A Reminder of the Role of Culture and Identity in Social Change

Peter Beinart has a great piece in The Atlantic about American culture and soccer.  While responding to an Ann Coulter piece on why soccer is un-American, Beinart takes a quick look at the history of soccer in America and conducts a quick exploration of what the rise in the popularity of soccer in the United States means about changing American culture (spoiler: he argues that it has a lot to do with demographic changes with respect to liberals and Hispanics).  In doing so he provides an excellent reminder of the impact that values, culture, identity, and our interpretation of future social change can have on the trajectory of history.

Here's an excellent example, a passage where he focuses on when America intentionally parted ways with Europe:

So why didn’t soccer gain a foothold in the U.S. in the decades between the Civil War and World War I, when it was gaining dominance in Europe? Precisely because it was gaining dominance in Europe. The arbiters of taste in late 19th and early 20th century America wanted its national pastimes to be exceptional. Despite the British roots of both baseball (in rounders) and football (in rugby), their promoters worked to cleanse them of foreign associations and market them as American originals. Basketball had the good fortune to have actually been invented in the United States.

Soccer, by contrast, was associated with foreignness in an era when mass immigration was spawning Coulter-like fears that America was losing its special character. “Soccer,” Markovits and Hellerman argue, “was perceived by both native-born Americans and immigrants as a non-American activity at a time in American history when nativism and nationalism emerged to create a distinctly American self-image … if one liked soccer, one was viewed as at least resisting—if not outright rejecting—integration into America.” Old-stock Americans, in other words, were elevating baseball, football, and basketball into symbols of America’s distinct identity. Immigrants realized that embracing those sports offered a way to claim that identity for themselves. Clinging to soccer, by contrast, was a declaration that you would not melt.

In casting his gaze forward, Beinart takes a look at some of the cultural trends that may be supporting this shift in soccer's popularity in the US: mass Hispanic immigration, how technology allows new immigrants to remain deeply connected to their home countries (and their national sports), and growing numbers of Americans (those under 50) are less likely to feel that the American way of doing things is the best or the right way.

And this, of course, has broader implications in a world where we are contemplating a new geopolitical era potentially without a stable new pattern of politics and conflict. As Beinhart points out, "it’s a healthy response to a world that America is both less able to withdraw from, and less able to dominate, than it was in the past."

5 Levels of Disruption

In a number of recent talks and working sessions with clients we've been dancing with the issue of "disruption."  As others regularly note, both the term and notion of disruption is pretty hot and hype these past few years, and we ourselves have often referenced the work of Clayton Christian in addition to other work on technological disruption and innovation.  Partly because the term is defined differently by different writers, and partly because clients have different scales and scopes to their businesses, we do sometimes need to be both more explicit as well as more structured in our thinking (and discussions) with clients about where, how, and why change might potentially "disrupt" their business.

Figure 1: a typology of disruptions

It is in this light that we will sometimes use the following framework (figure 1) with folks to help clarify and explore both potential disruption as well as lower, more typical types of changes. Note that we normally use this in discussing disruptions to a client's business and not to broader changes in the environment or society.

At the top of the inverted triangle we have what, frankly, futurists live for: large scale techno-economic paradigm shifts that ripple through society and redefine how we do things.  These are of course rare, though they have tended to occur once every 50 or 60 years for the last 250 years. While usually not top-of-mind for your typical business decision-maker, when these occur, they affect everyone.  [If we had to make a statement about the next big shift, which is likely building steam as we write, then we would expect it to be the Age of Microbes and Machines]

Next down from those society-wide disruptions we tend to look at disruptions that drive an organization to stop and reconsider its basic reason for being.  These are understandably rare, but they do happen, and in our experience they tend to be related to an impending and dramatic change in things like core regulations that would change the structure of a market.  Again, they don't happen very often, but the question itself, "Do we need to revisit the organization's basic purpose?" is often useful just for setting the bar, as it were.

Disruptions to the business model would be one down from mission.  Here things tend to get more interesting, partly because of the amount of genuine change occurring in the world, and partly as a consequence of the notion, prevalent today, that "business models" are constantly changing.  Here again we have tended not to see a genuine need to fundamentally reconfigure a business model that often, but the question legitimately surfaces more often than higher order change.  Here of course we encounter a variety of discussions concerning technological disruption, regulatory change, unexpected competition, etc..  And certainly at this level both the source of disruptions and their impacts blur across into the next level...

