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The Business World in 2025

Four Scenarios to Stress Test Your Strategy

By Michael R. Wade

25 pages

May 2016

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In order to challenge thinking and help decision-makers test their strategy and underlying assumptions we have identified the three factors which will lead to the greatest uncertainty and change:

Shifting geographies: How will the global economy work in 2025?
Blurring industry boundaries: How will companies organize across sectors in 2025?
Evolving digital behavior: How will the consumer react to Internet ubiquity in 2025?

The interplay of these factors leads to numerous different possible futures. We have selected four combinations which provide thought-provoking and challenging business conditions

Video

Global Bazaar

What happens in an open geopolitical environment where new revenue streams are unlocked by technology? Global Bazaar is a scenario of business transformation and continuous change. However, corporate volatility remains high, which means guaranteeing stable business results is challenging with fluid markets and hyper-competition.

Scenario: Cautious Capitalism

Concerned consumers reclaim their data and turn to privacy-friendly companies. This triggers new competitive dynamics, challenging digital players and reining in opportunities for cross-industry platforms. Cautious Capitalism describes a global and open business landscape challenged by a shift in consumers’ digital behavior.

Scenario: Territorial Dominance

Imagine an international environment, where countries step back towards protectionism. Local industry regulation tightens, big regional companies dominate and entrepreneurship is scattered and marginal. Territorial Dominance describes stagnant economic growth and companies focusing on efficiency gains.

Scenario: Territorial Dominance

In Regional Marketplace the world divides into localized clusters, each following its own rules in trade, business policy, and Internet governance. Governments still drive local innovative environments, fostering native disruptive ventures, but protect regional players from international competition.

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This report is part of a series

Four scenarios to stress test your strategy
The business world in 2025: Four scenarios to stress test your strategy

This report is part of a series

Four scenarios to stress test your strategy
The business world in 2025: Four scenarios to stress test your strategy

Four scenarios to stress test your strategy

By Michael R. Wade

Summary

Change has been relentless since the turn of the millennium, and the pace of change is only expected to accelerate as we move into the next decade....

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Research Information & Knowledge Hub for additional information on IMD publications

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Case reference: IMD-7-2455 ©2024

Summary

In the 2010s, card processing – Mastercard’s flagship service – started showing signs of commodification as new, nimble players (typically, fintech startups thriving on digital) entered the payment processing space, and customer preferences evolved beyond plastic cards and traditional contact payments. To re-energize its central position and its ability to capture value, Mastercard – as the incumbent – had to make bold decisions. The case details Mastercard’s approach to conceptualizing and building a global platform ecosystem that upholds the principles and design elements of modularity (i.e. interoperability and scalability) and optionality. Today, Mastercard's services, based on application programming interfaces (APIs), integrate with a variety of platforms and offer flexibility to businesses that require customized payment solutions. All along, the company has accommodated a high level of internal disruption. The case also explores the nature of Mastercard’s systematic collaboration with fintechs – players that often started out as competitors in specific parts of Mastercard’s value chain. It describes the company’s engagement with fintechs as fostering collaboration and co-creation and facilitating access; in other words, opening doors and sharing tools with partners. The case presents observations and quotes by CEO Michael Miebach, whose career trajectory at Mastercard – spanning Africa & Middle East experience, fintech partnerships, product management and the CEO role – sheds additional light on the philosophy and values that have driven the company’s transformation to a technology powerhouse and self-described original fintech.

Reference IMD-7-2455

Organization Mastercard

Industry Finance and Insurance, Financial Services

Available Languages English

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