Davos WEF
Davos WEF

Business faces biggest changes in 50 years: Bain & Co.

Karen Gilchrist, Digital Reporter
More for companies to worry about than just fourth industrial revolution: Bain & Company

Businesses need to brace themselves the greatest transformation they have seen in the last 50 years, according to Bain & Company partner James Root.

"We're expecting bigger changes in the way that firms are operated and managed and financed than we've probably seen in the last 50 years", Root told CNBC in an exclusive interview at the World Economic Forum in Davos, Switzerland.

Looking beyond current political and economic upheaval, Root said that research conducted by the management consultancy firms indicates that there are four fundamental changes at play which will impact the future of the workforce, particularly within large corporations.

Andrea Bricco | Brand X Pictures | Getty Images

These include the so-called 'Fourth Industrial Revolution', which refers to the fusion of technologies; the rejections of short-term leadership, which touches on Davos' 'Responsive and Responsible Leadership' theme; a shift towards simplification of operations; and growing demand for corporate responsibility.

"Over the last 40-50 years, a lot of companies have bulked up, a lot of M&A, a lot of winner takes all in many industries. But as they've gotten bigger, complexity has gone nuts – from chronic to critical – and it's so hard to get things done in many large corporations today, it's just not working."

He added: "I think firms are going to look and feel very different in the future and that will change the mind-set.

"So much activity is going to be automated, or outsourced, that the average headcount in a firm is going to shrink, and those that are left in the firm are going to be doing the mission critical things that you and only you can do."

This, he said, will also lead to greater self-management and, ultimately, a significant reduction in the number of professional managers needed in corporations in the future.

Clarification: The headline for this article has been updated since it was first published following clarification from Bain & Co.

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