Professional Documents
Culture Documents
THE UNKNOWN
nobody has a crystal ball. So perhaps it takes a science fiction writer's imagination to
articulate the unknown – and in some ways unknowable – futures. Isaac Asimov's words resonate
strongly with where we are right now in 2021, in the aftermath of a global pandemic which
has helped to rewrite the rules of how we live and work and do business. We can't cling to the
past, but now the future is less than certain. Nothing could have prepared us for the end of
IIllustration: Istock
predictability, but if projections don't work anymore it's hard to know what the future holds – and
difficult to plan for it. In this issue we look at what you can do to tackle the uncertainties ahead.
Read on to learn what forecasting tools you can use, how others prepare for the unpredictable
and what trends you need to look out for to lead your organization into the unknown …
6 Think:Act 34 in this issue
Think:Act 34
In focus
14 Small steps
and giant leaps
Three lessons from
history give insight into
different ways to manage
your course when sailing
off into the unknown.
18
outpace prediction in an Software offers ever cheaper
increasingly complex world. forecasting tools, but
beware – they can only be
30 Catching a black swan as good as their data, or
Dive into the history of the people reading them. WHEN
thinking that lies behind our GROUPTHINK
54 S
econd-guessing
quest to understand – and
get ahead of – outlier events. the unknown
WORKS
Four professionals who work A bit of crowdsourced wisdom
34 P
redicting the at the edge of their fields could help you supercharge
future: when years share how they've learned your forecasting powers and
make a difference to handle unpredictability. outpredict your rivals.
in this issue Think:Act 34 7
Wide angle
70
cover illustration: getty images | photos: sabrina peters, burt glinn/magnum photos/ agentur focus | illustrations: denis freitas, matt chinworth, cathal duane
THE UNKNOWN
Urbanists suggest that any Economist and Nobel laureate
perceived losses brought by Robert Shiller explains how
Covid-19 can be balanced out narratives change the way
36
of climate action and next-generation production, then take a
long view into the business-shaping trends that lie ahead.
HOW
DIGITAL TWINS Think:Act Ideas for Action
COULD SAVE US Sign up online to download this issue's
Ideas for Action with insights on how quantum
Scientist Reza Abhari is at the computing will change the business landscape and
forefront of computer simulations why it is time to prepare your organization for it.
that could make a huge difference rolandberger.com/quantumcomputing
in the business of prediction.
8 Think:Act 34
Think Food
in for
numbers thought
Putting a figure on …
the covid-19 vaccine
"Can a small company really compete against
the digital giants like Google and Amazon?"
329
by Jonathan Byrnes
million Yes. Amazon does one thing integrated with customers. The key
The number of of C ovid-19 very well: serve small customers is not to compete directly with
vaccine doses that had been at arm's length in an information-rich Amazon and others, but instead to
administered worldwide by March environment with strong network do what they did: identify an under-
11, 2021, the first anniversary
effects. This leaves a wide-open set of served market and focus tightly on
of the WHO declaring
the pandemic. lucrative, defensible, higher-service revolutionizing it. For example, tele-
segments providing customized and medicine and wellness management
•
abound with high-growth opportunities.
6,156%
semi-customized services, often
increase
The rise in Novavax’s stock
price between Jan. 1, 2020
and Feb. 4, 2021, one week
after the announcement that
its vaccine was the first to
demonstrate clinical efficacy
against Covid-19 and both UK
and South Africa variants.
4.9 years
The estimated amount of time
it will take to vaccinate 75%
of the global population with
a two-dose vaccine, based on
the vaccination rate at the
beginning of March 2021.
$1.9 trillion
PPhotos: getty images, fredfield.com
AT A GLANCE
At A G l a n c e Think:Act 34 9
Re-
Thoughts thinking
to live by buzzwords
without
explanations of the
latest jargon.
jonathan byrnes
action is a
is a senior lecturer at MIT
and founder and chairman of
Profit Isle, an SaaS profit analytics
daydream.
software company. Jonathan
is co-author with John Wass
of the book Choose Your Customer:
Action
How to Compete Against the
Digital Giants and Thrive.
"Tattleware"
vision is a
boom, has created a new
trend: apps to monitor
what the workers are
nightmare."
doing – regardless of
whether they're wearing
a suit or sweatpants. The
tools have earned the
"tattleware" title because
— Japanese proverb they can tell the bosses
what is going on remotely.
Using digital traces –
email use, calendar inputs,
time on calls – they build
a productivity profile.
But some tattleware can
be installed without an
employee's knowledge
to monitor online activity
and even take staggered
screenshots. That's surely
a privacy-infringing issue.
10 Think:Act 34 At A G l a n c e
The Chain
redacted Reaction
read
Best Economic
practice impact
AT A GLANCE
PREDICTING
THE FUTURE:
WHEN SECONDS In this issue
we get to grips with
unpredictability and
COUNT*
how to flourish when
facing the unknown.
there simply isn't one single future – and not all futures are uncertain. First,
THE UNKNOWN
consider the extremes. Look at the very, very far distant future and there’s a 100%
certainty: The Earth and the sun will collapse. And then observe the very, very near
future. That gives us an (almost) 100% certainty too: The next second will be more or
less exactly like the one that precedes it. So what about in between? Our cars already
tell us when we will reach our destination; the weather reports give a probability of
rain for the next 36 hours and apps can tell you whether your house will be swallowed
up by a rise in sea level by 2050. Yes, some things will always be an unknown: No one
has a crystal ball. But they are becoming known unknowns, with better and more reli-
able predictions. Predictions for the next minutes or seconds are mostly of little use:
What could really change during the next few seconds that would be of value? Well,
most prediction technologies for this kind of short time frame focus on emergencies.
