Predicting the Future
At a recent ACS/CBA event I was lucky enough to hear Peter de Jager speak about how one could go about predicting the future. Now a topic such as this is generally accompanied by images of flying cars and the like however this talk was far more practical and proposed legitimate reasons that a business would want to invest in such an exercise.
Firstly, why would an organisation want to predict the future? Peter gave the analogy of a crows nest on a ship being there to provide greater foresight to the captain and crew as to what is ahead – this is far more effective than standing on the bow of a ship. Having the ability to see what is ahead removes the stress and pressure of responding to last minute change and allows an organisation to plan and preferably to take advantage of upcoming changes.
This makes perfect sense and the real question is how do we go about predicting the future? In order to predict the future we need to understand how people respond to change. Instinct assumes that others will respond in the same way as yourself however this is typically incorrect – there are as many responses to change as there are people in the world.
A pre-requisite to being able to predict the future of a particular industry is to be a subject matter expert in that space. There is no silver bullet for prediction however for IT there are a couple of principles to consider:
- Moore’s law
- er’s law . Everything will become colder, faster, cheaper, whatever-“er”
- Rule of 100. Increase, decrease anything by 100 what does it look like then?
- As soon as anything becomes cheap enough a number of people will have it
- Vapour point – removal of something from the value chain i.e. book publishers where disintermediation by amazon etc will allow authors to distribute their content to the public directly. In this example the author takes 70% of revenue (Kindle) vs 7% in a traditional author-publisher model
Key takeouts
- It’s not about you
- Don’t ignore human nature
- Technological constraints will always diminish
Examples of companies who predict well
- Harley Davidson – they predicted the changing need of their customers desire to customize their motorcylces.
- Italian railway company – built a railway that went over a mountain at an angle that would not be possible to ascend with engines available at the time. By the time the line was complete the engines were available.
