Thinking usefully about the future

The latest issue of Business 2.0 has an interesting piece on how the Institute for the Future (IFTF), one of the oldest future-watching organizations, is creating “artifacts from the future” – physical manifestations of things that may come to pass – to help its clients understand the convergence of current trends and their impact. The article says that IFTF’s clients don’t have the time or mindspace to trawl through the annual 10 year forecasts that are its trademark, thus the creation of more tangible outputs. Alex Soojung-Kim Pang of IFTF believes its clients’ supposed lack of inclination to read reports is overblown, but there is no question that some of the IFTF’s outputs are pretty cognitively dense, and we can all see the attention span of senior executives whittling away year by year. Future Exploration Network will be applying a wide variety of ways of engaging our clients with new ideas. Richard and I, in a project last year helping a major bank develop long-term strategies, used newspapers mocked up with possible headlines for 5-10 years hence to stimulate discussions and new ideas. If we’d had the budget, we would have created one or more “bank branches of the future” that executives could experience for themselves. There is no question that rigor is needed in exploring fundamental trends and how they might play out, but time-impoverished executives often need a more direct approach to provoke them out of their everyday pressures.

Global innovation and networks

IBM has recently released its second Global Innovation Outlook report. I referred to a related initiative – IBM’s Global Technology Outlook – in the second edition of Developing Knowledge-Based Client Relationships as an example both of collaborative innovation, and how IBM provides customized and highly relevant insights to its clients. IBM brought together 250 thought leaders in five locations around the planet to think about innovation and the future. The insights are available in a publicly-available report, and also in customized interactive presentations for large clients. The report is excellent, not least because it hits on most of the themes of this blog 🙂 It points to innovation today being: Global, Multidisciplinary, and Collaborative and open. This ties in totally with the story I often tell, of how increasing depth of knowledge and specialization requires collaboration between disciplines, which must be global in scope, and requires new models to draw together disparate strands. In its examination of the Future of the Enterprise, the report focuses on networks, also touching on other key themes of strong interest to me, including “reputation capital” and how value is aggregated. Well worth a look.

Monitoring the future

Last week I caught up with Michael Hopkins of Monitor Group. Chris Meyer, author of books such as It’s Alive, and previously Director of the Ernst & Young Center for Business Innovation (CBI), came to the Monitor Group after Cap Gemini closed down the CBI, to establish Monitor Networks. Its very interesting business model includes acting as a talent broker, a rather unusual activity for a top-tier strategy consulting firm. Monitor Networks has recently set up FutureMonitor, which is an online community that brings together many people’s insights to gain perspectives on the future. There are a lot of directions this could go, including providing decision-relevant prediction markets for clients. Certainly FutureMonitor is well worth a look to gain some of the distilled perspectives from its participants – very interesting stuff.

Aggregated customization

A new business called DayJet – based in the US – is about to launch a new airline that allows business travelers to fly direct to regional airports thereby avoiding time-consuming connections at big airports and also avoiding unwanted overnight stays in small towns and cities. So far not that exciting, right? What’s interesting is how Day Jet plans to do this. First the airline has ordered two hundred six-seater micro-jets at a cost of US $1.3 million each. This will bring airliner style performance at a fraction of the cost. But that’s still not the interesting bit. The airline has no set routes and no fixed prices. Instead the airline will aggregate demand ‘on the fly’ linking small groups of people that want to go to the same place at roughly the same time. Routes and pricing will thus fluctuate in real time as demand comes and goes and customers will be offered a series of different prices depending on how flexible they are willing to be (give a little, gain a lot). What’s really fascinating about this idea is how the business model combines some of the hottest trends that are around, all of which will affect everyone in some shape or form in coming years. What are the trends? First there’s mass customization. This allows customers to order a customized version of a standardized product. Second there’s dynamic pricing. This is where the cost of a product or service changes depending on demand or supply. Finally there are social networks. This is how the Internet pulls people together that have similar interests or needs.

The wisdom of crowds

In terms of hot business trends, I’ve written extensively about open-source innovation, the long-tail effect and simplicity but here’s a new one – collective wisdom. The idea is simple: the wisdom of a large group of people is nearly always greater than the intelligence of any single member. The theory is especially hot in Internet circles where obviously it’s very easy to access the collective intelligence of users but it’s also emerging as a hot forecasting tool in financial markets. The idea is as old as the hills, but it’s re-emerged due to technological developments (e.g. convergence and social networks), and a book called The Wisdom of Crowds by James Surowiecki. Goldman Sachs, Deutsche Bank and Hewlett-Packard are all using group wisdom to predict everything from next quarter sales to future economic indicators. Group prediction can even be played for fun on various websites like www.ideosphere.com, www.hsx.com and www.longbets.org. Is this a future trend or just a short-term management fad? What do you all think?

