TheShiftIndex

UncoveringtheEmergingLogicofDeepChange
JohnHagelIII,JohnSeelyBrown,andLangDavison

DeloitteCenterfortheEdge
June2009
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 ThisarticleisanextendedversionofthearticlethatappearedintheJulyAugust2009 versionoftheHarvardBusinessReview.JohnHagelIII,JohnSeelyBrown,LangDavison, TheBigShift:MeasuringtheForcesofChange,HarvardBusinessReview,JulyAugust 2009,BR0907. Downloadthereport:Measuringtheforcesoflongtermchange:The2009ShiftIndex

Aglobaleconomiccrisis.Gyratingcapitalmarkets.Bluechipcompaniesinbankruptcy.
Howdidwegetintothismess? Thecausesarecomplex,butunderlyingmanyofthemistheascendancyofshort termthinkingandbehavior.Mortgagelenders,consumers,regulators,realestate speculators,investorsduringthelongboom,justabouteverybodychosenearterm resultsoverlongtermcosts. Isitanysurprisemanyofourcurrentmodels,forecasts,andassumptionsanticipatea returntonormalaftertheGreatRecessionends?Suchcyclicalthinkingrisks shortsightedlydiscountingorevenignoringpowerfulforcesoflongerterm,secular changeforcesthatareincreasinglyundercuttingwidelyheldassumptionsaboutthe sourcesofeconomicvalue. Normalmayinfactbeathingofthepast.Trendssetinmotiondecadesagoare fundamentallyalteringthegloballandscapeasanewdigitalinfrastructure,builtonthe sustainedexponentialpaceofperformanceimprovementsincomputing,storage,and bandwidth,progressivelytransformsourbusinessenvironment.Thisinfrastructure consistsofinstitutions,practicesandprotocolsthattogetherorganizeanddeliverthe increasingpowerofdigitaltechnologytobusinessandsociety. WhilethecoretechnologiesunderlyingpreviousdisruptionstheBessemersteel process,theSiemenselectricalgenerator,theautomobileallhadonebigperformance breakthroughandthenverymodestperformanceimprovementsthereafter,today's coretechnologiescontinuetoevolveatanexponentialrate.Astheydo,the discontinuitiesthatinthepastoccurredinfrequentlynoweruptonacontinuousbasis, drivenbyadigitalinfrastructurethatshowsnoprospectforstabilization. Noone,toourknowledge,hasyetquantifiedthedimensionsofdeepchange precipitatedbythisBigShift.Bydeepchange,wewanttohighlightthatnotalllong termchangeisequallyimportant.IntryingtounderstandtheBigShift,wefocusonthe

changesthatwillhavethegreatestlongtermimpactinreshapingthegameintermsof whosucceedsandwhofails. Intermsofunderstandinglongtermchange,fragmentarymetricsandsporadic studiesexist,tobesure.Butnothingyetcapturesaclear,comprehensive,andsustained viewofthedeepdynamicschangingourworld.Weexperienceinsteadadaily bombardmentofshorttermeconomicindicatorsemployment,inventorylevels, inflation,commodityprices,etc. Cyclicalmeasureswillalwaysbenecessaryandhelpfulbuttheyarenolonger sufficient.Inanattempttosupplementtheseshorttermmetricswevedevelopeda ShiftIndexdesignedtomeasurethevelocityandmagnitudeofthelongerterm,secular forcesreshapingtheworldaroundus. Our first release of the Shift Index highlights a core performance challenge for the firmthathasbeenplayingoutfordecades.Remarkably,thereturnonassets(ROA)for U.S.firmshassteadilyfallentoalmostonequarterof1965levelsatthesametimethat wehaveseencontinued,albeitmuchmoremodest,improvementsinlaborproductivity. Additionalfindingsincludethefollowing: The ROA performance gap between winners and losers has increased over time, with the winners barely maintaining previous performance levels, while the losers experiencerapiddeteriorationinperformance. Thetopplerate,atwhichbigcompanieslosetheirleadershippositions,hasmorethan doubled,suggestingthatwinnershaveincreasinglyprecariouspositions. U.S.competitiveintensityhasmorethandoubledduringthelast40years. While the performance of U.S. firms is deteriorating, the benefits of productivity improvements appear to be captured in part by creative talent, which is experiencing greater growth in total compensation. Customers also appear to be gaining and using powerasreflectedinincreasingcustomerdisloyalty. The exponentially advancing price/performance capability of computing, storage, and bandwidthisdrivinganadoptionrateforournewdigitalinfrastructure1thatistwoto five times faster than previous infrastructures, such as electricity and telephone networks. Given these longterm trends, we cannot reasonably expect to see a significant easingofperformancepressureasthecurrenteconomicdownturnbeginstodissipate onthecontrary,alllongtermtrendspointtoacontinuederosionofperformance.

