John Naisbitt caught a wave with "Megatrends," one of the seminal business books of the 1980s. It awakened executives to a particular brand of trend forecasting, turned Mr. Naisbitt into a sought-after consultant and lecturer, and spawned several more books in a series that continued in 1996 with "Megatrends Asia."
Mr. Naisbitt, while traveling the world to deliver his economic prophesies, divides his time among homes in Telluride, Colo., Cambridge, Mass., and Kuala Lumpur, Malaysia. In a recent interview with American Banker reporter Jennifer Kingson Bloom, Mr. Naisbitt discussed the importance of entrepreneurs in economic progress and had stern words for bankers about their future roles.
What lessons are you gleaning and teaching from your recent experiences?
My text these days is that to be successful we must at once be more individualistic and more global. That's the paradox: the bigger the global economy is, the more powerful the individual.
The Internet is a very good metaphor for all of this because it's totally decentralized. It can become as big as it wants to become - perhaps a billion individuals by the year 2000. And no one's in charge, which is what I love about it. It will give governments fits.
We must become more individualistic because the world will be dominated by person-to-person communications. And we must become more global. We talk about this all the time but I wonder how many of us really act on it. I see stories in the media all the time about how the global economy is slipping, but when I read the stories they are only about North America and Europe.
Meanwhile, the countries of Southeast Asia are growing between 6% and 10% a year, and they will continue to do so as we move into the next century.
Do you play on the Internet?
You picked the right verb. I don't have time to play.
I have been operating globally out of Telluride, Colo., for about 13 years, and I'm only now getting good at it. I remember the first fax machine that I got - a Pitney Bowes that was about the size of a pickup truck. The problem was I couldn't use it because no one else had a fax. The same will be true of the new technologies that are allowing people to do what I've been trying to do these many years. These technologies are primitive but will get a whole lot better. And it will take us years to get really good at using them.
A lot of banks want to offer services through the World Wide Web, and some already do. Do you think it's secure for that?
I think it will be in time. But right now none of us has any idea how it's all going to play out. People seem to think it's sort of the thing to do, to be on the Internet. We're in a period of just kind of wonderful, wonderful chaos, kind of thrashing chaos. I think it's just great.
A blending of technologies - all of these things that are being put together by alliances and entrepreneurs - is going to create a new revolution in telecommunications. That's why we don't know what it's going to look like. These things will be put together in thousands of combinations by thousands of entrepreneurs. We know the revolution in telecommunications is here, but we still don't know what it's going to look like.
You're a fan of chaos as an incentive to creativity?
Oh, yes. And the last thing we want to do is to start to make regulations for things until we know what they're all about.
As a trend watcher, how good do you feel corporations are at looking ahead and planning for the future?
Not very. Certainly bureaucracies don't. It's entrepreneurs who really do, and that's one of the things that we haven't focused on enough. There are two places on the planet where entrepreneurs can really be entrepreneurs - the United States and Asia. Europe is hostile to entrepreneurs, just when it needs them most. Red tape makes it very difficult to start a company there, plus the region is burdened by the excesses of the welfare state. It's going to be a long time before Europe becomes a growth player, if it ever does again.
There has been a lot of press about corporate downsizing. All of it is about the Fortune 500, which is now 10% of the U.S. economy. It's down from 20% in 1970. Ninety percent of the U.S. economy is elsewhere. It's entrepreneurs. Last year in the United States we created a million start-up companies.
Compare that with a time when there was not chaos, the 1950s and 1960s, when the United States was a roaring industrial economy. We created only 50,000 or 60,000 new companies a year. The 1970s, when the whole basis of the economy shifted, was a great time for entrepreneurs - we started to create 200,000, 400,000, 500,000 companies a year. And last year a million. The same phenomenon is creating the fabulous economies in the countries of Asia - it's not big companies at all.
Do you sense the banking industry is a little fearful that entrepreneurs will come in and usurp their traditional roles?
Usurp is such an interesting word, as if they have some kind of divine right. Banks are becoming increasingly irrelevant as we continue this two- decade-long process of disintermediation. I think it's a good thing because it's attacking transactional costs. In Asia, we call a transactional cost "corruption." Here we just accept it as information arbitrage.
If it's true that entrepreneurs create new economies, revitalize economies, accelerate economies, then you would think that a society would want to do everything possible to nourish and support entrepreneurship. Banks don't do that. As someone who has started several companies, I can tell you they are just totally useless.
How do you do your banking?
Well, I really don't do it.
Do you have people do it for you?
Do you use ATMs?
No. But I do have a banker. I forgot to mention that I am a banker. I am part owner of First National Bank of Telluride. We started it several years ago. I admit we're not really doing enough for entrepreneurs.
How did you come to form the bank?
I put up the money to get it started and became an owner. It's a small community bank. They only had one bank in town for several decades, and so we introduced competition, which I'm totally in favor of.
We have to think about this whole extraordinary development in mutual funds. I'm not totally sure of my figures, but around 1980, I think the money in mutual funds was about 5% or 10% of what banks had, and now they are about even. And it's mutual funds that are really funding the economic growth of the world, while banks are buying bonds.
What about the stock market?
It's totally supply and demand. There was so much money going into the stock market that demand overwhelmed supply, and prices went up. The same is going to happen in emerging markets in the next two years, especially Asia.
Any thoughts on the race for the White House?
I wrote in "Megatrends," which came out in 1982, that it doesn't matter any more, and I continue to believe that. My life goes on and your life goes on no matter who is president. Except I would like to see someone in there that I feel really good about, who makes me proud, instead of having to apologize for in Europe and Asia and the places I visit around the world.
Though I think it doesn't matter that much, I would have been very proud to have said that Colin Powell was our president. But I don't know how anyone can get excited about who is running for president these days. It's another paradox. Anyone who's willing go through the process is unfit to be president.
How long have you been interested in Asia?
I lived in Thailand in the 1960s, and I am quick to say that I was not a hippie, and I was not CIA. I've been going back to Asia every year, once to six or seven times. And for the last year and a half, I've been based out of Kuala Lumpur. So I've been experiencing Asia for a long time and witnessing this great renaissance unfolding. Asia was the center of the world for thousands of years, and now it seems clear to me that the center is returning to Asia.
Are Americans more curious about Asians, or vice-versa?
I would put it a little differently - and I do in the book. Westerners know almost nothing about Asia, and Asians just have total book, many of them, on the West. Millions of Asians have studied in the West, particularly in the United States, and I think that's one of the best things that happened to Asia. Millions of young people went to the West, got great educations, and now the reverse brain drain is well under way. They're returning to Asia because there are greater opportunities there than anywhere else in the world. Now young Westerners are seeing that and they're starting to come to Asia the way Asians came to the West.