The raw data of the global network economy

For some time now I (and quite a few others) have been talking about the “global network economy”. The best way to understand the way the global economy is in considering the global networks of flows of goods, services, money, people, entertainment, aid, and ideas. Now Professor Miguel Centeno of Princeton University has taken the concept deeper, using network analysis methodologies to study globalization. He has set up the International Networks Archive, which has a fabulous array of data on globalization from a network perspective, much of it in Excel format for those who like going to source for their data and analysis. This is a fantastic resource, and I certainly intend to play around with some of the data available here. Prof Centeno is now using the network analysis and visualization software Netmap (which I’ve previously written about in its intelligence applications) to bring the data to life. Part of the things that you can pick out far more easily in this network-centric view of the world is the interdependencies of the world. Simplistic views of say US and China relationships dissolve in the far more complex global networks in which single relationships are set. These are great tools for politicians, activists, and anyone else seeking to really understand the nature of our inextricably interrelated economic existence.

Keynote on the Future of Global Business at the Harvard Club in New York

This April 27 I’m doing a lunch address at the Harvard Club in New York City on The Future of Global Business, organized by Claxton Speakers International – description below. Details and registration here. If you’re in the area, please come along and say hi, or feel free to pass on word if people you know may be interested in coming along.
The Future of Global Business
Business is now truly global. Communications technologies and deregulation are creating a world in which there are no boundaries for competition. Manufacturing has already gone to low-cost locations. Now almost-free communication allows legal work, financial analysis, and other professsional work – as well as customer service – to be done anywhere on the planet. Innovations are copied in the blink of an eye. Blogging, podcasting, and internet TV change the rules for media and advertising. The entire planet has become a intensely interconnected hive of business activity.
Yet despite the challenges, there are massive opportunities in this new global world of business. How should individuals, companies, and indeed entire countries, position themselves for success? The answer is in connecting. You must have at least one world-class capability, and then tap into global networks for both suppliers and clients. Those organizations that can create effective collaborative networks will dominate. Those that attempt to stand alone will fall. Today it is still about who you know, but also about how you can create value with your personal networks. In his compelling and energizing keynote, Dawson brings clarity to the unfolding world of global business, and provides specific, actionable strategies for individuals and companies to succeed in the challenging times ahead.

10 Trends for 2006+

Future Exploration Network Chief Futurist Richard Watson, within our sister organization NowandNext, has just come out with what will be an annual report. 2006+ 10 Trends: Predictions & Provocations is through Richard’s generosity available here as a free download (usually £35), and Richard is allowing any use of his material with acknowledgement. The ten trends Richard explores in the report are:
1. Anxiety
2. Connectedness
3. Speeding-up
4. Mobility
5. Convergence
6. Privacy
7. Nostalgia
8. Localisation
9. Authenticity
10. Happiness
He then goes on to explore specific sector trends, including society & culture, government & politics, media & communications, money & finance, healthcare & well-being, travel & tourism, and far more.
Just a tiny smattering of the juicy tidbits from the 64-page report:

* In the UK the Royal Society for the Protection of Birds (RSPB) now has more members than the three main political parties combined.
* Reason magazine recently sent out 40,000 personalized copies of its magazine, each with a circled aerial photograph of the subscriber’s house on the cover, and detailed information about that subsciber’s neighbors.
* 42% of the US workforce is unmarried.
* More young people voted on American Pop Idol than in the last US Federal election. But politicians in Lithuania gave away drinks at polling stations, to help increase voting from 23% to 65%.
* At Harvard University, 75% of students support the armed forces, compared to 20% in 1975.
* 36% of high-school students believe the US government should approve news stories prior to publication.
* In 1900 Americans slept 9.0 hours per night, today they sleep 6.9 hours a night.
* It took 30 years for Japan to build to 17 million outbound trips a year, but only 5 years for China. There are 800 million internal trips in China each year, similar to the number on the rest of the planet combined.
* The MTV Starzine magazine, produced by MTV and Nokia, consists entirely of text and photo submission by mobile phones from readers.

Stacks more insights, trends, predictions, and observations in the report.