More than just bits and bytes, this digital infrastructure consists of institutions, practices, and protocols that together organize and deliver the increasing power of digital technology to business and society.


Firm performance metric trajectories (1965-2008)

1965

Present

Labor Productivity
Source: Deloitte analysis

Competitive Intensity

Return on Assets

Topple Rate

Theseconclusionscanbeframedintermsofaperformancechallengeontwolevels forourinstitutions.Atthefirstlevel,ourproductivityisimprovingataratefarslower thantheunderlyingincreaseinperformanceofourdigitalinfrastructures.Thegap betweenpotentialandrealizedperformanceissteadilywidening. Atasecondlevel,firmperformancecontinuestodeteriorateascompetition intensifies,drivenbythespreadofdigitalinfrastructuresandpublicpolicyinitiatives thatreducebarrierstoentryandbarrierstomovement.Inotherwords,firmsarefailing tocapturethebenefitsforthemselvesorfortheirshareholdersofeventhemodest productivityimprovementsachieved.Thesebenefitsinsteadappeartobecaptured increasinglybycreativetalentandcustomers,whoaregainingmoremarketpoweras competitionintensifies. Simplyput,theperformancechallengeisthatfirmsarefailingontwolevels:theyare failingtoharnessthefullpotentialofdigitalinfrastructuresintermsofproductivity improvementandthebenefitsfromthemodestimprovementsinproductivityarebeing suckedoutofthefirmandcapturedbyincreasinglypowerfulconstituenciestalentand customers. Ourinstitutionalleadership,preoccupiedbyshorttermforces,hasfailedtonotice thedeeperchangestakingthecorporatesectoreverfurtherintodifficulty.Cyclical

Exhibit1:WhileU.S.workersproductivityhasgrown,ROAhasdropped

recoveryintheeconomymayagainmakethesymptomslessimmediatelyapparentbut theunderlyingtrendsappeartoberelentlessintheirforwardmarch. Howdowereversethisseculartrend?Forprecedentandinspirationwemightlook tothegenerationofcompaniesthatemergedintheearly20thcentury.AsAlfred ChandlerandRonaldCoaselatermadeclear,thesecompaniesdiscoveredhowto harnessthecapabilitiesofnewlyemergingenergy,transportation,andcommunication infrastructurestogenerateefficiencyatscale. Todayscompaniesmustmakethemostofourownerasnewinfrastructurethrough institutionalinnovationsdrivenbyshiftingtherationaleforthefirmfromscalable efficiencytoscalablelearning.Theseinstitutionalinnovationsofferthepromiseof generatingmuchgreaterproductivityimprovementfromourcontinuallyevolvingdigital infrastructures.Evenascompetitioncontinuestointensify,substantiallygreater rewardsshouldmakeiteasierforcompaniesandtheirshareholderstocapturetheirfair shareofthesegrowingrewards.OnlythenwilltheShiftIndexturnfromanindicatorof corporatedeclinetoonereflectingpowerfulnewmodesofeconomicgrowth. TheDeepDynamicsoftheBigShift TheShiftIndexconsistsofthreeindicesdesignedtocapturethreewavesoflong term,deepchange.Byquantifyingtheseforcesweseektohelpinstitutionalleaders steeracoursefortruenorth,whilehelpingminimizedistractionfromtheshortterm eventsthatcompetefortheirdailyattention.Ratherthansimplyreactingtoevents, institutionalleaderswillbebetterpositionedtoanticipatethechangesthatwillmake thegreatestdifferenceintermsofsuccessorfailure.WhilethisShiftIndexoffersrich insightevenitsfirstrelease,thevalueoftheShiftIndexwillincreaseovertimeasthe broadertrajectoryandpaceofchangecanbemoreclearlydefinedforeachmetric WaveOneBuildingtheFoundations Thefirstwaveofchangeinvolvestherapid,unflaggingevolutionofanewdigital infrastructureandparallel,magnifyingshiftsinglobalpublicpolicythathavereduced barrierstoentryandmovement.Thesefoundationalforces,playingoutoverthelast fivedecades,catalyzeandcontextualizethemanyotherchangesoccurringinnearly everydomainofcontemporarylife.Asaresult,thechangesinthesefoundationalforces providepowerfulleadingindicatorsofthedeepchangesthatwillbeplayingoutover timeinotherwavesoftheBigShift. TheFoundationIndexquantifiesandtrackstherateofchangeinthesefoundational forces.Keymetricsincludethechangeinperformanceofthetechnologyfoundationsof

