January, 1998 - The New Year
FCC is considering whether enhanced service providers, such as ISPs, should be required to pay interstate access charges. The Commission tentatively concludes that ISPs should not be subject to access charges as currently constituted. See Fact Sheet on the FCC, Internet Service Providers and Access Charges for information. Comments must be sent to isp [at] fcc.gov before February 13, 1998.
1998 themes will shift to balance the creative, chaotic aspects of 1997. More emphasis in 1998 will be on using the information learned from the past few years to continue plans already in place and previous projects already started. Chaotic growth and expansion can only continue so long without a correction. Rather than sudden major changes, 1998 offers an opportunity for disciplined managed growth - a more grounded, focused year to build on past efforts. 1998 is also a good year for throwing out what doesn't work.
The economy will continue to expand for the next few years with increases in overall productivity without creating unhealthy inflation or high unemployment.
The strong worldwide growth of the Internet and new technologies, with all their implications, will continue to affect every aspect of business as we know it. The stock market should improve throughout the year, although ups and downs are to be expected, reminding us that humans cannot control the stock market any more than we can control Mother Nature. Sudden changes (up or down) will become "normal" and cause less distress as we adjust to more realistic expectations.
Intellectual pursuits of all kinds will be more evident in 1998, compared to the emotional aspects of 1997. Intellectual pursuits include the study of philosophy, a desire to understand, people sharing ideas in small groups, new discoveries, new inventions and new ways of doing business.
More attention will be spent seeing how things fit into the big picture. Big picture thinking also helps people see things in a more pragmatic, efficient way. If something is not working, the pragmatic solution is to either fix it or eliminate it. Keeping a big picture focus also relieves the fear and insecurity associated with minor ups and downs of life.
Telling the truth continues to be a big theme. This includes the general public's demands on politicians at all levels and the emphasis on truth in advertising. Part of this attention is affecting the computer industry as the public refuses to put up with shoddy products and untested software that flooded the market in 1997, which we mentioned last year.
Productivity improvements are greatly needed in business. The entrepreneurial spirit is affecting more and more people, and small business growth will continue to increase at noticeable levels. Large, inefficient corporations will continue reorganizing, downsizing, merging and restructuring. However, we expect the strength of economic growth areas will more than absorb any layoffs. Companies will continue to encourage smaller, more efficient business units, and promote joint ventures and partnership arrangements.
Simplicity will be a growing theme in all aspects of our life: simpler tax codes, simpler laws, simpler employment rules. We are becoming overburdened with complexity and people have had enough. This drive to simplification will help increase productivity as more time is spent producing rather than dealing with productivity-sapping bureaucratic nonsense.
In contrast to the recession of the early 1990's, major shortages of qualified employees are affecting the high-technology industries, so we do not expect to see an employment recession in the next 5 years.
As we said last year, the retail industry must change its focus on commercialism if it is to stay healthy. The Christmas season's lower retail sales were predicted. People want more value for their money and are spending their hard-earned dollars in practical, pragmatic ways with more conscious thought and less impulse buying. Retailers must learn to match their products and services to their customers needs.
Teamwork and community efforts continue moving toward self-managed teams, locally managed divisions and smaller operating units that meet the needs of the people involved.
Employees continue to be less tolerant of the rigid military command-and-control business model and make their wishes known more strongly for greater involvement in all areas of business. Employees and investors are demanding more truth-telling from all levels of management. With a strong employment economy, people are more able to leave unhealthy companies and will continue to do so.
Entrepreneurial efforts and small businesses will continue their strong growth, providing even more reason to leave an unacceptable corporate job. Temporary, short-term and part-time employment continue to expand as these types of working arrangements are more accepted in our society.
The line between independent contractors, regular employees, temporary employees, contract employees and business partnership arrangements is blurring as people and companies learn that nothing lasts forever. Expect to see more discussion of what "company loyalty" really means and continued pressure on the IRS to stop trying to reclassify single-owner businesses and independent contractors as employees of some larger company.
