The Hidden $3 Trillion Profit Opportunity for CEOs
Industrial companies leave a roughly $3 trillion pool of 'dark value' (2% to 3% of global GDP) uncaptured because complex, fragile markets reward trading skills they lack; building them could add 1% to 3% of EBITDA.
Summary
BCG estimates dark value, the profit from arbitrage and volatility in supply and demand, at about $3 trillion, of which traders and hedge funds already capture about $1.2 trillion. It arises in industries that are complex and fragile, which BCG sorts into strongholds, cash cows, specialist players and rising stars. Executives cite investor reluctance and setup cost as obstacles. Capturing it takes tools for managing complexity and fragility, and an operating model that either infuses trading into the core, runs a dual model or goes pure play.
Editor's opinion
Industrial companies can capture a large hidden profit pool by learning to act like traders, exploiting shifts in the supply and demand of capital, goods and services.
Key concepts
Dark value · Complexity and fragility · Dark value archetypes · Dual operating model · Pure-play dark value model