thedigitalinfrastructure,growthintheadoptionrateofthisinfrastructureandasub indexmeasuringproductandlabormarketregulationintheeconomy. WaveTwoUnleashingRicherFlowsofKnowledge Thesecondwaveofchangewillbecharacterizedbyincreasingflowsofcapital, talent,andknowledgeacrossgeographicandinstitutionalboundaries.Inthiswave intensifyingcompetitionandtheincreasingrateofchangeprecipitatedbythefirstwave shiftsthesourcesofeconomicvaluefromstocksofknowledgetoflowsofnew knowledge.Inthisrapidlychangingworld,ourstocksofknowledge(whatweknow) obsolescemorequicklyandsuccessdependsincreasinglyonourabilitytotapinto expandinganddiverseflowsofknowledgetomorerapidlyrefreshourdepletingstocks ofknowledge.Whiletheseknowledgeflowsareenhancedandenrichedbydigital infrastructures,themostvaluableknowledgeflowsthosethatresultinnew knowledgecreationratherthansimpletransfersofwellcodifiedexistingknowledge stillmostoftenoccurinphysicalspacethroughfacetofaceinteractions.Inthisrapidly changingworld,thereisfarmorevalueinatightlyknitteambringingtogetherdifferent experiencesandviewsoftheproblemtosolveanewperformancechallengethanin readingatrainingmanual. ThemetricsintheFlowIndexcapturesphysicalandvirtualflowsaswellasthe amplifierssuchashowpassionatelyengagedemployeesarewiththeirjobsandsocial mediausethatresultfromandmagnifytheeffectofthedigitalinfrastructure.Given theslowerratewithwhichsocialandprofessionalpracticeschangerelativetothe digitalinfrastructure,thisindexwilllikelylagtheFoundationIndex.Itwillbeextremely helpfultotrackthedegreeoflagovertimeforspecificelementsofknowledgeflowsis itincreasingordecreasing? WaveThreeEffectivelyAddressingthePerformanceChallenge ThethirdwaveoftheBigShiftreflectstheabilityofcompaniestoharnessthefirst twowavesofchangesthroughinnovationstoinstitutionalarchitecturessuchasthe abilitytodeployscalablelearningecosystemswhereperformanceacceleratesasmore participantsjoin.Overtime,theseinnovationswillenablefirmstodevelopandadopt newwaysofcreatingandcapturingwealthinthedigitalera.Initialdeteriorationin shareholdervalueandROAwilleventuallyimproveasfirmsharnessthefoundational andflowforcesofthefirsttwowavesofchangeandacceleratetheirrateof performanceimprovement. TheImpactIndexisforthatreasonalaggingindicatorreflectingtheimpactofthe deepchangesplayingoutinthefirsttwowavesontheperformanceofthefirmand equitymarkets,consumerchoice,andthevaluecapturedbytalent.
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Shift index indicators
Competitive Intensity: Herfindahl-Hirschman Index Labor Productivity: Index of labor productivity as defined by the Bureau of Labor Statistics Stock Price Volatility: Average standard deviation of daily stock price returns over one year Asset Profitability: Total ROA for all US firms ROA Performance Gap: Gap in ROA between firms in the top and the bottom quartiles Firm Topple Rate: Annual rank shuffling amongst US firms Shareholder Value Gap: Gap in the TRS1 between firm in the top and the bottom quartiles Consumer Power: Index of 6 consumer power measures Brand Disloyalty: Index of 6 consumer disloyalty measures Returns to Talent: Compensation gap between more and less creative occupational groupings2 Executive Turnover: Number of Top Management terminated, retired or otherwise leaving companies Inter-firm Knowledge Flows: Extent of employee participation in knowledge flows across firms Wireless Activity: Total annual volume of mobile minutes and SMS messages Internet Activity: Internet traffic between top 20 US cities with the most domestic bandwidth Migration of People to Creative Cities: Population gap between top and bottom creative cities2 Travel Volume: Total volume of local commuter transit and passenger air transportation3 Movement of Capital: Value of US Foreign Direct Investment inflows and outflows Worker Passion: Percentage of employees most passionate about their jobs Social Media Activity: Time spent on Social Media as a percentage of total Internet time Computing: Computing power per unit of cost Digital Storage: Digital storage capacity per unit of cost Bandwidth: Bandwidth capacity per unit of cost Internet Users: Number of people actively using the Internet as compared to the US population Wireless Subscriptions: Percentage of active wireless subscriptions as compared to the US population Economic Freedom: Index of 10 freedom components as defined by the Heritage Foundation

