Posted by Adam Gordon on Feb 12, 2010 in all, economy & finance, failed predictions, management, strategic foresight
Two running business stories with foresight importance this week, both I realize brought to me by smartbrief.com (Smartbrief on Leadership) which I find a very credible news aggregation service. The first is a WSJ piece ‘How Lean Manufacturing Can Backfire.’
Toyota President Akio Toyoda, Feb 11, 2010. Pic: AP
Lean manufacturing creates efficiencies and shaves production costs by creating just-in-time — no inventory — systems, using common parts and designs across product lines, and generally squeezing materials, processes, and (inevitably) quality controls. This may or may not include pressing suppliers to lower prices, and therefore squeeze their own materials, processes, and quality controls. ‘Lean’ has been very much a core process and operations mantra for about two decades. To misquote a favorite saying, manufacturing companies have been adamant: ‘one can never be too rich or too lean.’
But now Toyota has had a slew of embarrassing recalls — the 2010 Highlander; 2008 – 2010 Sequoia SUVs; and 2009 – 2010 RAV4′s due to gas pedal problems. It has just recalled 437,000 Prius and other hybrid vehicles worldwide to fix brake problems. In 2009 it recalled Corolla, Camry, Vios and Yaris sedans due to faulty electric window-control systems.
The point of the WSJ piece is to implicate lean manufacturing in this. (It’s unclear whether it’s too much lean or too little quality control, but they are clearly connected.) Now, lean as an idea is not going to go away. Nobody is suddenly going to advocate ‘bloat manufacturing,’ but looking at the damage in reputation and bottom line that Toyota has soaked up, the company and others like it will obviously looking across their lines and saying to themselves ‘a bit of redundancy (fat, if you like) in the system will be cheaper than this.’ Thus the pendulum swings back from lean extreme to somewhere a bit more durable. A happy medium.
Maharaj Mac
In the other story, the Times reports how McDonalds is seeing benefits from localization of it’s menu, for example, offering the McItaly in Italy, the (non-beef) Maharaja Mac in India, the McLobster in Canada and the Ebi Filit-O (shrimp burger) in Japan. The pendulum effect here is that McDo became the mega-corporation it is based on global standardization and a ‘one-menu’ mantra from Cleveland to Taipei. It wasn’t just one menu, but each item had to be produced from the same stock, and in the same way. McDo fries were identical everywhere, that was the guarantee (and they were always called ‘fries’ no matter what locals called them.)
It is now become common cause among the global food companies (notably Starbucks and KFC) to work local options into their offering. One may think this is merely ‘think global, act local.’ The point is, it is an about-turn indeed from the ‘think American, act global’ that went before. What works best is in fact a happy medium.
What does this have to do with better future-thinking? Expect a recall sooner or later on forecasts that don’t see change resolving itself around a happy medium.
read morePosted by Adam Gordon on Dec 15, 2009 in all, economy & finance, emerging technologies, lifestyles & values, policy, politics of the future, strategic foresight, technology change
I have a fond little memory from one of the early multi-candidate debates in the last US election campaign. It was on prime-time TV: there were still about a dozen or so candidates in the running, including Obama and Hillary Clinton, each was standing behind a podium, and as the topic of climate change came up they were asked en masse: “So, who didn’t fly here today in a private plane, raise your hand?” The delegates all sheepishly kept their hands down but one – I forget which – raised his. “I came in yesterday,” he explained. (laughter)
So to the Copenhagen climate change summit, and all the luminaries and dignitaries and celebrities landing at København airport, many of them in private jets.
http://www.cph.dk/CPH/DK/MAIN
This tells us something about the future, and what it says is: ‘needs must.’ What are they going to do, row a boat to Copenhagen? Scale that up and you have the real, actual future. People will fly. In fact the entire new global middle class of billions will fly. And they will heat their homes. And they will eat meat, and so on. And any even remotely democratic system that tries to take away this will be out on its ear.