...which is where we talk about potential disruption to strategy.  Planning is, frankly speaking, more art than science, and any discussion about strategy or strategic plans necessarily pivots on basic definitions.  These definitions will in no small part determine whether or not an organization traces a disruption to business model or strategy.  For our own work, and in the absence of an entrenched and differing definition within the organization, we tend to work with strategy as an abstraction, starting with a core definition of strategy as:

A concept or theory for how, in a given context and employing a given set of resources and competencies, you expect to achieve your goals.

It has been our experience that many small and some medium sized firms do not actually operate on what we would identify as formal strategies, though most are certainly focused on some set of achievements or some general direction, and many have enormous lists of initiatives and projects. Regardless of whether or not they do, however, there is a lot more action at this level when it comes to exploring potential disruptions.  And as alluded above, at this level we see a lot of conversations about technological disruption, new competition, and things like regulation and business environment.

Finally, we have the most typical changes, those that force new directions in products or services. The sources of "disruption" at this level can be broad, and because product/service portfolios can be organized in a variety of ways and oriented towards a variety of different markets, organizations will often identify a number of drivers that are fairly local or simply localized but that still require serious responses through product/service innovation.

And while there may be nothing terribly innovative about this framework (the framing is quite intuitive, after all), we do find that it can greatly help un-muddle certain strategic conversations.  This can particularly be the case when a client is facing a context of high complexity, in which they have multiple concerns across multiple domains or scales.  Separating out the different pressures, and exploring how they might be interacting across levels, can be a very useful exercise amidst a broader conversation.

As with just about all of our work and frameworks, this one is an evolution-in-process (in fact, we've been discussing whether or not to flip the pyramid to reflect the number or breadth of the sources of potential disruptions, vs the way it is now, which emphasizes the scope of impact of the specific source of disruption under review...).

Surveying the Landscape of Economic Change

Figure 1: nested political changes

In most of our work, and particularly for our original research and content, there are one or two key frameworks that help us organize and make sense of the dynamics we (and clients) are observing and experiencing.  In the Third Era one such framework is the nested view of political changes (figure 1).  This particular construct helps us separate out the various changes in political life that are often lumped together in everyday discourse while also allowing us to consider how things interact across these domains.

The Third Era also incorporates frameworks like the Three Horizons, but the above nested view is probably the most important overall framing right now.

Figure 2: education as a socio-technical system

Another framework, this time from our most recent work on learning futures, adapts a socio-technical transitions model to viewing and understanding current and likely changes in education in the United States (figure 2).  This framework provides a compelling way of not only understanding education as a system embedded in larger systems and susceptible to developments in the margins, but also for exploring how education will become ever more shaped by technical influences.  This lets us explore the issue of education becoming a more typical socio-technical system than it has ever been before.

While there are some other, more minor models at work in our learning futures content right now, the nested view above is by far the most central to our work.

Figure 3: layered economic changes

And so, in updating the Infinite Economy, one of the new framings that emerged was that of layered views of economic change dynamics (figure 3).  For the Infinite Economy, there are a number of models/theories related to economic change that we like to draw upon, and this layered view, which builds upon the common analogy of the "30,000 foot view," allows us to incorporate multiple models while (hopefully) not muddying the issue too much.  And while Perez's technological revolutions models is also central to the Infinite Economy framing and forecasts, this layered view is almost more important in the bigger picture (ha, ha) because it allows us to capture in one view some many of the different issues and changes people are confronting.

The ability to organize the many conflicting and contending signals we are receiving today about our economic futures is, to us, a critical ability if one wants to usefully talk about the futures of economic life.

Onizuka Quote

I recently visited the Ellison S. Onizuka Space Center at the Kona airport and right within the front entrance they have a poster with a quote from him.  It's an excellent quote, and in particular the passage I liked the most was:

"Every generation has the obligation to free men's minds for a look at new worlds... to look out from a higher plateau than the last generation."