Markets

Impact Index

Firms

People

Virtual Flows

Flow Index

Physical Flows

Amplifiers

Foundation Index

Technology Performance Infrastructure Penetration Public Policy

1. TRS Total Return to Shareholders 2. Creative occupations and cities defined by Richard Florida's "The Rise of the Creative Class." 2004 3. Measured by the Bureau of Transportation Statistics Transportation Services Index Source: Deloitte analysis

Exhibit2:TheShiftIndexconsistsofthreeindicesthatquantifythethreewavesofthe BigShiftFoundationIndex,FlowIndexandImpactIndexeachmeasuredbyasetof indicators.

ShiftIndexFindings OurinitialdevelopmentoftheShiftIndexhasfocusedontheUSandUSindustries. Subsequentreleaseswillbroadentheindextoaglobalscopeandprovideadiagnostic tooltohelpassesstheperformanceofindividualcompaniesrelativetoasetoffirm levelmetrics. Thechoiceofmetricsreflectedarobustselectionprocess.Manymetricsare directionalproxieschosenintheabsenceofidealalternatives.Somearedrawnfrom secondarydatasourcesandanalyticalmethodologies;someareproprietary.Whilethe datarevealssignificantcorrelationsacrossmetricsconsistentwiththeunderlyinglogic ofourtheoreticalframeworkthefindingsaresuggestive.Wehavenotattemptedto provecausalitygiventhelimitationsintheabilitytogeneratedatatodirectlyandtightly measuremanyofthedeepchangesoccurringaroundus,butwearehopefulthatthe