Knowing some seconds in advance that a tire will explode – or that an earth tremor
might occur or lightning will strike – could indeed make a difference …
an epicenter you are, the more might be missing. Or asks: car in front or beside you. a car is starting up and a
time to warn and prepare. And "Do you REALLY want to send But there’s more to come: space will soon be free. It can
in the wake of a quake, every this mail that contains the Especially since self-driving also reserve that space for
second counts when it means words 'file attached' without technology relies on (almost) a minute – but that feature
you can prepare to save lives. having a file attached?" perfect accident prevention. may come at a price.
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14 Think:Act 34 V OY AG E S O F D I S C OV E RY
SMALL
STEPS
WHAT CAN HISTORY
TEACH US ABOUT
SAILING OFF INTO
THE UNKNOWN? THREE
VERY DIFFERENT
A N D APPROACHES HAD
GIANT
SIGNIFICANT AND
SUCCESSFUL RESULTS.
LEAPS
by Detlef Gürtler
illustrations by
Denis Freitas
THE UNKNOWN
READING TIME:
00:07:14
V OY AG E S O F D I S C OV E RY Think:Act 34 15
Y
ou know your destination. into terra incognita – but only one step
But you don't know the way to at a time.
get there. For land-based All the inventions and innovations
problems, the solution is a SATELLITES: accompanying these Portuguese explo-
simple one: use a map. For almost every EARTH EXPLORATION rations wasn't by chance, but by design:
place in the world, there's a way and it Prince Henry supported research and
is mapped. All you have to do is put a expertise in all the disciplines that were
map in your pocket and set off. No 15th century maps. Of course we know necessary to boost maritime strength –
surprises – nasty or otherwise. In busi- from our school history books that namely shipbuilding, cartography and
ness, it's a different story. You can have these Europeans took the risk to step navigation. The caravel, engineered in
clear targets – perhaps becoming a CO₂ out into the unknown, and successfully the mid-15th century, was a light and
neutral company, or developing an so. Could their strategy to tackle terra reliable ship made for navigation on the
innovative device no one has used incognita help us tackle the business open sea. Henry employed some of the
before – but there's no map to show you unknowns in 2021? best cartographers to map the new hori-
how to get there. There are lots of possi- Let's take a look at not just one, but zons, sponsored new navigation instru-
ble directions to choose from, and they three strategies used by these maritime ments and invested in Africa-bound
all lead into the unknown. discoverers. All successful, and all as expeditions. The Algarve region in the
Well, that kind of business situation different as different can be. southwestern corner of Europe became
today is exactly the situation which faced a maritime cluster of innovation – a bit
Europe's political leaders in the 15th the Portuguese strategy: Step by Step. like the birth and growth of Silicon
century.
They had a clear target: India, Prince Henry the Navigator crafted a Valley in the 1960s.
the land of gold and spices. But they had strategy to sail southward along the Portugal didn't have to wait until
no known way to get there by sea. The African coast early in the 15th century, the end to reap what Prince Henry had
THE UNKNOWN
traditional trade route via Byzantium although it took the whole century to sown. Long before Vasco da Gama's suc-
was destroyed by the Ottoman Empire in reach the final destination. Portuguese cessful journey to India in 1498, the
1453. And no one had ever reached India ships made it to Mauritania in 1441, step strategy bore the first fruits for the
by ship. Whoever wanted to be the first then to Senegal (1444), Cape Verde Portuguese. The maritime route from
had to cross terra incognita, unknown (1455), Sierra Leone (1462), South Africa West Africa to Europe broke the
territories – a common expanse seen on (1488) and last but not least, in 1498, to
India. Every new trip stepped further
TELESCOPE:
SPACE EXPLORATION
COMPASS:
SEXTANT: ORIENTATION
NAVIGATION THROUGH THE
ON OPEN SEA UNKNOWN
16 Think:Act 34 V OY AG E S O F D I S C OV E RY
dominance of the gold trading routes make history, not just be part of it – and As they saw it, Columbus didn't
through the Sahara and promised high preferably see it in their lifetimes. That's stand a chance of reaching India by
profits for Portuguese merchants. An what the great stories of superheroes sailing westward. And indeed, no one
equally profitable trade also emerged: like Alexander the Great or Napoleon had dared to take the route Columbus
slavery. In 1444 the first slave market are made of. And that's what you your- proposed – or, at least, no one had yet
opened in the Portuguese harbor town self can aspire to if you dismiss the returned to tell the tale. And the trip
of Lagos. By 1450, 700% profits were small steps into the unknown and take couldn't be done in legs. The journey
documented on trade of Mauritanian instead one giant, daredevil leap. would succeed, or fail.
slaves. The returns were reinvested in This all-or-nothing character made
expeditions to Africa. So step by step, The Spanish strategy: a Giant Leap. it difficult for Columbus to find inves-
the Europeans also started to write one The most famous proponent of the tors: The risk was simply too high. If he
of the darkest chapters of their history. leap strategy is far more famous than made it, however, the rewards would be
Prince Henry the Navigator passed the Portuguese prince. Christopher as gigantic as the risks he took. In 1492,
away long before the first Portuguese C olumbus was convinced that the after many years of working the corri-
caravels reached India. That's a typical Promised Land in the East (India) dors of power, he persuaded the Spanish
outcome for the step strategy. It takes could best be reached by sailing west. monarchs to back him. The three nut-
time – a lot of it. Leaders must follow the Turning right if you want to go left is shells that finally sailed west were
footsteps of their predecessors. The good counterintuitive and against common bound to fail: Columbus' science was
news, though, is that it can be done. The sense; but it's a sensible move when flawed. He had massively underestimat-
project can be bigger than you are. The you are traveling in a circle. The con- ed the distance from Spain to Asia. And
challenge can survive for generations, temporary scientists already knew that indeed, his ships never reached their
if you build a solid base for long-term the world was round. But they did have destination. It was sheer luck for him
sustainable development. In short: Expe- two other problems with Columbus' that a whole continent lay in the way.
