November 2016 Special Issue Business SCAN
In business, many people say that it is impossible to predict the future; that all we can do is prepare for uncertainty. But what if managers could now acquire the skills to make some predictions of the future, to better defend or create their organisation’s competitive advantage? According to researchers at London Business School (LBS) this is possible.
To get better at creating a deeper understanding of their organisations’ operating environment, opportunities, developments and threats, managers and leaders need to broaden their view of the world. No one can predict short-term shifts in the market or the price of fuel tomorrow, but that’s not the point. It’s the long-term big picture that will shape the future and the businesses we serve.
When predicting the future, emotion is a key driver to consider. Reactions to events can be far more significant than events themselves. We see this every day in global markets, house prices, consumer ‘confidence’, political debates, social media and in the success or failure of new product launches.
To help expand our world view, researchers at LBS have created a forecasting tool: Six Faces of the Future. Each face denotes a cluster of factors that will influence future events: Most business professionals examine life from above, through a ‘Universal’ lens, accentuating the ‘Fast’ and ‘Urban’ faces. Unfortunately, this leaves them blind to the other dimensions – communities or markets dominated by Radical, Tribal and Ethical issues – where emotions can make a drastic difference.
How managers can plan for the future:
Fast - Speed of change, including impact of ‘wild cards’ such as corporate scandals, military action or viral plagues, and future digital technology
Urban - Future urbanisation, demography, health, fashions and fads
Tribal - Future nations, cultures, social networks, brands and teams
Universal - Future globalisation, retail, trade, e-commerce and manufacturing
Radical - Death of politics, the rise of radical activism and sustainability
Ethical - Values, motivation, leadership, aspiration and spirituality
Sources: Dixon, P. (2016) How to be a futurist and safeguard your business, LBSR, Oct 18; Birkinshaw, J. (2016) Corporate innovation: coordinated symphony or messy jazz?, LBSR, Apr 13
Think of one of your clients and their industry. Consider which of the faces in the forecasting tool could impact most on their competitive advantage. What does this mean in practice, and what advice might you subsequently give?
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