There does not seem to be any doubt now that there really is a climate emergency, but there is a lot of uncertainty about what we must do to address it. The COP 26 meeting in Glasgow in November 2021 clearly highlights the difficulties we have as a global society in coping with systemic problems of this magnitude. In Glasgow there was essentially no disagreement about the nature and scope of the problem, but a lot of dithering about what to do.

Defining Net Zero

Since greenhouse gases are causing the climate emergency, the pursuit of “Net Zero” means transitioning society to produce zero net greenhouse gas emissions. This means effectively stopping the use of fossil fuels.

Some nations are now targeting 2050 for Net Zero, some 2070, but if we wait that long then the climate situation will apparently become quite dire.

So how should we address this?

Our new book, Net Zero City, proposes a pathway of innovation, a ten-year effort to achieve Net Zero. It contains a highly specific set of 113 action examples and a specific set of recommendations.

Why the City?

We focus on the city because whereas so many national and state governments seem to be absorbed in partisan ideological struggles, it is in cities that much of the real and important work gets done. City leaders are usually chosen or elected because they manage well, and if the world’s cities began making the changes necessary to address climate change, then we would indeed be able to overcome this challenge. Cities, in other words, are where the action is.

Achieving Net Zero

Achieving Net Zero is a complex problem, and it will not be solved by simplistic thinking or actions.

In the book we propose that to deal with it effectively we require a few key solution elements:

We need a framework model to describe the system city, for which we propose an Urban System Framework consisting of five key elements that make the city what it is.

We also need to engage a huge number of people in a process of fundamental change, and to address this topic the book proposes a Theory of Change.

We require a reliable data and a data management architecture to help organize the huge amount of data and information needed to inform the complex policy decisions that will have to be made. For this we offer the concept of the Data Value Stack.

We need to define a pathway, which we propose as a Four Phase Model.

And we need to identify the actions that you can take with respect to each sector of the framework, which address with a detailed Transformation Roadmap.

Book web site: www.netzerocitybook.com

Click here to get your copy from Amazon.

Net Zero Urban Data Science

We’re so committed to this effort, that in addition to writing the book, we have also established a partnership with The Modern Data Company to provide the data management system necessary to make Net Zero a reality. Modern’s “DataOS” can support the complex data management effort that we will require, and we are partnering with them to support cities in the implementation of the “Urban Twin,” an innovative approach to data management across all aspects of the Net Zero journey.

•••

As always, we welcome your feedback.

Thanks!

The post How to Cope with the Climate Emergency appeared first on InnovationLabs.

As innovation professionals, however, we can do more than just worry. Since social, economic, scientific and technology innovations are the pathway out of crisis, we’re much better off rolling up our sleeves and getting busy. And with that in mind, InnovationLabs is developing a new suite of services to support companies, cities, and regions to attain “Net Zero.”

For the last few months we’ve been working on a new book about Net Zero, which will be out in September. Here is a short excerpt.

•••

There is now no doubt that the destiny of humanity lies in our cities. The human population crossed the halfway point around 2010 on our journey toward becoming a fully urbanized civilization, and each day the populations of our cities continue to increase while rural populations decline.

But we live in turbulent times, and due particularly to worsening climate change, the fate of those very cities is now in question. Will they thrive, or will they be overwhelmed by the tumultuous storms and bitter droughts brought on by climate change?

Much of the human drama over the next century will be defined according to our ability adapt to a new, entirely unprecedented, and frightening set of climate conditions. But we must adapt, which really means that we must innovate, so perhaps it is our ability to innovate that will largely determine our fate. Innovate well and we can survive and thrive; fail to innovate and we are doomed to prolonged suffering and decline.

The necessary innovations will be developed across countless dimensions of modern society. They will involve how we build, what we build, and what we build with. They will impact our systems of food and water, our ideas about a healthy economy, our approaches to governance and decision making, and our use of technology. And perhaps most of all, they will involve a fundamental change to the energy infrastructure of civilization, both in terms of where we get our energy from, and how we use it. Fossil fuels will be replaced by other sources that do not produce greenhouse gases, a switch that’s going to be a massively expensive and hugely disruptive technological, economic, and social transformation.

And this transformation will occur, by and large, in our cities. Cities are the catalysts that created civilization, and they are now also becoming the innovation catalysts that will enable the transition to a new and sustainable energy infrastructure.

Our forthcoming book is about all those innovations, and how they can be designed to bring forth a new city, the Net Zero City.

•••

The global economy of the 20^th century was stunningly innovative, and based on its constant nurturing and perfection of countless innovations, amazingly effective at transforming raw materials into public and private wealth.

The 21^st century innovation challenge requires us to transform that very economy, and to replace its underlying fossil fuel energy systems, but without wrecking the economy in the process. This challenge is perhaps an order of magnitude more complex than what was achieved in the 20^th century, primarily because we no longer have time for it to unfold at its own pace. Nor is it a matter of waiting for innovations to emerge spontaneously from efforts of the private sector.

The massively adverse impacts of climate change are becoming more evident as they also become more destructive with each passing year, and leaders in science and government have realized that unless we make significant changes to how we live and work, we are tragically destined to endure significantly worse climate conditions than we are already experiencing. We already have irrefutable evidence that climate change threatens to destroy entire cities on all continents, and to cause massive damage to others that it doesn’t entirely wipe out. Horrible floods, punishing storms, exhausting droughts, and massive fires are now a daily part of the news, and apparently much worse is soon to come. It is indeed a climate emergency.

Our current systems for living are significant producers of greenhouse gas emissions precisely because of their reliance of fossil-based energy for cooling and heating, transportation, lighting, and the production of goods and services. As all of these activities are concentrated in the world’s cities, if we are going to limit the Earth’s warming to a tolerable range, we must learn how to limit greenhouse gas emissions by and in our cities.

We therefore must now develop new tools, new behaviors, new mindsets, and new systems for living, a civilization-wide innovation challenge of the highest order.

The term “Net Zero” describes the end goal, as a Net Zero building, or city, or civilization, is one that produces no net greenhouse gas emissions at all. Climate scientists have suggested that achieving Net Zero prior to 2032 must be adopted as a global priority for governments at all levels, from neighborhoods to nations, in order to avoid permanent alteration of the climate and a worsening crisis situation for billions of people.

•••

The book is “Net Zero City.” It provides extensive guidance and detailed roadmap that companies and communities can follow to begin their own journey to Net Zero.

We’ll let you know when it’s available.

Photo: The town of Youdunjie in Poyang county, Jiangxi suffered particularly acute flooding in July 2020. (Image: Alamy)

The post Net Zero Innovation appeared first on InnovationLabs.

Plus …
OUR FORTHCOMING WHITE PAPER, NEW BOOKS,
and a NEW ONLINE INNOVATION COURSE

1
SUCCEEDING IN ZOOMWORLD

Like everyone, you no doubt included, we’ve been spending rather large amounts of time on Zoom these last few months. We’ve learned a lot, and have run some surprisingly successful collaborative sessions, including one that spanned 12 times zones and four continents, and another as a series of three workshops, from both of which we’ve learned how to make Zoom sessions highly productive at accomplishing meaningful work.

While we don’t think that Zoom will ever fully replace the magic of collaborating and innovating face to face, there’s a surprising amount that you can do online to make it useful and effective (and also less exhausting).

We’ve done highly useful brainstorming, as well as scenario planning, and even some interesting work in strategy and urban design, all over Zoom.

Here are a couple of quick tips:

1. With groups of more than 6 people on Zoom, someone has to facilitate. One of the ley reasons is that without body language cues we get from being in the same room, it’s really hard to know when it’s your turn to talk, so people tend to hold back.

One solution that works nicely is simply to have a facilitator who calls on each person in turn, and if they want to comment that’s their chance. Two loops through the participants list can lead to a very productive conversation.

2. Breakouts of 3 to 5 work well. We distribute the instructions in advance via email, and also post them to the chat. Of course the instructions need to be pretty simple, but multi-step guidance is fine.
3. Zoom pairs nicely with Mural, Miro, and Google Jamboard (and probably others). This is great for small breakouts (but mostly useless for large groups). We instruct the team members to keep the zoom window open on one side of their screen, and have Mural open also. We encourage them to create Mural post-its (or whatever) while talking, and keep it mostly stream of consciousness. This has proven to almost replicate the in-person experience quite nicely.

To learn how we develop and share some of these learnings and others in more detail, Langdon will be giving a keynote to the International Forum of Teaching and Studies Journal Online Teaching & Learning Conference, September 25.

His talk will be on “How to Design Effective Online Courses,” and will highlight learnings from the recent virtual events that InnovationLabs has led with London School of Economics, and NurseTrust.

This event is free and open to anyone. You can register here: https://www.surveymonkey.com/r/IFOTSRegistration

We’re also working on a Guidebook to Virtual Facilitation, and as soon as it’s ready we’ll let you know.

2
WHAT’S NEXT: BUSINESS AS UN-USUAL

As America descends into full pre-election chaos, we we’re finishing up our fifth white paper in the Covid-19 series. We’ll let you when it’s available.

And based on that white paper, Langdon will be giving the keynote talk at the CoreNet Global Philippines Chapter, 2020 Signature Event. His talk will be on “Business as Un-Usual,” and will focus on planning for the short, medium, and long-term futures.

Register here: https://resources.corenetglobal.org/Meetings/Meeting.aspx?ID=10387

3
NEW BOOKS and NEW WORKBOOKS

We’ve just published our newest book, THE CHIEF INNOVATION OFFICER: The Complete Guide to Your Success. Check it out on Amazon. It’s 280 pages of guidance for anyone in an innovation leadership role – what to do, what not to do, what to expect, and how to be amazingly successful at what may be the coolest job in the world.We’ve also revised and updated THE INNOVATION MASTER PLAN and THE INNOVATION FORMULA, as well as its companion workbook, THE INNOVATION MASTER PLAN WORKBOOK.

