The Business Horizon Quarterly (BHQ) is the Emerging Issues team's signature publication. Its purpose is to share informed insights on emerging issues facing the American business community. By asking questions like “what is growth?” and “what is innovation?”, we aim to inform and to spur debate.
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At first glance, few people would describe government involvement in private business activities as a game changer. After all, the government for more than two centuries has played a part in business activity. The Commerce Clause in the U.S. Constitution granted the federal government authority to regulate certain types of commerce.
Yet what if government's role in business operations is increasing and even at an all-time high? That might prompt astute observers to call the government-business relationship a game changer.
One way to answer that question would be to find a smart way to measure the magnitude and impact of government actions on business.
Government Impact from a Company Perspective
Some people have already tried to measure the magnitude of the government-business nexus. They've counted the number of regulations enacted, tried to assess the rules’ monetary impact, or tracked legislation cleared by Congress. Yet none of these measures, together or alone, provide an absolute answer to the question of magnitude, and all of them focus solely on the government side of the relationship.
In antiquity, much of the world's recorded knowledge was located in one spot: the Library of Alexandria in Egypt. Nearly every culture and empire of that era recognized the library as the epicenter of scholarship. Today, however, information is increasingly decentralized. Alexandria's vast repositories of papyrus scrolls could now fit onto a single flash drive. In the 21st century, digital information is being created, analyzed, and stored at an astonishing rate. Consider that 90% of the world's data has been produced in just the last two years. This explosion of information is known as “Big Data,” and it is completely transforming the world around us.
Big Data is already an integral part of every sector in the global economy—as essential a factor of production as physical and human capital. Much of our modern economic activity simply could not function without it. The main driver of Big Data is the nearly incalculable amount of transactional data being produced by companies, financial institutions, and online intermediaries. This includes trillions of bytes of information about buyers, suppliers, and operations of critical interest to businesses and financial analysts.
Heather Bresch is chief executive officer of Mylan, a generics and specialty pharmaceutical company. During her 20-year career with Mylan, Bresch previously served as the company’s president, chief operating officer and chief integration officer. In addition to her current role, Bresch also sits on the company’s board of directors. She has served two consecutive terms as chairman of the Generic Pharmaceutical Association and provides expert testimony to national institutions, such as the U.S. Congress and the U.S. Food and Drug Administration. As a career-long advocate for initiatives and policies that improve access to high-quality medicine for those in need, Bresch holds a keen insight on how game-changing individuals and ideas can transform industry and government and make a dramatic influence on healthcare and patient well-being.
Foundation: Who or what is the biggest game changer in business today?
Foundation: What are the qualities of a game changer?
Bresch: To me, a game changer is someone who is willing to be disruptive and able to manage effectively through this disruption. You have to be aware of the impact of disruption on the organization and ensure that your day-to-day business can move forward, even as you are seeking to transform it.
The complexity of the modern world can seem overwhelming. The world moves faster every day, and despite obvious advances in technology and living standards, public officials see the chaos of life and seek ways to soften the world’s edges. The great temptation is to match the world’s growing complexity with corresponding rules and programs that help citizens and firms navigate the tumult.
Evidence increasingly suggests, however, that the content, number, and unforeseen interplay of these multiplying rules is doing far more harm than good. The economy’s continued underperformance, therefore, offers an opportunity to fundamentally reexamine our approaches to regulation and public finance. We believe such a reexamination will suggest a stark new path: one that demands simple rules for a complex world.1
Two examples highlighted below suggest bad rules can even begin with the very best of intentions. Yet, the results can be catastrophic.
A Labor Market Example