2020 is a Perfect Storm. Don’t be the Andrea Gail. Have a game plan for when the game changes.
The successive health, economic, and social crises of this year underscore the need to be prepared for uncertainty. Follow this Five-Step Playbook to be Future PROOF.
22 years ago, I was staying at a friend’s house in San Diego and I couldn’t sleep. In perusing his bookshelf for something to distract me, I stumbled on a book about a once-in-a-century hurricane … and proceeded to stay up all night devouring it in one sitting.
That book was “The Perfect Storm” by Sebastian Junger (later made in a movie with Mark Wahlberg and George Clooney). In addition to detailing the almost impossible confluence of events that created a “perfect” (in terms of lethality) cataclysmic event, it also described — in morbid but fascinating detail — what it would be like to drown or how long you could live while bobbing in the middle of the Atlantic Ocean. There is a wide cast of characters in the gripping story, but the central plotline is the tragic tale of the 70 foot Andrea Gail and the six sword fishermen aboard who find themselves in the middle of the storm. That might sound like a big vessel, but not when you’re facing 100-foot swells in the world’s biggest ocean. Like another famous maritime disaster movie, they needed a bigger boat.
What does this have to do with our present moment? We are facing a Perfect Storm, and we don’t want to be the Andrea Gail.
We must shift from a tactical and reactive mindset to a strategic and proactive one
2020 has hit us with 3 successive and interconnected shocks: a global pandemic, precipitous economic collapse, and massive social protests. This triptych of crises has demonstrated how important it is to think strategically about the future.
Humans are generally horrible at planning ahead, however. Most of us go through life focused on the here and now. A survey from 24 countries found that most people don’t look past 15 years in the future — and I suspect our most common time horizons are much shorter (15 minutes?) than that.
However, we have to start planning for such disruptions to our way of life and commerce for two reasons: they are happening with increasing regularity, and their impacts are tectonic. 2020’s calamities demonstrate how terrible the outcomes are when we operate without anticipation and preparation. The need to methodically think ahead has never been greater — because the consequences of not doing so have never been higher.
Here, then, is a five-step playbook for making yourself or your organization as future-PROOF as possible:
P — Predict a bit
R — Use RADAR and SONAR
O — Organize your (Future) Thinking with Scenarios, Red Teams, and Tripwires
O — Go on Offense with Experiments + lots of little bets
F — Develop greater Strategic Fluidity
Step One: Predict a bit
I’m not suggesting that you gaze into a crystal ball or get a tarot card reading. Even in a highly uncertain and fluid environment however, there are some reliable ways to see around the corner. Intel CEO Andy Grove once observed that “snow melts first at the periphery.” What he meant was that there are always signs of a big change coming if you know where to look. Science fiction writer William Gibson concurred, noting that “the future is already here; it’s just not widely distributed yet.”
You need to look for what futurists and economists call “weak signals.” How do you do that? If you’re a big company, make sure that information is flowing freely from the front lines of your operation. What are the salespeople hearing? Make sure the satellite office intel and the water cooler chatter makes it up to the conference room level and corporate headquarters. If you’re a company of one, scour the fringes of your industry or sector for clues.
You can’t always wait for bulletproof patterns to emerge, though. Hard data are often lagging indicators of what could potentially be important. By the time you are dealing with a fact on the ground, whatever led to it has already happened.
In other words, you can’t avoid having to predict (a bit) whether or not what you’re reading in the tea leaves is going to turn out to an important trend.
Step Two: Use RADAR and SONAR to scan the environment
Radar is an acronym for “radio detection and ranging.” A radar system is used to detect the position and movement of objects in the air at a safe distance. Sonar (sound navigation ranging) performs the same function, but in a more opaque environment — such as beneath the oceans. It allows sonar operators to identify enemy submarines by their distinctive audio signatures, for example.
In much the same way, business leaders need to be able to spot threats from far away and ideally be able to identify them. In other words, they need to develop both Radar and Sonar capabilities.
I’m an optimist by nature, but a pessimist by necessity: I like to cultivate a little professional paranoia. If you don’t periodically scan the horizon for potential threats and vulnerabilities, you are flying blind into the future.
Ask yourself: are there issues looming that you need to begin preparing for now? Or are there new opportunities that appear to be emerging around the corner?
We are hardwired by evolution to be on the lookout for threats. However, long-range vision can also alert us to opportunities — if we figure out what won’t change.
The recently passed HBS professor Clayton Christensen was the father of “disruption theory”, but I believe his most helpful thinking tool is “The Jobs to be Done” mental model. In essence, he argued that when we use a product or service we are “hiring” that company to do a particular job. Ikea doesn’t sell furniture; we ask it to furnish an apartment cheaply and quickly. FedEx doesn’t deliver parcels; it sells “peace of mind” — because you know you can send it by FedEx and then forget about it.
NYU Professor Rita McGrath has stood on Christensen’s shoulders to build on this powerful way of looking at the future. She surmises that while products and services will constantly change, the jobs that we hire them to do are remarkably stable. Equinox is the service that I “hired” to keep me in shape in the pre-pandemic world; I might have to pivot to Peloton or Fight Camp to fulfill that need in the future. But her point is that I will still need to pay someone or some organization to help me stay healthy. The product and provider may change, but the underlying need that it satisfies will not.