THE UNKNOWN
rience helps to grasp the unknown. plan. They knew the world was a bigger The history of geographic, scientific
Some leaders, though, don't really globe than the adventurer claimed – and economic discoveries is littered with
cherish a challenge bigger than their his science was flawed. And they right- stories like this. But usually they are writ-
ego. They want to be the winners, they ly doubted that the Spanish ships of ten by persons or institutions that have
want to reap what they sow, they want to that time would be able to survive that little to lose. Thus the leap strategy of
much, much longer voyage. going full steam into uncharted territory
CYBERNETICS:
CONTROL OF
SATELLITES:
COMPLEX SYSTEMS
EARTH EXPLORATION
V OY AG E S O F D I S C OV E RY Think:Act 34 17
is mostly implemented when all other the UK. That city was called Tyre, the her team have excavated parts of the
options are exhausted – or when even the most powerful and expansionist of the first Phoenician settlement in the bay of
loss of 100% of your investment in the Phoenician settlements. The discovery Malaga in Southern Spain. Today, it's a
endeavor seems bearable. In today's trips started during the reign of King meadow near Malaga's airport – but
economy, that's business as usual for Hiram in about 960 BC, and with an 2,800 years ago, the colony of Malaka
venture capital investors: The return on amazing speed. As Aubet says: “It is likely was a thriving harbor close to the mouth
one profitable leap counterbalances the that the first expeditions to Huelva in of the Guadalhorce river. The same pat-
losses of 5, 10, 15 failures. Southern Spain took place in the period tern as in Tyre – and as in the neighbor-
We have already looked at two ways of Hiram I or his immediate successors” ing Phoenician colonies of Gadir (Cadiz)
to break into the unknown. But there – within about three or four decades the and Sexi (Almuñécar).
was a third way back then, as today – Phoenicians explored the Mediterranean The stronger your foothold is in
even if it wasn't used. If the step strate- Sea from the Far East to the Far West, known patterns, the easier it gets to ex-
gy was too tame and the giant leap too about 4,000 kilometers of mare incognita plore into the unknown. You don't need
risky, the explorers could have com- – unknown sea. a charismatic leader like Columbus.
bined the best of both strategies for an Wherever they anchored for the first Any captain of any merchant vessel can
alternative way to break into the un- time, they had no idea of what would identify suitable places for a new colony.
known. An expert on the discovery of await them. But they reduced complexi- You don't need to invest many resources
the unknown, Maria Aubet, professor ty by sticking to familiar patterns: “The for many years in advance, like Henry
for archaeology at the University of locations of the Phoenician colonies the Navigator. You just need some mer-
Barcelona, has expounded this strategy. resembled the characteristic features of chandise to start trading. You can stay
By taking us some 25 centuries further Tyre,” says Aubet. “A harbor on an island in your comfort zone and leave it at the
back in time, right to the end of the close to the shore.” This way, the colo- same time. There is, however, one slight
Bronze Age, she reveals how the most nies were easy to reach by boat and easy disadvantage to the Phoenician strate-
THE UNKNOWN
successful seafaring people of the to defend. And they were natural born gy: No one will give you the credit.
ancient world sailed into the unknown. trading posts: Merchandise arriving via Which explains why your old school-
ship could be traded with food and raw books didn't carry the names of any of
the Phoenician strategy: patterns. materials from the hinterland. The these brilliant and efficient Phoenician
Some 3,000 years ago, a city state at the most valuable local products (like met- merchant explorers. ■
eastern end of the Mediterranean in to- als) could be shipped to other colonies,
day's Lebanon started to explore and catering for other regions. Aubet and
dominate the Mediterranean sea – in
addition to large chunks of the Atlantic
coast from Morocco up to Cornwall in
GENETIC TESTS:
IDENTIFY GENETIC
PREDISPOSITIONS
SMART DATA:
STRUCTURED USE
OF BIG DATA
WHEN
GROUPTHINK
THE UNKNOWN
WORKS
A NEW BREED OF FORECASTERS
CLAIMS IT'S A HUMAN SKILL,
ONE YOU CAN LEARN AND QUITE
QUICKLY PUT TO WORK TO BEAT
YOUR RIVALS. ADD IN A LITTLE
BIT OF CROWDSOURCED WISDOM
AND YOU COULD SUPERCHARGE
YOUR PREDICTING POWERS.
by Geoff Poulton
illustrations by Matt Chinworth
READING TIME:
00:08:04
superforecasting Think:Act 34 19
THE UNKNOWN
20
THE UNKNOWN Think:Act 34 superforecasting
D
eath and taxes: Everything else has spent decades researching humans' ability to
in life is uncertain. That's what make predictions. As Tetlock points out, we are all
Benjamin Franklin wrote to the forecasters in a way: When we think about doing
French physicist Jean-Baptiste something – booking a holiday, buying a home or
Le Roy in 1789. More than 200 changing jobs – we make decisions based on how
years later, advances in science we expect the future to unfold. For larger, more
and technology mean we can complex events such as wars, elections or market
predict some things with near crashes, we often rely on a select group of experts
total certainty: when the sun will rise tomorrow; for their forecasts.
what will happen if you knock a cup of coffee over.
More complex events, however, still remain much But should we? Tetlock first caught the public eye
tougher to forecast. 2020 served up more than its with his 2005 book Expert Political Judgment. It
fair share of the unexpected, from Covid-19 and summarized a 20-year study into the forecasting
Black Lives Matter to the chaos of US politics and accuracy of academics, pundits and analysts, con-
Brexit. It made planning for the future an extremely cluding that, for many predictions, the average
hard task for governments, businesses and pretty expert is no better than a random guess. Intrigued,
much everyone else. Tetlock set up the Good Judgment Project (GJP)
Hard, but not impossible. Research shows that in 2011 to assess whether forecasting skills could
accurately forecasting the likelihood of future be enhanced. He worked with the US Intelligence
events isn't some sort of mystical gift: It's the prod- Advanced Research Projects Activity (IARPA) to cre-
uct of certain ways of thinking, gathering informa- ate a forecasting tournament in which GJP and four
tion and calibrating beliefs. What's more, this is a other teams spent four years tackling thousands of
skill that can be learned and refined by any smart, economic and geopolitical predictions.
