Posted by Adam Gordon on Mar 28, 2012 in all, emerging technologies, lifestyles & values, scenario planning, strategic foresight, technology change
The logistics firm DHL (Deutsche Post) has just completed and publicized five future scenarios called “Delivering Tomorrow: Logistics 2050.”
In the never-ending mountain of corporate waffle, surely this is the summit? Why spend time and resources on thinking about what might happen 38 years from now when even the 5-year-future is effectively unpredictable?
In an exclusive interview with Forbes, Senior VP for Communications Strategy at Deutsche Post in Germany, and management executive directly responsible for the project, Dr. Jan Müller, said the 2050 scenarios started as “a pure play in communications strategy. It was a thought leadership exercise. We put the scenarios out there to energize the societal debate.”
In other words, this is DHL’s “heads-up” to the big issues driving world change over the next few decades, and its reference document for steering the future away from two bogeys: (1) national trade protectionism and (2) indiscriminate resource use and resulting climate change.
Said Müller: “DHL is well advised to constantly insist on the benefits and relevance of liberal world trade.”
So far, so normal, in using ultra-long term alternative visions of the future to urge the world to become a better place, including for the company concerned, while polishing the public image of the firm and providing something new to show at Davos.
Second Life
What’s particularly interesting about this project, and more-or-less unique in the field of industry foresight, is the scenarios will have what Müller calls a “second life” inside the firm. In something of a tour-de-force in scenario construction, the scenarios appear ingeniously formed to span both their external corporate “save-the-world” function and an internal strategy-formation role.
According to Muller, colleagues in Deutche Post corporate strategy have become active with the scenarios, and the Deutsche Post Management Board recently spent a day analyzing the project’s implications.
The work “has ramifications that reach deeply into the strategic and entrepreneurial thinking of the company,” said Müller.
All the way to 2050? Well, no. “There is a follow-up project trying to calculate development perspectives that are closer than 2050, and derive more concrete options from that exercise,” said Müller.
This version will obviously not be for public consumption.
But even as it stands, the project as applied to internal executive decision making is a challenge to the linear planning culture at Deutsche Post. Presenting the work in-company over the past weeks, Müller has argued to colleagues across the firm that “in the current age of volatility, it is not useful to apply linear prognosis. We have to think in alternatives.”
This was also the tenor of CEO of Deutsche Post DHL Frank Appel’s opening address at project launch in Berlin last month. In an increasingly complex world filled with uncertainties, short-range projections would no longer be of much help in setting the appropriate long-term direction and devising robust strategies, said Appel.
The Deutsche Post DHL 2050 scenarios are:
1. Untamed Economy: untamed growth and unchecked materialism cause a mounting number of natural disasters, putting the world on the brink of a collapse.
2. Mega-efficient Cities: cities emerge as the world’s power centers, with radically altered consumer needs, while an urban low-wage class is entrenched and rural areas stagnate.
3. Customized Lifestyles: individualization and customization shapes people’s everyday lives, requiring decentralized and regional production structures.
4. Paralyzing Protectionism: the world is hobbled by economic hardship, excessive nationalism and trade protectionism.
5. Global Resilience: resilient production and logistics structures gain a higher priority than continued efficiency maximization, after repeated natural disasters and supply chain failures earlier in the century.
Posted by Adam Gordon on Jan 16, 2012 in 2025, all, economy & finance, strategic foresight, technology change
Financial markets are delicately poised at the start of the year, to say the least. A steady low-bubbling stock rise – what the FT calls a “stealth” rally – has left the S&P 500 index at a five-month high and the Dow up 10% in 6 weeks, flying in the face of the 2012 analyst outlook which is on-the-whole bearish amid Eurozone debt and global growth concerns.
Bears are in a surprise squeeze. Not so long ago it was rebound-optimist Jon Corzine of MF Global publicly taking the hit that many others were privately taking too.
It’s certainly not news that markets don’t behave as expected, nor that emotion drives decisions, but Joan Foltz, author of Market Whipped: And Not By Choice (Alsek, 2012) suggests something further: that we are going through a basic shift in how markets work and therefore how to succeed in them.
She says the financial markets have become a MMORPG, that is, a “massive multiplayer online role-playing game.” In gamer world, a MMORPG is a vast virtual world where an effectively unlimited number of players assume characters and interact with each other in a persistent and ever-evolving “reality.”
The same computation and virtualization platform technologies that have produced game worlds also underpin financial markets, and are therefore unsurprisingly producing similar effects.
Buy a stock and you have entered a virtual arena of realms and battles, with characters taking roles in stories that play out over a known (to insiders) time period. There are masters and magicians and druids and emporers, and who knows what else, all gaming for your money. Play the game right, and you win theirs.