As a futurist, I find that to be a wonderful sentiment.

The Infinite Economy

Today we released the highlight booklet for the updated Infinite Economy material.  First presented to audiences in 2012, the Infinite Economy is a look at how the material basis of our modern lives is poised to undergo fundamental transformations over the next several years.

"A review of current global trends such as population growth, continuing industrialization, rising energy demand, massive urbanization, and long term climate change shows that humanity is entering uncharted territory with respect to the material and organizational challenges it will face in the coming decades.

Yet, despite these considerable challenges, a review of humanity’s history and an exploration of the presently dim outlines of the future both strongly suggest that humanity can and is developing the insights and tools to dramatically raise the material security and affluence for all if it chooses to do so.

Thus, the future is very much a matter of vision and of choice."

Please check it out today.

Your Futures Context is Always Longer than Your Planning Horizon

Leaders frequently ask us why they should do foresight work (or strategy, for that matter) if, as "everyone" says, company planning horizons have shrunk to just 1 - 3 years.  Why, they ask, should people spend time looking beyond 3 years?

The answer is: context.  In order to develop either a strategy or a set of activities (or both) for the next year or next 3 years an organization has to account for the context in which it will be operating.  And that context is necessarily broader and longer than the work scoped out in any plan.  That context always includes what might be lurking further down the road and what might approach from the "sides."

If an organization is working on a 1-year plan, then the context for that plan is closer to 3 years.  If it is working on a 3-year plan, then the context is more like 5 - 7 years.  And in each case the range or breadth of issues that reasonably falls within the context for the plan increases as the horizon increases.

Why should we look at things this way?

1. Things Take Time: Looking farther out is important even in an age when so much seems to change so quickly, if for no other reason than most things that will become important to your business still take time to develop.  Whether it is a new technology, an emerging public policy idea, or the growing dissatisfaction of consumers, most things do not simply emerge spontaneously out of thin air, and their development can often be identified early and tracked.  Do not mistake media (blogosphere) hype or triggering events with the longer cycles of maturation.
2. Accounting for Uncertainty: The farther out we look the greater the range of potential issues that will impact your business and, perhaps more important for the current issue, the greater the uncertainty in precisely when something will "pop."  Thus, the longer the time frame for our planned activities, the more "deviation" from our projections we need to consider.  So, if we forecast that something will be mainstream in say, 5 years, then we have to consider that it might actually happen in 4 or take as long as 7 (or more).
3. Good Strategic Thinking: It is not simply what you are going to do or focus on within the next 1 or 3 years that is important, but also how does that position you for what comes next?  Even when your plan is to address things that are critical over a short time horizon, those decisions will position your company for the next set of things that will be developing towards maturity over your 1 or 3 year planning horizon.  Making those near term decisions (typically the "urgent") with an eye to the next set of things (likely the "important") is fundamentally part of good strategic thinking. 

What is a good rule of thumb for identifying your planning horizons?

• If your plan covers the next year, then your horizon should be the next 3 years
• If your plan covers the next 3 years, then your horizon should be 7 years
• If you plan covers the next 5 years, then your horizon should be the next 10

Pathways to Hybrid Government in Hawai'i

A few days ago I posted a piece on Hybrid Models of Governance on thethirdera.com blog, which centered on why hybrid representative/democratic government models are a believable pathway to political innovation. Anyone that might be momentarily nonplussed by a suggested contrast between representative government and democracy, you can catch up quickly with this post that talks about the definition of democracy. Yesterday's post, though, got me thinking about how such a pathway could unfold in a place like Hawai'i.

To start, let's quickly review the four scenario-types described in the Third Era post:

• Crisis-Driven Change at the Center: a national (in the US case, the Federal) government is driven by some form of crisis or a popular movement reaching critical mass to adopt new structures
• Slow Build to the Center: augmenting structures are experimented with at local and district/province levels over many years, and success and socialization lead eventually to adoption at the national level (as people’s expectations for political norms change)
• Proliferation and Diffusion: augmenting structures are experimented with at the local level and gradually spread as other localities mimic the new, more effective structures; hybrids become the norm at small governance scales (localities), but there is no upward adoption at the national level (one explanation could be strong and coordinated counter-narratives at the national level directed at protecting the national-level status-quo)
• Quirky Outliers: after a period of augmenting structures being fashionable and many local governments experimenting with them, most die off or are shut down as the intellectual movement passes its zenith without achieving broad institutionalization, but a few experiments survive as testaments to the idea