Now we call it all The Innovation Mastery Library, 8 books + 6 workbooks. Yikes, what a lot of great content! And all available at Amazon.

These are the NEW WORKBOOKS, which we have never published publicly, but we’ve been using them and constantly revising in our consulting practice for more than a decade:

4
ADVANCE NOTICE:
OUR NEW ONLINE INNOVATION COURSE IS COMING

And why all this publishing activity?

Well, it’s because …

For the last few months, InnovationLabs has been preparing an online video course entitled Innovation Mastery. As far as we know, it’s the most complete online innovation course available anywhere, as it consists of more than 100 video chapters that cover the full range of topics related to innovation management, design thinking, business model innovation, the innovation culture, and small business innovation. It’s more than 22 hours of content, and comes with 4 digital books, 6 workbooks, and more than 250 worksheets. Three certification options are available as well.

We’ll be putting the course live within the next couple weeks, and you’ll be hearing more from us at that time. Feel free to reach out now if you’re interested in being a beta tester.

•••

As always, we welcome your feedback.
And please do stay healthy!!

The post Succeeding in Zoomworld appeared first on InnovationLabs.

Prelude: The IMF: “A higher-than-usual degree of uncertainty…”

In its June 2020 Update, the IMF is forecasting negative 4.9% global economic growth in 2020, 38% lower than its forecast of April. And in a fine burst of understatement, it then added, “there is a higher-than-usual degree of uncertainty around this forecast,” and went on to enumerate the reasons, all of which relate the vast uncertainties regarding the pandemic.

These are indeed times of exceptional uncertainty, which of course presents huge challenges for leaders and strategists who must chart a course in this era of massive unknowns and tremendous ambiguity.

The purpose of this blog, as with the previous four, is to help you think about what’s happening, and what you should do about it for yourself and your organization. Here we examine today’s challenges, offer a new framework for strategy development, and make six specific recommendations for what you could or perhaps ought to do. This blog post is an extract from a larger white paper, which you may download here.

Topics Covered in this White Paper

Strategy in a Time of Fundamental Change
Strategy as a Learning System
Hidden and Unspoken Meanings
A Speculation on Black Lives Matter and its Relation with Covid
The Key Questions
>> Six Essential Action Items
Change Brings New Terminology and New Data Points
Conclusions: The Next Economy May Be the “Accordion Era”
Appendix: Succeeding at Virtual Teaming

Strategy in a Time of Fundamental Change

The world was already deep in flux when Covid arrived, and thus the pandemic has accelerated the changes, but it has also altered them qualitatively. It’s clear that even if you had a well-defined organizational strategy in January, you probably need to toss it out and start all over again now, because our situation has definitively changed. But furthermore, as we simply don’t know what’s coming next, what does the strategy change to?

And at the day to day level, have you noticed how many companies and governments have announced plans, actions, and decisions, only to reverse course the following day when subsequent events or public blowback revealed the flaws in their thinking? Public sporting events are on, then off, then on again. India shuts its economy and its transport systems, forcing millions to begin a long walk back to their home villages, which the government then realized would undo the intent of the shutdown, and the millions were then stopped half way.

Masks are optional, then mandatory (“AMC Theaters reverses course on masks after backlash”); Black Lives Matter masks are barred, then allowed (“Starbucks reverses its policy”); restaurants open, then reclose, and no one knows what’s going to happen next. Protests arise and turn into riots, or they don’t; police beat protesters, or join beside them; and all of this reveals how day to day uncertainty requires that our thinking evolve continually during the crisis.

Both of these vital factors – strategic uncertainty  and day to day uncertainty – create a challenging new set of conditions for strategists and leaders.

So while it used to be the case that leaders would plan strategy every six months or once a year, now we’ve got to shift to a process of strategic thinking that’s a regular, even a constant process, not just a once-in-a-while thing you do at the annual offsite.

Consequently, the results, the plans, will not be written up in a binder for occasional reference, and the communications will not be the annual triumphant memo to the rest of the organization. They will be an ongoing strategic dialog among the leadership, and also involving everyone else.

The reasons for this ought to be crystal clear: the future – near, medium, and long term – holds such vast uncertainties, change is so pervasive, and the magnitude of what’s happening is so great, that whatever you come up with as the best plan as of today may be valid only for weeks or months, but it will almost certainly not be valid for much longer than that. This requires a shift in perception, and a shift in practice as well.

Old Way to New Way

Please take a look at the table below and see if you agree or disagree with any individual line, and with the overall “net result” message.

Do any of these shifts seem incorrectly labeled or misconceived to you? We would be very interested to have your feedback either way, agree or not.

But assuming that some, much, or all of the shifts noted on the table do make sense, then the practice of strategy-making must shift to adopting these new ways of thinking and working as described in the right-hand column.

We’ve previously referred to the new ways as “Agile Innovation” (the title of our 2014 book), and in this white paper we’ll examine them in some new dimensions, and make some specific recommendations.

The new way to play the game requires that strategy development shifts from being an intermittent (once a year) event, to an ongoing process. This is “Strategy as a Learning System,” for as change never stops, learning never stops.

As a quite timely example, The Economist reports (June 13, 2020) that, “Every Thursday at 5 pm three dozen of Germany’s most prominent economists brush their hair, clear their throats and Zoom into the finance ministry for 90 minutes of debate on whatever is on its officials’ minds. The sessions, which emerged from an informal discussion about the covid-19 crisis in March (2020), have inspired several policy measures.”

In Germany, economic policy debate and policy making has thus, quite appropriately, shifted to become a real time endeavor.

Perhaps you’ve already adopted some of these new practices; now you should consider doing all of them (although not necessarily with 36 German economists…).

A bit further down in this white paper we’ll describe six recommended actions to implement this new approach.

Hidden and Unspoken Meanings

Are you familiar with the iceberg model? It was developed by anthropologist Edward T. Hall, who suggested in his 1976 book Beyond Culture that while the overt actions are visible above the surface, what’s more important is what’s hidden below.

The purpose of the German economic debates is precisely to discern what’s going on in the deeper layers, and to identify the consequences for the German government and the German central bank. (And due to Germany’s importance as the strongest economy in Europe, these consequences will significantly impact the entire EU.) Events, it turns out, impact on mental models, and so there is a loop of social change.

Now that change is accelerating, and now that we’ve reached the fork in the road labeled “Covid-19,” mental models are shifting, and the sooner you figure out what the new models are going to be, the better off you are.

By “fork in the road” we mean that prior to January we seemed as a society to be headed in a particular direction, but Covid has forced us onto a much different path, a sharp change in direction. This is amply illustrated by the recent wave of support for Black Lives Matter.

A Speculation on Black Lives Matter and its Relation with Covid

BLM is an example of the power and relevance of changing mental models: Have you wondered why the Black Lives Matter movement reignited with so much force in the last month?

Here’s an interesting hypothesis as to why: The broad social response to Covid brought people throughout their communities to new levels of engagement with one another. Covid caused us all to discover a new dimension of caring for self and caring for neighbors, wearing masks for protection, and staying home to protect ourselves, our neighbors, and health care workers, thereby sacrificing our economic situation because of a health crisis.

Business closed, but also gave away many tons of food, restaurants offered free meals for “essential workers,” food banks expanded rapidly, companies donated protective equipment to clinics and hospitals, all at a scale that was unimaginable just a few months before.

And so the key point is that we all became much more highly sensitized to the importance of, and the meaning of, mutual care, and mutual respect.

And when black people in multiple cities were murdered by police, and these events were captured on video and displayed universally, instead of resigned acceptance of still more police brutality, the sensitized public suddenly experienced it as an unacceptable breach of the new normal of caring, and the outrage was not only immediate, it was universal. Marches occurred spontaneously in conservative Midwestern towns as well as in Europe and Asia.

I am thus suggesting an underlying hypothesis that Mental Models all across society had shifted, and that the  response to Covid was a significant contributing factor in that shift.

Our understanding of the meaning of “society” and our roles in it had shifted over the course of just a few months, and so up the iceberg the repercussions ran, from Mental Models to Underlying Structures, and then to Patterns, and then the stunning Events: Huge protests everywhere, statues destroyed, defund movements, names of schools changed, etc.

Or in the words of Ford Foundation President Darren Walker, “Everyone is riveted… the murder of George Floyd has gripped the psyche of white Americans like nothing I’ve seen in my lifetime.” (He’s 60 years old, so he’s seen a fair amount.)

He makes an important point, that it’s level of the engagement of white Americans in BLM that’s particularly different now. Indeed, a year ago, no one would have even considered painting “Black Lives Matter” on the street in front of the White House; this year it seems entirely fitting to use this method to communicate an important message to a president who seems intent on a different message.

In this view, the outpouring of Black Lives Matter protests during Covid is thus in part a consequence of our experience of and response to Covid, not merely a coincidence.

It will take some time to know if this interpretation holds up to deeper scrutiny, but it does seem cogent as of now.

But assuming the connections between Covid, BLM, and our mental models of society are real, then these are key questions which the leader or strategist must now ask:

The Key Questions

1. Is this a temporary or permanent change in our mental models?
   (We believe it is likely permanent.)
2. If it’s permanent, what does it mean? (It will have enduring consequences. We think that Covid is a fork in the road, and we will now begin down a new path. See below for more on this…)
3. And what else is going to change? (Yes, there will be further changes.)
4. What does this mean to our organization? (See below also…)

Six Essential Action Items

A fantastic way to find the answer to question 4 is the engage in an ecosystem-wide learning process. Specific learning efforts should take many forms; here are six we highly recommend:

Knowledge to Action

Set up an organization-wide knowledge capture system to enable many, many people to jointly build shared awareness, and to stimulate even more people to participate as well, and to take action also. This is of course exactly what you want – people learning actively and transforming learning into action: this is organizational adaptation.

