This is the second in a series of five blog posts on future-proofing a company's strategic decision-making. Part one can be found here.
When we lack exact knowledge, we rely on past experiences when making decisions. But when will we ever have all the necessary knowledge about the future? Probably never, and this is exactly why it also pays off to model qualitative information and human behavior – not just numbers and quantifiable facts – to support strategic decision-making.
The following outlines the most likely future scenario for the European Union in ten years, created using mathematical modeling in our explorative EU case described in the first blog post in this series. The research question was “how to create a thriving digital business environment and equally distributed well-being in the EU.” We modeled uncertainties around these goals using a Bayesian approach and opinions from various experts within three different ministries in Finland, academia, and business professionals who regularly work with the topic at hand.
If this world becomes a reality, what implications does that have for your organization’s agenda today?
- Technological development has transformed business, and ownership is in the hand of few. The playground for private companies in the EU is dominated by giants that control vast ecosystems. These business ecosystems are mainly run from within the EU’s digital core, whereas more remote border states focus on agriculture.
- Most EU citizens work short-term gigs. At the same time, they are wealthy digital experts. Yet, wellbeing in the EU is distributed more or less evenly.
- European values are those of human rights and equality. There is also an emphasis on wealth and technological benefit. Those who are doing fine focus on increasing their own benefit. Marginalized groups are increasingly resisting the system and status quo.
- There is a common view that global collaboration is useless, and trust in global agreements and institutions has deteriorated. In many areas, large corporations are more powerful than nations and global institutions.
- Inside the EU and its digital core states, a politician has been able to create new kinds of enabler policies and infrastructure. Thriving internal markets make the EU competitive on a global scale.
Regardless of whether this world will become real or not, the more interesting question at hand is what this scenario implies for decision-making? Our project’s experts responded to the results by saying, “This is provocative. Do we want a world like this? We need to start rethinking our decisions today.”
There are tools to help expand our thinking. The simplest of them are tools like a pen and paper. They help us do more complex math than we could in our heads. Try multiplying 134909 by 2398 – some people can do it just like that, but I, for one, need paper.
Simple analog tools have existed for hundreds of years, and they still help us expand our mental capacity and share abstract ideas with others in the form of expressive doodles on a paper.
The mathematical models used in the EU case study have a similar effect. Much like rudimentary writing instruments, they are tools that help us go beyond our mental capacity. For example, when we think about the future, modeling is a tool for processing a huge quantity of simulations and demonstrating how different uncertainties and drivers interact with each other as they lead to the goal.
Modeling human decisions will lead to better decisions. It teaches us to recognize our often unconscious certainties, desires and intentions – or biases. In other words, subconscious emotions that drive our actions. Both action and inaction have an impact. Essentially, if you understand your emotions, you will have a better impact on people, the planet, as well as the profits and purpose of your organization.
Experienced leaders use their previous experiences – and biases – to make quick judgements in a fast-paced environment. High potential leaders also know when and how to identify and challenge their biases.
As a decision maker, what do you think is the most probable future? You can book a Future Forces 2019 session with us to sit down and think alternative certainties, desires and intentions for your organization together with us.
Future-Proofing Strategic Business Decisions