Jack Welch identified "seeing around the corner" as a mark of great leaders. He said they must have a sixth sense about what may lie ahead. First, this means asking broader questions than those covered by operations dashboards. Second, these questions should be viewed as "thought starters" to explore parts of the picture beyond where others focus.
Follow these rules to get your mind pointed into the future:
Learn from the past. A natural starter question is, "What have been our blind spots?" Studying actual as well as near "misses" helps reveal patterns of systematic vulnerabilities in the organization. Next, see if there are instructive analogies or precursors from another industry or geography. One nanotechnology firm, for example, began looking more deeply at the genetically modified organism (GMO) debacle in Europe (remember Frankenfoods) for sources of public resistance to new technologies. The firm's leaders felt that GMOs and nanotechnologies have some worrying similarities: both technologies may pose health hazards and both were developed by faceless global firms viewed with suspicion. Also, in both cases the public could easily imagine unpleasant risks while the benefits were mostly indirect.
Another insightful guiding question about the past is: "Who in our industry has a strong track record of seeing sooner and acting faster?" What is their secret? This prompted one packaging technology firm to copy a rival by launching an outpost in Japan, expecting relevant innovations to appear there first. Examining your own past, as well as best practices elsewhere, can help reduce your own vulnerability to surprises. This is a good start although seeing around corners entails more than just learning from the past.
Canvas the present. Most surprises have antecedents, often appearing as anomalies-- something that deviates from what is normal or expected. A competitor may start hiring a different kind of talent, for example, or a customer complains about a tightening of labor supply. An early focus on anomalies was central to how Ford CEO Alan Mulally set out to challenge the insular and vulnerable mind-set of his leadership team. He made it culturally acceptable for Ford executives to raise concerns or even admit that they had no good answers, starting with his own doubts and questions.
Much can be learned from mavericks and outliers in an organization. They may be tolerated for their specialized talents, but their broader insights are seldom sought. As Intel CEO Andy Grove, the famed proponent of healthy paranoia found, most mavericks within the company had difficulty explaining their visceral concerns and feelings to leadership. Vigilant organizations try to listen carefully to employees at multiple levels, by encouraging openness to ideas and by addressing festering problems. This goes far beyond suggestion boxes, since it includes regular meetings, formal recognition, and encouraging feedback about how leaders responded to warnings that had been flagged earlier.
Another rich source of probing questions is complaining customers, especially those who walk away. Lost sales and postmortems on contracts won by competitors are revealing, but only if those doing the pathology are open to digging deeply. Smart firms monitor blogs, social media sites and chat rooms for signs of trouble in order to take rapid, remedial action. Some go further and examine edge cases. One company asked, for example, what are some new type of jobs that did not exist two years ago? The answers they found included: indoor farmer, synthetic tissue engineer and virtual fashion designer. Most of us can roughly guess what these are about and decide if a trend watch is warranted. But other jobs that surfaced, such as "bot wranglers," are less obvious and may require a deeper investigation.
Scan the future. Asking good questions about the long term can be greatly aided by the construction of scenarios. These are alternative future narratives that reflect how important uncertainties - from socio-economic to technological-- could play out in years ahead. What is the next oil shock or market disruption? Try to include at least one "impossible" scenario, such as what happened to Arthur Andersen and Enron. By explicitly entertaining the "unthinkable," such as leaders going to prison (Enron and Tyco) or the business model collapsing (Kodak and Nokia), leaders might confront scary scenarios before they actually happen. Without such shock cases, the organization may simply rationalize away important early warning signals.
And try this for a thought starter: How would you attack your own business if you were a new market entrant using a disruptive digital business model? The aim is to surface and exploit all internally known weaknesses of the current business (and then fix them). This approach is a variant of the "red team" exercise widely used by the military in which internal teams role play key decision makers inside the enemy. Red teams can likewise surface weaknesses in a new strategic initiative, such as launching a new product or integrating a merger. The red team would be asked to systematically collect any signals suggesting that the plan is wrong, thus allowing for timely correction perhaps.
A final imaginative, guiding question asks, "What future surprises could really hurt (or help) us?" For example, what future surprises might be as big as Paypal, Dodd Frank or Crypto currencies in financial services? Also, what would be an idealized future that we should try to make happen? A global advertising agency explored how new digital technologies could change marketing. The company examined how the role of the Chief Marketing Officer would change and how media decisions would be made differently. Such probing questions helped them see around the corner a bit more, which may just be enough. After all, in the land of the blind, one eye is king.
Co-authored with Wharton professor George S Day, drawing on our forthcoming book See Sooner-Act Faster: Thriving in an Era of Digital Turbulence, MIT Press, 2019.