Let us choose Slow Build to the Center, and cast Hawai'i's state government as the "center" and the county governments and neighborhood boards as the localities. For key trends to project forward let us use things like continuing basic demographic/age-cohort transitions, proliferation of mobile technology and ubiquitous mobile internet access in daily life, and tightening budget constraints for local governments.  For key emerging issues, we will use things like "crowdsourcing" efforts and "open data."

So, how would we then expect to see hybrid governance structures emerge according to this scenario-type?

To keep it fairly simple, let us just build a timeline for our scenario:

• A local resident creates a Web app called DisPLACE that combines several public data sets to create information-rich maps of Honolulu neighborhoods
• A well-organized neighborhood board starts to use the DisPLACE data maps in their neighborhood meetings; they also use it to annotate their neighborhood issues and recommendations
• The mayor publicly endorses the Web app; public use of DisPLACE spikes; more neighborhood boards start using it
• A college team creates another application called VoteDis using the DisPLACE data that sorts issues and enables residents to prioritize them
• In a future mayoral race, campaign staffs realize that VoteDis enables them to slice resident data and get at specific constituency interests in a much more powerful way
• A well-endowed nonprofit sets up a tracking service that analyzes county council progress against the priorities showcased on VoteDis; they team with local media to run ongoing political analyses and roundtables; other nonprofits latch on to VoteDis for their own advocacy needs
• The Honolulu city council decides to use the neighborhood priorities from VoteDis to set a portion of their own agenda; resident approval and satisfaction starts to rise
• Over a few years all of the county councils begin incorporating both DisPLACE and VoteDis in their deliberations; many state legislators begin to publicly reference them as well
• Over a few more years there is a growing discussion about adapting VoteDis to create a permanent internet-enabled structure to incorporate some citizen-driven agenda-setting for the legislature
• The question of a constitutional convention is called by the lieutenant governor…

This is just a quick example, but it is illustrative of the type of slow diffusion and incremental change we might expect in a Slow Build to the Center scenario.  Essentially, we are looking at the gradual development of tools or processes that are adopted as add-ons to existing political processes.  The O'ahu neighborhood boards, while not possessed of much authority, do have a purpose of increasing citizen participation and do have a degree of flexibility in how they engage with local residents.  They, therefore, are one logical locus of augmentative political innovation.

I will work on another scenario that incorporates a few more elements to explore how new governance structures could logically arise in Hawai'i.

Notes:

1. we used a linear progression for the scenario overall, versus an exponential pattern of change

2. for simplicity we restricted the introduction of new technologies and multiple parallel developments; in a more robust scenario we would weave in a wider of array of logical developments

3. because of the focus on emerging democratic augmentative structures the scenario followed the evolution of just that type of structure and not other, more e-anarchic or plethocratic structures that could easily emerge from the current ecosystem of political innovation

Futures thought of the day

My futures and foresight thought for the day (yesterday) was simply this:

Intuition and imagination are necessary but insufficient elements of good foresight work.

Great quote about predicting the future

I just finished the book China Airborne: The Test of China's Future, by James Fallows, which is by far the most interesting book about China that I have yet read.  Fallows' narrative is entertaining and engaging, and yet he is able to use the development of a modern commercial airline industry as a very effective proxy for framing and (trying) to grasp the scale of both potentials and challenges in China.

At the very end he has a great line about the challenge in predicting China's future that I just loved:

But I know how much is in flux, and how much is at stake.  It is not an evasion of analysis but a recognition of China's complexity, and the world's, to say that a wide range of outcomes is possible, and that it is worth watching very carefully signals like those I have mentioned to recalibrate our estimates.

That's simply an awesome and elegant quote that I think captures the tentativeness and openness more or us should adopt in our thinking about the futures of complex life.

S-curves, uncertainty, and investment

Figure 1: basic VFS s-curve

Yesterday I had a great conversation with some folks from out of town and at some point our foresight work came up.  In discussing with them some of the industries in which their clients operate, I drew some diagrams to help illustrate some of the foresight-related points that I was trying to make.





