Good evening from Davos, where I’ve just returned to my hotel after a 30-minute walk – in minus 14 degrees Celsius (7 degrees F) weather – following a Japan event I attended with Kasai-san. (More on that later.) It was good to get back to the hotel.
I have five thoughts for you tonight.
The first is a general observation. There is a strong sense here in Davos that major changes in the way companies operate and organize themselves are on the way, and that they are being driven almost entirely by the changing landscape around technology, data and information. (Christian and Sheila have both referred to this in their blogs.)
Second, this is good news for us at JLL and LaSalle. The drive to incorporate technological and data revolutions into business practices is one that we recognized several years ago. We’ve been spending significant time, money and resources to build it into our business. The sense I take away from the presentations I’ve attended here is that technology will make strong, established businesses even stronger. If we embrace the change and use it to enhance the way we operate, we’ll get stronger.
This means that the worst thing we can do is deny that technology is driving change and new ways to do business, and miss the chance to improve our approach to markets and customers. But we’re ahead of the curve on this, and I’ll spend more of my time in this important strategic area in the future.
Theme three: All the short-term worries which people are worrying about and the media is writing about are ‘noise’. I mentioned some in my first post: the Chinese economy, growth rates in the developed world, U.S. elections, stock market volatility, interest rate uncertainty, technology- and digitization-related employment challenges, and on and on.
In Davos this week, the most significant worry is about China, as people try to understand what is happening in that market. Given our presence in China, I think we, as a company, have a very good handle on what is going on: growth in the consumer sector and decline in the manufacturing sector. Both are actually benefiting our business, since the change is happening in the major cities where we are leaders, and where the consumer and service sectors are growing.
I found my fourth theme at a lunch today with 60 CEOs: no politicians, no journalists, no famous actors, no government people. The message was that, although short term volatility can certainly be worrisome, their businesses are fundamentally trading very well today. So the CEOS of these 60 major global companies are not changing their plans for continued investment in the growth of their organizations. At this point, short-term issues are not sufficiently impactful to change their, or our, approach for the medium- and long-term.
That theme was made even clearer in a session which Christian and I attended today about the importance of thinking for the longer term. Real estate, or any business sector, can be impacted by short-term activities. But the important thing is to keep our eyes, plans and investments focused on the medium term and longer: three to five years and more.
Nothing out there today is going to impact the continued steady growth of our markets in 2016. We’ll certainly be watching the volatility and other issues affecting the business world, but we’ll continue to invest confidently for growth in 2016.
Theme five revolves around the JLL brand and reputation. I’ve spent most of the past two days meeting with clients and potential clients. They’ve ranged from Bank of America, to Generali (a European capital markets client I visited with Christian), to HSBC, as well as a number of Indian clients Anuj and I met with. What I saw and heard is that they have a very positive view of JLL and LaSalle. Our reputation is solid and strong, not only for the work we do for our clients, but also for our image in the marketplace.
Stepping back, in the ten years I’ve been coming to Davos, JLL’s name recognition and reputation have risen dramatically, not just among clients, but among non-clients, too, both investors and corporates.
Coming back to the Japan event I attended with Kasai-san this evening, in a very short period we met 20 CEOs or Chairmen of major Japanese corporations. To my surprise, they, or the people with them, all recognized the JLL name. I’ve seen that across multiple businesses and multiple clients and potential clients over the last two days. It’s a testimony to the work that you all do to make our brand and reputation keep rising on the global stage.
To close, in a week where the stock market volatility has aggravated concerns for the short term, it was good to have one day, today, when markets rose globally, including our own shares. More to the point, nothing I’ve seen in Davos changes my view that our image and reputation continue to rise as well, and that the markets continue to offer us good opportunities for continued growth and success.