Future Casting

In my post on SCAMPER Revisited, I talked about how Bob Eberle had developed the technique to develop our children’s ability to harness their creative imagination. In particular, I mentioned his development of games designed to develop our sense of curiosity and our need to elaborate and add detail to ideas.

In today’s post I want to look at how we can use our imagination to create business strategy, and how we often don’t.

We all want to know what the future holds, whether it’s predicting the winning lottery numbers of dreaming up a future of flying cars and green buildings. In 1960’s Britain, if you weren’t already getting enough visions of the future then you could watch Tomorrow’s World. As you can see from this clip on the future of home computing, early predictions on home internet use were starting to develop, albeit with some pretty noisy machinery.

In business, we would like to know what our competitors are going to do next and what we need to do in order to be successful. Here are some different ways we might approach this sort of future casting.

Predictive Strategy

Predictive strategies are based on careful analysis of the business and the environment it is operating in, and development of scenarios to try to understand how the future might unfold.

This can include modelling buyer behaviour, market segmentation, competitor behaviour, control of resources, broad economic factors, and any number of other areas in an effort to try to understand how the business works now, and where it might be heading. Tools like Porter’s 5 Forces, PESTLE analysis, VRIO Resources Analysis, Customer Adoption Profiles, and a good old-fashioned SWOT analysis are all familiar predictive strategy tools for any MBA student.

In this  approach we typically develop our visions for the future, and determine where to invest based on the potential return on investment and the risk of not investing there (e.g. how likely is this to happen).

Emergent Strategy

Emergent strategies assume an unpredictable future and focus instead on decision-making behaviour, or “the way we do things around here”. Rather than just float along hoping for the best, Simple Rules can be developed to define how decisions will be made based on a few underlying principles. Instead of defining which opportunities to pursue, we would define how to identify them. For more on this approach check out this podcast by Donald Sull (who co-authored the approach), or this simple illustration.

In this approach we use our visions of the future to walk through how we might behave using a few simple rules to guide us.

Black Swan Strategy

Black Swan Strategy is based on an unpredictable future populated by statistical outliers whose impact is so great as to outweigh all other alternatives. Think of the recent financial crisis and the failure of normal, predictive styled diversification. As with other planned strategies, the idea is to have a diversified set of options so we don’t have all our eggs in one basket. The key difference is that we disregard likelihood and focus instead on impact.

From an investment perspective this would have a portfolio of very safe investments and a small number of extremely high risk investments (with extremely high returns), and no investment whatsoever in areas of moderate risk. Booz and Co have a pretty good explanation of black swan strategy here.

In this approach we develop scenarios with the goal of identifying disruptive events, responding based on impact and cost to respond rather than likelihood or risk.

Visualisation for Creative Thinking

Regardless of your intended approach to strategy development, the core skill here is in visualisation or scenario planning. What we want to be able to do in creative thinking is to visualise thoroughly, and imaginatively:

  • Curious – all good explorers should be curious, and interested in finding out where the path will take them. Scenario planning should be fun, engaging and captivating enough for everyone to be genuinely curious about how the future could unfold.
  • Elaboration – scenarios need details, the more the better.
  • Flexibility – don’t just stop at one possible future, imagine how the future can change differently as you make choices along the way
  • Suspend Judgement of Likelihood – THE most important rule in scenario planning. We are not trying to predict the future, determine what will happen next, or evaluate the likelihood of future events. Just as brainstorms require that you suspend judgement of idea value, so scenario planning requires that you suspend judgement of event likelihood

So just how do you visualise? You could try brainstorming, but this is generally better suited to creating lots of shallow ideas (often called idea headlines) to be developed later. The following individual exercises are taken from this excellent article by Albert Foong, the Urban Monk:

  1. Take a photograph, memorise it, try to recall it in your mind’s eye (i.e. shut yours). How much detail can you recall?
  2. Take an object, memorise it, try to recall it in your mind’s eye. Can you rotate the object, or have it interact with other stuff?
  3. Re-imagine your 3D object from exercise 2, but with your eyes open. Can you still visualise it moving around and interacting with other things?
  4. Imagine yourself some place special. Bring in your senses one by one. What can you hear, smell and feel around you?
  5. Re-imagine your place from exercise 4. This time, interact with your environment. If you were on a beach, can you throw stones into the sea or talk to the people next to you? What do they say back to you?

These techniques are designed to develop your powers of observation and visualisation. Elaborate on each exercise, introducing more detail and pushing your senses to get involved. The next time you try scenario planning, push yourself to imagine future events in more detail.

In my next series of posts I will explore questioning techniques, and the way in which we can direct our attention when trying to solve problems creatively.

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