The Internal Revenue Service will eventually be forced to change their anti-business and guilty-until-proven-innocent attitudes. In fact, the IRS is suffering loss of respect and serious weaknesses in its strangle-hold on the average taxpayer as people inside and outside no longer accept the IRS's historic hostile, inhuman methods. These changes may take many years to become fully implemented, but the 1997 congressional hearings and IRS employee testimony was a major step in this direction. Expect to see more calls for dismantling the IRS and for creating simpler tax methods.
Relationships continue to be important. People will be concerned with their business relationships, personal relationships, family relationships and friendships. If those relationships are not providing appropriate support, people will no longer tolerate bad situations. Rather, they will leave the relationship if it cannot be fixed. Continue to see interest in ethnic heritage as well as discussions about "community" and "tribal family" as people find ways to connect and interact with people that have similar interests, beliefs or lifestyles.
A need for balance will be evident as the work force learns that job burn-out may kill them (literally as well as figuratively). This will continue to be evident in increased demands for flexibility working conditions and more positive working relationships as well as less tolerance for hostile working conditions. Better support systems and benefits will be demanded by employees. Implementation of these measures in forward-thinking companies will help improve overall productivity. Smart executives have already learned this lesson, now the rest of the world must learn it in order to remain profitable. Since such changes in working cultures require many years, changes will take many years to fully unfold.
The need for balance and interest in relationships may fuel continued growth in coffee houses, small gatherings, dinner with friends, movies and sports. Leisure, play or week-end activities of all types will be actively sought out by people searching for relief from the intense high-pressure business demands of recent years. Companies that provide products or services in this area are expected to do well in 1998.
As tolerance for differences in race, gender, religion and lifestyle grows, people will be more accepting of each other. While some nations will continue to fight wars, long-lasting peace is a real possibility for much of the world.
The increased interest in angels and spirituality is a long-term trend as people seek a way to understand their world in a deep personal way. Demands for telling the truth will affect the new religious practices as well as mainstream religions, leading people to question and re-evaluate their personal beliefs. A search for personal meaning and understanding may lead many people to experiment with fringe groups and esoteric practices.
The health care industry will notice that more and more people are taking responsibility for their own health, evidenced by growing interest in alternative healing practitioners, natural therapies and less invasive medical procedures. Pharmaceutical companies will notice sales of drugs declining as people learn more about good nutrition and natural remedies. The demands for telling the truth may cause public revelations about past abuses and renewed interest in reforming health care.
In education, home schooling will continue to grow. Smaller classes will be more acceptable than large impersonal lecture halls as people desire to make a more active connection with others in their learning process.
Telling the truth means being honest with ourselves as well as expecting truth from others. Many people will find that they look more closely at their own goals in 1998 and re-evaluate what is important to them as individuals or what makes them happy. When relationships, jobs or situations are not providing personal satisfaction, people will be more willing to make conscious changes. Again, this reflects an intellectual (thinking) focus rather than changes based on emotions.
Weather continues to provide interesting times, with wind and volcanoes in the news this year. Changes in weather patterns may cause problems in the agriculture industry due to drought or unseasonal rain. El Niño is another name for the changing weather pattern, bringing warmth to normally wet areas and water to normally dry areas. Forecasts that California will drop off into the ocean will continue to create fear, laughter or indifference.
Predictions of the world coming to an end will continue until we are safely past the new millennium.
May your 1998 be filled with high productivity, efficient progress forward, personal happiness and corporate prosperity. And, remember to keep everything in balance by spending time with friends, in enjoyable activities and laughing when times get crazy.
Our forecast last year seems fairly accurate when we look back. Please, don't just take our word (or anyone else's) for what will or will not happen. Use whatever methods work for you in planning for the future. Wise people will use all the forecasts they can find, then see what feels right for them rather than letting any one dictate their activities.
