Book Review: The Anticipatory Organization: Turn Disruption and Change into Opportunity and Advantage
Disruption is shaking all industries and established business models today. Retail is being hammered by eCommerce; fossil fuel driven vehicles by electric vehicles; Uber is making customers think whether they should own a car? Customer and employee loyalty have an increasingly short shelf life. Is strategic planning dead as some gurus shriek from pulpits?
As Nestle’s experiences with the ban on Maggi noodles shows, even after hiring the best brains, building a culturally evolving organisation or investing a fortune on data and information management tools, gazing into the future is a hazardous activity, more so in the VUCA age. The U.S. healthcare industry was also recently given a shock treatment with the announcement of a new company to be launched by heavyweights Jeff Bezos, Warren Buffett and Jamie Dimon to tackle the high cost healthcare industry. Welcome to the World of Volatility, Uncertainty, Complexity and Ambiguity.
In this uncertain world, Futurist Daniel Burrus’s pathbreaking book The Anticipatory Organization comes a welcome respite from the tensions and stresses of forecasting into the foggy future where established practices such as strategic planning are not working. Within this fast-changing future, opportunities will be revealed to those who can separate the Hard Trends that will happen, from the Soft Trends that might happen. As Professor Burrus explains, the future is far more certain than we realize and changes still take place much more slowly than we think. For example, a concept like Electric Vehicles has been around for more than a decade and it will still require at least another two decades where these vehicles are a significant threat to existing fuel-based technologies. This gives enough breathing space for vehicle companies and those companies which supply to these OEMs, to make their transition. The future only looks uncertain and arrives fast because we have not yet developed the mindset and tools to look into the future, which Professor Burrus now introduces.
A Hard Trend is a projection based on measurable, tangible, and fully predictable facts, events, or objects. It’s something that will happen: a future fact that cannot be changed. For example, demographic data is a hard trend. We can anticipate with certainty out of so many babies born today, what percentage will reach adulthood, after 18 years and what percentage will reach 65. We know that after winter comes spring, tides can be anticipated to the minute and governments will continue to increase their regulatory stranglehold. In contrast, a Soft Trend is a projection based on assumptions and statistical probability that have the appearance of being tangible, fully predictable facts. It means soft trends can be changed.
We know that longevity is rising in India which is a hard trend. This offers many opportunities for companies to cater to older population from healthcare to recreation.
To go further in trend analysis, Soft trends can be divided into those with Hard Assumptions, that is supported by some data and those with soft assumptions, which is nothing but gut feeling. Soft trends with soft assumptions carry the maximum risk in planning for the future. These underlying principles provide a powerful vehicle to influence the future, and they can be capitalized on.
One of the ways to put accurate timeframes on Hard Trends, is to use what Professor Burrus calls the Three Digital Accelerators: the exponential advances in processing power, bandwidth, and storage. Professor Burrus has been tracking the Three Digital Accelerators, as well as their exponential trajectory, for the past thirty years. These Three Digital Accelerators have now entered a predictable new phase due to their exponential growth—a phase that will transform every business process. Think of it this way: Based on the technology-enabled Hard Trends that are already in place, over the next five years we will transform how we sell, market, communicate, collaborate, innovate, train, and educate. If you cannot anticipate, someone else will.
Understanding the difference between Hard and Soft Trends allows us to know which parts of the future we can be right about. When you learn how to analyse trends in this way, you can accurately predict future disruptions, identify and solve problems before they happen, and practice what the author calls “everyday innovation.” This enables you to solve challenges and problems faster, and see opportunities that were impossible just a few years before. In other words, you become anticipatory rather than reactionary. Amazon is anticipatory while brick and mortar retail are reactionary. They may be agile, that is the ability to respond fast, but that is not enough today. A company which cannot anticipate the future cannot survive. A graveyard of organisations such as RIM (Blackberry), Dell, Kodak, Yahoo are a proof of organizations which were agile but not anticipatory. The recent debacles at, once laudatory company such as GE only underlines the risks involved in deciding about the future and committing resources to take a chosen path.
Emergence of Electric Vehicles is still in the realm of Soft Trend Hard Assumption and companies should keep developing various scenarios based on available information. We know EVs will dominate roads in future, but many aspects related to this emerging industry, such as battery cost and power, charging points, regulatory frameworks are still evolving. For example, after launching an ambitious EV policy with great fanfare last year which would have transformed Indian vehicles ecosystem by 2030, the Indian government has recently shelved this policy sending the nascent EV industry in a tailspin. Not everyone believes that EV is dead in India and in future, decisions can be reversed or revised.
Professor Burrus has built a proven business model The Anticipatory Organization model, further refining the Hard Trends analysis. The Burrus Hard Trend Methodology is a scientifically developed system based on thirty years of research. Many companies, including Deloitte, Lockheed Martin, and IBM to name a few, have changed how they forecast and strategize based on this methodology of separating Hard Trends from Soft Trends. Organizations which embrace the Anticipatory Model learn that many future disruptions, problems, and game-changing opportunities are predictable and represent unprecedented ways to gain advantage and build a sustainable organization. Being anticipatory means modifying plans to keep them relevant and from becoming obsolete before them are implemented. Companies like Amazon, Apple, Uber, Netflix, and Facebook have anticipated future disruptions and created game-changing innovation to capitalize on them. The Anticipatory Organization fits well with the new type of organization culture which is evolving, based on shared vision and collaboration.
This business model is based on two key concepts introduced in the book. These are:
The Model is a systematic method to ready your organization for the disruptive transformations ahead. It is comprised of four key disciplines:
Transformation begins with challenging the status quo and its’ time to challenge the prevailing strategy practices. Any transformation requires an organization culture which can absorb new concepts and apply these throughout the organization. This is the major drawback in most companies built for the industrial society and have not evolved to meet the needs of a VUCA world. Without a learning organization, characteristics of which are exhibited by Netflix, Fujifilm, Pixar Studios and Genpact in India, no new concept can take roots within the organization. We have observed that at regular intervals, new concepts are introduced with much fanfare such as Re-engineering, Balanced Scorecard and Knowledge Management and our leaders speak about these at every forum. In the absence of a learning culture and without periodical nourishment, these concepts remain a fad and over time, die a natural death, thus depriving the organization of building a sustainable future.
To avoid the same fate with The Anticipatory Organization, we hope that the copies will be distributed to all executives for reading and the prescriptions, advise and business model introduced will be discussed widely within organization to uncover insights. This will create an environment for building and adapting systems and tools to anticipate future with confidence and certainty. Professor Burrus is not just an academician with a new theory but one of the world’s leading futurists on global trends and innovation with an active Foresight practice who has introduced the concept and model of Anticipatory Organization in many Fortune 500 as well as smaller companies. The book is derived from his personal experiences and as companies struggle to look into the future, they will benefit immensely from it.
The Anticipatory Organization: Turn Disruption and Change into Opportunity and Advantage
By Daniel Burrus
Publisher: Greenleaf Book Group, Release: October 10, 2017
Reviewed by Suhayl Abidi, co-author of The VUCA Company
