One of the essential skills for a business leader is the ability to predict the future. And it is a risky job!
There are a few things that can help the leader become better at this craft.
We pull the string back to propel the arrow forward. History indeed repeats. So, digging into the past and tracking the events that unfolded gives us insights into the future. For example, the mom-and-pop stores were replaced by departmental stores. These were then challenged by the superstores and malls. Today, online stores are becoming dominant. The underlying reason for this shift is the improved and enhanced connectivity between buyers and sellers. Railways-Highways-Internet being the progression.
Every business passes through the following phases - Invention, Evolution of an Ecosystem, Adoption, Scaling-up, Consolidation, and Commoditization. Though the cycle time between these phases has reduced significantly, they still hold good. Therefore, if we identify the current stage in the business cycle, we can predict what is expected next. It is believed that Sachin Tendulkar judged where the ball would be in its trajectory and make adjustments in advance. That millisecond advantage made him the God of Cricket. It is, therefore, essential to be able to know at least in the immediate future what is likely to happen. That small headstart can create a long-term strategic advantage.
Osterwalder created the Business Model Canvas. The canvas covers many blocks like Partners, Key Resources, Key Activities, Cost, Value Proposition, Customer Relations, Channels, Customer Segments, and Revenue Streams. These same blocks can be used to assess the risk to the business. Scenario Planning is a great way to do it. It means asking What if questions and exploring all possible ways in which each of these things can go wrong.
Michael Kallet wrote a book about critical thinking. In his book, he describes the process by which we make decisions. Most often, we only use our experience and assumptions. Truth or Facts are rare. The final decision is then based on the assimilation of these factors filtered through our belief system. Therefore, in predicting the future, we need to challenge our biases and assumptions. We should be ready to question everything.
Michael Gerber constantly advises business owners to work on their business instead of in it. It enables us to look at our business unbiasedly. For example, Jio is going to launch the Giga Fibre in India. Soon, TV Cable Operators and ISPs would become obsolete. Are these businesses thinking? The cable operators have a team of people to pull cables, collect money, and fix problems. Is this infrastructure not essential for Jio? Also, the installation of Surveillance Cameras is increasing. Can the same set-up be not used for this purpose? It is critical to work on the business to identify and exploit such opportunities.
With the onslaught of technology, many of the current businesses and business models will be disrupted. However, one thing that may take time for the algorithms to beat is being human. Think of the pains your customer may experience and how you could empathetically resolve them. That may be the biggest differentiator in the future.
Subodh Gadgil
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