Says Foltz: “Keep the market in mind as you go through this list of features:
Who are the characters in the game? High-frequency traders, hedge funds, corporations, pension funds, celebrity investors, the media, the government, to name just the obvious ones.
Into this world walk investors who think the markets are what they used to be, and work how they used to work – that they are understandable through due-diligence in research, and winnable by well-considered valuations or by technical analysis. No surprise that they find themselves surprised. In gamer world, nothing is as it appears and nothing works out as expected.
Game on
Foltz’s argument is that traders of all stripes improve their results by acknowledging market MMORPG and thinking like a gamer. That is, seeking to understand where the battle is at any time; recognizing who battles whom, under what conditions, and for how long; knowing who the strongmen are in their realm and what story is playing out.
Investors should know their own token in the game, its attributes and ammunition, as well as its limitations. This will improve judgment of where to be, when to come and go (market timing), and encourage quick exits from realms that are best left to more powerful, and perhaps, darker forces.
The book itself has a chaotic, breathless, aspect, and is marred by a tendency to conspiracy theory. But it does provide a productive analogy that sheds light on unchartered territory. In other words, it does what “futurists” should do when they do their job right: identify and illuminate a change in the world, and describe why assumptions and practices that worked in the past may fail going forward.
Posted by Adam Gordon on Jul 5, 2011 in all, emerging technologies, failed predictions, innovation, technology change
Mansueto Library: robots and underground storage vaults
The University of Chicago’s new Joe and Rika Mansueto Library is, it seems, a caricature of futurism. Under a vast glass dome sits an 8,000 sq-ft reading room, complete with flat screens, a circulation desk, ergonomic furniture, and … no books.
Turns out the books, all 3.5 million of them, are packed efficiently – by size – into 2 x 4 x 1.5 ft metal bins stored in vaults below ground. If you need one, you go tap-tap at your keyboard, which sends enormous rolling robots to fetch the right bin and crank it up to the circulation desk, allegedly in less than 5 minutes.
A number of things are interesting here, the first being that this “library-of-the-future” is about paper books at all. In a Google-digitize-the-planet world where Amazon says that more than half of its books sales are for the Kindle, the University of Chicago’s $81m bet on “dead-tree” storage and retrieval is quite a bet.
It is a good bet. Hype aside, it will be still many generations before “paperless” is any kind of on-the-ground reality, as paperless office evangelists have found out. Imbedded human habits and systems just don’t move that fast.
But systems do. Ingrained human preference for tactile objects doesn’t mean that storing, finding, and retrieving of the objects can’t be improved overnight, which is the essence of what is going on here. The automated search-and-retrieval system creates efficiencies as all automation does – by dumping human beings out of the process. Specifically, it copies advanced manufacturing systems such as those used in automobile assembly plants, which effects just-in-time finding and retrieving of components this way.
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The first industry foresight principle at work here is this: where the same problem applies, a solution that creates value in one industry will turn up to create value in another, even if apparently unrelated. Innovation doesn’t respect sector or management thought silos. Ergo, leaders who are able to comprehend challenges at a systemic level and look across industry boundaries for solutions that already exist elsewhere, find the future before competitors do.
Second, although the book definitely survives in the University of Chicago’s forward view of the library, note that the solution is not simply head-in-the-sand “nothing changes.” What changes, they are arguing, is the system aroundthe book, the storage, finding, and shlepping thereof. Moreover, the new system is a radical departure. It turns the status quo upside down, to make the physical book a relatively minor element of the online system, not the other way around.
Finally, the solution on offer is one more piece of evidence that inexorable advances in single-purpose (non-human-like) robotics and sensors are quietly yet absolutely changing the world around us. If we drop the Frankenstein image, and see robots for what they really are in our time, that is, sensors + wheels + software, many imminent changes in industry and society come quickly into focus.
read more
Posted by Adam Gordon on Jan 18, 2011 in all, innovation, leadership, lifestyles & values, technology change
A photo exhibition, Facing the Impossible, opened at the end of last year in New York. (425 Broadway, 5th floor, NY 10013; to 28 February 2011.)
Just another photography exhibition in NYC? Well, not quite. It’s an industry foresight story too – the survival and revival of Polaroid analog instant photography in a digital world.
Polaroid, for those too young to have heard of it, is a camera system that produces a picture in a few minutes out the back of the camera, no darkroom required.
Polaroid US brought out its first camera in 1948. The company filed for bankruptcy in 2008, closing down its last production plant in Enschede, Netherlands, making 180 employees redundant. But a group of entrepreneurs and ex-employees calling themselves The Impossible Project acquired the plant and have set about making (and improving) Polaroid film. The company reports that 500,000 packs of film, retailing from $15 to over $100 per pack for Polaroid cameras was sold this year. Revenue for 2010 was more than $10m and the number of ex-employees on staff has grown from 10 to 30.