Beginning with some s-curve diagrams like Figure 1, I started mapping out where our foresight work leads up to, and overlaps with, things like venture capital and investing in start-up companies.  We talked a bit about where (on the curve) you are likely to find different people focusing, and for what reasons.  Obviously futurists are trained to deal with the stretch that encompasses the Foresight and Innovation zones, even though many clients are asking for help with things that are already into the Reactive zone and the New Normal.

Figure 2: cone of uncertainty

We talked a bit more about the emergence of new technologies and the patterns of exploration and experimentation of business models and new ventures that almost inevitably takes place (the Innovation zone), which led to some talk about uncertainty and the narrowing of possibilities as time progresses.  Here we would normally think about the classic "cone of uncertainty," pictured in Figure 2.  The basic idea in most futures work, as it is in weather forecasting (where they also use cones of uncertainty in forecasting), is that the further into the future one gets the more uncertainty increases.  And I think most people intuitively grasp this, so it's not usually a difficult concept.

During the conversation I started lining up these different concepts, again to illustrate some points in the conversation about how our foresight work typically relates to other business activities.  In doing so, I had to reverse the cone of uncertainty to accurately capture the progression of things and the direction of change in our levels of uncertainty.  What resulted, reproduced in Figure 3, was a layering of three basic charts:

• A reversed cone of uncertainty identifying where core foresight work really operates in relation to the gradual reduction of new possibilities (e.g. new tech, startups, and emerging industries), on top of,
• The s-curve chart I earlier detailed to talk (initially) about "thought leadership" and consulting work, layered over,
• The classic s-curve of issues/tech development that is so common to foresight work

Figure 3: all 3 charts, aligned

A couple of things were of particular interest to me as I connected these charts.

A.  There is something about that dark, dashed lined in the reversed cone on the top.  What I mean is, I think there is something about crossing that line that typically represents a move from a more wide-open futures mind-set (shuffling possibilities, struggling for a useful framing of the many uncertain possibilities) to a more focused concern with driving change and/or beginning to lay real bets (take options, as some would say).  To the left of that line, I think organizations are more likely to be in a scanning/discussion/scenario forecasting type of mode.  To the right, as things begin their slow work of shaking out, individuals feel more confident to begin positioning themselves or use the emerging outlines as a real guide for action.

B. At the risk of delving a little too much into some inside baseball, I think different schools of futures, and certainly different traditions of anticipating change, are more comfortable, or perhaps are better able to have their art flourish, along different stretches of that cone.  I suspect many of the folks trained in the "Manoa" schools are most comfortable and most artistic to the left of that line, while still having a facility as they begin to cross the line.  I think those trained at Houston might gain a bit more momentum in their art as they hit that line.  And I think, if it bears out, it's probably to do with the philosophic and methodological emphases that the two schools have traditionally had.

And again, I personally think that most good foresight practices work better when we move beyond, say, a three year time horizon.  I think that once we are into the Reactive zone real subject matter experts will, generally, have a better sense of the shape of the near-term future, and importantly the nuances of standards, competition, and emerging regulation, than will good futurists (who are not also genuine subject matter expects in that topic).

Figure 4: reversed cone of uncertainty

More technological revolutions

In the last post just before New Year's I included a graphic that combined the three horizons framework from Sharpe and Hodgson with the the cyclical sequence of tech-driven economic change.  As promised, here is an additional graphic (build for upcoming content) that illustrates the various technological revolutions that Perez talks about in her book, Technological Revolutions and Financial Capital: The Dynamics of Bubbles and Golden Ages.

We built the waves using the tech revolution start dates ("big bangs") and end dates that Perez identified and built the projected 5th and 6th waves using mean averages of the previous waves.

What's really interesting to me, and what I would really like to focus on more, is the idea that, if in fact innovation is accelerating globally, then will these waves begin to overlap more as the cycle (the "surges") shorten?  The result, I suspect, would be greater turbulence as the different surges, each at different phases in their life cycle, wreak increasing havoc (just kidding) through culture lag, dislocation, and what not.