Carl Sagan said “You have to know the past to understand the present”. As a futurist, I believe you have to know the past to understand the future. History really does repeat itself and gives us a lot of clues to where we are heading. History tells us where we have been, and foresight tells us where we are going. But futurists are not always right. Nobody has a crystal ball to be able to see into the future with total accuracy.
Futurists are not always right
It’s impossible to be exactly right all the time. And that’s not even the purpose of futurism. The purpose is to be prepared and not be blindsided. Business in general is about risk. But a futurist will help a business see the big picture and the possibilities of the future. They help them be more prepared for the future so they can make better decisions. It’s about surveying the business environment to determine likely issues that are going to impact an organization, individual or community.
People have been fascinated by the future for thousands of years. In Greek mythology Cassandra was a futurist with the ability to see accurately into the future. But her curse was that no one ever believed her or her predictions, despite every prophecy being true. She was forced to speak the truth, no matter what. But she would never be believed. In mythology you can be an accurate predictor of the future. But in real life, futurists are not always right.
Ancient Greeks used to consult the Oracle of Delphi. The high priestess Oracle Pythia lived in a temple cave, which was often filled with volcanic gases. It’s been thought that she may have been delirious from the gas and that caused her to spout out incoherent predictions that were taken to be prophetic. She was known to give guidance to individuals and heads of state. She was often wrong about her predictions, which could be interpreted in different ways. But the Greeks kept coming back to hear the next prediction. More proof that futurists are not always right.
The Delphi Technique
According to Wikipedia:
“The Delphi method or Delphi technique is a structured communication technique or method, originally developed as a systematic, interactive forecasting method which relies on a panel of experts. The technique can also be adapted for use in face-to-face meetings, and is then called mini-Delphi or Estimate-Talk-Estimate (ETE). Delphi has been widely used for business forecasting and has certain advantages over another structured forecasting approach, prediction markets.
Delphi is based on the principle that forecasts (or decisions) from a structured group of individuals are more accurate than those from unstructured groups. The experts answer questionnaires in two or more rounds. After each round, a facilitator or change agent provides an anonymised summary of the experts’ forecasts from the previous round as well as the reasons they provided for their judgments. Thus, experts are encouraged to revise their earlier answers in light of the replies of other members of their panel. It is believed that during this process the range of the answers will decrease and the group will converge towards the “correct” answer. Finally, the process is stopped after a predefined stop criterion (e.g., number of rounds, achievement of consensus, stability of results), and the mean or median scores of the final rounds determine the results.”
The Delphi method was developed at the beginning of the Cold War. It was first used in the forecasting of science and technology. It was then used to forecast the impact of technology on warfare. The method polled a panel of experts to find out their opinions on how, when and where an attack could possibly happen.
Issues management technique
Issues management is another method of forecasting used by futurists. It’s the process through which an organization manages its policy, and identifies potential problems, issues, or trends that could impact it in the future. The issues management process is a long-term, problem-solving function placed at the highest level of the organization through which it can adapt organizational policy and engage in the public affairs process. In a project that begins with a plan that defines activities and business rules to manage and control issues that arise during a project. Examples are problems with suppliers, technical failures, delays or material shortages. I tried to avoid the problem of supply chain issues in my own manufacturing business by having multiple suppliers around the world. It’s a good idea to try to think of everything that could possibly go wrong and have multiple backup systems.
Environmental scanning technique
My strengths as a futurist focus more on the method of environmental scanning. This includes all of the factors that can affect your business. It includes threats to your business, but also opportunities for you to innovate and grow. These threats and opportunities need to be monitored constantly. They are always changing. You never know what could change your business. But you have to stay ahead of the curve to avoid the negative and take advantage of the positive. Sometimes a threat to your competition could mean an opportunity for you. And vice versa.
SWOT analysis
You’ve probably heard of this as the SWOT analysis:
Strengths:
What do you do well and what separates you from your competition? Do you have any intellectual property? What kind of skills and knowledge do your employees have? Do you have a unique selling proposition or a well known brand?
Weaknesses:
What can your competition do better than you? Do they have deeper pockets or stronger IP? Have they been in business longer? What is your business lacking that needs to be strengthened?
Opportunities:
Is there a new need for your products and services? Has something changed in the market that works to your advantage? Are you operating in an industry with few competitors that do exactly what you do?
Threats:
Did you recently get some negative press or did your industry get any negative press? Are there new competitors entering the market? Do they have strengths you need to worry about? Are there new regulations that will stifle your business?
Surviving Disruption
In my new book “Surviving Disruption: 12 Unique Innovation Strategies to Create Your Competitive Advantage” I address SWOT. I talk about what you should be doing to prepare for the future and how to use it to create your ultimate competitive advantage. Futurists are not always right, but we are a good tool to have to help you spot opportunities and stay clear of threats you might not even be aware of.
As a futurist I try to sound a warning that their business will absolutely, positively change one day, and they had better be prepared for it. It doesn’t really take a crystal ball to know this will happen. It’s been happening since the first business owner hung out their shingle. Even legacy industries like the newspaper industry would enjoy hundreds of years without being challenged, until technology threw a monkey wrench into their business model. But throughout the years I always come across a few businesses or organizations who don’t believe they could ever be disrupted.
Environmental scanning
Environmental scanning starts with competitive intelligence. Competitive Intelligence is the practice of gathering information about a competitor so that you can determine what their strategies are and be able to anticipate their next move.
Competitive advantage
The Institute for Competitive Intelligence says:
“Competitive Intelligence” (CI) can be described as a systematic process of information retrieval and analysis, in which fragmented (raw) information on markets, competitors and technologies can be transformed into a vivid understanding of the corporate environment for the decision-maker. Competitive Intelligence topics are usually future-oriented statements on competitive positioning, intentions and strategies. On the other hand, “Intelligence” is the final result of the process: the required knowledge on markets and competition. Especially statements on the expected effects on one’s own firm and thereupon based recommendations are made.”
If you immerse yourself in competitive intelligence, you reduce the chance of being blindsided. You don’t want to be vulnerable and you don’t want to be behind the curve. Be the innovator in your industry and let others try to keep up. Study your industry AND your competitors before you make up a game plan.
Study the competition
By studying your competition you also reduce the chance that you might happen to be doing something exactly like your competition. It happens. Most people follow the path of least resistance. You want to know what all of your competitors are doing so you can create your own unique path that they are not thinking of. In order to avoid the bloody red ocean you have to be the most innovative.
Even if you think you don’t have competition now, there’s always the threat of someone coming along who is smart and innovative, who sees an opportunity others missed. People love to hear about the latest “bright, shiny new thing”, which might become your new competition. Stay ahead of them by doing your due diligence. Environmental scanning is a good way to gather information for your innovation strategies. It may require a lot of work on your part, but it’s worth it.
A strategic innovation plan prepares you for the future. Futurists are not always right. But we can help companies and organizations better prepare for the threats and opportunities that will inevitably come their way.