You can gamify this to make it fun as well as meaningful. Bring forth interesting and surprising discoveries, and share them widely. Connect people together who observe similar or related events, and encourage them to explore the deeper levels of meaning. Engage people in collaborative discussions to anticipate what’s next, and to create innovations in anticipation of these emerging needs and opportunities. (See “Active Experimentation,” below.)

And even better than capturing knowledge from within the organization is to capture it from the broader ecosystem of partners, customers, and suppliers, thus becoming an ecosystem-wide knowledge-to-action base.

The lesson: The more and faster you learn, the better your responses will be. 1000 people learning is better than 10 or 100 people learning.

Explore Alternative Futures

The purpose of the scenario planning technique is to open our eyes to new possibilities, to get us out of our mental ruts, and to face the unpredictabilities and uncertainties of the future with fresh and attentive eyes.

Scenario planning, or really any type of futures-oriented thought experiment, should yield early warning signs, items of interest for renewed study, topics to follow in detail, and imperatives that your organization must address immediately.

As we saw with the first and third of our recent white papers (see the Appendix for a summary, or download them here), if you haven’t done scenario planning you may find it quite worthwhile to do so. Especially now.

Other techniques to consider include Backcasting (the subject of the recent book “Lead from the Future” by Mark Johnson of Innosight), Trend Safaris, and Collaborative Future-Making.

The lesson: Find ways to look at the world through different eyes.

Active Experimentation

In our rapidly changing environment, it’s mandatory to constantly test to discover what’s working now and what’s not working any more. Tests have to take place at many levels – services design, product design, business model design, brand identity, market channels, customer communication, operating model …

Throughout your organization, people should be constantly testing, exploring, probing, trying new things. Many of these will be minor or incremental tweaks, but some will be major initiatives, big ideas, bold moves.

To facilitate this you should consider setting up a new brand or two that you can use as “experimentation brands,” where you can try new ideas without taking risk with your core brand. (This is a big topic, for sure, and worthy of its own white paper; we’ll discuss it in more depth later this year.)

And as noted in the prior white paper, be particularly alert to threats to existing business models, and opportunities for business model innovations. While breakthrough technologies can take years to develop, business model transformations can be achieved in mere months, and can transform irrelevant business forms into renewed successes.

The lesson: Experiment constantly to discover the boundaries of possibility, and the spaces in which there are new risks and new opportunities.

Data Collection & Analysis

Some of your new knowledge will be conceptual and topical, but you should also collect quantitative findings, data, and then analyze that data extensively.

Massive amounts of data are now readily available, and AI systems can comb through these giant data sets to yield important insights.

Such data analytics tools should be available and in use quite broadly throughout your organization, and so should the skill to use them well. It may be that widespread training in analytic methods is necessary.

The lesson: Invest in data collection and analysis to get early warnings on market shifts.

Core and Edge Exploration

“Core” refers to existing markets and customer sets; “Edges” are the places where you have no presence, and probably weak knowledge. But as markets are changing, and quickly, core customers often desert you, and you’re left scrambling.

Hence, it’s necessary to always be alert to what’s happening on the edge, as that’s where your new customers will come from, and that’s also where a lot of new ideas come from. (Steven Johnson’s 2010 book “Where Good Ideas Come From” addresses this quite well.)

In our diagram below, the core is the heart of the bell curve distribution, and this has been your target market. But new ideas and behaviors are usually evident on the edge long before they reach the core, so by engaging with the edges you can learn important lessons early on.

The lesson: Don’t just focus on your core, look to the edges as well.

And New Initiatives

These five learning techniques empower you to succeed at the sixth:

Do new things!
Big and bold things.

•••

The white paper goes on to provide a list of new terms that the crisis has introduced into our language, and to suggest that paying attention to evolving language is very worthwhile, as it sensitizes us to change.

And the conclusion proposes a name for the economic era into which we are arriving: “The Accordion Era,” and explains why.

In the Appendix we offer 7 suggestions for effective virtual teaming.

Please download the full white paper here.

•••

Stay well!
As always, we welcome your feedback, comments, and questions.
Please let us know if you’ve been successful implementing any of these action items, and any others that have worked for you as well.

The post Covid-19: Strategy as a Learning System appeared first on InnovationLabs.

The Rising Cost of Covid

As of this week, global unemployment is rapidly escalating to levels not seen since the 1930s, the world’s governments have already allocated trillions of dollars to covid relief efforts, and every day that the crisis continues means more lost jobs, and livelihoods, and lives.

The cost of covid, in other words, is enormous and rising.

One of the key elements of the solution is a vaccine, and the World Health Organization reports that 70 different teams of researchers are working on Covid-19 vaccines, three of which have advanced to clinical evaluation as of April 11, and the 67 were in preclinical evaluation phase.

The full list can be accessed here as a downloadable pdf.

(The WHO page has not been updated since April 11, although it’s likely that additional labs have since joined the effort.)

These projects include efforts by private companies, universities, and government labs around the world, and will require tens of millions of dollars of investment.

We have to wonder though if there’s any duplication of effort here. And it’s obvious that there must be, because the competitive dynamics of the health care marketplace creates powerful incentives for individual companies and institutions to tackle challenges like these on their own. There are huge profits waiting for the winners in the race for the successful vaccine that will immediately result in the sale of 7 billion doses.

But then we also have to ask, “Does this sort of competition speed up or slow down the progress?” and it’s apparent that if there was more collaboration there would be less duplication of effort, and therefore faster progress. Possibly or probably much faster.

In some situations that’s perhaps an acceptable attribute of a capitalist system, but in the case of covid it’s probably not. As of today (May 16, 2020), about 310, 000 people have died, 4.6 million have contracted coronavirus, and the current death rate in the US is 1000 – 2000 per day. The search for and delivery of a virus will not only impact the lives and deaths of potentially hundreds of thousands of people, but it could also mean the difference between a global economic depression, and a return to normal economic life.

How, then, could we set up a system for researchers to collaborate on developing a solution while still protecting their intellectual property rights and commercial prospects?

On the Shoulders of Giants…

A new paper published yesterday (May 15, 2020) in Science magazine outlines an innovative approach that could enable scientists around the world to work together and share knowledge by using a blockchain-enabled knowledge repositories that would automatically validate and time-stamp proofs of their existence, integrity, and (scientific) priority.

Here we see a blockchain application not taking the form of a speculative cryptocurrency such as Bitcoin, but as a powerful tool to facilitate and help manage complex knowledge discovery and accelerate knowledge sharing, which indeed is the basis of most scientific advances.

It was Newton who remarked that if he had seen further, it was by standing on the shoulders of giants, so imagine how much more progress we could make if today’s global scientific community didn’t have to wait months or years for their scientific advances to be patented and then published, but instead could be shared safely and instantly through a what the authors call an “outbreak R&D blockchain infrastructure (ORBI).”

The paper was written by leading virologists in the Netherlands, Mark B. van der Waal, Carolina dos S. Ribeiro, George B. Haringhuizen, Eric Claassen, and Linda H. M. van de Burgwal together with visionary technologist Moses Ma of our sister company FutureLab an advanced technology incubator.

You can access the paper and the supplementary materials here.

Two days after publication, the paper is garnering significant attention. It already ranks among the top 5% of all research outputs scored by the Altmetric tracking system, and it’s climbing fast. The coauthors are actively working to develop the proposed ORBI consortium, and you are invited to contact us if this is of interest for you or your organization.

•••

As always, we welcome your feedback.
Thanks!

Images by: Fernando Zhiminaicela, Pixabay (test vial); Yaroslav Danylchenko, Pixabay (masked Mona Lisa), Florent Courtaigne (covid microscope & riding the dollar)

The post How to Accelerate Covid Vaccine Research appeared first on InnovationLabs.

Introduction to InnovationLabs White Paper #3 in the Series

Prelude: What’s Next?

What’s going to happen in the next six months?

It’s a big and very important question, which we tackle here. We gather evidence from a wide variety of sources, including Shell Oil, JPMorgan, Commerzbank, Warren Buffet, Forbes, The Economist, Fannie Mae, Governor Andrew Cuomo of New York, the Bank of England, and a recent survey of 281 CEOs, to come up with a model of what’s emerging for all of us.

Based on what we can surmise, it’s going to be … unusual.

The phrase “business as unusual” has been used by entrepreneurs and authors during the past few decades to depict an idiosyncratic approach to business. Anita Roddick, founder of The Body Shop, used it as the title her book about her iconic and highly unusual company, and others have used it to convey the same meaning.

We’re using it here because we believe that now it won’t just be the iconoclasts who have to embrace the unusual, it’s all of us.

Covid-19 and society’s response to it has led to a new and unprecedented situation, which is, we believe, going to lead quickly – possibly immediately – to permanent change in the structure of society and the economy.

So although we want to, we’re just not going back to the way things used to be, which means that we all must accept the unusual, embrace it, learn to live with it, and find new ways of living, working, and thriving under a quite different set of conditions.

This blog post excerpts our latest Covid white paper, and examines what may be up next for business leaders on this journey of adaptation, and suggests four specific action items that should probably jump to the top of the to-do list.

White Paper #3

The first white paper in our series on Covid-19 was a thought experiment published March 26, 2020 which applied the technique of scenario planning to examine the paths that the Covid crisis might take in the coming months and years, and posited the likelihood of a number of (bleak) possibilities for the future.

