Zeitenwende entered the English lexicon in 2022, a word used by German Chancellor Olaf Scholz on February 22, to describe the epochal change triggered by Vladimir Putin’s invasion of Ukraine. (Financial Times) In geopolitics and other ways, the year 2022 marked a sharp turn from the trends of the post-Cold War period. In this article, we examine some of the implications for business and strategy. We analyze the situation, assess impacts and recommended responses by business leaders to the following:
- Geopolitical realignments, that are bifurcating the world into competing camps.
- Resurgence of Western liberal democracies after a perceived steady decline.
- Assertion of extraterritorial technological and financial power of the US and the return of the American-led world order.
In the decade after the financial crisis of 2008–10, it was fashionable to decry the decline of the democracies, the fecklessness with which they met challenges such as Brexit, the rise of populism, and the malaise of Western societies confronting drugs, crime, homelessness, and other social ills. Their decline increased the appeal of authoritarianism. (Freedom House) Authoritarian regimes were posited to be more efficient, deliver greater economic growth, and have more competent leadership.
Twenty twenty-two showed the missteps of two of the foremost authoritarian regimes: Russia and China. Putin started a war that will greatly diminish Russia’s power, influence, and economic prospects. This might appear to be the biggest self-own blunder in 2022; yet, under Xi Jinping, China made equally stunning mistakes. Xi aligned himself with Putin, blustered about Taiwan, and pushed India away from its studied neutrality. Many nations erred haplessly in the 20th century: Germany lost two World Wars and truncated its ascendency; China ate its own children under Mao’s Great Leap Forward and Cultural Revolution; Russia squandered its demographic and territorial advantages in the deadend of Communism and the terror of Stalinism; America for all its checks and balances and first amendment still managed to blunder into Vietnam and Iraq. In fact, it seems more often the case that nations and leaders cannot find their way — even…