Eight Ways IBM Develops a View of the Potential Futures

Last week I presented at the 47th meeting of the Technology Market Analysis Group.  The theme for the meeting last week was “Trend Spotting and Forecasting Market Disruptions”, a theme that was right up my alley.   I’ll blog more about TMAG and the meeting in the coming days. 

How IBM Develops Views of the Potential Futures - Aug2011The inspiration for my presentation came from a white paper “100 years of foresight: The importance of long-term thinking at IBM” written by my IBM colleague David Jarvis, Senior Consultant of the IBM Center for Applied Insights team.

This was a very timely topic as this past June IBM celebrated its 100th birthday…a major milestone in the company's history.  It’s important to pause and reflect how a company like IBM continues to survive and even thrive in an industry that experiences one disruptive trend after another.  The answer lies in a series of initiatives designed to help the company understand and prepare for the potential futures that lie ahead.  

During the presentation, I provided an overview of eight examples of ways in which IBM approaches the discipline of strategic foresight.  In each of the eight initiatives collaboration plays a big part in planning for the future.   If you scroll to the bottom of this post, you’ll see I’ve also embedded the presentation which I have loaded to HorizonWatching on Slideshare.

Eight IBM Foresight Initiatives

1.Global Technology Outlook (GTO).  The GTO is developed annually by IBM Research and identifies disruptive societal, technical and economic trends that might impact IBM and its clients.  The GTO is used to drive technical initiatives in IBM Research and to jointly engage with IBM in formulating these initiatives.  For more information, check out the 2011 GTO report.  A side benefit of the all the work that goes into the GTO is the annual list of Five in Five…which provides a list of five technologies that may have a disruptive impact on our lives in five years.

2.Academy of Technology. The IBM Academy of Technology is a society of IBM technical leaders across all IBM Business Units.  The academy’s mission is to advance the understanding of key emerging technical areas.  Groups of technical leaders voluntarily study, organize, synthesize and advance technical dialogue and innovation across business lines on important emerging technical topics.

3.First of a Kind (FOAK). The First-of-a-Kind (FOAK) Program encourages collaboration of early adopter companies with IBM Research and Sales.  The effort pushes early thought leadership and experiences with new technologies and results in the piloting of experimental solutions and working prototypes.  For more on FOAK see http://www.research.ibm.com/FOAK/index.shtml

4.Global Innovation Outlook (GIO).  The Global Innovation Outlook focuses more on broad issues impacting all types of organizations. This is an open, collaborative, multi-disciplinary process with external business leaders, academics, researchers and policymakers.  The focus on tackling broad and challenging topics – spanning geographies, generations, industries and interests.  Access past GIO reports via http://www.ibm.com/ibm/gio/us/en/index.html

5.InnovationJam. InnovationJams (https://www.collaborationjam.com) are online collaborative discussions and brainstorming sessions for focused audiences ranging in size from a few hundred to hundreds of thousands.  The brainstorming sessions are enhanced by real-time text analysis and data mining software that highlights hot discussions and possible solutions.  An example was the HabitJam.

6.Institute for Business Value.  The IBM Institute for Business Value (IBV) is global team of 50+ consultants who conduct research and analysis across multiple industries and functional disciplines. IBV consultants author thought leadership papers, like “Future Agendas” and “C-Suite Studies” that provides an original, research-based point of view told from a client’s business perspective.  

7.Market Development & Insights.  IBM’s Market Develop & Insights is a global team of market research analysts and consultants that research topics of importance to IBM business leaders and strategists.   The team accelerates the understanding of new or emerging markets, and acts as a catalyst for future growth.  The team provides foresight from a marketing perspective, including market definition, opportunity analysis, market drivers/inhibitors, potential segmentation, and competitive intelligence.

8.HorizonWatch Community.  This is a cross-IBM community of 1900+ IBM employees from all types of functions, divisions and geographies that I have led since it’s creation in 2001.  The mission is to improve our collective ability to sense future disruptive technologies, business issues, trends and opportunities.  The community meets via monthly conference calls on an emerging topic, which are led by a subject matter expert.  In between calls, the community collaborates via an online community platform that allows the members to share and brainstorm ideas about how the future will play out.

Growth Oriented Companies Pay Attention To Customer Goals

A few weeks ago I attended a 2 day conference jointly organized by the Kellogg Graduate School of Management (at Northwestern University) and the Marketing Science Institute.  The conference was titled Realizing Opportunities for Profitable Growth.  