The second paper was published three weeks later on April 14, 2020, by which point the possibility of bleakness had turned to reality. It thus explored the likely and emerging impacts on society and business, and came away with two key insights:

1. We are heading not for a recession, but a full-on depression.
2. Business leaders must seize this moment to consider how they can transform their businesses to adapt to the new conditions, which will have to be considered permanent.

Both papers have reached far larger audiences than we had expected, and we have received a great deal of very helpful feedback from readers around the world. We greatly appreciate their comments, and we welcome yours as well.

You can access them here.

This paper focuses on the challenges specifically for business leaders, while a fourth paper, which will be published in a couple weeks, will look at the situation from the broader political and macroeconomic perspectives.

Contents

1. Living Under Uncertainty
2. Four New Scenarios
3. A Slow or No Recovery: Downward Spiral
4. Your Covid Action Plan
5. Conclusion

Appendix 1:  Debt Deflation
Appendix 2:  Resources

Living Under Uncertainty

At this stage of the crisis we have achieved a clear understanding of what happens when vast stretches of the economy are abruptly shut down: market demand collapses, and an economic crisis immediately ensues.

Once it became clear that social distancing was urgently required, the retail, restaurant, travel, transport, education, entertainment, sports, and tourism industries contracted instantly and massively, and the fossil fuel and manufacturing sectors followed immediately thereafter.

They have stayed down, casting many millions into unemployment, and at this point the only segments of the economy that have not been crushed are health care, the internet-based tech and entertainment sectors, and e-commerce.

But those are not enough to carry the economy, and consequently it’s clear that unless the damaged sectors revive, and major rehiring occurs quickly, the recession that we’re now in will soon turn into a depression.

But revival of the closeted sectors depends upon the course of the pandemic, and what we do not know is … everything important about what’s going to happen:

• We don’t know if the current viral hot spots such as New York City will cool down and allow a return to social contact.
• We don’t know if infection with the virus confers any long-lasting immunity.
• We don’t know if the virus will make a major return visit later in the year and we are forced to return to large scale lockdowns.
• And we don’t know if a vaccine can be developed.

All of which means that we don’t know when or if the damaged sectors of the economy can resume, and so we don’t know how long this ordeal will last.

Or in the words of Warren Buffet, “We do not know exactly what happens when you voluntarily shut down a substantial portion of your society.”

We can, however, readily anticipate that the longer it lasts, the more cautious consumers and businesses will be with their spending, and consequently the slower any recovery would be.

Aside from the economic situation, which is unprecedented, the social and psychological situations are equally so. For 75 years we’ve lived in a certain type of social and market environment, and in the space of a few months that has evaporated.

Since no one knows what’s next, we turn again to the scenario planning technique to consider what might happen with respect to what appear as of today to be the two most critical short term factors.

Four New Scenarios

In our first white paper, published 6 weeks ago, we considered the ten key forces that were driving the situation then, some of them specific to the virus and others arising as results of the virus. We mapped these into twenty scenarios, which allowed us to explore key unknowns such as the virus deadliness, the government response, the crisis duration, and its economic and social impacts.

We came away with useful insights about the importance of leadership, governance, the health care sector, and the nature of crisis itself.

In the intervening six weeks many of those questions have been answered, bringing us now to focus on the two critical factors we must understand, “market demand” and “social distancing.”

Market Demand: The onset of crisis and the imposition of lockdowns caused the collapse of demand, so the key question is, “What happens if demand recovers nicely, and what happens if it remains collapsed?”

Social Distancing: Social distancing is a proxy indicator for the course of the virus, its spread, its fatality rate, its persistence in society, the presence or absence of treatments or vaccines, and immunity. The question is, “Will social distancing still be required, or are we done with it?”

Putting these together gives us the 2×2 matrix we’re now familiar with based on our previous scenario discussions:

The titles of four quadrants guide us to expect one of three outcomes:

Scenario 2 shows a Zippy Quick Recovery. Wouldn’t that be nice. The birds are singing again!

Scenario 3 suggests a Slow Recovery, which feels like pushing the giant rock up the endless hill.

Scenario 4 is the Non Recovery, where we’re drowning in a depression of merely long or utterly and excruciatingly long duration.

And Scenario 1 is An Entirely New Economic Model. Government would presumably play an increasing role in boosting demand, but for this to happen it’s necessary to forge a new social contract, a Renewed Deal.

If it turns out to be #2, Zippy Quick (hurray!), then this event that we’ve been living through for the past few months becomes an historical blip, a strategic bump in the road, but something we’ve gotten readily past.

If it turns out to be #3 or 4, though, the Slow or Non Recovery, then we’re in a deeply serious situation, perhaps as serious as it gets, which we’ll discuss at length below under the heading “A Slow or Non Recovery.”

And if it turns out to be some variation on #1, then we enter a realm of social and macroeconomic inventions and hypotheticals that makes for fascinating speculation. We’ll address that in the next white paper, out in a few weeks.

Having framed four different views of the future, let’s now take a quick look what the evidence from the last couple weeks is suggesting.

Indicative Data

As usual, there’s a vast ocean of data to tap into, from which we have selected some data points that will perhaps provide useful perspective:

From January to March 2020, the gross number of hours worked by hourly employees in US small businesses dropped by 70%. Annie Lowrey of The Atlantic is now referring to this as “the small business die-off.” (May 4)

Harvard Business Review published the results of survey by researchers at U Chicago, U of Illinois, and Harvard which found that a quarter of America’s small business do not have enough cash on hand to last a month.
https://hbr.org/2020/04/a-way-forward-for-small-businesses

As of mid-April, Goldman Sachs expected the US unemployment rate to reach 15%, higher than any time during the last century. As of May, it seems that the actual rate may be climbing even higher than that.

Payroll processor ADP reported on May 6 that US companies dropped 20 million employees during April, the worst job loss in the history of its report.

Check out the fascinating 27 second gif history of unemployment in the U.S. created by Len Kiefer, Deputy Chief Economist at Freddie Mac:

Meanwhile, oil prices plummeted, regarding which renowned oil expert Daniel Yergin, author of the definitive history of the oil industry, The Commanding Heights, noted, “Nothing like this has ever happened before.” Oil prices are now in the low twenties, having even gone weirdly negative for a very brief period (i.e., sellers had to pay buyers to take oil). This price is far below the $30 to $50 per barrel level that most of the industry needs to remain solvent. The low price has already forced some debt-heavy oil producers into bankruptcy, and if it remains low then others will surely follow.

An initial wave of Covid bankruptcies has begun, and thus Forbes has initiated a “Coronavirus Bankruptcy Tracker,” with J.Crew, Gold’s Gym, Virgin Australia Airlines plus three smaller airlines, Modell’s Sporting Goods on the list so far, along with 42 other companies (the threshold to make the list is you have to have more than 500 employees).
https://www.forbes.com/sites/hanktucker/2020/05/03/coronavirus-bankruptcy-tracker-these-major-companies-are-failing-amid-the-shutdown/#5c1785853425

Neiman Marcus declared bankruptcy today, and J.C. Penney is reportedly nearing bankruptcy as well, and we can thus expect further waves or cycles of bankruptcies in the months ahead. As the retailers drop, their landlords will begin to feel their pain, and major real estate holders will tumble as well. The Economist refers to this as “the insidious means by which weak sectors of the economy will infect otherwise moderately healthy ones.” It’s a nasty chain reaction that spreads the pain.

And in the event that Covid makes a return appearance later in the year, which health care professionals are now warning of, we’ll experience yet another episode of economic contraction when we’re forced to revert to lockdowns.

For the airlines, meanwhile, which have been badly hammered, the International Air Transport Association (IATA) estimates that they’ll lose at least $300 billion this year.

And finally, a forecast issued by the Bank of England on May 7 observes that the UK economy is headed for its worst crash in more than 300 years. The report from CNN states the following:

The Bank of England said that GDP contracted by 3% in the first quarter of this year and would fall by as much as 25% in the second quarter, leaving the economy about 30% smaller than it was at the end of 2019. Unemployment is expected to increase to 9%.

The central bank expects a swift economic recovery in 2021, but it cautioned that its forecast, which assumes a gradual easing of social distancing measures and “very significant” monetary and fiscal stimulus, depends on the “evolution of the pandemic, and how governments, households and businesses respond.” And the bank warned that it’s more likely to have underestimated the scale of the economic crash than to have overstated it.

Economists at Commerzbank said that they expect more economic scarring and a slower recovery. Historic examples suggest there will be a more permanent loss of output, they said, and more persistent unemployment.
Charles Riley, CNN Business. “The UK economy is heading for its worst crash in 300 years.” May 7, 2020. https://www.cnn.com/2020/05/07/economy/uk-economy-bank-of-england/index.html

Some key points to reiterate here are, first, the Bank’s forecast is actually optimistic, in that it assumes social distancing can be eased. If the virus perseveres and social distancing remains necessary, then things become even worse, which the bank actually does admit in noting that they may well have underestimated the scale of the crash anyway.

And the note from the German Commerzbank affirms the notion that the crisis will likely result in permanent structural change to the economy even under the most optimistic of scenarios.

On top of all that, a new forecast from the US government projects that the daily death rate in the US will continue to rise, doubling from the current rate to reach 3,000 fatalities per day by June, largely occurring as a result of the easing of social distancing. In an ominous sign, eight states that have begun to reopen are already seeing increases in the number of Covid cases (Alaska, Indiana, Iowa, Kansas, Minnesota, Nebraska, Tennessee, Texas).
https://www.forbes.com/sites/lisettevoytko/2020/05/04/report-internal-trump-administration-coronavirus-model-predicts-3000-daily-deaths-by-june/#4cac8309ad4a

This is apparently providing a vivid picture of the experiment embedded in the trade-off between ‘a return to economic activity’ and ‘a greater risk of getting sick and dying.’ How this will play out in public opinion over the next couple months will be fascinating to observe, and certainly central to the upcoming election: will Americans choose to risk their lives to restore their economy?