thoughtful, resolute person – and bring huge ben- For its forecasts, the Good Judgment Project
efits to any organization. Few people know this bet- team aggregated the predictions of thousands of
ter than Philip Tetlock, psychology professor at the online volunteers. Tetlock found that a combina-
University of Pennsylvania's Wharton School, who tion of the wisdom of crowds and focused training
superforecasting Think:Act 34 21
THE UNKNOWN
and improve."
to tackle: a sweet spot that requires some data, Tom Liptay. He should know: Liptay is himself a
logic and analysis, as well as an element of judg- superforecaster and former CFO at Good Judgment
ment, says Tetlock. Inc, the commercial spinoff of the Good Judgment
Rather than a group of "experts," companies research project that now provides forecasting for
should engage diverse teams in decision-making. businesses, governments and NGOs. "As humans,
"We know from research into collective intelligence we all have cognitive biases that get in the way of
and the wisdom of crowds that diversity is a key accurate forecasting. Anchoring bias, when we rely
factor for success," says Aleks Berditchevskaia of ******* too heavily on the first information we learn, is
the Centre for Collective Intelligence Design at THE WISDOM a common one. So is confirmation bias – our ten-
Nesta, a UK innovation foundation. "People with OF CROWDS dency to favor information that confirms existing
different experiences and expertise tend to have ******* beliefs. Once you're aware of the most frequent
different assumptions and make errors in slightly In 1906, mistakes, it's easier to adjust for them."
different ways. When you have a group with mixed British In 2019, Liptay and Michael Story, who also
abilities and backgrounds, these errors are can- statistician worked at Good Judgment Inc, set up Maby, an app
celed out, producing a more accurate forecast." Francis to help businesses benefit from the techniques they
Galton noted
had learned. It enables teams to forecast anony-
one of the
platforms that enable forms of crowdsourcing mously – reducing bias – and to calculate a median
THE UNKNOWN
earliest
can really work to improve the way we forecast, says examples of prediction. Maby also follows the golden rule of
Gaia Dempsey. She is the CEO of Metaculus, an "the wisdom forecasting: logging predictions versus actual out-
online community for generating predictions of crowds." comes so forecasters can track their progress.
about future events, from elections to technological He visited a "Nothing beats seeing improvement as a motivator
breakthroughs and financial market performance. country fair, to strive further," says Liptay.
where around
Metaculus poses questions to its community, such
800 people
as "Will the next US recession turn into a depres-
took part in
human involvement in forecasting is, as in many
sion?" before aggregating the responses into a a contest areas of life, rapidly merging with artificial intelli-
single, quality estimation of the likelihood that to estimate gence [see article p. 52]. The Delphi Crowdcast
something will occur. Dempsey likens her opera- the weight project from Carnegie Mellon University has com-
tion to an encyclopedia of the future: "Wikipedia of an ox bined data mining, predictive modeling and crowd
is where the crowd can bring together our best when it was prediction to forecast the spread of flu trends – and
butchered.
knowledge about any given topic, but it stops at the more recently, Covid-19. But it's important to rec-
Afterwards,
present day," she says. "We're aggregating our best ognize that every method has its blind spots, says
he collected
knowledge about what could come." each guess Aleks Berditchevskaia. "Rather than seeing AI or
Metaculus' forecasters aren't necessarily subject and then crowd predictions as a panacea, they take the esti-
experts. In fact, anyone can join the community and calculated mates from both of these sources of intelligence
track their performance, earning points for correct the median into account to arrive at the final answer."
forecasts. Much like the Good Judgment Project, the average – Metaculus, too, wants to combine man and
best forecasters are then given a higher weighting in 1,197 lbs. machine more in the future. It is working with an
The actual
the final prediction. Interest in Metaculus, which AI researcher to provide insight into how the
weight of
was launched in 2015, has risen fast in the last 12 the ox?
human brain makes predictions. "We're interested
months and the platform is working with a growing in building a hybrid system that can augment hu-
icon: Eucalyp/The Noun Project
1,198 lbs.
number of governments, businesses and research man intelligence where appropriate. This would
institutes. Its current highlight is a pandemic dash- free up our human creativity and judgment to do
board packed with hundreds of detailed forecasts its job," says Dempsey.
on areas like epidemiology, public policies and the There's no doubt 2020 was a chastening year
potential impact on societies and economies. for many of us. But this collective experience has
On an individual level, forecasting is all about an upswing, too: The public has gained a clear in-
becoming better calibrated to your own mind, says sight into the world of statistics and probabilities.
Think:Act 34 23
HOW TO
IMPROVE YOUR
ORGANIZATION'S
FORECASTING
IN FIVE STEPS
THE UNKNOWN
01
BREAK DOWN THE PROBLEM.
IF A QUESTION SEEMS TOO
COMPLEX, SPLIT IT INTO
SMALLER SUBPROBLEMS.
02
BE PRECISE. SAY YOU'RE
"75% CONFIDENT," RATHER
We have a slightly better understanding of just how THAN "FAIRLY SURE."
hard it can be to make accurate predictions. This
should motivate us to strive for more reasoned
ways of looking ahead. "I hope we've become more 03
cognizant of the need to get better at mobilizing PRACTICE AND BE SURE TO
different sources of skills and intelligence to pre- RECORD YOUR PREDICTIONS.
pare for the future," says Berditchevskaia. Her
hope is supported by Tetlock, who sees a continued
need to reach into the future to the best of our abil- 04
ity, however flawed. "Debunkers go too far when SEEK OUT THE ERRORS
they dismiss all forecasting as a fool's errand," he BEHIND YOUR MISTAKES –
writes in Superforecasting. ARE YOU SUSCEPTIBLE
Given the benefits organizations can reap by TO A PARTICULAR BIAS?
gaining a more accurate picture of the future, it's
hard to argue. And while not everyone needs to be
a superforecaster, by simply adopting some of their 05
approaches, you too can deepen your insight and
LEVERAGE THE WISDOM OF THE
make much better decisions. ■ CROWD WHEREVER POSSIBLE.