It was a fantastic conference for me.  The agenda was packed with excellent presenters, I met many interesting people, and I felt like I was back at graduate school on the Kellogg GSM campus, my alma matar.   It was especially great to see one of my favorite professors, Professor Greg Carpenter, again.

I’ve had a busy couple of weeks since the conference so I am just getting around to organizing my notes from the conference.   Over the next few posts I plan on summarizing those notes and providing the most important nuggets of learning to you.

The first topic area discussed at the conference was how companies can go about the task of developing better strategies to achieve growth in a competitive marketplace. 

An obstacle to growth for many maturing customers is how they currently think about their customers.  Many companies can't grow a mature product until they put aside their traditional thinking about how and why their customers buy.  Many companies in mature markets have blinders on and have hard fast assumptions about their customers.  For example, they think that their customers have the following purchasing behaviors

  • Lower price is better
  • Buyers choose rationally
  • Buyers know what they want
  • More choice is better
  • Information improves choice

Growth companies tend to throw out those assumptions and ask: How can we think differently about our customers?   Companies that do a good job of developing competitive growth strategies in maturing product categories know that it requires a deep understanding of what customers value. 

To understand what customers value, we must understand how customers set goals…for goals are what drive customer decisions.  Goals are desired future states of being.  Customers set goals because they have ambitions about the future.   They set both short term and long term goals.   The goals drive customer wants, needs, and purchase behaviors. 

There are, of course, different types of goals, but from a marketing perspective, there are three important types of goals that customers have that impact purchasing decisions.  

  1. Emotional goals
  2. Functional goals
  3. Economic goals

Most goals are set high and are somewhat difficult to achieve.  So by the mere process of setting goals, customers are also creating problems that need to solved if they are to achieve the goals.   Thus goal setting quickly turns into a process of learning what problems they need to solve and then coming up with action plans to solve those problems.   As a result, customers place a high value on products and services that can solve their problems. 

Growth oriented companies who pay attention to their customer’s goals and help position products to help solve problems, can grow, even in mature product categories.  They can do this by helping shape how customers learn how to solve problems.

As they go about solving problems, customers seek knowledge.   All customers have a process for how they go about learning how to solve problems, and eventually, making decisions.  Based on learning activities they choose participate in customers form their own sense of reality.   Growth oriented companies develop marketing strategies that are designed to influence what and how the customers learn …and therefore impact customer’s perception of reality.

Growth companies look to create new learning paradigms around maturing products by innovating uniqueness in their products.   By innovating uniqueness into maturing products, growth companies cause customers to seek more knowledge.  But you also need to keep things simple as customers need to know just enough information to solve their problems…not much more than that.

It is also worth noting that customers have an unlimited supply of goals.  As goals are achieved, new goals are created.  So this leads to a unlimited supply of problems customers must solve. 

As I said above, look for a few additional posts in the near future summarizing some of the other key thoughts from the conference.

Thanks to the Marketing Science Institute for putting on such a great conference!!

Looking to 2050: Ten Challenges For The Human Race

Peter Schwartz is recognized internationally as a futurist and strategist.  He honed his skills at Royal Dutch/Shell Group in London, where he led a widely respected scenario planning effort.   He has written a number of interesting books about the future, including The Art of the Long View. 

This past May he gave the commencement address at Rensselaer Polytechnic Institute.  During the address, he outlined ten longer term challenges for the human race as we look forward to the next 40-50 years.  He encouraged the graduates to come up with innovative solutions to these challenges. 

The top challenges Schwartz outlined are:

  1. Creating long-term solutions to meet our energy demands sustainably.
  2. Launching a bio-industrial revolution with sustainable manufacturing.
  3. Understanding and enhancing the human brain to avert age-related impairments.
  4. Improving agriculture to reduce costs and increase its energy and water efficiency.
  5. Building sustainable cities through better urban planning and "smart architecture”.
  6. Stimulating job growth and economic development.
  7. Fusing the technological with the spiritual and aesthetic dimensions of human culture.
  8. Advancing technological instruments to drive scientific discovery forward.
  9. Harnessing biological tools to advance human evolution.
  10. Discovering new ways to lower the costs and environmental impact of space flight and development.  

The list above is an interesting list.  I am not sure that these are the top ten most important challenges, but each of the above ten are certainly important. 

Some comments…

  • Energy tops his list and it is hard to argue that it should not be there.  I can’t see the demand for energy going down anytime soon and we need to figure out how to transition to clean energy. 
  • Improving agriculture processes in developing nations will have have a significant impact on the economy and quality of life.
  • Building smarter and sustainable cities is a very large challenge as the number of megacities grow and grow.
  • Number 9 on his list, “Harnessing biological tools to advance human evolution” sounds both scary and beneficial at the same time.
  • Regarding number 10, with announced plans to go back to the moon and to Mars, we will need innovative ways to travel through space and live at the destinations we travel to.