And indeed, all of this gives us a great deal to think about as we consider what’s next for the economy.

A Slow or Non Recovery:

Downward Spiral

In the previous white paper we discussed the possible shapes of the recession/depression curve, and we presented these five possibilities:

“V” indicates a sharp decline and a quick ascent.
“W” is a double dip, a false recovery followed by another decline, and then a real recovery.
“J,” the optimist’s curve, says quick descent is a prelude to even greater heights.
“U” is a slow decline and slow recovery.
“Oscillation” is a prolonged period of ups and downs.

Now that we’re a couple months into this, though, none of those are looking quite right. Instead, there are two shapes that seem most plausible, a “Lazy J” and an “L.”

The “Lazy J” describes a precipitous decline, which is indeed what we have just experienced, followed by an agonizingly slow recovery.

Between the “J” and the “L,” this would unfortunately have to be considered as the “optimistic” scenario, because the “L,” on the other hand describes not only a depression, but also a significant restructuring of the economy that involves massive uncertainty, and a lot of social and economic pain. It’s the Non-Recovery scenario.

This is what was implied in the observation by the Commerzbank., whose economist Peter Dixon said this: “Current conditions are unprecedented in our lifetime and all forecasters are struggling to make out where the economy stands now, never mind what happens in future. But it is clear that the next few months are going to produce some of the biggest output falls on record.”

This is also in line with the expectation of Shell Oil, as expressed by its CFO Jesscia Uhl. She told investors on April 30, 2020 that she sees, “major demand destruction that we don’t even know will come back,” and that Shell expects an “L-shaped recovery” in the wake of the pandemic. She warned that the “relatively disorderly way in which all systems start to shut down is also going to affect us in ways that are very hard to predict.”
https://earther.gizmodo.com/shell-ok-we-may-actually-be-fucked-this-time-1843200534
https://www.naturalgasintel.com/articles/121841-shell-ceo-says-covid-19-may-capitalize-society-to-reduce-long-term-oil-natural-gas-demand

The “L” shape isn’t exactly a recovery though. It  describes a significant decline in economic activity followed by a prolonged period in stasis, which is effectively a non-recovery.

The underlying economic process, which no one in government really wants to talk about publicly, is the cascading impacts of a decline in demand.

The sequence unfolds something like this: Demand collapse leads to massive layoffs (seen that), which then exacerbate the decline in demand because fear sets in (seeing that now). Entire industries contract, and so do government tax and fee revenues, and unfortunately this is exactly when governments must spend massively more to prop up the health care sector, public transit (because fare revenues plummet), as well as unprecedented unemployment benefits.

What happens next in this situation is that many business and family borrowers have lost so much income that they cannot cover their debt payments, so many are forced to sell the underlying assets. But they are selling into a depressed market, so they don’t get full value. Alternatively, borrowers just default on their loans, and hand devalued assets back to the banks, who assuredly don’t want them.

•••

The paper goes on to consider the economic process that an “L” depression would be likely to follow, a nasty downward spiral (it’s not pretty).

But then we go on to propose four critical items for

Your Covid Action Plan

1.     Find the Future
2.    Collaborative Inquiry
3.    Business Model Innovation
4.    Learn from the Data

Our notion is that in addition to the many actions you’re taking to protect your business, you should also consider the many opportunities that the Covid crisis is creating, particularly in areas like business model innovation.

You’re invited to download the full white paper here, and to share it with friends and colleagues.

(The previous two papers are available here also. If you have already downloaded them, you will regrettably be asked to enter your email address again, but the system is smart enough not to send you duplicate emails in the future.)

•••

As always, we welcome your comments and suggestions.
Thanks!

Our global team stands (or sits) ready to support your innovation journey with an ever-improving suite of remote support tools and methods, to help you and your teams achieve high performance and exceptional creativity in these exceptional times.

•••

The post Covid-19: Business as Un-Usual And the “L” Shaped (non) Recovery appeared first on InnovationLabs.

As the tragedy of Covid-19 continues, the images above and below depict utterly bizarre realities about today’s economy in an astonishing juxtaposition.

Look closely below and notice that as CNBC’s Jim Cramer celebrates the “The Dow’s Best Week Since 1938,” he seems entirely unaware that streaming across the screen below his face is a much different reality, the fastest and most brutal decimation of American employment in history. Why is the Dow up so brilliantly while unemployment is also soaring?

There’s a disconnect here, a big one, and we need to sort it out.

Or, to say it differently, this is our Covid moment. So what’s next? That’s what we will examine here in the second thought experiment in this series.

•••

On March 26, InnovationLabs published a detailed white paper that applied the scenario planning technique to consider how the Covid crisis may play out over the next few months and beyond.

The response to the white paper was exceptionally positive, and it found a readership far larger than we had expected. One thing we did expect, though, was that the situation would evolve rapidly, and so it has. During the three weeks since we published it, many of the questions that we raised in that white paper have already been answered.

Among these is one critically important factor, as it’s now clear is that we’re not going back to the way things were before. The “old normal,” that is, is permanently gone. Hence, this paper is entitled “The Next Normal,” based on the premise that while we’re not going back to how things were, the way things are going to be isn’t going to be permanent either: we’re entering a period of flux.

And thus the purpose of this follow-up report is to help us understand what’s that “next normal” might be.

It is important to note that we are aware that although we look at evidence from many nations, this paper takes an American perspective on the crisis, but it also seems that the choices and issues are nearly the same everywhere: what’s going to happen now, how will this end, and what comes after that.

Many readers kindly shared their thoughts and ideas on the first paper with us, and we list them here as contributors to this follow-up, as their ideas and suggestions have strongly influenced our thinking. We greatly appreciate their feedback, and we welcome yours as well.

White Paper Contents

Highlights: Executive Summary

1. Some Basic Statistics
2. A Model of Change
3. The Economy: How Do You Cope with a Depression?
4. Society: How Do You Rebuild Trust?
5. Government: What Is Its Role Now?
6. Your Family: What’s Next?
7. Your Business: Survival Mode, Or, How Do You Restart?
8. Conclusions & Recommendations

Appendix 1: Scenario Planning Summary
Appendix 2: The Politics of Crisis
Appendix 3:  Resources

Please click here to go to the page where you may download the white paper.

Highlights: Executive Summary

Building on the previous white paper, we here consider the impacts of the Covid crisis at five levels of focus: the economy, society, government, the family, and business. Looking at them individually reveals some important insights for leaders to consider as they think about and plan for the post-Covid world.

Among the key insights is the likelihood that we are heading into a possibly severe depression with much deeper impact than a mere recession would bring. Although a depression is not a certainty, it is such a strong possibility that it is imperative to plan as if it is going to occur, and then be happily surprised if we avoid it. This will obviously have long-term repercussions.

Looking at society’s response to the crisis brings forth the theme of trust, in that all responses to Covid have to do with the absence of trust. Lockdown, after all, is the choice we make when have to assume that as anyone may be carrying the virus, we cannot trust anyone. How and how much trust returns to society will mark a major turning point.

Governments around the world have responded in many different ways, and they will surely be judged according to the how good or bad their recommendations and directives turn out to be.

Families, meanwhile, are under severe pressures now, as millions have abruptly been put out of work, and of course all of this has profound impact for business. At the more superficial level, we’re in the “Zoom Era” now, with renewed focus on remote work, and this will have enduring influence.

At a more fundamental level, the immediate issues brought forth by the crisis, as well as the longer-term implications, suggest that the macro economy itself is now in the midst of a transformative process, and the only thing a business can do is to go along and engage in its own process of transformation as well.

This is by no means an easy thing to understand or to accomplish, but it seems to be the emergent necessity for those that wish to survive and thrive in the times ahead. Transformation means thinking deeply about how work is organized as well as who customers are and what needs they may have. It means innovating new products, services, and business models while also engineering how systems operate.

When we started writing the report we didn’t know exactly where the trail of ideas and concepts would lead, and of course that’s exactly the point of doing a thought experiment, and that’s exactly why we wrote this paper as well as the previous one. And where we ended up, somewhat to our surprise, is in recognizing the great opportunity that the crisis has presented us with.

While we believe that the global economy was already in the early stages of a major transformation, a topic we’ve covered in our last few books, we realized that the Covid crisis is amplifying and accelerating this basic trend. Transformation, that is, is apparently inevitable, but Covid has brought forth many awarenesses and possibilities that did not previously exist. It has cleared the air (literally), shifted our perceptions of the role of government, and brought forth an abundance of creativity and social responsibility, all of which we can now build upon as we engage in transformation not merely to restore the economy, but to create a better one.

This is not to discount or diminish the loss of life, fear, and financial calamities in any way, but to identify what good can be made of them, and how they can help us to facilitate a better future.

1.

Some Basic Statistics

If the magnitude of what we are now facing is not yet apparent, please consider a few data points. While we could easily spend all day (and night) looking at stats and graphics, we’ve selected just a few highlights (or lowlights) to focus on.

Unemployment

“Moody’s Analytics calculates that more than 30 million American jobs are highly vulnerable to closures associated with Covid-19. Research published by the Federal Reserve Bank of St. Louis suggests that close to 50 million Americans could lose their jobs in the second quarter of 2020, pushing the unemployment rate about 30%.” Those are Depression-level job loss statistics.
The Economist. “Trough to peak.” April 4, 2020.