ShiftIndexwillbecomeacatalystforabroadsetofresearchtotestandrefineour findings. Foramuchdeeperlookatourmethodologyanddataaswellasafulldiscussionof ourfindingspleaseseeThe2009ShiftIndexReport. Overall,theShiftIndexsuggeststhatthedeepchangesintheFoundationIndex continuetomoveatafasterpacethanthechangesineitherFloworImpactIndices. ThetrendlineforchangesinFoundationmetricshasamuchsteeperslopeof7.83 relativetotheslopeof5.95measuringchangeforFlowmetricsorandtheslopeof1.93 forImpactmetrics. ThisisoneimportantwaytotrackwhereweareintheoverallBigShift.Wewould expectthatcountriesandindustriesthatareintheearlieststageoftheBigShiftwillsee thehighestratesofchangeintheFoundationIndex.Overtime,astheBigShiftgathers momentumandpervadesbroadersectorsoftheeconomyandsociety,wewouldexpect toseetheratesofchangeintheFlowandImpactIndicestopickupspeedwhiletherate ofchangeintheFoundationIndexmaybegintoshowsignsofslowingdown. FoundationIndex TheFoundationIndex,witha2008scoreof153,hasincreasedata10percent compoundannualgrowthrate(CAGR)since1993,andtellsthestoryofaswiftlymoving digitalinfrastructurepropelledbyunremittingpriceperformanceimprovementsin computing,storage,andbandwidththatshownosignsofstabilizing.Ourfindingsshow thattherateofchangeintheperformanceofthetechnologybuildingblocks substantiallyexceedstherateofchangeinthetwootherfoundationalmetrics adoptionratesandpublicpolicyshifts.Itremainstheprimarydriverofalltheother deepchanges. Publicpolicyremainsthewildcard.Thereisconsiderableriskthatapolicybacklash drivingincreasingbarrierstoentryandbarrierstomovementmaygainforcein responsetotheintensepressuresofthecurrenteconomicdownturn.TheShiftIndex willmonitorthistrendovertimerelativetothechangesintheotherfoundations. FlowIndex TheFlowIndex,witha2008scoreof139,hasincreasedatasevenpercentCAGR since1993,althoughthetrendanalysesarelimitedherebytheearliestdatesforwhich dataisavailable. ThecreativeclassesRichardFloridaidentifiedasthedrivingforceforeconomic developmentcontinuetoincreasinglycongregateinconcentratedspikesoftalent. Increasingnumbersofcreativesarefleeingtheconfinesofthefirm,aswell.This
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creativetalentisthemostpassionateabouttheirwork,andmostlikelytoparticipatein knowledgeflowsrelativetotheirlesspassionatepeers. Thefacetofaceinteractionsthatdrivethemostvaluableknowledgeflowsresulting innewknowledgecreationareimpossibletomeasuredirectly.Socialmediausage, conferenceandwebcastattendance,professionalinformationandadvicesharedby telephoneandinlunchmeetingsallprovidesuggestiveproxiesofvariouskindsof knowledgeflows.OurShiftIndexsurveysestablishabaselineoftheseactivitiesand indicatesthatsocialmediasuchasFacebookmaybeexpandinginterfirmknowledge flows.Futuresurveyswillquantifythemagnitudeandpaceofchangeofthese importantflows.
Participation in Inter-Firm knowledge flows by type of worker (2008)
30%
Participation Percentage

25% 20% 15% 10% 5% 0% Disengaged Google Alerts Community Org. Passive Web-casts Conferences Engaged Social Media Professional Org. Passionate Lunch meetings Share info on phone

Source: Synovate, Deloitte analysis

Exhibit3:Workerswhoarepassionateabouttheirjobsaremorelikelyto participateinknowledgeflowsandgeneratevalueforcompanies

ImpactIndex TheImpactIndex,witha2008scoreof111ata2.4percentrateofchangesince 1993,tellsthestoryofintensifyingcompetitiontakingitstolloncorporateperformance despiteasteadyriseinlaborproductivityacrossalltheindustriesinourstudy. Consistentwithourviewthatnewdigitalinfrastructurescreatethepotentialformuch greaterimprovementsinproductivity,itisstrikingthattheTechnologyand Telecommunicationsindustriestheonesmostheavilyinvolvedindefiningand deployingthedigitalinfrastructureshaveledthepackintermsofproductivity improvement. Atthesametimetheeconomicenvironmenthasbecomeconsiderablymore unstable,asshownbyincreasesinthetopplerateatwhichcompanieslosetheir

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leadershippositions,adoublinginstockpricevolatilitysince1972,andgrowing divergencebetweenwinnersandlosers,asmeasuredbybothshareholdervalue creationandROA. Meanwhile,creativetalentcontinuestocaptureincreasinglydisproportionate returnsintermsoftotalcompensationrelativetotherestofthelaborforce.These increasesinreturnstocreativetalentappeartobecorrelatedtoanaccelerationof growthofthemostcreativecities.Onthecustomerside,newgenerationsenteringthe marketplaceappeartobemorewillingtoexercisetheirmarketpowertoswitchto productsandservicesthatmoreeffectivelymeettheirneeds,puttinggreaterpressure onvendors. Thegrowingpowerofcreativetalentandcustomersascompetitionintensifiesrises helpstoresolvethemysteryofwhyROAisdecliningsomarkedlyatthesametimethat productivityimprovementscontinuetooccur.Theanswerisnottofindwaystosqueeze creativetalentandcustomersinazerosumbattletocapturemoreoftheexistingpie.
Economy-wide Asset Profitability (1965-2008)
5.0% 4.5%
Return on Assets (%)