It is worth pointing out that many on the list kind of fall under the push for a smarter planet.

If you want to read a transcript of Peter Schwartz’s commencement address, check out http://news.rpi.edu/update.do?artcenterkey=2585

Can you think of any other challenges Schwartz’s list?  The only one that comes to my mind right now is the never ending desire to live in a world free from war and conflict, but I don’t suppose for one minute that that will be solved in the next 40-50 years.

A Primer on Futurists

As organizations increasingly try to grapple with the seemingly endless scorching rate of technological innovation and change, more are engaging the services of self-described futurists for advice on how to adapt.

What Is A Futurist?

Basically, futurists are those who look to and provide analysis and insights on potential futures.  They help others anticipate and prepare for potential changes and disruptions in order to make better decisions today.   Think of futurists as in the same league as historians.  Futurists explore the future, just as historians study the past.   Historians are  concerned with origins, roots, stories/points of view of where we have been in the past and how we got to where we are today.   Futurists are interested in emerging trends, technologies, goals, purposes.  In short, futurists are interested in where we might be going in the future and how we can get there.   It’s interesting to note that in many cases good futurists have a little bit of a historian inside of them (e.g. studying the past can help predict potential futures.)

 

What Do Futurists Do?

Futurists research and explore the full range of potential / plausible futures.  A futures consultant or facilitator helps clients expand their typically narrower focus on the future to a broader range of possibilities.  They forecast the future, not just to know the future as an abstract description, but rather to prepare for it as a concrete reality.
The objective is not just to know what will happen, but to be ready whatever does happen.  The objective is not necessarily to be exactly right (which is impossible), but rather not to be wrong–that is, not to be surprised.  Surprise means inadequate preparation, late response, higher risk of failure, even chaos or panic.  Thus, preparing for the full range of plausible futures is the objective of futures studies.

Futurists take an inter-disciplinary approach and employ a wide range of methods, from trend analysis to scenario planning, to simulations, to strategic planning and visioning.  Since the future does not exist, we must study ideas about the future. Futurists use data from the past and present, and our concepts and methods to understand how the present will evolve into possible alternative futures. We also borrow liberally from other fields, such as creativity, complexity science, organization development, systems analysis, and philosophy.

What Type Of BackGround Do Futurists Have?

Futurists come from a wide range of backgrounds. What they have in common is big picture thinking, strong pattern recognition, and innate curiosity.
Futurists come from a wide range of backgrounds and walks of life, be it liberal arts, psychology, engineering, the sciences. A growing number are coming from the dozen or so futures degree programs worldwide.
Other characteristics typical of futurists include openness to new experiences, comfort with ambiguity, thinking systematically, seeing options and alternatives, questioning and challenging assumptions, a global outlook, a long-term time horizon, optimistic, and having a sense of purpose.

How Can I Train To Become A Futurist?

The formal study of the future goes by a number of names, including “Strategic Foresight”, “Futures Studies”, and “Prospective Studies”. 

Formal futurist higher education options are somewhat limited.  There are about a dozen degree programs worldwide.   Within the United States there are two main academic programs created that focus on training futurists 1) the University of Houston (M.S.) and  2) University of Hawaii (M.A. and Ph.D.).  Both programs have been around for over 30 years.

Futurists without the formal education learn on the job through professional development.  Many professionals become futurists by acquainting themselves with futures concepts, tools and methods, familiarizing themselves with the literature, and participating in futures conferences and organizations.

What Professional Networks Are There?

Here are some places to go to find more information….

  • World Future Society  20-25,000 members who subscribe to The Futurist magazine and attend annual meetings; mostly centered in the U.S.  www.wfs.org
  • World Futures Studies Federation   Several hundred members spread across the globe with a rotating secretariat, includes many academics  www.wfsf.org
  • Millennium Project  Volunteer group around the globe that produces the annual State of the Future report and other futures studies, as well as the Futures Research Methodology.  www.millennium-project.org 
  • Association of Professional Futurists  200+ professional futurists and students in futures degree programs.  http://www.profuturists.org/
  • The World Future Council.  http://www.worldfuturecouncil.org. The World Future Council brings the interests of future generations to the centre of policy making.  The Council addresses challenges to our common future and provides decision-makers with effective policy solutions.

