I am back posting again after a brief 2 month hiatus where we have been the busiest we have ever been in the life of our company. During that time it has been my privilege to work with people like the CEO and 180 senior managers of YMCA Victoria, the senior staff and associated bodies of the NE Catchment Management Authority, and the Expert Advisory Group for the National Farmers Federation Blueprint for the Future of Agriculture among many others.
One thing that has consistently come up has been discussions on change versus disruption. We all experience change in our working lives and it seems for many people that this change has become more rapid and more exhausting. On top of that we are also experiencing more disruption which I would define as sudden and abrupt change that fundamentally changes the way that we operate. Commonly people have regarded that as the province of large companies that are suddenly blind sided by a fundamentally changed technology or way of doing business as we have seen in the last few years with the iPhone and Android phones blind siding Blackberry and Nokia. More and more these changes are affecting organisations of all sizes and people are constantly asking us how do we spot disruption before it destroys us?
There are three basic principles that we use to answer that question.
1/ The first is that the disruptions while they might seem abrupt at the time quite often have a long lead time before they create the disruption. The figure below from Business Insider shows the RIM (manufacturer of the Blackberry) share price from the date the iPhone was announced by Steve Jobs. This is clearly a technology that has completely disrupted RIM’s business model but it took several years to do so.
2/ The second is that you can look around a search for possible disruptions to your business model. You do this by looking outside of your industry area but also by looking more deeply into trends and developments than just the surface stories. More on this below.
3/ The third is that you must accept that you are not going to see all disruptions before they arrive. This is particularly true in the developments of technology changes. As Kevin Kelly says in his book What Technology Wants social use of a modern technology changes the technology and the use. If you put Microsoft Kinect in the hands of 10 million people then some of them are going to use it for different things. So we now have Kinects being used to manipulate micro-satellites, being the sensory head of robotic guide dogs, and being used as 3d scanners in archaeological digs. If you think you can predict or know where 10 million hackers and innovators might take 50 different technologies and business models then good luck to you. If you accept that you cannot do that then you must build a resilient and adaptive business model that can cope with disruption. One that is not reliant on a single future taking place one that you are constantly challenging.
If you want to start looking around more at what might affect you and your organisation then one of the ways that we recommend people do that is a structured environmental scanning system.
The most common way of doing that is to use a framework such as STEEP which stands for Social, Technological, Economic, Environmental and Political. If you collect information and possibilities and test them against these categories you can see where you are looking and bolster your scanning in areas that you are normally weak in.
On top of that we recommend looking for possible disruptions and so use the STEEPeD acronym to describe that. At the end of this post I have put in several examples of disruption that we have seen in the last few months. A disruptive change can be in any of the categories of STEEP but must have the ability to significantly challenge your business model.
As well as looking around you to see what might happen you need to have a structured approach to try and make sense of what you are seeing. We use a simple system of questions to structure that approach which are:
- Did you See it? (are you looking in the right directions?)
- Did you Heed it? (when you saw it did you really notice it?)
- Did you Understand it? (have you looked beyond the surface for implications)
- Did you Execute? (did you actually do something or are you just daydreaming? – Making a decision to do nothing is different than doing nothing)
So if you follow these principles you can improve you ability to spot disruptions before they occur and to change your business models to take advantage of disruptions but you must always remember that you will miss lots of them and your strategies must be able to cope with that.
Here are some interesting disruptions from our scanning in the last few months:
Automate or Perish
Successful businesses will be those that optimize the mix of humans, robots, and algorithms.
We are seeing a widespread disruption of institutions: not just economically and technologically but also in their status in society. Note: Gallup finds that more than half the institutions it tracks have hit historic lows in confidence in the last five years.
E-Commerce Is Head Over Heels for Pinterest
evidence that Pinterest is skyrocketing:
- In Q2, referral traffic from Pinterest is up 2,535 percent year over year.
- In Q2, referral traffic from Facebook is up 2.7 percent year over year.
- Conversion rates from Pinterest are 0.43 percent in Q2, up from 0.29 percent in Q1 2012.
- Conversion rates for Facebook are 0.61 percent in Q2, up from 0.49 percent in Q1 2012.
Disruption in Film Making
Every aspiring filmmaker should get really excited right about now. A group of programming enthusiasts have successfully hacked a Kinect to produce a stunning new hybrid of video and computer generated imagery. CGI is hard. And expensive. This technique puts it within reach of anyone with a Kinect and a digital camera.
Scoot Airlines Cuts 7% of Aircraft Weight and Slashes Fuel Bills by Switching to iPad 2 Rental
No more airline entertainment systems or servicing!
If you are interested in increasing your scanning capacity then we offer a free month’s trial for our scanning database which contains all the future orientated stuff we see. You can access the trial by going to http://www.emergentfutures.com and entering your details at the bottom of the page.
4 thoughts on “STEEPeD in Environmental Scanning”
HI Paul, Relevant and timely and challenging! Regards John Cleary
Thanks John. Very Kind of you. I hope that the recovery continues well
my organisation has just experienced what it costs when you don’t scan using a tool such as STEEP.
The changing nature of my industry required that we change and change quick, but management did not do enough to manage the change and consequently we are in the process of a divestment of the business. Another organisation which did manage the change has now entered the market and will take control of the majority of our clients.
It is no longer “business as usual”, but “business in the unusual and unexpected.”
Happening more and more and constantly talking to clients about how to handle it
We will never get perfect at it but can improve and some of it with relatively simple tools