Companies that execute successful transformations seem to be able to predict the future better than others. They spot trends early and are able to make informed investment decisions that give them a head start developing innovative solutions. Do they employ psychics or have leaders with superpowers? Clearly not. It is because they follow a structured approach to understanding the future.
There has been a lot said about agility and the need to sense and respond. Being able to quickly adapt to changes is an essential component of being prepared for the future. However not enough companies focus on improving the time it takes to sense trends.
Like everything in life to get better at something you need to put in the time. Reading articles on the plane (remember that?) isn’t going to be enough. Best in class leaders allocate significant amounts of time with their top teams getting inputs from world class thought leaders, deep subject matter experts as well as the views of their own people. Based on these inputs leading companies develop an informed view of what they collectively believe the future holds in 5, 10, sometimes even 100 years out. With this in place informed investments can be made to best prepare for the predicted future.
It is important to remain focused on the emerging trends that are going to be relevant to the business. There is going to be hype and it is very easy to get sucked in. If you cannot see line of sight on how a new technology is going to help improve the lives of your customers or solve a business problems, park it for now and revisit. When blockchain first emerged it felt that all of the world’s problems were going be solved but to date only a tiny fraction of use cases ended up solving real problems.
While I was at DBS we spent 3 days every year with the CEO and top team focusing on the emerging trends, getting the views of the world experts, studying the best in class across all industries and asking our own people for their views. The majority of the time was spent debating the relevance of trends to the business and selection experiments to run to learn more.
In addition each business area went through a back-casting exercise based on a board game we created called North Star where leadership teams visualised the future by prioritising a series of pre-canned technology, macro social-economic and industry statements (eg 80% of cars will be autonomous, average life span will be 110) in terms of probability to be true in 10 years and relevance to their respective businesses. The teams then decided what areas should be invested in over the next 12 months to prepare for the predicted 10 year view. A proportion of the annual investment budget was then allocated to creating experiments to test feasibility and viability of the ideas. This resulted in a more ambitious innovation strategy.
However, there is one big danger out there – the HIPPO or Highest Paid Person’s Opinion. No-one can completely predict the future. Those that do just are lucky. The leading innovative companies consistently estimate that one idea in 20 is a good idea. Therefore you have 95% chance of getting it wrong. Therefore you should expect to be wrong. However it is not uncommon for the entire workforce to pivot to something that the leader has said in passing in a meeting. Egos and ignorance can make it tough to change course. Therefore companies pursue what Scott Anthony would call “zombie projects” too long. Best in class companies build a culture where each idea is treated as imperfect and is tested and tuned through experimentation and data.
Spend time as a leadership team getting inputs from all quarters to make an informed view of the future
Make sure that the focus remains on future trends that are most relevant to the business and customers and make the relevant investments now to best prepare for your predicted future.
Expect to be wrong. No-one can accurately predict the future so you need to continually check that ego driven beliefs are not taking the company in the wrong direction.
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