Airlines

“According to multiple metrics, the number of airline passengers has dropped by about 96%. On April 8, the TSA screened about 95,000 people at its airport checkpoints, as compared with 2.3 million a year previously. About one seat in ten is occupied on U.S. domestic flights, and U.S. airlines have taken 1800 planes out of use, parking them at various airports around the country.”
Gregory Wallace. CNN. “Airlines and TSA report 96% drop in air travel.” April 9, 2020.

“Analysts at Citigroup estimate that Delta Airlines is losing about $50 million per day. Automaker Volkswagen says it is losing €2 billion per week.”
The Economist. “Great white night.” April 4, 2020.

The Economy

“According to economists at J.P. Morgan, the U.S. economy collapsed at an annual rate of 40% during March. RBC, Canada’s largest bank, has identified five different scenarios describing how the virus may play out in the economy, but the uncertainties are so great that the most likely of the scenarios has only have a 35% probability of being correct. In other words, they just don’t know. Because no one knows. Further, as Dr. Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases has commented, ‘You don’t make the timeline, the virus makes the timeline.’”
Randall W. Forsyth. Barron’s. “Here’s How Bad the Economy Will Get — and How Quickly It Could Revive.” April 10, 2020.

“The biggest business handout in history has begun. At least $8 trillion of state loans and goodies have been promised to private firms in America and Europe, roughly equivalent to all their profits over the last two years. More than half a million European firms have applied for payroll subsidies.
The Economist. “Bottomless Pit, Inc.” April 4, 2019

Lockdown & Labor

When India announced a national lockdown on March 24 for the entire nation of 1.2 billion people, it immediately shut down rail, road, and air transport. Upon which about 600,000 people began the long walk from their precarious employments back home to their villages. But the government then stopped that exodus as well, reasoning that it would only spread the virus that the lockdown was designed to halt. The migrant waves were thus forced to stay wherever they were, and having no work and no means therefore to feed themselves, the state government of Delhi, India, for example, finds itself obliged to provide free food for 1 million people per day.
The Economist. “Under pressure.” April 4, 2020.

There is a massive labor shortage throughout the farming regions of Europe as the migrant labor force that normally does the harvesting is unable to travel to the farms. 300,000 workers are needed in Germany, and another 200,000 in France for the strawberry harvest alone. Polish workers normally migrate to Germany, and Ukrainians to Poland, but neither is able to move now. Consequently, local citizens are being actively recruited for the harvest, and many labor rules and laws are being relaxed to facilitate this. For instance, in France those living in migrant camps, and who are normally shunned, are being encouraged to join in, and farm earnings for unemployed French citizens that would normally cause an automatic reduction in social supports are now permitted.
The Economist. “Farmhands needed.” April 4, 2020.

There are plenty more indicators to consider, but these covey the outlines clearly enough. Everything, in other words, has changed.

But is it temporary? We don’t think so, as we will now explain.

2.

A Model of Change

In the previous white paper, we applied the scenario planning approach to consider many possible futures. We noted in that paper that scenario planning is a multi-step thinking process: First you identify the forces driving change; next, you develop multiple scenarios of what may occur by considering the interaction of those forces; and then you note any observations that cut across the multiple scenarios. As a final step you identify any imperatives for your organization based your observations. These imperatives are things you must do regardless of how you think things are going to turn out.

And after that, while you implement the imperatives, you also watch closely to see what happens. Because your brain has been sensitized through the thought experiment process of crafting scenarios, you’re often able to recognize the importance of key events and trends that you might otherwise have missed. That is, you begin to notice early warning indicators which suggest how things are starting to go.

These are called “Leading Indicators,” and they are often powerful insights that will help you to further improve your imperatives action plan, because they provide evidence of what’s happening so you can course correct. You compare the evidence with your expectations, and quickly make adjustments, and all this occurs on an accelerated time scale because you are mentally prepared.

In addition, in the Covid Scenario Planning White Paper we put forth a model which suggests that a crisis such as Covid provokes change at three levels. When the crisis first arrives there is an immediate emergency impact, which then leads to actions, and then eventually the long term social consequences become apparent. These are often changes in attitudes and they can be the most impactful, and hence they are represented by largest circle.

While only three weeks have passed since we wrote the first paper, we’re highly sensitized to change and we are indeed already starting to see important leading indicators, early warning signs of what the future may hold.

Hence, in this paper we take the leap from considering scenarios of what might occur, to looking more deeply at impacts that are now emerging and possibly even evident, as we are extrapolating from these to consider what the future may hold.

Please note that the purpose here, as with the previous paper, is not necessarily to accurately predict what’s coming, but instead to provide useful thought stimulators that may help you to get clear about what you’re seeing, what you need to prepare for, and the actions you need to take.

Five Dimensions of Change

Broadly, as the impacts and consequences unfold we can already see implications emerging in five dimensions:

1. The Economy
2. Society
3. Government,
4. Your Family, and
5. Your Business.

These five are intimately connected with one another, and the connections between them contribute to the sense of complexity and the feeling of overwhelm that is now common for many of us of. Everything is happening at once, and much of it is frightening.

We’ll look at some of those connections in the Conclusion of this paper, but first we’ll take a look at the five as though they were separate and distinct domains. While we know they’re not really separate, looking at them individually will nevertheless help us to see some important trends and patterns.

And so the white paper continues on for quite a few pages with detailed discussions of each of these five topics, a great many relevant quotes from various news sources, and then concludes with a discussion of two major recommendations:

1. Prepare for the worst, a depression.
2. Prepare also for a transformation of the global economy, which will in turn require a transformation of your own enterprise.

Please click here to go to the page where you may download the white paper.

•••

As always, we welcome your comments and feedback.

Please contact us at LMorris@innovationlabs.com

The post Responding to Covid-19: The Next Normal appeared first on InnovationLabs.

A Thought Experiment on the Short and Long Term

Impacts of the Present Crisis

Prelude

On March 22, 2020, the International Olympic Committee announced that it was going to take a month to study the scenarios regarding the Tokyo 2020 Summer Olympic and Paralympic Games to determine if the Games would go on as planned, or be postponed or cancelled. Only two days later, long before that month had passed, they leaked the announcement of the postponement until the summer of 2021.

The broad outlines of what happened during those 48 hours are easy to guess – having weighed their options, the Committee was unable to see how the Games could continue as planned. There was, they must have seen, no credible scenario in which the athletes would be ready to compete, and the world’s travel industry could be ready to transport millions of fans.

They also must have realized that the huge uncertainties about the course of the pandemic meant that there was no way to know if by July, when the games had been scheduled to begin, the pandemic would have eased enough that travel on a mass scale would even be possible.

And so they shared their decision, 28 days ahead of their self-appointed deadline.

Covid-19 is having that kind of effect all over the world – one day’s plans and accepted truths are overturned and displaced already the following day. And as we go through the daily ups and downs of the crisis, still business and government leaders need to have insight into what the future holds, even as the fast pace of events day by day seems to make prediction impossible.

But while we cannot predict, we can still learn much about the future to help inform our decision making through modeling the pattern of the pandemic. A set of models that has been critically important to the global Covid-19 response was developed at Imperial College, London, to consider how the epidemic-turned-pandemic might develop, and what actions would be most effective in mitigating the threat.

The College has issued a series of reports, the most recent dated March 26, 2020, in which they model the impacts of the virus under various scenarios and offer valuable guidance for leaders. Here is an excerpt:

We estimate that in the absence of interventions, COVID-19 would have resulted in 7.0 billion infections and 40 million deaths globally this year. Mitigation strategies focusing on shielding the elderly (60% reduction in social contacts) and slowing but not interrupting transmission (40% reduction in social contacts for wider population) could reduce this burden by half, saving 20 million lives, but we predict that even in this scenario, health systems in all countries will be quickly overwhelmed. This effect is likely to be most severe in lower income settings where capacity is lowest: our mitigated scenarios lead to peak demand for critical care beds in a typical low-income setting outstripping supply by a factor of 25, in contrast to a typical high-income setting where this factor is 7. As a result, we anticipate that the true burden in low income settings pursuing mitigation strategies could be substantially higher than reflected in these estimates.

Our analysis therefore suggests that healthcare demand can only be kept within manageable levels through the rapid adoption of public health measures (including testing and isolation of cases and wider social distancing measures) to suppress transmission, similar to those being adopted in many countries at the current time. If a suppression strategy is implemented early (at 0.2 deaths per 100,000 population per week) and sustained, then 38.7 million lives could be saved whilst if it is initiated when death numbers are higher (1.6 deaths per 100,000 population per week) then 30.7 million lives could be saved. Delays in implementing strategies to suppress transmission will lead to worse outcomes and fewer lives saved.

We do not consider the wider social and economic costs of suppression, which will be high and may be disproportionately so in lower income settings. Moreover, suppression strategies will need to be maintained in some manner until vaccines or effective treatments become available to avoid the risk of later epidemics. Our analysis highlights the challenging decisions faced by all governments in the coming weeks and months, but demonstrates the extent to which rapid, decisive and collective action now could save millions of lives.

Source: Walker et al. The Global Impact of COVID-19 and Strategies for Mitigation and Suppression. WHO, MRC, Imperial College London

The 19 page report makes fascinating and frightening reading, but essential reading for leaders and those who must make decisions for themselves, their organizations, and their countries.

In addition to epidemiological models, another tool we use to understand the future in periods of change and uncertainty is “scenario planning.” To help our friends and clients to get a clearer picture of what lies ahead as the Covid pandemic unfolds, InnovationLabs conducted a scenario planning thought experiment on the unfolding of the Covid-19 crisis and the Post-Covid World. Our focus was not on the medical dynamics of the pandemic itself, but on the broader economic and social consequences.

We then wrote a white paper to share our findings, and hopefully to help leader to identify the short, medium, and even possibly long range impacts that they must consider.

Please click here to go to the page,
where you may download the full white paper in PDF format.

