“The only constant is change”
Contrary to popular belief, Heraclitus never said these words, but they manage to sum up perfectly the ancient philosopher's brief of the "universal flux." And, paradoxically more than 2,400 years after the theory that made them possible, these five words happen to be the ultimate description of the world we live in right now. After centuries of timid technological progress and stable socio-political evolution, exponential technological advances and rapid value shifts have defined the last decades: we live in a state of permanent revolution – or permanent disruption.
But in a world in which everything is subjected to disruption, it is becoming increasingly difficult for companies to stay relevant over time. With the average company lifespan dramatically declining, pressure is on companies and their leaders, who are struggling not only to get into markets, but to stay in business as well. The world of today is very complex and volatile, and it is imperative to find new ways that allow us to understand what it is being disrupted, how will that happen, and how to navigate that disruption in a successful way.
How to find and exploit value in a sustainable, scalable way has become more challenging than ever. As I explained in my previous article on new innovation models, both traditional and lean strategies, with their different approaches to pursuing value, are proving incomplete when it comes to dealing with disruption. Instead, the changing markets of today call for an approach that lets companies shift their strategic pivot when required to tackle the disruption while maintaining a direction to promote scalability and growth. As Ellen di Resta states, companies need to “deliberately create an ideal future vision that guides new, continually disruptive steps toward realising it.” Traditional and lean strategies fall short at dealing with uncertainty and planning for leadership at the same time: a navigational strategy doesn’t.
Having a navigational approach to strategy is not an easy task though. Quantitative strategic methodologies are inadequate alone when it comes to tackling the uncertainty of disruption, because, by nature, uncertainty does not allow for measurement. The business world has come to realise this lately and, slowly but steadily, has started to implement creative disciplines in strategic skillsets to overcome that. Companies not traditionally related to design, as PepsiCo and IBM, have started to include the figure of the Chief Design Officer right in their executive boards. In a strategic context, creative approaches should go alongside quantitative ones to enrich decision-making with qualitative insights and lateral thinking. This will boost strategic moves with what is called informed intuition - the ability to take decisions in uncertainty, where quantitative facts are not enough (if you’re not very much familiar with this concept, you can always check out the thorough paper IDEO wrote on the subject). But how can you reach this informed intuition that will help strategists to come up with the right answers to disruption? What are the creative disciplines that can contribute to the business toolkit?
Trend analysis has been increasingly winning a space in current business strategy as a methodology to provide qualitative insights that help identify new horizons and changing values. Observing changes in society, culture, and people’s behaviour is an important skill in forecasting. Many institutions, from governments to corporations, have incorporated trend research as a creative-based routine for their strategic programs. For instance, the UK Ministry of Defence established the Global Strategic Trends Programme in 2001 to research and understand potential trends that shape and inform the future strategic context, including design thinkers in their programme. In the corporate world, Royal Philips Electronics has been using trends analysis for more than fifteen years as an indispensable input for strategic actions, from proposition generation to identifying emerging business areas, through their dedicated and expanding strategic trend team.
Trend analysis helps companies adapt to fast-changing times and reinforce a leadership position in the market by guiding innovation from upstream vision to downstream propositions. Adding trend knowledge to any business toolkit gives a company strategic advantage to a company’s proposition and promotes disruptive innovation. Trend foresight helps us discover emerging consumer behaviours and needs, spot qualitative growth opportunities, create vision landscapes on a determined subject, define critical emerging drivers shaping the future of industry and enrich decision-making from a qualitative and intuitive perspective.
There is no 10-step-guide to success in disruption. But there are a set of methodologies and frameworks than can help guide our innovations in the best way possible. And there, trend analysis proves to be one of the strongest supports to strategic foresight. During my professional experience incorporate innovation, I did set up and collaborated in a series of trend programs that ran throughout the whole of the End to End (E2E) process. Whereas as a framework for developing a new portfolio strategy, or as input to innovation E2E processes and to corporate strategy, trend analysis give a very broad set of actionable insights that help define and deliver competitive visions and plans of action. In my academic activities I walk my International MBA students at the Instituto de Empresa through the mindset and frameworks behind trend analysis to enable them later in their business-oriented careers, in which they will need to define critical emerging drivers shaping the future of their industries and enrich their decision-making to successfully lead them.
As a part of my corporate, consulting and academic experience, I’ve worked in a series of trend programs and, as a result, have set up a methodology to implement trend analysis in strategic foresight, meant to help strategists and innovators understand critical emerging drivers and changes, and their impact on a business, from strategy planning to proposition development. If you want to know more about the enormous potential of trends to help you navigate disruption, you are welcome to view a presentation on my methodology and approach here.
There is no guide to guarantee a business will survive disruption. But trend analysis will increase dramatically its chance of making it through the storm – and leading the way once it has passed.
Have you utilised trends to implement your strategy?
How much do you think trend programs are implemented nowadays in strategic departments?
What other creative strategy methodologies do you see useful to improve decision-making in disruptive environments?