THE FUTURE:
WHEN HOURS
MATTER >>y Detlef Gürtler
chance that they both meet pricing algorithms that predict events that will move the candidate: cars. They could
at one place at the same what you might be willing markets – from company act as millions of weather
time – and lead to more to pay. And, of course, for earnings to wheat harvests, stations, transmitting real-
efficient and sustainable counteralgorithms that try to from central bank decisions time data about temperature,
e-commerce logistics. outsmart the smart pricing. to Elon Musk's tweets. precipitation and GPS position.
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THE UNKNOWN
GO TO PAGE 34
TO PREDICT THE FUTURE
WHEN YEARS MAKE
13:00:00
A DIFFERENCE ›››
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PREDICTIVE SUICIDE DIGITAL TWIN
POLICING PREVENTION (MACHINES)
18:00:00 Stopping crime before it starts Most suicide attempts cast a VR glasses for service
would be a kind of Holy Grail shadow ahead – sometimes technicians are becoming state
of law enforcement, but it explicitly said or written, but of the art for machine repair
19:00:00 also poses a threat to personal often subliminal. In hindsight, and maintenance. Next steps
freedom. Up to now, the we can more clearly see and suggest feeding a "digital
results of experiments with understand those signals twin" with real-time data of
surveillance technologies, we did not process early an analog machine that will
20:00:00
pattern and facial recognition enough to express our will detect problems before they
are mixed at best – but to help. Technologies could become damaging – reducing
these will improve with aid in detecting suicidal downtime and increasing
21:00:00
data quality and quantity. thoughts before it's too late. machine productivity.
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26 Think:Act 34
THE UNCHARTED
READING TIME:
00:07:25
we use to navigate tomorrow no longer work. Still Then, when something like a pandemic comes
in the middle of a pandemic which few were pre- along, you can't handle it.
pared for, we're just starting to grapple with the
changes it has wrought and figure out what the new What are the key characteristics of the current
normal will look like – whenever we get there. environment aside from uncertainty?
How can businesses make good decisions at a The environment most businesses face today
time like this? In her book Uncharted – How to Map is complex, not just complicated. People think
the Future Together, leading business thinker and complex is just super complicated, but they're very
author Margaret Heffernan offers a way forward. different beasts. Complicated systems tend to be
Drawing on examples from science, health care, the linear, with clear cause and effect, and predictable
arts and politics, she says businesses should not put patterns. These can be managed for efficiency.
their faith in technology or forecasting alone, but Think of when you fly. You check in, check your
should rather accept uncertainty and complexity bag, board the plane, have an in-flight meal. All
and use their full human potential to explore and those processes tend to be provided by different
build the future together. companies and making it profitable for each of
them is complicated, but it is pretty much the
Why is the environment of heightened uncertainty same every day, so making it efficient is an appro-
created by Covid-19 difficult for business leaders? priate goal. But once I board the plane, I'm in a
Many businesspeople have grown up in a world of complex environment. We can't completely predict
so-called scientific management – forecast, plan, what's going to happen – whether there's a bird
execute, measure. Under this model, the aim of strike or a random weather event.
business leaders is to achieve maximum efficiency. That's why planes are designed to be robust.
But efficiency only delivers benefits to the degree They have more engines and operating systems
that what you're doing is predictable. That doesn't than they need so that if there's a flaw in one,
CHARTING
MARGARET HEFFERNAN Think:Act 34 27
THE UNKNOWN
MARGARET
HEFFERNAN
is a former serial entrepreneur and
CEO. The author of six acclaimed
books on leadership, her exploration
of the very human mindsets that can
lead organizations and management
astray is informed by her experience
leading businesses in the highly
competitive markets of the early
internet as well as her background
working in program production at
the BBC. She is currently a professor
of practice at the University of Bath
28 Think:Act 34 MARGARET HEFFERNAN
the whole thing doesn't fall out of the air. They are
designed not just to be resilient – which means
they can recover from an accident – but to be ro-
IN COMPLEX SYSTEMS,
bust, which is to say they can keep going through
an unpredictable event. For a business, it is essen-
DATA WON'T HELP.
tial to understand which of its systems are compli-
cated and should be managed for efficiency, and THERE ARE SO MANY
which are both complex and so mission-critical
that they should be managed for robustness. POSSIBLE CAUSES
Forecasting is a central plank of business planning.
Why is that not the best way forward now?
AND EFFECTS THAT
One of the problems with the way that we think
about the future is that we define it by the present,
UNTIL YOU TRY IT
and that constrains our thinking. Look at retail.
Since the advent of e-commerce traditional retail OUT, YOU DON'T
REALLY KNOW WHAT'S
has been in a bloodbath. As retailers see revenues
dropping, they put more items on sale, cut costs
and compete as viciously as ever with their imme-
diate rivals. All this has done is perpetuate the
decline. Instead of starting from the present and
GOING TO HAPPEN.
extrapolating forward, the sector needs to confront
——MARGARET HEFFERNAN
THE UNKNOWN
THE UNKNOWN
a climate crisis which we are already in. However, I
think we have come to understand the interdepen-
dence between business and society and [the need
for] a healthy connection between what an organi-
zation does, what it takes from society and what it
be like, but we think it could be this or that. The a Changing game puts back in. For example, in order to have a useful
question is, if scenario A turns out to be the case, For Heffernan, workforce there need to be educated people in the
what would we wish we'd have been doing right learning when population with safe places to live, a safe means of
now? We ask the same question for scenario B. We to be efficient getting to and from work and access to solid infor-
develop a menu of options. Some will be too risky and when to be mation. Companies should recognize that they
for an unlikely outcome. Some may turn out to be robust is the key benefit from all these things. This wider view is
to playing through
a good basis on which to experiment. Scenario pushing toward a better integration between
complexity.
planning is a fantastic exercise to prime leaders to organizations and the societies that they serve.
look more broadly and discursively at what could
happen to their organization and to come to terms Which companies are succeeding at mastering the
with uncertainty. It also helps you pick up on weak current challenges?
signals from things that could have a major impact. I couldn't point to one that has done it perfectly
because everybody's still trying to figure this out.