But we will of course move to cleaner, renewable, sustainable systems. How fast this happens depends essentially on money, which in turn depends on political will, which in turn depends on public concern. Money is required to fund new energy technology research, and — the core issue of Copenhagen this week — it is needed to buy off industrializing countries.
There’s no doubt that climate change (manmade or not) is real, and a real danger. But when scientists and academics are worried about it that means little in terms of changes to human practices. When the public gets concerned — as they now are — we get the possibility of fundamental change. This is true of the future generally, not just climate and the environment.
Between the public sentiment and the money lies political will. Essentially the political will of post-industrial economies on the one side, who find it politically easy, relatively, to pay the price of emissions constraints vs. that of developing economies which will be choked economically and therefore politically by those constraints.
Inequality
Correlating degrees warming with ecological and therefore social upheaval is important. But to think that is what the argument is about is to miss the point. The point is global inequality and its future, and how developing economies are not going to allow emissions constraints to further entrench it.
The future goes always to the most powerful side. That’s what power is for: determining the future. The sides are both strong in this dispute, so this battle will not be won or lost in Copenhagen this week. We are still in its early stages. The effects of climate change are incremental (unlike, say, nuclear holocaust) meaning there is plenty of room for postponement even if the planet can’t and won’t ultimately take it. And those who would occupy the moral high ground have burned public and private jet fuel to be there to do it, and will no doubt indulge in a bit of Smørrebrød and Frikadeller too. Needs must.
So expect the political clock to remain stuck as it has been for a while now, at ’5 minutes to midnight,’ while the issue smolders slowly without definitive resolution — until technology advances get human energy, finally, off fossil fuels and the problem works its way out of environmental and human systems.
read morePosted by Adam Gordon on Sep 14, 2009 in 2025, all, emerging technologies, failed predictions, foresight tools & methods, managing uncertainty, Perils of Prediction, technology change
I note from a link on the Ian Miles Futures blog that “2025: Scenarios of US and Global Society Reshaped by Science and Technology” by Coates, Hines, & Mahaffie, is now available free for full-text download.
For full disclosure, I should say I worked in the Coates office in Washington D.C. during the mid-late 1990s (but got there just after the book was done.)
There are deep and ultimately overwhelming problems with the book itself. It sees science-technology as the primary driver of change, when what science is done and what technology is produced is often the product of policy or economic or values / zeitgeist decisions further up the chain. It also has an astoundingly poor conceptual framework (‘Worlds 1, 2, 3′) for dealing with non-US societies and cultures, and their economic and social development: one that would make Tom Friedman (‘World is Flat’) giggle and Hans Rosling surely cry. Truly there are many reasons they have to give this book away for free.
But its importance is elsewhere. It remains remarkable for one thing — the thing that the Coates & Jarratt foresight firm was known for — a willingness to speculate confidently and in detail (and sometimes even stupidly) about future changes. The book is likewise exemplary in its commitment to concrete, interesting, ‘fearless’ long-range speculation, in a world where most analysts waste most of their foresight ink timidly equivocating and covering their back.
Quality, reloaded
Evocative, concrete speculation is important, even if it is wrong. It is commonly misapprehended that the purpose of foresight work is to “predict the future,” (and someone with this perspective is going to pop up in 2025 and say “so, how right or wrong was this book?”) But, nobody can be right. The real value of foresight work is other: to know as much as we can about the present, and the forces and factors changing it, to be able to preconceive the full range of possible future outcomes that pertain, in order to make decisions today towards an outcome we prefer. (Who “we” are and what “we” prefer — social welfare; shareholder value maximization; environmental sustainability, etc., — will vary hugely among interest groups of course.)
This preconception (of a range of scenarios, if you like) is what allows truly effective discussions and debates to take place in considering alternatives, and therefore promotes better decision-making regardless of whether the scenarios ultimately turn out to have been, in themselves, ‘right’ or ‘wrong.’ High-quality scenarios are to be preferred of course, but quality is in the ability to stimulate and provoke management attention to the right areas in a timely manner, not in having been right in prediction. As Coates used to say (and I echo this to my Industry Foresight students): “You don’t have to be right, you just have to be interesting.”
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