Humankind is now facing a global crisis, perhaps the biggest crisis of our generation. The decisions people and governments take in the next few weeks will probably shape the world for years to come.
We must act quickly and decisively. We should also take into account the long-term consequences of our actions. When choosing between alternatives, we should ask ourselves not only how to overcome the immediate threat, but also what kind of world we will inhabit once the storm passes. Yes, the storm will pass, but we will inhabit a different world. Everyone is looking for the answer.
What next? What are the scenarios which are likely to play out? One thing is sure there will be some fundamental changes in the way world conduct its business. Strategy for businesses will change and has to be different. It will lead to new wave of M&A. The waves of M&A caused major changes in the structure of global capitalism, causing a transition from a business atmosphere composed of agglomerations of small and medium-sized local businesses to the current form, with the market dominated by multinational corporations. Human history is full of examples that flourishing civilizations fell prey to natural calamities The five elements in the business environment are the economic and legal environment, the technological environment, the competitive environment, the social environment, and the global business environment. The waves of mergers and acquisitions are usually caused by a combination of economic, regulatory or technological changes, which are called “shocks”. Historians have identifies eight waves of M&A.
No doubt we faced similar situations in past, and the world came out. The comparable event having impact on the world as a whole can be identified as World War II. Low oil price fueled the economy post World War II. It also created huge defense industry and USA trying to control source of supply by having military strong hold on oil producing Middle East countries. One major effect of World War II was the use of nuclear weapons in war, which would later lead to the Cold War.
Let us try to ponder what will be the major impacts of this black swan event and how the world and businesses will cope-up with and come out winners. Whether the world economy order will change and if yes which industries and countries will be the winners.
Happy to hear your thoughts on the same!!