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Opinion | How youth perspective can help firms future-proof their strategy
- The increasing influence of Gen Z and millennials means businesses need to understand and incorporate their views to stay competitive
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International Youth Day on August 12 was not only a celebration of young people and their contributions to social advancement, it was a timely reminder of the need for businesses to understand their values, outlook and needs if they want to stay ahead.
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The need for understanding and incorporating young people’s perspectives into corporate strategies cannot be overstated. Generation Z – those born between 1997 and 2012 – are expected to make up about 27 per cent of the global workforce in 2025. Meanwhile, the average age of independent directors on the boards of S&P 500 companies is about 63, despite many of these firms having a mandatory retirement age of 70.
The gap is more than one of age. Many large firms that thrived in recent decades are struggling to understand the challenges and potential of Gen Z and millennials as future customers, employees and business leaders.
Being out of touch with young people can have serious consequences. Consider the downfall of Yahoo, which failed to retain users and made a series of corporate missteps. Above all, Yahoo’s decline can be attributed to its inability to adapt to and evolve with the trends.
On the other hand, the turnaround of Abercrombie & Fitch in changing its image from the “most hated retailer” in the US in 2016 and regaining the favour of Gen Z customers attests to the need to prepare for the wave of change driven by younger generations, both in terms of workforce and business strategies.
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Some companies and research institutes are increasingly aware of the need to learn more about young people’s views. However, a truly future-proof strategy requires corporate leaders to attach as much importance to the youth factor as artificial intelligence, climate change or geopolitics as a key aspect of corporate strategy.
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