Robert Moritz, chair and senior partner of PricewaterhouseCoopers LLP (PwC), visited campus April 21st as part of the Accountancy Program’s Lyceum series. His talk, titled “Leadership Re-imagined: Four Forces Shaping Future Leaders,” addressed not only leadership, but also the changing world economy.
Moritz acknowledged that these are still “tough times globally and individually, although the economic outlook is brighter than a year ago.” There is no question that “we are emerging with a different global economy than the one we had going in,” he said. “This is not the normal cycle.” Nevertheless opportunities exist, “as long as we are prepared to see the world as it really is not how we wish it was.”
This changing world is driven, not only by technology, but also by a rate of change that is continually increasing. Moore’s Law, which states that the number of transistors that can be put on an integrated circuit doubles every two years, did not predict the impact of such a law on information and information technology in parts of the world we’ve come to think of as “developing.” That information technology is, among other things, enabling people in those developing countries to see the standard of living in the West and want to emulate it.
“These ideas [free market, free speech] spread around the world and take root,” said Moritz. “People in other countries see our high living standard. They like what they see and they want it.”
Globalization used to imply a kind of condescension, as if the developed world is doing poorer countries a favor.
“That’s not only condescending, it’s just wrong,” he said.
Growth will come from China, India and Brazil rather than the traditional (i.e. Western) markets companies have relied on. For example, three of the 10 largest companies in the world are located in China. None, he noted, ranked that high in 2000. In addition, Moritz asked the audience where they thought the richest woman in the world lived. He said it was not Oprah, but a woman in China who owns a paper recycling company.
Businesses must recognize this “rise of the rest” phenomenon and seize it as an opportunity, said Moritz. Secondly, they must pursue a more cooperative relationship with governments and thirdly, they must use talent more broadly than ever before.
The emergence of non-traditional markets has forced Western executives to rethink their strategies. Previously a product would first be introduced in the U.S. and then to the rest of the world, with a one-size-fits-all mentality. Now people outside the U.S. are demanding and developing technology to fit their own personal needs. Sometimes those needs are game changing. For example, low-cost healthcare solutions that are originating in other countries, he said.
As for better cooperation between business and government, Moritz noted that there is a growing overlap between business and governmental responsibilities. Private/public partnerships, or PPPs, in which business and government share the cost of investing in, for example, infrastructure improvements, are becoming increasingly common, especially in Europe. PPPs also are growing in Asia.
As for using talent more broadly, Moritz reminded students in the audience to identify their own personal brand, to be able to deliver a 20-second elevator speech about themselves, to enhance their networks and to get coaching. But, perhaps more intriguingly, Moritz spoke of PwC’s reverse-mentoring program, in which new hires introduce partners to things like Twitter. The idea of new hires being able to teach partners about today’s culture is one way to use talent more broadly.
To be a leader in this new global economy takes four qualities, said Moritz. He called them IQ (intelligence), EQ (emotional intelligence), CQ (cultural-sensitivity), and finally PQ (passion and purpose).
Moritz said that PwC looks for people who are smart (IQ), not just about the content they have learned, but are also able to apply concepts and thinking to problems they have never seen before. They also must be able to communicate and inspire others (EQ), especially members of very diverse groups. Along with these qualities, leaders must be able to go out into the world and bring back ideas (CQ). By interacting with many cultures from a business, ethical and behavioral perspective, leaders increase their opportunities for success. And finally, Moritz told the students that leaders also must have PQ, which refers to intellectual curiosity and a purpose and passion that prevents them from getting side tracked in a world that, admittedly, has an infinite number of distractions.
His final points involved the profession of accountancy. Moritz said that with all the noise in the media about one crisis and another it is easy to become paralyzed. The best leaders identify three things to focus on and ignore the rest.
Instead of worrying exclusively about the risks in the market, he said PwC is developing new leaders inside the company, hiring off campus to “gain new skill sets” and acquiring other companies. They also are sending more people overseas, rather than retrenching.
Moritz said he and, by extension PwC, was optimistic about the accountancy field. Strong companies and good leaders can take advantage of the current turmoil and find huge opportunities for growth.
“We wouldn’t be hiring so many people if we weren’t bullish on the profession,” he said.