The world is full of chance, chaos, and things we don’t have a tested solution for. As such, companies try to eliminate uncertainty by either using data to predict trends or employing complex forecasting methods. Yet, neither of these models has any relevance unless we devote some time to thinking about what kind of future we want.
by Aleksi Neuvonen
We are living in an era full of anticipation and trepidation about the future. The digital revolution. Green transition. Life ‘after’ the pandemic, a ‘new normal’ to create together. These are all promises for the future, where things are different (and perhaps better) than they are now. Meanwhile, these opportunities are also sources of stress: we don’t really know the recipes for success in an unknown, mysterious future.
That is why we often approach the issue (the future), through the easiest way: by focusing on the future that appears (the most) probable.
1. The most probable future
Most corporate decisions are made imagining the future to be a direct continuum of the past: a steady run, perhaps a slight uphill or downhill. We tend to assume that we can predict the future as long as we have data on market developments and the company’s recent operations. Based on those trends, we decide what products we keep in our portfolio, who we try to attract as customers and how much money we should allocate to marketing at this time of year. We know the predictions are uncertain but we act as if they were true. In other words, we do what we do best: rationalize the plan with a forecast.
But there really isn’t one specific future. It does not exist. The world is full of chance, chaos, and things we don’t know enough about. Therefore, identifying different possible futures is a more relevant way of preparing for the future than predicting the likely course of development.
2. Alternative futures
When identifying different possible futures, we can realize what can follow from trends emerging at the moment, what kinds of changes different innovations might result in and what kind of discontinuities we could face. It’s eventually about grasping the true meaning of the famous slogan “Think different!”: the future can be something other than a direct continuum of the past. We must free our minds to see the future as something open and full of alternative options.
There is clear evidence of the success of companies that actively anticipate potential futures: a longitudinal study by René Rohrbecke and Menes Kum showed that companies that had strong future preparedness in 2008 were 33% more productive in 2015 and achieved up to 200% more market value growth than the companies compared in the study on average.
Now, in the midst of a pandemic, many companies have woken up to the importance of anticipating unlikely and unexpected futures. But how to do foresight that results in more than just names of risks and trends on a meeting room flip chart? After all, all futures specialists have included pandemics in their ‘top 10 uncertainty’ lists for decades. The TedTalk by Bill Gates, held in 2015, which warns of the risk of a global virus epidemic, has been viewed more than 42 million times. Gates’ talk was titled ‘We are not ready.’ Now we know that none of us was much readier in early 2020 when the COVID-19 pandemic hit than we were for the Ebola outbreak in 2014.
Indeed, the major management innovations of the next few years will be about how to build long-term leadership and decision-making processes, supported by systematic foresight activities. Yet, these innovations cannot be the exclusive prerogative of management teams. A company’s vigilant relationship to the future requires good future literacy throughout the organization.
3. A future we desire
Alongside probable and alternative futures, the third way to anticipate the future is to identify desirable futures. The prevailing megatrends seem to push us towards futures where climate change and loss of biodiversity will significantly depress the living conditions of future generations—or even our own. The digital revolution seems to have had severe negative impacts on democratic systems while giving rise to unprecedented concentrations of economic and political power. In the midst of these transformative upheavals, it could be even unethical to just predict and anticipate them. We need to enrich our foresight methods with a clear vision of where we want the world to be in the future; then start working towards that goal.
In this way, a common, challenging but meaningful target point is formed for the whole company: it is towards such a society that our company strives and creates solutions for what we wish to achieve. It helps us to understand what behavior changes our products should promote and how we can support the adoption of such new habits through marketing. Above all, it helps us in identifying the issues that will shape new markets and how to create monetary value once such markets emerge and grow.
Aleksi Neuvonen is a co-founder of Demos Helsinki.
This article was originally published as a guest blog on Sanoma Media’s website in Finnish and has been translated and edited for clarity.
Feature Image by Daniele Levis Pelusi / Unsplash.