We all know how important it is to follow the major trends in society, in order to understand how our customers, consumers and clients are changing. However, trend following is only the beginning and not the end of preparing your business for the future.
Why? Because your competitors are also following trends and probably the same ones as yourself. So how can you get a real advantage over them? By stretching the trends into the future, developing scenarios and then identifying their drivers and triggers.
The competitive advantage of scenario planning
Whether or not you have a successful business today, things can change. In fact change is the new norm, and as Charles Darwin said in one of his famous quotes: “It is not the strongest of the species that survive, nor the most intelligent, it is those most responsive to change”.
Most organisations do follow trends in an effort to keep up with what is happening in society, but because it has become the norm, this will not provide you with a competitive advantage. All your competitiors are almost certainly working on many of the same new product or service ideas that you are, based on the recent changes in attitudes and behaviours that they too have identified.
A real competitive advantage comes from working on changes that have not yet happened, or are only just emerging. Thinking about and planning for possible future events and situations makes you more prepared for different eventualities and better able to meet the challenges. It also gives you a better chance of identifying things that your competitors may not yet have done.
Scenario planning for uncertain times
In times of turbulence, as witnessed these last few years, many companies have found themselves uncomfortably exposed and unprepared for what is happening. Even more recently, many countries around the globe are being forced to re-evaluate their energy strategies and asking themselves how they themselves would have coped with the disaster that hit Japan. Governments all over the world are taking another look at the possibilities that they have imagined and reviewing whether they have pushed their scenarios far enough into the future. The only way they – and you – will know is to keep pushing outwards.
Thinking the “unthinkable”
I remember working on one set of scenarios with an FMCG / CPG company many years ago. I had pushed the most relevant trends to the extreme, then “collided” them to see what new “worlds” might thus be appearing. Happy with my conclusions, I presented my four worlds to the executive board, who were interested and immediately started discussing which of the four was most likely to happen and the consequences for the company.
I pointed out that scenario planning is not a forecast and that they should prepare plans for all possible new worlds, as the future was likely to hold elements of all four of them. A member of the board then said “But Denyse, no retailer would ever demand that all our products be carbon neutral in order to be given shelf space”. Whilst I agreed that this might indeed not be the case, I asked what he would do if this was demanded of us. He had no answer.
Imagine his surprise – and my, albeit limited, satisfaction – when one of the largest retailers in one of our markets said they were going to demand this of all products within just a few years! The board quickly asked for another presentation of the scenarios and started reviewing all possible eventualities, having finally understood the power of scenario planning.
Maybe your company should start to think the “unthinkable”; it might just save you from a nasty “wake-up call”!
This post was originally published on March 24th 2011 on C3Centricity Comments
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Are you really Ready for the Future? by Denyse Drummond-Dunn