A worthwhile exercise is to look at your own resolutions, goals and plans from a year ago and see how well they did for you, then adjust them for this year. Throw out what didn't work and do more of what did work. Spend some time thinking about what you really want - in your life or in your business. Make a commitment this year to review your goals regularly and make small adjustments as necessary. In this way, you will apply discipline and make steady progress forward all year.
This forecast represents our views and opinions. No guarantees are implied or given - use it as you would anyone's opinions. We will accept donations if anything we say here makes you rich in 1998.
Our belief is that the end of the world as we knew it has already occurred. We may be a bit bruised and shaken, but we got through it just fine and will continue to change and evolve. It didn't happen all at once - it has happened gradually over the past 10 years or so. Our challenge now is to adjust to the changes that have occurred and continue to make small improvements in our own individual ways.
Think about where you were 10 years ago, what you believed in, what was going in the world, and how much different things are now than then.
To paraphrase Henry Thoreau, things don't change, people do. Some time ago, people began to change their thoughts about what they wanted in their world. Around the world the actions of individual people combined to make the changes we see today. This is a constant activity that occurs over time, that eventually looks like the end of the world as it was.
Some people choose to believe that the world will end in some cataclysmic event. We see it more as the natural evolution of change.
General Themes -> the downside:
As in all things, there is a positive side and a negative side. In 1998, the downside we are looking at is what happens when you have too much of a good thing.
While we believe the economy will continue to expand at a slower pace, there are some people who feel that expansion always leads to inflation. If the economy is working just fine as it is, imposing more restraint (i.e., raising interest rates or tampering with other economic forces), will cause the economy to stagnate, rather than achieve the type of solid growth we expect.
The Internet continues its explosive growth, pulling the need to create faster and faster ways to communicate. The high-technology industries are scrambling to keep up as computers, telephones, movies, voice recognition and media all combine into a single desktop unit being shoved in the face of the average person and corporate manager. How can we possibly keep pace with such explosive growth? (more about this in the Information Technology section).
We've addressed the Year 2000 "problem" previously, and will be addressing it for executives in a new book, due out in early 1998, The Other Side of Midnight, 2000: An Executive Guide.
The desire of companies to keep up their hectic pace of development simply has to be managed better. More attention must be placed on improving productivity rather than improving profits or cutting costs. We expect to see some previously successful companies crashing falling apart because they are not paying attention to what needs to be done to survive in the new world of business.
The focus in 1998 of intellectual interests has a downside of some people spending too much time developing theories and not acting in practical ways. Thinking and planning is good up to a point, but action must be taken at some point. Thinking too much, being too cautious or too efficient leads to ineffectiveness - a real possibility in 1998.
Telling the truth can be overdone when people reveal things that should not be revealed. Again, information revealed must be relevant rather simply telling the whole truth that leads to damage to reputations unnecessarily. Do we really want to know about every high school girl friend of a politician who is now 50 years old? Do we really want to know all about someone's self-doubts or their private opinions? Do we really want to know all about a company's many failed efforts during their tests of a new product? There must be a reasonable, ethical, well-balanced way of telling the truth.
What we do want is people in companies to be responsible and honest about testing their new products. We want products that work, not those that companies think an unsuspecting public will buy simply because of heavy advertising. The tobacco industry is an example that is currently in the news. The congressional hearings on the IRS is another example of people's desire to get to what is really important. Politicians who do not "get" the message of honesty and ethics are in for a rough time. The rank and file employees want honesty in dealing with management and their unions, not cover ups.