So figure out first what is the “job to be done” by your work or your organization. This is a tremendously useful thought exercise that I undertake with clients even before they start strategic planning.
Today, it’s even more important to identify how you are providing value to your customer, and how that will have to evolve in the future.
Step Three: Organize Your (Future) Thinking
One of the mantras that I live by is: plans are useless but planning is priceless. If you become anchored to a specific and rigid strategy, you won’t be able to make crucial course corrections or consider opportunistic adjustments. Static plans can be prisons — but the act of planning is a crucial thought exercise to prepare a set of options when faced with a given situation. Here are my top 3 thinking tools in this regard.
Scenario planning is an attempt to sketch out the future by building a narrative around a prediction. The term was borrowed from the film industry, and for good reason: the purpose is to set a fictional scene and paint a vivid alternative picture of reality. Humans have evolved to respond to stories, and scenario planning taps into that instinct. Not only are the vignettes one creates in such an exercise more memorable, but they also activate a lot more of your imagination as a result.
You could do really sophisticated scenario planning, but don’t let the perfect be the enemy of the good. I recommend a quick and dirty three-level scenario planning exercise whereby you sketch what the world would look like if:
- The situation got better
- The situation got worse
- The situation got weird
Those last two scenarios blur with another favorite framework of mine: Red Teaming. This is an incredibly useful thought experiment where you try to imagine bad things that could occur to your plan or business before they happen. By doing so, you identify the most likely points of failure, but also discover low-probability but high impact events that could totally derail your project. Having thought about these risks ahead of time is a great start, but the real ninja move is to develop some contingency plans to put in place should the “Black Swan” event occur. As the Latin proverb “Praemonitus, praemunitus” points out, forewarned is forearmed.
Finally, once you’ve drawn up some richly detailed scenarios and played devil’s advocate, you can’t just file those lessons away in a folder. Instead, you need to set up an early warning system and “tripwires” to alert you to the likelihood that an important scenario — a threat or an opportunity — is coming into focus. Ask yourself: what would the key indicators in your industry to monitor? Remember to zero in on leading or “live-time” indicators rather than lagging ones.
Create a simple dashboard — with no more than 5 metrics — to monitor on a daily basis. This will serve as a regular trigger to review the state of play, but also as a reminder to sound the alarm if one of the indicators starts “screaming.”
Remember — the information we collect is only useful if we use it to inform the choices we make for today and tomorrow.
Step Four: Go on Offense with lots of little bets
The hardest part of navigating change is not actually seeing around the corner. That’s relatively easy. The signals are there if we’re willing to spot them. The true challenge is making the changes to your life and organization. Strategy is easy. Execution is hard.
So how do you go on offense?
Find a pilot project that you can stand up quickly — a “minimum viable project”, so to speak — and test out certain hypotheses. Then, like a good poker player, cut your losses or double down. Split your aces.
Experiment constantly. Make lots of little bets and then examine the results.
Step Five: Develop Strategic Fluidity
Bruce Lee once described the ideal martial artist as having a “mind like water”. I think the ideal organization should be like that, too.
Like water flowing down a river, attention and resources should flow to opportunities and pool in places that promise great profits.
What does that mean in practice? For one, you want to have the lightest cost structure possible in order to enable quick pivots. Second, you have to jettison rigid, top-down “command and control” structures and reshape the organization into small units or project teams that are modular, dispersible, and easily redeployed.
One of the reasons that former General Stan McChrystal is sought after right now as a business advisor is that he led just such a transformation. When he took over Joint Special Operations Command (JSOC) in Iraq and Afghanistan in 2006, he inherited a jigsaw puzzle of organizations that was up against a fluid, always adapting insurgency. His response was to emulate his opponents’ agility, reconfiguring JSOC into the now-famous “Team of Teams” model that he wrote about in his subsequent eponymous bestseller. These days, agility trumps strategy. In fact, agility is your strategy.
This does not give you a license not to have a strategy, however. Organizations still need to have a point on the horizon on which to aim; otherwise, they risk being rudderless. But in this fluid world in which we find ourselves, we must be more descriptive than prescriptive. We need to paint a picture of what success looks like without dictating how we get there. It’s more about giving direction than directives.
The ability to adopt “Strategic Fluidity” is the key to surviving and succeeding in this new world. Just like Darwin pointed out about nature, it’s not the strongest species that survive but the most adaptable.
Make your fluid structure a central part of your strategy.
As Paul Auster points out, “if you’re not ready for everything, you’re not ready for anything.”
You need to start preparing for the next crisis now. We have to realize that we can’t wait for it to start raining before we start building an ark. It’s almost always too late to prepare for a catastrophe when you’re IN one. So whether it’s this existential threat or the next one, we need to become “crisis-ready” — every day. The best organizations and the most future-proof professionals are poised to deal with disruption by anticipating it — before it happens.
Consider this your early warning. Winter has come, and summer isn’t coming this year. It’s time to follow legendary CEO Jack Welch’s advice to “change before you have to.”
I’ve tried to provide a playbook here for you to prepare for what is likely to come. While we can never know exactly what the future holds, we can take steps today to be more ready for tomorrow.
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