Is your business strategy missing the gorilla?

by Joseph F. Coughlin

Two psychologists, Daniel Simons and Christopher Chabris, conducted a now-classic experiment called the “Invisible Gorilla.” Participants viewed a video of a basketball game and were asked to count the number of ball passes between players. Without warning, a person dressed in a gorilla suit walked into the middle of the video, paused, and then walked off.

About half of the participants in the experiment missed the gorilla. This startling statistic is not just a quirk of human perception, but a reflection of a deeper issue. The experiment’s findings demonstrate how people have selective attention and are so focused on a task or activity that they miss a significant change fully in their view. They are, in effect, blind to change, often called change blindness.

Organizations also suffer from change blindness, which can have serious implications for their strategy and competitiveness. Nearly every business news story, investor note, company annual report, and strategy discussion is focused on the fast, flashy, and one might even describe them as fashionable change agents of the day. Few would dare give a presentation or make a strategy recommendation without identifying the potential and peril of artificial intelligence, the uncertainty of geopolitics, the ups and downs of inflation, guessing the Fed’s next move, and the impacts of the coming election. In fact, as these factors are reported by many, they form a reinforcing chorus of what must be integrated into strategy. Of course, these factors must be considered, but strategy discussions rarely mention or reflect the impact of changing demographics with much in-depth contemplation.

Unlike these other strategic factors, demography does not have an event, a shiny object, or a product launch to grab attention and fire up emotions. Few images are available to show the longer-term impact of population and lifestyle trends and simultaneously ignite the imagination. Unless you’re a numbers nerd, then there are loads of line and bar charts. Demographic trends play out over long periods, and while they have a lasting impact, they are sometimes beyond standard reporting periods and the professional career horizons of market and investment strategists. It is ironic given that strategy, by definition, is about the long view. And unlike technology, economics, and even geopolitics, demography is the longest of views with any predictive power.

Don’t get me wrong, demography is getting more attention. There are periodic pieces in fine publications like The Economist, FT, and the Wall Street Journal that describe coming trends. Unfortunately, often, the tone and framing of many of these pieces discuss how demographic trends are disrupting markets or heading us all to pension and healthcare ruin. Few observers, however, call business and government leaders to act and to imagine how new markets are being created, how housing, community, work, education, and even retirement and fun must be rethought, as well as how traditional life course assumptions may be at best incomplete, if not outright incorrect in today’s society.

Many demographic trends are hiding in plain sight. They are the gorilla in the middle of the game that few see, and even fewer are integrating into market and workforce strategies to succeed in tomorrow’s business and policy environment. What are some of those trends?

  • Global aging
  • Longer life expectancy
  • Delayed adulthood
  • Plummeting fertility rates
  • Households of one
  • Economic power of women
  • Immigration and migration

I discuss a few of these transformative demographic trends in my recent Op-Ed in Chief Investment Officer Magazine (Change Blindness? The risks and opportunities of demographic change are hiding in plain sight)

In my article in the current issue of Investment & Wealth Monitor, I consider how demographic changes will impact financial services, Preparing for the New Average: The changing face of tomorrow’s financial services client.

So, the question is, is your organization just counting ball passes in a game everyone else is playing, or does it see the gorilla?

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About the Author

Photo of Joseph F. Coughlin
Joseph F. Coughlin

Joseph F. Coughlin, PhD is Director of the Massachusetts Institute of Technology AgeLab. He teaches in MIT's Department of Urban Studies & Planning and the Sloan School's Advanced Management Program. Coughlin conducts research on the impact of global demographic change and technology trends on consumer behavior and business strategy. He advises a wide variety of global firms in financial services, healthcare, leisure and travel, luxury goods, real estate, retail, technology, and transportation.

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