Cartegic Group - Strategic Scenarios for Resilient Organizations    



Making Predictions:
Reflections on Discontinuous Change

Few gurus ever predict the kind of discontinuous change and fundamental disruption that can quickly demolish a business, an industry, or even a nation from outside. If they do, their prognostications are often so sweeping and generic as to be of little practical use. Examples of sudden, surprising change abound. Well-known examples include:

  • Regulatory change, wireless telephony and VoIP eroding the established franchises of fixed line telecommunications providers
  • Digital photography crushing Polaroid, deeply challenging Kodak and re-making the wet-process photographic industry
  • Blogs challenging the power of established media outlets
  • P2P technology providing a wake-up call to the recording industry
  • Terrorist attacks disrupting the airline and entertainment industries (to pick just two)
  • Asymmetrical warfare challenging established global security arrangements and practices
  • Snowboards expanding but also cutting into what had been steady, predictable growth in the downhill skiing industry
  • PC's making Digital Equipment, Wang, Data General, Prime and a host of other minicomputer makers virtually obsolete
  • Dell shaking up the nature of electronic distribution and re-defining supply-chain efficiency
  • Wal-Mart permanently 'upping the ante' for success in retail trade in nearly every category
  • Amazon and eBay revolutionizing consumer shopping

Guru consultants typically work by offering pre-packaged solutions rooted in historical trends, and their own industry-specific experience. In stable times, this can be quite effective. Imposing industry norms in order to get a faltering organization back on track can be an important service.

But what industry is truly stable? Oil? Paper? Telecom? Banking? Hardly. Pre-packaged 'answer consultants' are seldom equipped to help a client drive quantum breakthroughs in their business or envision and foment truly disruptive changes that play to their strengths. At worst, they can sound like this:

"I've been in this industry for 30 years...
Listen to me, do what I say, and you'll be fine."

Such talk can be tremendously reassuring. In times of high uncertainty, it's tempting to look for definitive authorities who "know" what's going to happen in the future, and can tell you what to do about it. But it's always worth remembering:

Nobody has actually been to the future.

As chaos theorists will tell you (and pundits will sometimes admit), many aspects of the future are fundamentally impossible to forecast. Definitive predictions - no matter how cleverly graphed and footnoted - are simply the embodiment of someone's assumptions and hopes.

Some forecasts are better than others, but too many predict "up and to the right" futures: things will get better and better! Real life seldom works that neatly.

While acknowledging the power of traditional forecasting tools in certain limited contexts (e.g., short term, stable industry), Cartegic favors an approach to prediction that uses scenarios to anticipate broad changes to the rule-sets of a given industry and prediction markets to harness collective intelligence in assigning probability to specific events. For more on these tools, see our blog (Mapping Strategy) or Contact Us.