Now a $10m turnover and 30 employees is hardly a business number of consequence for the world. The point is, conventional wisdom says it should not exist at all. Even Kodak stopped making Kodachrome this year, after 70 years. How can anyone be growing sales of analog film in 2010?
The Message in Red Ink
One might say Polaroid US head office could be forgiven for assuming digital media completely trumped its product and exiting the market. But should shareholders be forgiving? Yes the company filed for Chapter 11 bankruptcy amid various complex management issues, but at its heart, red ink is always the product of inability to see and adapt to the future in time (or poor execution, or both.)
What The Impossible Project saw, that Polaroid itself could not see, was that niche, expert, aficionado secondary markets often remain extant and lucrative well after the mass market has moved on. Of course digital photography is the mass product-and-service market of the future. But in the rush to the future, lucrative pockets of specialization remain and this is one of them.
This principle can be seen in the media industry as a whole. Records and record players have not gone away in a CD and iPod world, they have moved to aficionado markets. Printed books and magazines are going this way too. They won’t disappear but they will be a format for niche uses. This is true across other industries and across history too: transportation, for example, has seen eras when horses and bicycles were primary modes of working transport. Their primary function changed, but this opened up lucrative secondary, leisure, and niche industries.
In adapting to the future, opportunities exist in taking retiring mass-market solutions into new industries, or upmarket into niche areas of the same industry.
Creative Adaptation
The irony in this story is that the Polaroid camera and film was always a niche product. It fought giants Kodak and Fuji for a piece of the mass market in analog photography but never became a mass-market solution. (Its competitive advantage was instant-ness; its disadvantage was price and relative quality.) So it didn’t require any great “shift in DNA” by the company leadership to make the moves that Impossible has. But it did require a leadership willingness towards industry foresight and creative adaptation.
Impossible is doing the basics of providing (and improving) film to Polaroid’s installed base of users. It estimates that 300 million working Polaroid cameras still exist. This is the legacy factor. The future doesn’t move as fast as we think.
But more importantly, Impossible is also actively building a future for itself in its new niche — broader artistic and creative industries. In addition to its project space in New York, it has one in Tokyo (and had an exhibition during the Arles Photography Festival.) It is using these spaces as hub for soliciting alliances across visual creative media, promoting analog instant photography in its relationship with other creative industries, including growing beyond Polaroid’s static image legacy.
Promotional projects during the year included the creation of a special film edition with HUGE magazine (Japan), participation at Photokina 2010 Germany with the first 20×24 camera, and cooperation with the band The Decemberists — all growing the future of the product, reaching out to new users and a whole new generation of users.
Posted by Adam Gordon on Dec 16, 2010 in all, innovation, lifestyles & values, social change, technology change
I recently got caught in front of a video on the Future of Money shown at the banking industry conference, Sibos (SWIFT International Banking Operations Seminar) in Amsterdam.
Source: tradefinance-jobs.com
I’d give the video a miss. It’s Gen-Y dude-immersion to the like, max, and what co-producer Venessa Miemis has to say is much more effectively communicated on her site, which is:
“All the decisions about where I spend my time, attention, and money say something about me. For example: I buy organic food from local farms and products and services from local businesses —(I believe in building resilient communities by supporting local economy.) I have a garden, I fish, I hunt, I brew beer— (I find empowerment, gratification, and joy from understanding where food comes from and how to get it myself.) I recycle—(I understand that we live on a planet with finite resources and I want to reduce my impact.) I don’t shop at Wal-Mart. – (I prefer not to buy products that were produced in a country where people’s labor had to be exploited so I could “save” a dollar.)”
The well-identified trend to ethical consumption is at work here, but Miemis is actually expressing a far bigger consumer trend that in industry foresight workshops I call “identity-building consumption” (which may or may not be ethical.) Ref: “All the decisions about where I spend my time, attention, and money say something about me.”
Miemis continues: “Now, what does my bank say about me? Nothing.”
How might a bank go about articulating customer identity?
“Transparency… All I know about the way my bank works is that I deposit my money there, and then they take that money and go make money off of it. Where is that money going? Where is it being invested? Can I have control over how you use my money? Can I set a standard of where I allow you to invest my money, so I can be proud to say my money is being invested in green technology, or local initiatives, or anything that I care about?
