Where will earnings and profits come from in the new economic environment?

Where will growth come from and which sectors should we focus on?

What stocks do we buy in order to position ourselves to be part of the next upturn? Following the economic difficulties over the past year, when investors feared the worst, we wonder, once the fog lifts what will we see? Recent consumer and social behaviour trends seem to be giving some clues as to the signposts to look out for and the companies that we should direct our investments to.

Clearly, there are real changes in expectations and practices from employees. There is some evidence that individuals are demanding work with a clearer purpose and meaning, and choosing employers with a higher moral standard. These so-called ‘ethical employees’ also place a high emphasis on communities in the workplace. Does the company you work for fit this mould?

Offices have in any case become more important social communities, with increasing numbers of workers finding friends, partners and spouses though work social networking sites are seeing significant growth and the difficulty at present is seeing just how many of the recent start ups will be able to monetise their efforts. These social ties are strong predictors of wellbeing at work; to that extent, networked firms are happy firms, too.

At the same time, there has been a growing acknowledgement of the importance of cooperation in modern ‘learning economies’. This extends to the relationship between businesses, too, as firms become entwined, and also between businesses and consumers.

As Charles Leadbeater argues in We-Think: Open and collaborative models of organisation will increasingly trump closed and hierarchical models as a way to promote innovation, organise work, and engage consumers. In Disorganisation, Paul Miller and Paul Skidmore explored how the pressures from employees for more human values at work was forcing organisations to ‘loosen up’, giving them space to pursue interests and collaborations and working practices that fit those values. Similarly, in the Pro-Am Revolution, Charles Leadbeater and Paul Miller found a new ethic of commitment to what might previously have been thought of as hobbies. So in a number of sectors, employees have and want more control over their work.

More recently, in the pamphlet Working Progress, Duncan O’Leary and Sarah Gillinson painted this in generational terms. Duncan O’Leary and Niamh Gallagher found that the ‘terms and conditions of work, beyond pay – company ethos, the psychological contract, corporate social responsibility (CSR) and ethics – are increasingly important to candidates seeking work’. In addition to remuneration, they found that people are often looking for, and organisations often have to offer, something else beyond remuneration to attract the best talent.

We have all learnt valuable lessons from the past year and consumers are increasingly demanding a new social contract from companies that they buy from.

Companies and marketers need to be adept at the changing trends and be able to sniff the breeze in order to remain relevant. Just like a meerkat.

Recently, we saw a major backlash from consumers to some unacceptable behaviour on one of the breakfast radio shows in Sydney. Companies that advertised on the show and the network acted rapidly in order to distance themselves from clearly unacceptable practices. Because they acted rapidly, they were able to resist a significant consumer backlash before it got rolling. The new social interactivity and software applications available mean that news and opinions spread like wildfire and companies and businesses can quickly face ruin if their practices fall foul of what is acceptable.

Hollywood is always a great predictor of trends. Just take a look at the movies they are now producing for a snapshot of future trends.

The year 2009 has seen an emergence of new hope, less bleak representations of societies and relationships, and a brighter outlook on, well, just about everything.

You can thank the Millennials for that and next week I will write more about who they are and what they represent.

Important information:This content has been prepared without taking account of the objectives, financial situation or needs of any particular individual. It does not constitute formal advice. For this reason, any individual should, before acting, consider the appropriateness of the information, having regard to the individual’s objectives, financial situation and needs and, if necessary, seek appropriate professional advice.