Photo: mauritius images/Lorenzo Dalberto/Alamy
What skills and tools do you need to carry this out? But I think the need to deal with hugely complex
Many senior people struggle because they are too issues has made people realize that participation
imbued with the current system. Younger people is key to decision-making – people who bring lived
are better at it, as are people who play a lot of experience, because the essence of good decision-
computer games. In many ways, every game is a making is not just the decision itself, but how it is
scenario planning exercise – let's see what happens reached. Take citizen assemblies. Even the people
if I turn left ... oh no, I get shot. Okay, back up: Let's who don't like the outcome can accept it because
see what happens if I turn right. It's about not they see the decision-making process has been fair.
being afraid of what your imagination might show It isn't carried out by a few ideologically driven in-
you. The process involves collecting huge amounts dividuals; it's transparent, open and informed. We
of data and insights. Then you work in teams to are facing some tough decisions, so there has never
craft scenarios. What do we think really matters? been a time when we've needed that more. ■
SWAN
CATCHING A BLACK
THE UNKNOWN
H
omo sapiens is, by most accounts, the into a five-part miniseries, is hardly an unexpected
only species that can "think" about >>y outlier in trying to make sense of what seems
"the future": the unknown next chapter, Steffan Heuer npredictable, chaotic and nebulous. In fact, he
u
momentous change and catastrophic LLortraits stands in a long line of forecasters who use more
turning points. And we've been bad >>y MUTI or less scientific approaches – instead of mystical
at it, argued financial trader-turned-philosopher or religious ones – to analyze what the future holds
Nassim Nicholas Taleb in his 2007 bestseller The and where the next catastrophe (or big opportunity)
Black Swan. In it, he postulates that "the world is might lurk. This type of rigorous future thinking
dominated by the extreme, the unknown, and the and scenario planning that tries to take external
very improbable … all the while we spend our time shocks into account goes back at least to the post-
engaged in small talk, focusing on the known and World War II era, when the threat of nuclear anni-
the repeated." He applied a catchy label to such hilation and the rise of computers made " futurist"
outlier events, "black swans," inspired by the rare a venerable profession with an urgent brief.
birds the Old World didn't know existed before the
discovery of Australia in the early 17th century. one such forecaster of the early days is Theodore
Taleb is speaking of frightful fowl, or events Gordon. The 90-year-old futurist developed a con-
that are characterized by three things: They are cept called Trend Impact Analysis (TIA) back in the
rare, have an extreme impact and provide humans 1970s that explicitly deals with the unexpected
with retrospective predictability – meaning experts Taleb popularized. Today, he is a senior fellow at
will, in hindsight, find a way to explain them away. the Millennium Project, a think tank affiliated with
Think disastrous stock market crashes, the attacks the United Nations University that does scenario
of 9/11 or the collapse of the Soviet Union. Taleb's planning for current events such as the Covid-19
main criticism was aimed at the forecasters who pandemic. "There's no such thing as a perfect
are not only unaware how error-ridden their work model," Gordon says. "What makes a difference are
is, but live and work in denial. non-causal surprises, the flashes and bright novas
The Black Swan made Taleb a famous writer in the evolutionary chain." Gordon's crucial con-
and sought-after lecturer as the Great Recession tribution was an approach that infuses quantita-
was rattling the world. Yet his book, which grew tive methods with expert opinions about
READING TIME:
00:07:44
p r e d i c t i n g t h e u n p r e d i c ta b l e Think:Act 34 31
N
THINKING ABOUT THE FUTURE
HAS ALWAYS BEEN ENTICING,
BUT THE ADVENT OF NUCLEAR
WEAPONS AND COMPUTERS
TURNED A PASSION INTO
A PROFESSION TO TRY
TO SEE AND GET AHEAD
OF OUTLIER EVENTS.
A BRIEF
HISTORY OF
FUTURIST
THOUGHT:
THESE THINKERS
FOUND DIFFERENT VANNEVAR BUSH HERMAN KAHN
WAYS OF SEEING AS WE MAY THINK (1945) THINKING ABOUT THE
WHAT LIES AHEAD UNTHINKABLE (1962)
– AND PREDICTING One of the earliest works forecasters
THE BEYOND. will bring up is As We May Think by The very real possibility of nuclear war
the American engineer and science led to the establishment of think tanks
administrator Vannevar Bush. His 1945 like the RAND Corporation and "thinking
essay ran in The Atlantic and predicted about the unthinkable" – also the title of
the PC, the web and speech recognition. the 1962 book by Herman Kahn, who left
He envisioned a "memex desk" that RAND to start The Hudson Institute. The
stored loads of interlinked information, peace movement resented him for his
similar to how the brain works. chilling "what-if" scenarios – say, if
the Soviets were to drop a nuclear
Bush set the stage for many of the heady bomb on New York – and director
tech predictions to come in the following Stanley Kubrick modeled his deranged
decades — and darkly pondered the film villain Dr. Strangelove on him.
downsides: "The applications of science
have built man a well-supplied house Nevertheless, Kahn's cool approach
Photo: IStockphoto
... They may yet allow him truly to of employing systems and game
encompass the great record and to grow theory when dealing with outliers was
in the wisdom of race experience. He influential in focusing generations on
may perish in conflict before he learns thinking through the wildest disruption
to wield that record for his true good." out there: man-made annihilation.