“Intelligent Investing Opportunities… Show me opportunities where I can micro-invest in things I care about. Recommend ways I can save money on the things I already buy regularly. Show me how I can leverage my network and invest with a whole swarm of people. (Think Groupon for investing.) And then make each of these investments a part of my digital identity. I WANT people to know. I’ll wear it like a badge. Give me a service that empowers me to invest intelligently and in a way that represents the ethics I believe in, and I’ll tell everybody about it. This information will become part of ‘Social Credit Score,’ which will be more important than our current credit scores one day.
“Social Network Analysis for Co-Production Opportunities… There are a lot of people out there who want to cooperate and collaborate in order to manifest something together and make their lives and the world a better place. How do we find each other? Could a BANK help hook us up and then provide us with the information and resources we need to take an idea to action? Could we display projects we want to work on that are socially responsible and environmentally sustainable, and the bank links us to the investors that can help actualize it?”
Miemes rails against how at Sibos her “Innotribe’s” manifesto was met with no more than a polite “there-there” pat-on-the-head from gray-haired bankers. That’s to be expected. But if there is a solid principle in industry foresight, it is that the next generation wins in the long run (and the long run is becoming shorter.)
Retail banking, like just about every other retail industry, is being sucked with new generations into Web 2.0, the “Social Web.”
And the Social Web is, fundamentally, a self- (and group) identity-building and identity-expression machine.
So the banking sector has to prepare for a near-term future where it plays an active role in the identity construction and identity articulation of its customers. Here they are shown some important ways to do it. That is, they have been gifted a blueprint of the future of their industry.
read morePosted by Adam Gordon on Oct 25, 2010 in all, foresight tools & methods, policy, scenario planning, social change, strategic foresight, technology change
This week the Association of Research Libraries in Washington D.C. released The ARL 2030 Scenarios: A User’s Guide for Research Libraries.
Source: http://www.arl.org/rtl/plan/scenarios/
Now it would seem that a 20-year-future-gazing process for libraries is a world away from the concerns of managers making today’s critical decisions, but it is not, for two reasons:
First the study deals with the critical trends and forces changing the operating environment in just about every industry today – digitization, sustainability, social media, China, etc. The scenarios are instructive because they lay out forces changing the operating environment not only for libraries but pretty much every significant organization or company going forward.
Second, while four different “futures” are described and investigated, the organizational subject (libraries) are not explicitly written into them. As the user guide comments: “Scenarios created for use in scenario planning intentionally leave the organizations that are planning out of the picture. This allows the organization to better focus on the main forces that are shaping the environment around it. Thus, each scenario has a blank where the library can fill itself in through the planning process…
“This approach means that other kinds of organizations might also find blanks that they can explore through a scenario planning process. ARL can consider its future as an association using these scenarios, but other kinds of libraries, other actors in the research enterprise, or other participants in the scholarly communication system could find value in using this scenario set and the user’s guide.”
In fact, all kinds of organizations and businesses can use the study in this way: inserting themselves into the stories and asking themselves: do “we” still work? That is, is our value proposition, our business model, our resource or alliance base, still valid? Do our success recipes still apply? If not, what are the necessary new ways to be valuable and to engage with consumers and stakeholders? What would we need to do—how would we need to innovate to transform our organization such that it creates value for future users—given the overwhelmingly powerful external dynamics redefining our operating environment?
The organization deferred
Although the ARL doesn’t say it, it’s actually quite remarkable in the scenario world that the subject organization is NOT written into the story. Often scenarios are hamstrung by exactly this problem: Conflating what the world will do and what the firm can do in response, therein becoming no more than wishful-thinking stories. It is much better for the purposes of real-world decision-making when these two questions are dealt with sequentially, as they are here, and organizations can then think through the options and priorities they can shape within the larger future world they can’t shape.
Bearing in mind that scenarios are not predictions, and that the whole point is that the most likely future operating environment will combine elements from all, these are the four independent strands that the AFL comes up with:
In Research Entrepreneurs, individual scholars are central and their orientation matters more than institutional or disciplinary affiliations. Research institutions provide support services to these agents rather than driving the research agenda. Scenario 2, Reuse and Recycle, describes disinvestment in the research enterprise. With fewer resources, the crowd-cloud approach is widespread, producing information that is “ubiquitous but low value.” In Disciplines in Charge, “computational approaches to data analysis” force scholars “to align themselves around data stores and computation capacity that addresses large-scale research questions within their research field.” Global Followers describes a world similar to today, but where Asia is prominent in providing money and support for research, and Eastern “cultural norms” govern the process.
ARL 2030 Scenarios: A User’s Guide for Research Libraries is available for free athttp://www.arl.org/bm~doc/arl-2030-scenarios-users-guide.pdf. More information on the ARL project, “Envisioning Research Library Futures: A Scenario Thinking Project” can be found athttp://www.arl.org/rtl/plan/scenarios/.