The desire to improve productivity has been eluding us for several years. 1998 has the possibility to see some measurable gains. The downside is that productivity must be coached and nurtured - it cannot be ordered by management. When executives give orders or write scathing memos to improve, the result is exactly the opposite of their intentions. People's human desire to be free leads them to resist - consciously or unconsciously. With greater opportunities available in smaller, entrepreneurial business, those companies that are too harsh in their employee demands face the risk of silent resistance or organized revolts among the rank and file. A stunning example of this is the recent incident locally, where Caltrans issued a new directive eliminating a common practice of selling scrap material to support employee parties. A man was fired and came back a few months later with a gun, killing 4 people including his former boss.
Teamwork in all areas of business continues to be an important theme. The downside is "decision by committee" where too many people are involved in decisions, therefore, nothing ever gets accomplished.
Backlashes against tolerance for differences may be seen as some people resist the societal changes we are seeing. The desire to disband affirmative action programs, cut off immigrant benefits, fanatical religious activities and protests against abortion clinics are all examples of resistance. Whenever a society is changing, there are always some people who will resist the changes. Expect to see this played out in communities and countries. However, if the economy in the US stays healthy and most individuals feel their lives are improving, the smaller revolts will have a lesser effect. This is an example of keeping a pragmatic attitude with a big picture focus. Most of us have learned that diversity is our strength and that we must find better ways to deal with it. We expect more and more discussion of what is right, what is just and where to draw the line.
Spirituality continues to be growing mainstream issue. Expect more scrutiny of fringe groups, new age practices, criticism of angelic or "other world" promoters, as well as challenges to mainstream religions. People will be looking deeper into themselves and deciding what is true for them, rather than listening to someone else telling them what to believe.
The health care industry is due for some wide scale scrutiny, which may lead to a renewed round of proposals for reorganizing it from the government. People have had now had enough unsatisfactory experiences with HMOs and find that the focus on making profits rather than on quality, affordable health care has gone too far. Watch for more attention and news coverage of abuses in nursing homes, HMOs, home health practitioners and drug companies.
The educational system is failing to achieve what people want and failing to provide society with employees who have basic life skills, capable of performing honestly and productively on the job. Watch for more attention to better ways of educating children was well as adults. Smaller, more focused schools may fill the gap as the larger educational institutions struggle to change themselves.
Weather changes will continue to have disastrous effects on localized areas. Too much rain, not enough rain or high wind can destroy crops. Where a local economy depends on a single crop or a village depends on their agriculture to survive, the results may be very negative. Expect to see starvation in the news in some undeveloped areas and serious economic hardship in some areas of the world. Food shortages may happen in isolated areas, causing increases in prices or unavailability of some food items. Natural disasters will be common in 1998, as they have been in recent years. More efforts of the military forces will be directed to assisting in disasters rather than in fighting wars.
While it may be uncomfortable to look at the downside of life, it is an important aspect of balance. Preparation and planning can help lessen the harsh affects of disasters, although it won't eliminate them.
As more and more people communicate via the Internet, world-wide connections will improve in quality and speed. This means the possibility of sending a photograph or voice message along with e-mail, viewing movie clips and seeing animated versions of people in chat rooms. The new forms of communication improve the ability for strangers to become friends and for greater understanding between foreign cultures. The world is becoming smaller and friendlier by the minute. The Internet is a major force for changing business and communications as we know them. Don't under-estimate the power it has to change our society and the ability of a single person have world-wide ramifications.
The high-tech industry has done an excellent job of creating jobs and providing powerful fuel to the US economy. Computers will continue to be smaller, faster and cheaper. New ways of using them will continue to challenge us all, providing many wonderful opportunities and some significant failures.
People working in the high-tech industry have a hard time keeping up the pace of the demands being placed on them. Cutting time cycles and cutting corners has led to the growing proliferation of new products of lower quality. The industry must either find new ways of creating well-qualified people or change the way they do things. This is truly a race against time.
As someone once said, "The definition of insanity is doing the same old thing and expecting different results." By that definition, the entire computer/high-tech industry is probably insane.