32 Think:Act 34
The book’s lasting impact, argues Silicon is 'in final exam' as to whether or not came into its own with the 1993 launch
Valley forecaster Paul Saffo, is its call "to it qualifies for continuance in the Uni- of Wired magazine, each issue acting
create a culture in which anticipating the verse." Important here was the insight as an ongoing exercise in future-telling
future becomes the everyday concern of that black swans will hit us, but humans where the next big thing is always on the
everyone, not just experts." do have the agency to shape the future. horizon. And it's mostly good.
p r e d i c t i n g t h e u n p r e d i c ta b l e Think:Act 34 33
what crazy stuff the world might have in store for less white supremacy," as Brooks describes it.
us. "The Black Swan was an important book because "Black people always had to innovate, be futurists –
it made people pay attention and understand how envision a place free of slavery, find their redemp-
crucial discontinuities are. TIA didn't have that tion. This was scenario making we can draw upon
impact on the field," Gordon admits. today." Players work with a deck of 90 individual
Dig a little deeper, and Gordon, too, stands on cards divided between tensions, inspirations and
the shoulders of other thinkers who have tried to system states. This kind of freewheeling explora-
sensitize citizens, government and the corporate tion can yield serendipitous results. In one round
world to the impact of outlier events [see panel pgs. set in 2030, a participant suggested a tattoo that
31-32]. What hasn't changed as you look through can be scanned to find out one's heritage and
the decades of trying to count black swans is the receive slavery reparation funds.
cast of characters: mostly white males with connec- Brooks has honed the game over the past three
78%
tions to, or in the employ of, the powers that be. years and has run it with more than a thousand
That lack of diversity has seriously impeded how participants so far, in person and virtually, and is
we think about outliers and options, says Swiss now working on a version that can be played online
futurist Gerd Leonhard . "All of these works are un- and potentially with VR headsets. Early interest
doubtedly important and build on each other, but came from Google, the US health insurance com-
THE UNKNOWN
of the value of the
you have to ask who ultimately pays for research. NASDAQ composite pany Blue Shield and UNESCO's Futures Literacy
We have to get rid of purely academic and military- was lost in the Summit. Inclusion makes for better forecasting
industrial future thinking," Leonhard argues. dotcom crash in and future thinking, the professor is convinced.
the early 2000s.
He sees encouraging signs that the field is "The game can help in schools and communities.
becoming more diverse but thinks that broader What if we created a network of the imagination
input is urgently needed for another reason: The where marginalized groups can present their
future is coming at us at an increasingly faster clip.
Still, the notion of a "black swan" nobody can see
coming is a misnomer, according to Leonhard. He
$2
trillion
visions that can be transformed into new cultural
activities and policy agendas for legislation so
communities come armed with scenarios of the
prefers to call game-changing events "gray swans" future they can articulate?"
since we already know momentous disruptions are This crowdsourced approach alongside today's
approaching: catastrophic climate change; power- vanished from the unheard-of reams of data and arsenal of analytical
value of global
ful and unregulated technologies such as AI; the tools might turn out to be the best preparation for
markets following
ongoing merging of man and machine and genetic the UK's 'Brexit' dealing with future pandemics and the ravages of
engineering; and the reckoning of an economic vote in 2016. climate change. Scouting for black and gray swans
system obsessed with growth. "We create the has already spawned a new kind of proactive sci-
future with everything we do and don't do," he says. ence fiction, such as Kim Stanley Robinson's late-
"Outside of that, there are things we truly can't 2020 book Ministry for the Future. The fictitious
know, like comets crashing and aliens visiting." agency's mission is as simple as daunting: "Estab-
lished in 2025, the purpose of the new organization
games with a diverse set of participants are one was simple: to advocate for the world's future gen-
of the most intriguing and inclusive ways to think erations and to protect all living creatures, present
about outliers. Add empowerment to it, and you and future. It soon became known as the Ministry
arrive at a card game that puts a strong emphasis for the Future." ■
on inequality and social justice: Afro-Rithms from
the Future. It was developed by Lonny Brooks, a
communication and media studies professor at online exclusive
California State University in Hayward, southeast Hear what Gerd Leonhard
of San Francisco. The card deck is a tool to envision has to say on ourwebsite:
multiple futures with "more black storytelling and rolandberger.com/en/leonhard
THE FUTURE:
WHEN YEARS
MAKE A
DIFFERENCE this longer-term time frame should be seen as
THE UNKNOWN
less about operations, and more about strategy; less >>y Detlef Gürtler
doctor's practice, no waiting planning cycles (like China's Lagerfeld or Steve Jobs did migrant flows is a political
rooms, you don't even have to five-year plans or the EU's it with their guru-style genius; issue – but the more is known
leave your bed. And it's not just seven-year budgets) are more but data-based sensing of in advance about migration
for diagnostics, but also for a frame than a corset – they wishes is rapidly becoming dynamics, the more options
testing medication or surgery. give directions, not directives. serious guru competition. there are for decision-makers.
2022
2023
PREDICTING THE FUTURE Think:Act 34 35
P
2024
2025 GO TO PAGE 48
T
W
TO PREDICT THE FUTURE
WHEN DECADES/
GENERATIONS MATTER ›››
2026
I
2027
2028
G
2029
2030
2031
THE UNKNOWN
2032
2033
PANDEMIC
2034 PREPARATION
If we only had known at the
beginning of the pandemic
2035 what we have learned during
its course … Sure – but why
didn't we know? The Western
world in particular showed
2036
blatant deficiencies in handling
the seemingly never-ending
Covid-19 story. What worked
2037 quite fine at the beginning of
the emergency mode showed
fatigue cracks as the second
2038
INVESTMENT REBELLION and third wave rolled in.
SIMULATION MOOD-MAPPING Preparing society for long-haul
Investment has always When riots break out, they resilience could be one of the
2039
been a bet on the future. often seem to come out of learnings for the crises to
The calculation behind the blue. The rebels, however, come. Another one could be
it is based on a bunch of are never without a cause taught by the only real global
assumptions about cost, – and with hindsight, the success story of the pandemic:
2040
customers, competition and causes will become clearly vaccine development.
so on. Technologies that visible. Mood-mapping could Multiple approaches and
back (or rebut) guesstimates help to realize in foresight technologies competed (and
2041 and gut feelings can where discontent becomes collaborated) globally to
reduce investment risk and despair – and how that turns reach the common goal as
misallocation of resources. into rage and rebellion. well and as fast as possible.