Scenario Planning

Scenario planning is a compelling technique that looks at the future not in order to make predictions about what will happen, as in any case our predictions would most likely be wrong, but to consider possibilities, and thereby to inform our thinking about what may happen and develop options in advance of the need.

Good scenarios open our eyes to unseen possibilities, they help us to see connections, and they help us to foresee chains of events that might otherwise be hidden. All of this enables us to become better decision makers, strategists, and leaders

During the last 20 years, InnovationLabs has delivered successful consulting projects in the energy, health care, and aviation industries among others by applying scenario planning, and these experiences led us to write extensively about scenario planning in some of our recent books, including Foresight and Extreme Creativity: Strategy for the 21^st Century (2016), which includes an extensive, 100-page section just on scenario planning, and The Big Shift (2018), which examines 83 of the key forces that are currently driving change in our world, and which are key topics for scenario planners to consider.

So what can scenario planning tell us about Covid-19 and its impacts? A great deal, as it turns out.

White Paper Contents

1. Coping with Uncertainty
2. Sixteen Scenarios of the Future with Covid-19
   Scenario 1: Deadliness & Government Response
   Scenario 2: Duration & Economic Impact
   Scenario 3: Recurrence & Political Impact
   Scenario 4: Treatment & Social Impact

3. Observations
   Leadership
   The Economy
   Scenario 5: The Economy & Social Order
   Health Care in the US
   Science
   Environment
   Complexity and Systems Thinking
   How Crises Unfold
   Education

4. Imperatives
5. Conclusion
6. Resources

1. Coping with Uncertainty

If our experience with Covid-19 tells us anything, it’s that our predictions about the future are likely to be wrong in nearly every aspect and circumstance. To make that point crystal clear, it’s evident that throughout this crisis things that we believed were true yesterday were reversed today, suddenly overturned by new findings or unexpected outcomes. So how then are we to plan for the future and compose our strategies amidst such uncertainties?

This is why scenario planning is so useful, because it enables us to consider what may occur across a wide range of forces and factors, and thereby stretches our thinking beyond what we already know to new discoveries and realizations.

The scenarios in “scenario planning” are stories that we concoct that illuminate our present and future. We create them by identifying “forces” that are driving change, recognizing that the outcomes these forces will attain cannot be predicted. Hence, we may know what is driving makes, but we don’t know how those changes will turn out.

For this experiment, we chose eight forces, and for each of the eight we then identified what might be the two most extreme outcomes, as shown below.

1. Covid-19 Deadliness: How deadly is it?
2. Covid-19 Duration: How long will the virus circulate in society, or until we have an effective defense strategy?
3. Covid-19 Recurrence: Is it a one-time pandemic, or will it recur?
4. Covid-19 Treatments: Will an effective vaccine or therapeutic drug be developed?
5. Government Responses to Covid-19: Will governments shut down society for weeks or months to stop the pandemic?
6. Global Economic Consequences of Covid-19: What will the impact be on globalization, and what are the costs in terms of GDP growth, bankruptcies, and lost jobs?
7. Political Impact of Covid-19: How will the handling of the crisis impact on established national politics?
8. Social Impact: How much will Covid-19 affect how we live and our attitudes?

The scenario planning technique pairs two driving forces to create a 2 x 2 matrix of possibilities, as shown here:

Each quadrant of the 2 x 2 matrix defines a scenario, a unique and specific situation that results from the labels on the two ends of the driving force axis. “Scenario 1” is thus the outcome of the world in which Alternative 1A and Alternative 2A are the realities.

Because the two ends of each axis are polar opposites, the four resulting scenarios are quite different from one another. And that is exactly the point. This thought experiment forces us to consider four very different sets of outcomes in any given situation, which by definition enables us to think beyond our first instinct and beyond our base assumptions and biases.

We’ve seen over and over how this opens minds, as we hear comments like, “Oh, now I see the bigger picture!” and “I thought I knew what would happen, but now I realize that all four options are actually possible.”

This is the case even though the 2 x 2 matrix is obviously a simplification, as each pairing thus omits 6 of the 8 factors we chosen (and who’s to say that those 8 are even the right 8 to begin with…). But experience has shown over and over that humans are quite good at modeling 2 x 2, and rather poor at trying to model more than 2 x 2. Experience has also shown that we can get a lot of insights from looking at the intersection of just two forces, and so while this does simplify things, it also illuminates them. Once our thinking process is used to extrapolating from constrained conditions, we tend to extend that faculty to address even more complexity, so we can readily think of scenario planning as training for real-life decision-making.

2.  Sixteen Scenarios of the Future with Covid-19

With 8 driving forces to consider we can devise 28 different pairings, and of the 28 possibilities we have chosen 4 to focus on here. We chose these four because each one pairs a Covid-specific theme with a non-specific theme.

1. Covid-19 Deadliness & Government Response
2. Covid-19 Duration & Economic Impact
3. Covid-19 Recurrence & Political Impact
4. Covid-19 Treatment & Social Impact

There may certainly be other useful or interesting pairings to try, but we expected that thinking through these four would suffice to bring forth a lot of insights, as indeed it did. Four 2 x 2 matrices yield 16 scenarios in total, which gave us a lot of content to consider…

(and then the white paper continues for another 15 pages…)

•••

… Please click here to go to the page,
where you may download the full white paper in PDF format.

We hope you find this interesting and helpful.
Feel free to share it with family, friends, and colleagues.
And as always, we welcome your comments and feedback.

Photo credit: Image by Image by Vuong Viet from Pixabay

The post Covid-19 and Scenario Planning appeared first on InnovationLabs.

The Covid 19 crisis has disrupted the entire world, but even so it’s not the only big news of the day. From a broader perspective, it’s clear that we’re in the midst of a large-scale process not of small changes and the current crises, but of fundamental change that’s affecting all aspects of society on a long-term basis. The structure of the economy, the profusion of technology, our social structures, and our cultural values are all changing rapidly, and permanently, and so is the very structure of our politics.

These are fascinating and frightening times, and if you’re like us, you’re always looking for insights into the important patterns of change. And if, like us, you’re going to be at home for a few weeks and you’re looking for some good reading about this new world of ours, here are four suggestions: one important new book innovation, two on economics that have innovation as core themes, and one on politics and the role of strategy and innovation across America’s political landscape.

NEW on INNOVATION

IMPLEMENTING AN AGILE INNOVATION MANAGEMENT SYSTEM

Noted innovation expert Tom Brazil has written a very fine guidebook describing how his company, ICS Inc., has successfully implemented a comprehensive innovation system, the tools they used, and the results they have achieved so far. Tom is quite candid and accessible in his writing style, and provides excellent advice and countless specific tips on what has worked well for ICS. This book is a valuable contribution to every innovation library, and if you’re interested in the guts of innovation management, then you ought to get it and read it.

An excerpt:

“This book will serve as a useful guide for those interested in implementing an agile innovation management system. You will find here that the way we implement the framework at our organization was also the result of innovative thinking. In particular, we concluded that due to the agility requirements of portfolio management – along with our commitment to be as efficient as possible in our innovation practice – we would need to invent some unique capabilities that were simply not in the market.

“They are discussed in this book:

• • • An automated means of pivotingthe portfolio in an objective manner
    • An automated means of evaluating prototypesin an objective manner
    • An objective means of selecting from the pool of eligible ideas for the next projects to initiate, taking into consideration the makeup of both the current and desired innovation portfolios in relation to strategic intent

“The results we have achieved at ICS offer powerful endorsements for the innovation path we have taken. Some of these achievements are listed below:

• • • Cultural alignment across the entire organization, with Managers of Innovation certified by the International Association of Innovation Professionals(IAOIP) at the executive, director, R&D and Service Delivery levels
    • Multiple innovative solutions created and delivered for our clients, resulting in more than $6 million in value to our customers
    • Exceptional performanceratings by our DoD customers
    • Washington Technology Industry Innovators Finalist award
    • Creation of an innovation-oriented small business joint venture called RedTeam Engineering (RTE). Managed by ICS, RTE is one of only 25 Small Business Awardees for the Defense Information Systems Agency (DISA) Systems Engineering, Technology and Innovation (SETI) 10-year, $7.5 Billion contract. SETI is the first DoD contract focused squarely on innovation, not only the final solutions developed, but in the methodologies used to design, engineer and deliver those solutions.

“It is because of these and other outstanding results that my colleagues and I are so enthusiastic about the power and importance of innovation. Hence, the goal of this book is to enable you to learn from the lessons that we at ICS learned as the result of our time spent in the discovery, development, testing, and implementation of this framework.”

It is of particular interest to InnovationLabs that the framework which ICS used is the Agile Innovation Master Plan, which has been the subject of a series of our own books, written during the last ten years, including Permanent Innovation, The Agile Innovation Master Plan, The Innovation Formula, and Agile Innovation (co-authored with Moses Ma and Po Chi Wu).

NEW on ECONOMICS

It’s now quite clear that we are in the midst of the transition to a new economic system on a global basis. This is occurring not because of any planning or due to the leadership of any government, central bank, or economic theorists, but as the result of the natural (and possibly unnatural) evolution of society, technology, trade, and population dynamics around the world. Two recent books explore this evolving situation and provide many insights into what’s coming:

CAPITALISM, ALONE

Renowned economist Branko Milanovic has written a compelling historical analysis of the evolution of industrial capitalism over its entire history of two hundred years, with a particular focus on the last fifty years and the emergent global competition between the Western, liberal form of open capitalism (which he calls “liberal, meritocratic capitalism”), and the Chinese form of state-sponsored capitalism (which he calls “political capitalism”).

The book is very well written, and happily it is presented in a non-technical manner for the general reader. If you’re thinking about what’s coming over the next decades, you’ll find many insights here.