The people who support corporate computing are being squeezed badly between trying to do their regular job, make the necessary changes for the Year 2000, make currency changes in Europe, and meet management demands for faster and faster product cycles. There are already major shortages of qualified people in the entire IT industry. Companies are openly telling employees that they will not provide training to them, while expecting them to remain current on technologies that are obsolete before the books and training courses are published.
When all these forces come together, what happens? Does the symbolism of gas and matches come to mind?
The historical success rate of corporate Information Technology projects is dismal at best. What leads management to believe that all of a sudden this will change and their favorite projects will be completed on time?
Warnings about coming disasters in the Year 2000 arena take all these issues into account. In spite of dire warnings and press coverage ad nauseum, many executives (according to surveys) continue to ignore their responsibility to get involved in what their IT folks are doing.
The desire of companies to keep up the hectic pace of software and/or hardware development (expecting high levels of bottom line profits) simply has to be managed better. More attention must be placed on improving quality and productivity rather than improving profits or cutting costs. We expect to see some previously successful companies crashing or falling apart because they are not paying attention to what needs to be done to survive in the new world of business.
The average person who owns a computer is getting fed up with products that don't work properly, broken promises and the constant bombardment of junk mail, junk e-mail and other forms of technology that disrupt their right to life, liberty and the pursuit of happiness. While new technologies are exciting and fun, their maintenance cost is prohibitive for the average person and a growing burden for corporations. Replacement cycles used to be counted in 3-5 years or longer; now they are counted in months at best and days at worst.
The Internet has opened the world of computing to the average person from their home. They expect their home computer and the programs they use to have the reliability and ease of use of a television. And, they expect problems to be rare and solved instantly by a phone call, answered immediately by a knowledgeable person. High quality, reliable customer service is becoming more and more important to buying decisions.
Is there an answer? Of course there are answers. Expect to see a few creative, innovative companies finding new ways to solve these problems before the turn of the century. Those that do will be wildly successful and profitable.
Warning: these are both serious and not-so-serious links.
It used to be that people needed products to survive. Now products need people to survive . . . Nicholas Johnson
Seek simplicity and distrust it. . . . Alfred North Whitehead
The US will not solve the competitiveness problem until it again becomes the place where the most advanced, highest quality goods and services are produced by the most skilled workers using the most advanced methods. . . . Michael Porter
Productivity is not the application of tools to materials, but logic to work. . . Peter Drucker
It is not the employer who pages wages. He only handles the money. It is the product that pays wages and it is the management that arranges the production so that the product may pay the wages. . . Henry Ford.
Don't tell me how hard you work. Tell me how much you get done. . . James Ling
The only thing that saves us from the bureaucracy is its inefficiency . . . Eugene McCarthy
I usually judge a man by what he laughs at. . . Wilson Mizner
The art of prophecy is very difficult, especially with respect to the future. . . Mark Twain
Business will be better or worse. . . Calvin Coolidge
Never make forecasts, especially about the future. . . Samuel Goldwyn
I don't set trends, I just find out what they are and exploit them. . . Dick Clark
Can anybody remember when the times were not hard and money not scarce? . . . Ralph Waldo Emerson
Things do not change, we change. . . Henry David Thoreau
Anyone who says businessmen deal in facts - not fiction - has never read old five-year projections . . . Malcolm Forbes
The United States is the only country where it takes more brains to figure your tax than to earn the money to pay it. . . Edward Gurney
One machine can do the work of fifty ordinary men. No machine can do the work of one extraordinary man. . . Elbert Hubbard
The man who does not work for the love of work, but only for money, is not likely to make money nor to find much fun in life. . . Charles Schwab
Those who complain the most usually work the least. . . author unknown
The secret of joy in work is contained in one word - excellence. To know how to do something well is to enjoy it . . . Pearl Buck.
Small opportunities are often the beginning of great enterprises . . . Demosthenes (382-322 BC)
A consumer is a shopper who is sore about something . . . Harold Glen Coffin.
Page updated: June 05, 2009
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