Being a futurist sure sounds like fun….and there might just be a future for futurists.  🙂

APF: Top Ten Published Futures Works

Looking for some books to read this summer?  Well, the books on the list below are not necessarily the type of books you would take on that beach vacation you are planning.  No thrilling mysteries on this list.

However, the books on this list were voted the top ten classic works in the area of Futures Work.  So if you are interested in learning more about how to understand the future, you might want to check out one or more on the following ‘classics’.

The Association of Professional Futurists (www.profuturists.org/) is a community of professional futurists who are all interested in understanding and influencing the future.   Recently, the membership voted on a list of what they called ‘classics’ in the topic of Futures related work.  Here is the “top ten” in order of votes received, along with a description of the work.

  1. Art of the Long View by Peter Schwartz.  Amazon description:  “Presenting a revolutionary approach to developing strategic vision in business and in life, a guide for managers, entrepreneurs, and investors explains how to apply creative and intuitive skills to corporate practices.”
  2. Foundations of Futures Studies: Human Science for a New Era by Wendell Bell.  Amazon description: “Author Wendell Bell brings together futurist intellectual tools, describing and explaining not only the methods, but also the nature, concepts, theories, and exemplars of the field.  Bell illustrates how this sphere of intellectual activity offers hope for the future of humanity and concrete ways of realizing that hope in the real world of everyday life. His book will appeal to all interested in futures studies, sociology, economics, political science, and history.”
  3. The Knowledge Base of Futures Studies, edited by Richard Slaughter.  Website description:  “This CD ROM presents an up-to-date international overview of futures studies and applied foresight.  Readers can access some of the core material of the field produced not only by well-known authors but also by many who live beyond the main centers in Europe and the USA.”
  4. Limits to Growth by Donnella H. Meadows, Dennis L. Meadows, Jergen L. Randers and William H. Behrens.  Amazon description:  “offers a pessimistic view of the natural resources available for the world's population. Using extensive computer models based on population, food production, pollution and other data, the authors demonstrate why the world is in a potentially dangerous "overshoot" situation.  Put simply, overshoot means people have been steadily using up more of the Earth's resources without replenishing its supplies.”
  5. The State of the World (series) by The Worldwatch Institute.  Website description:  “State of the World is the authoritative and comprehensive series that is mapping out what an environmentally sustainable society will look like.  Produced by the award-winning Worldwatch Institute, it has become an indispensable guide for national leaders as well as concerned citizens everywhere.   The topics in the 1998 volume include an assessment of the world's forests, an analysis of the decline of fisheries around the world, a survey of all five major groups of vertebrate fauna that are facing severe stress, and the financial aspects of sustainable development.”
  6. The State of the Future by Jerome Glenn and Ted Gordon.   Website description:  “Produced by the Millennium Project, under the auspices of the World Federation of UN Associations (WFUNA), the State of the Future report contains insights into the Project’s work from a variety of creative and knowledgeable people, obtaining information from and getting feed back on emerging crises, opportunities, strategic priorities and the feasibility of actions.”
  7. The Art of Conjecture by Bertrand de Jouvenel   Website description:  “Originally written in French, this is a classic work on the topic of probability.  It was published in 1713 and shows how de Jouvenel derived the form of the binomial distribution.”
  8. Futures Research Methodology by Jerome Glenn and Ted Gordon   Amazon description:  “Comprehensive and internationally peer-reviewed handbook on tools and methods for forecasting and analysis of global change.  Each chapter in this series gives an executive overview of each method's history, description, primary and alternative usages, strengths and weaknesses, use in combination with other methods, and speculation about future usage.”
  9. The Age of Spiritual Machines by Ray Kurzweil   Amazon description:   “Kurzweil, artificial intelligence expert shows that technological evolution moves at an exponential pace.  Further, he asserts, in a sort of swirling postulate, time speeds up as order increases, and vice versa.  He calls this the "Law of Time and Chaos," and it means that although entropy is slowing the stream of time down for the universe overall, and thus vastly increasing the amount of time between major events, in the eddy of technological evolution the exact opposite is happening, and events will soon be coming faster and more furiously.”
  10. Collapse: How Societies Choose to Fail or Succeed by Jared Diamond   Amazon description.  “The book examines why ancient societies, including the Anasazi of the American Southwest and the Viking colonies of Greenland, as well as modern ones such as Rwanda, have fallen apart.  Not every collapse has an environmental origin, but an eco-meltdown is often the main catalyst, he argues, particularly when combined with society's response to (or disregard for) the coming disaster.”

Well, like I said, these are not for light reading.  For those of you who are building your library of futures related books, I hope this list helps you get started.