An excerpt:

“The two types of capitalism now seem to be competing with each other. They are led, respectively, by the United States and China. Political capitalism has certain features that make it attractive to the political elites in the rest of the world and not only in Asia: the system provides greater autonomy to political elites. It is also attractive to many ordinary people because of the high growth rates that it seems to promise.

“On the other hand, liberal capitalism has many well-known advantages, the most important being that democracy and the rule of law are values in themselves, and both, arguably, can be credited with encouraging faster economic development throughout promoting innovation and allowing social mobility, and thus providing approximately equal changes of success for all. It is the reneging on some crucial aspects of this implicit value system, namely a movement toward the creation of a self-perpetuating upper class and polarization between the elites and the rest, that represents the most important threat to the longer-term viability of liberal capitalism.

“I focus on the social and economic structures that the two systems reproduce, especially as they affect matters of income inequality and class structure. The way the two systems deal with these matters will, I believe, determine their relative attractiveness and stability.”

COMPLETING CAPITALISM

You already know that the Mars Company spans the globe selling well-known snacks and candies, including the Mars Bar, M&Ms, Wrigley chewing gum, Altoids, and also many food and pet food brands. What you may not know if that Mars is a family-owned company, and as such it’s not subjected to the whims of Wall Street or the distorting pressures of quarterly profits, and thus the company’s owners and leadership have taken a longer-term view of business and the economy.

Mars has its own in-house think-tank, and two leaders of the think tank, Bruno Roche and Jay Jakub, have recently published a fascinating discussion about the transformation of capitalism away from the Friedman/Chicago school’s obsession with shareholder returns to the exclusion of all else, to a balanced view that seeks a proper balance between financial capital as well as human capital and natural capital.

This work is not merely a matter of theory for Mars, as they’ve been able to apply the principles they’ve uncovered in experiments with Mars businesses. Hence, this is a book of both useful theory and compelling practice.

An excerpt:

“Our approach is based on the simple assumption that most business sustainability issues can be solved effectively and durably, not through ad hoc corporate social responsibility initiatives or philanthropy, but through innovative business model approaches that have the ability to drive both social and environmental performance while also delivering strong financial performance.

“The management theory we are developing holds that business can simultaneously drive both profits and wide mutual benefits to people and planet through understanding and managing multiple forms of capital, namely human, social, natural, and shared financial capital.”

NEW ON POLITICS

As we shift toward the summer we know that we’ll see the heat level of the American presidential election steadily rise. We also know that we’re in for a long and likely unpleasant campaign season, as it will be a contest not only between two individual candidates, but also between two quite different world views.

Trump is not just Trump, he’s the voice an entire movement and the embodiment of a very specific world view. The Democrat he will face will also not just be an individual candidate, but he or she will represent a deeply contrasting viewpoint about what America stands for, and its role in the world. All this promises to make 2020 into an epic contest, a war.

WINNING THE WAR FOR AMERICA

InnovationLabs Senior Partner Langdon Morris has written a guidebook to the American political landscape that explains how Republican strategists have systematically outplayed their Democratic counterparts over the last thirty years. Republicans know how to win elections, and they’ve developed a highly refined toolkit of strategies and tactics that have produced consistent results, but in doing so they’ve left ethics far behind.

An excerpt:

“There have been times in history when America’s political parties generally agreed on what needed to be done, and put forth candidates who promoted variations on common themes. Those elections turned on issues of likeability, charisma, and persuasiveness, and less on actual policy differences.

“We do not live in one of those times.

“The values, visions, and the policies of today’s parties are enormously different, which consequently raises the stakes considerably. But which vision of the future do Americans prefer? This is what our war is all about.

“The War for America is an ideological war, a war of ideas, and also a war of contrasting cultures and values. It’s a policy war, a class war, a race war, and a war about the role of money in society. Conflicting ideas about America’s future are at play, and conflicting ideas as well about the proper role of our government.

“Trump’s victory in 2016 was a testament to the advanced state of Republican acumen at strategy, execution, and branding, but it was surely abetted by the ineptitude of the Democrats. Strong Republican strategy elected Trump; weak Democratic strategy failed to stop that from happening. All of which raises some intriguing questions:

• • • How did the Republicans manage to get Trump elected despite his shortcomings?
    • What is the essence of Republican strategy?
    • And what can the Democrats do to regain power?

“The outcome of the 2020 election battle may be determined by the popular vote count, or perhaps by the Electoral College vote count, or at worst, by a decision of the Supreme Court. But the pathway to the outcome will be shaped by the strategies that the two sides employ throughout the battle. Their capacity to seize strategic advantage, adapt to the other side’s moves, counter and adjust, to grab initiative, or having lost the initiative, to seize it back, will determine who shows up to vote, and who they vote for.

“This book is about these strategies.”

•••

Keep your distance, keep washing your hands, and look to these books to provide you with insights into the present and the future, to keep you learning and keep you enthralled.
As always, we welcome your comments and feedback.

•••

The post RECOMMENDED READING for CHANGING TIMES appeared first on InnovationLabs.

Happy New Year!

As we come to the end of 2019 and shift into the decade of the 2020s, we are naturally inspired to think ahead and to wonder what the future holds. This is true around every New Year’s holiday, but even more so this year since “2020” also has such a strong parallel meaning about the quality of our vision – can we see what’s ahead? What does the future hold for us?

Today’s global economy is built upon, and built for, rapid population growth. A growing population means increasing consumption, which is a reliable engine of growth for the world’s businesses. Population growth means new, young workers joining the work force, tax revenues for government, and new households being formed, with all the additional consumption that comes with it – more furniture, more TVs, more stuff. And while growth is considered an economic good, it’s a challenge for the environment, as more growth and more stuff means more consumption of resources and more waste, including of course more CO2.

Consequently, when we think about the future, it’s essential that we consider future population trends, as they will be decisively important to the future of society and the environment.

On a global basis, the birth rate is closely linked with urbanization, because where people live has a lot of impact on how many children they have.

It turns out that when families move from the countryside to the cities the birth rate drops, usually within a generation, so to understand the future of population growth it’s necessary to pay attention to the proportion of the world’s population that is rural, as compared with the proportion that’s urban.

In 1900, just ten percent of the world’s 1.5 billion people lived in cities, but from 1900 to 2000 the rapid spread of industrialization, sanitation, health care, and scientific knowledge led to the population explosion; the world population ballooned to 7 billion by 2000, creating fears of mass starvation and a population apocalypse.

Until the 1980s, most of that population growth was in rural settings, but the pace of urbanization has accelerated since then, and the world’s population is becoming steadily more urbanized.

So if urbanization leads to a significant reduction in family size, then we ought to be seeing a decline in the overall global birth rate, and indeed we are. In fact, the decline is so fast that it’s quite possible that by 2050, a mere 30 years from now, the world’s population will peak.

And what then?

At that point, and in fact long before, we will see a fundamental transformation of the global economy. This will not be a simple or easy transformation, but it will be a transformation nonetheless, because then the very structure of the economy will change, not because businesses or governments want it to change, but simply because the declining impetus of consumer demand will act as a brake on the economy.

In short, while the global economy is designed for, and requires, a booming population, the era of the population boom is quickly coming to an end. No one knows what the economy of 2050 will look like, but we can be sure it will not look like the economy of 2020.

Will this cause suffering? Surely it will.

Will this be a force that results in the rise of new companies and the fall of older ones? Surely it will.

And while urbanization and changing demographics drive a global economic transformation, an additional force will be fully at play, and it, too will have enormous impact. This is of course the arrival of yet another generation of new technologies, including robots, artificial intelligence, machine learning, virtual and augmented reality, and perhaps blockchains and quantum computing as well.

Each of these technologies promises to be an active driver of change, but perhaps frighteningly, they’re all maturing and arriving at once, and thus the tsunami of change that they portend could also be utterly transformative.

Whether this will be a positive transformation or a catastrophe depends a great deal on how we manage the transition.

Today we see already the early signs. The number one job globally, the form of work that more people do than any other, is driving vehicles. So what impact will self-driving cars, trucks, taxis, buses, and trams have on global employment? And already Amazon employs more than 100,000 robots in its warehouses, while more arrive each day. Soon there will be billions. Already artificial intelligence systems, i.e., computers, read and write legal documents, analyze x-rays, calculate logistics, and trade in the stock market.

Work is therefore changing, just as the rate of population growth is changing, and while these may be seen as huge but separate forces, in fact they aren’t really separate at all, they’re two parts of one massive economic transformation that has already begun.

Adapting to these changes will require close attention to strategy, the process of thinking through how any organization will adapt to and create change, and to innovation, the internal driver of adaptation within organizations.

Already we are seeing the early impacts of these shifts, and those organizations that develop the necessary mindset and actions will gain enormous advantages as the process of change unfolds throughout this decade.

This, then is what the future holds: a time of great challenges and great opportunities as well!

The Roman Horace advised to carpe diem, to seize the day; we also think it’s time to carpe momentum, to seize the moment, a conveniently double meaning.

Or more simply, avoid the mismatch (see the graphic above) start getting ready now!

Change, strategy, and innovation are topics that we study and write about extensively, and we help  our clients to understand these forces and to prepare for the impacts they will have. Please contact us if these are of interest to you, and we’ll be happy to discuss the strategic and innovation implications of accelerating change, and the actions you can take to get ready.

•••

InnovationLabs wishes everyone a wonderful year in 2020!

•••

The figures in this blog post appeared previously in our recent books Foresight and Extreme Creativity (2016) and The Big Shift (2018), where we explored these themes in great depth.

The post The 2020s Have Arrived: Preparing for Global Economic Transformation appeared first on InnovationLabs.