. with an income level that allows spending on discretionary goods – McKinsey
- By 2013, consumer spending power in emerging economies could match the spending power of Western Europe – McKinsey
- The ranks of the middle class will swell by 1.8 billion to become 52% of total population, up from 30% today – McKinsey
The law firm, which has a heavy presence in the US and Europe, will increasingly find that their clients are moving into these hot new growth markets. I’ll use as an example Molex, a US manufacturer of “electrical connectors,” who has seen results from their own globalization strategy:
- 80% of sales are now from abroad
- they just had record sales of $3.59 billion
- 6-7% of sales is committed to R&D
- 30% of current sales comes from new products developed in last 3 years
- sales are up 8.5% year over year
- 59% of it sales are in Asia, and 2/3 of its 59 manufacturing facilities are abroad
In other words, if your clients are aggressively globalizing, as a legal firm you need to do so as well — and do it fast.