4.7%

4.0% 3.5% 3.0% 2.5% 2.0% 1.5% 1.0% 0.5% 0.0% 1965 1969 1973 1977 1981 1985 1989 1993 1997 2001 2005 2008 0.5%

Return on Assets
Source: Compustat, Deloitte analysis

Exhibit4:AssetprofitabilityforU.S.firmssteadilyfallmorethan75% overthepastfourdecades

TheShiftIndexsuggeststhatinsomeindustriescompanieshavepursuedaggressive M&Astrategies.Whilethismayhelptodrivenewscaleefficienciesandmarketpower intheshortterm,thesedefensivestrategiesareadiminishingreturnsgame.Thistends tobeconfirmedbythefactthatwinnersinthegrowingperformancegaparebarely hangingonintermsofsustainingexistinglevelsofperformanceeventheyarefinding itverydifficulttoholdontothebottomlinebenefitsofproductivityimprovements.

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Economy-wide Asset Profitability by quartile (1965-2008)

20% 15% 10% 5%
Return On Assets (%)

12.9%

11.0%

0% Top Quartile

20% 0% -20% -40% -60% -80% -100%

1.2% -14.7%

1965

1969

1973

1977

1981

1985

1989

1993

1997

2001

2005

2008

Bottom Quartile
Source: Compustat, Deloitte analysis

Exhibit5:Winningcompaniesarebarelyholdingon,whilelosersarerapidlydeteriorating

Asanalternative,theopportunityistodriveinstitutionalinnovationtomore effectivelyharnesstheperformancepotentialofdigitalinfrastructuresandfindwaysto unleashthecreativepotentialoftherestoftheworkforce(notjustthecreative professions)sothatthereisamuchbiggerpieintermsoftotalreturnsthatcanbe sharedmorefairlywithallrelevantconstituencies. Summary Itiscompletelyunderstandablethatweallhavebecomesofocusedontheshort termeconomiceventsplayingoutaroundus.Atthesametime,though,itisvery dangeroustolosesightofthedeepchangesthatwillcontinuetoplayoutlongafterthe currenteconomicdownturnisadistantmemory.Wefacealongtermperformance challengethatcontinuestointensify.Thestepswetakenowtoaddressthischallenge willnotonlyhelpustoweatherthecurrenteconomicstormsbutwillpositionusto createsignificanteconomicvalueinanincreasinglychallengingbusinesslandscape.We believethattheShiftIndexcanserveasausefulcompassandcatalystfortheactions requiredtoturnaperformancechallengeintoaperformanceopportunity.

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JohnHagelIII Cochairman, Deloitte'sCenterfortheEdge JohnHagelIIIhasnearly30yearsexperienceasamanagement consultant,author,speakerandentrepreneur,andhashelped companiesimprovetheirperformancebyeffectivelyapplying informationtechnologytoreshapebusinessstrategies.John currentlyservesascochairmanoftheSiliconValleybased DeloitteCenterfortheEdge,whichconductsoriginalresearchand developssubstantivepointsofviewfornewcorporategrowth. BeforejoiningDeloitte,Johnwasanindependentconsultantand writer.Priortothat,heheldsignificantpositionsatleading consultingfirmsandcompanies.From1984to2000,hewasaprincipalatMcKinsey& Co.,wherehewasaleaderoftheStrategyPractice.Inaddition,hefoundedandled McKinseysElectronicCommercePracticefrom1993to2000.Johnhasalsoservedas seniorvicepresidentofstrategicplanningatAtari,Inc.,andearlierinhiscareer,worked atBostonConsultingGroup.HeisthefounderoftwoSiliconValleystartups. Johnistheauthorofaseriesofbestsellingbusinessbooks,includingNetGain,Net Worth,OutoftheBoxandTheOnlySustainableEdge.Hehaswontwoawardsfrom HarvardBusinessReviewforbestarticlesinthatpublicationandhasbeenrecognizedas anindustrythoughtleaderbyavarietyofpublicationsandprofessionalservicefirms. DeloitteCenterfortheEdge TheBigShiftBlog JohnHagel.com EdgePerspectives EdgePerspectivesBlog

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JohnSeelyBrown IndependentCochairman, Deloitte'sCenterfortheEdge JohnSeelyBrownistheindependentcochairmanoftheSilicon ValleybasedDeloitteCenterfortheEdge,whichconductsoriginal researchanddevelopssubstantivepointsofviewfornewcorporate growth.Inaddition,heisanAdvisortotheProvostandaVisiting ScholarattheUniversityofSouthernCalifornia,apositionhehasheld since2003.ThispositionfollowedalengthytenureatXerox Corporation,whereheservedaschiefscientist(19922002)and directoroftheXeroxPaloAltoResearchCenter(PARC)(19852000). WhileheadofPARC,Johnexpandedtheroleofcorporateresearchto includesuchtopicsasorganizationallearning,complexadaptivesystems,micro electricalmechanicalsystem(MEMS)andNanotechnology.Hisresearchinterests includedigitalculture,ubiquitouscomputing,serviceorientedarchitectures,global innovationnetworksandlearningecologies. In2009,JohnwaselectedasamemberoftheAmericanAcademyofArts&Sciencesin thefieldofComputerSciences.HeisalsoamemberoftheNationalAcademyof Education,afellowoftheAmericanAssociationforArtificialIntelligenceandatrusteeof theMacArthurFoundation.Heservesonseveralcorporateandadvisoryboards.John haspublishedmorethan100papersinscientificjournalsandauthoredorcoauthored fivebooks,including"TheSocialLifeofInformation"and"TheOnlySustainableEdge." Heholdsabachelor'sdegreefromBrownUniversity,adoctoratefromtheUniversityof MichiganandhonorarydoctoratesfromBrown,theUniversityofMichigan,Claremont GraduateUniversity,theUniversityofLondonsBusinessSchoolandNorthCarolina StateUniversity. DeloitteCenterfortheEdge TheBigShiftBlog JohnSeelyBrown.com

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LangDavison ExecutiveDirector, Deloitte'sCenterfortheEdge LangDavisonistheexecutivedirectoroftheDeloitteCenterforthe Edge,whichconductsoriginalresearchanddevelopssubstantive pointsofviewfornewcorporategrowth. Inthisrole,Langdefinesandguidesthemarketplacepositioningand developmentofthecentersplatformsandkeyactivities,andhelps representDeloittewithselectclients.Heisalsoresponsiblefor discoveringanddevelopingdistinctiveintellectualcapitaland distributingittoaudiencesinnewandmeaningfulways. LangjoinedDeloittefromMcKinsey&Company,wherehewaseditorofitsflagship publication,TheMcKinseyQuarterly.Duringhis14yearsatMcKinsey,Langservedina varietyofseniorcommunications,contentandmediaroles,leadingthedevelopment teamformckinseyquarterly.com,whichheeditedfrom1998to2003.Hewasthe collaboratingwriterforthebestsellingandcriticallyacclaimedbooksNetGainandNet Worthandformorethan300articlesinTheMcKinseyQuarterly,HarvardBusiness Review,FinancialTimesandTheWallStreetJournalbythoughtleaderslikeStanfords RobertSutton,HarvardsPankajGhemewat,McKinseysLowellBryanandEric Beinhocker,andInternationalInstituteforManagementDevelopmentsPhil Rosenzweig.UnderhisownbylinehehaspublishedinHarvardBusinessReview,The ConferenceBoardReview,DeloitteReview,andotherpublications. DeloitteCenterfortheEdge TheBigShiftBlog ThisabstractispartofalargerresearcheffortaroundtheShiftIndexconductedat DeloitteCenterfortheEdgeledbyDuleeshaKulasooriyaandTamaraSamoylova withthesupportofBrentDance,MarkAstrinos,andDanElbert.

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