2042
2043
36 Think:Act 34 s i m u l at i o n
HOW
DIGITAL TWINS
COULD SAVE US
READING TIME:
00:05:59
s i m u l at i o n Think:Act 34 37
by Detlef Gürtler
illustrations by Cathal Duane
"IT
is amazing how predictable the But until then, his simulations will deliver decent
THE UNKNOWN
ehavior of most human beings
b results – without being overly concerned with
is," Reza Abhari says. The director human individuality.
of ETH Zurich's Laboratory for
Energy Conversion knows what Simulating what might happen in the future is
he's talking about: He's predicted again and again f amiliar for many of us who play computer games.
how we'll behave in future scenarios. What started Sim City, the Sims or the Civilization series all
as a model to measure possible impacts of energy showed how people, cities and countries develop.
investments is becoming a window into the future And this indeed comes close to what Abhari does.
of society. Or better: a million windows. There is just one, albeit significant, difference –
When the 58-year-old professor at Switzerland's Abhari's simulations are for real. "Our approach
most prestigious university changes one of the was to create a digital twin of the society where we
scenario components – fuel prices, migration laws, gather up actual data – where people are, where
birth rate, education preferences – in his computer the buildings are, the infrastructure, the transpor-
simulation, the software recalculates life-changing tation systems – and build it up layer by layer,
decisions by every single person in the respective the entire complexity of a society, but on a conti-
region and time frame. How many people move, nental scale."
and to where? How many resources are used, and In 1987, then British Prime Minister Margaret
how? What kind of shortages occur and how do we Thatcher said: "There's no such thing as society.
react? Our main driver is the fear of loss, Abhari There are individual men and women and there are
says. "At least that's what we found in the mature families." That's rather close to the algorithms of
societies of Europe, Japan or North America. The the simulation software. A slight difference is that
people there have a lot to lose – that makes it rather the digital twin of the society is not formed by men
predictable how they react in a situation where and women, but by "agents": anonymized models
their status is at risk." of single human beings based on datasets from
You may think differently. You may even object very diverse sources. These agents can decide what
to the assumptions a professor of energy technol- they do with their life; and their decisions deter-
ogies is making about human behavior. Fine. If mine, from the bottom up, how the society – or
insights of behavioral psychology can improve the rather its twin – changes.
outcomes of his agent-based modeling, Abhari will One classic example for the interdependence
happily use them to recalibrate his simulations. between individual decisions and societal
38 Think:Act 34
43%
simulation outcomes, the local administration is the right crisis for the simulation software: knowing
better equipped to provide the infrastructure and what people do, what they need, how different sce-
services for the shifting demographics – or initiate narios alter the outcome for a society and how to
policy shifts to alter the real-life outcome. minimize damage for society and/or economy –
How much of the that's great stuff in a big crisis. And Abhari's digital
better, more detailed information to improve Swiss population agents were prepared: "It took us nine days to
would catch Covid-19
the prediction- and decision-making process? Isn't update a virus model, to calibrate it and to run a
by May 2020 without
this the kind of digital twin that politicians and ad- restrictions in place, as
number of varying scenarios. We generated amaz-
ministrations dream of, Professor Abhari? If they predicted by Abhari's ingly accurate solutions of the first wave and had
want to build a new city-to-city connection, the software in March detailed local projections at our fingertips, where
software agents can compare the long-term results 2020. to ramp up which kind of critical infrastructure
for different technologies and for different tracks. for the following days and weeks." The governments
1%
And for controversial projects – a new pipeline or they talked to, however, were not interested at all.
refinery – agent-based modeling can offer insights "They were interested in setting up a committee, in
before investing, not when it's too late. In theory, conferences and in claiming victory. This was about
yes, Abhari answers. But it often seems to be less power distribution, not about problem-solving."
of a dream and more of a nightmare for real-world Abhari's simulated So Covid-19 became crucial for the simulation
politicians: "We have encountered on certain occa- prediction for the technology in a rather surprising way. "One of our
sions that the incumbent would question the infection rate in the learnings from Covid: We basically scaled back our
application of a better decision-making tool – same time frame with offer of support to governments. They are simply
strict restrictions in
because it could make themselves redundant." not the right audience." But if they weren't, then
place, a close match to
The Covid-19 pandemic has been an especially the real-life scenario.
who was? At this point, Abhari hands over to Anna
sobering experience for Abhari. It should have been Gawlikowska, co-founder of Swiss AI, a spin-off of
s i m u l at i o n Think:Act 34 39
THE UNKNOWN
for one city, but for every city in Japan. The Tokyos,
Beijings, Berlins of this world could afford to do
TO PREDICT." these kinds of studies on their own – the small- and
medium-sized cities can't.
—
REZA ABHARI, Bringing the big global future to your local town
DIRECTOR OF ETH ZURICH’S hall or grocery chain would be a business case not
LABORATORY FOR ENERGY CONVERSION only for energy issues, but for a lot of other ques-
tions, too. Gawlikowska names the fate of cars with
combustion engines. Sooner or later they will face
extinction – and cities and their infrastructure
should be prepared for this inevitability. Availabil-
ity of granular prediction data can significantly
raise the preparation level. And this of course not
only in Japan – but everywhere.
In the end, could this become a digital twin not
just of a society, but of the whole world? "That's
still far off," Reza Abhari says. Right now the sim-
ulations are covering the whole of Europe and
North America, plus parts of Asia, so about 1.5
billion of the world's 8 billion people. But he can't
simply add new regions in Africa or South America
to the already covered countries – he would have to
recalibrate the agents. "Societies where the main
driver is not to avoid losses, but to make gains, may
have less predictable behavior – or behavior that is
different to predict." Scientifically, this would be
interesting, he admits, and it would be a challenge,
but doable: "All we need is a decade of time, and a
business case." ■
Devil's throat
(Garganta del Diablo), San
Pedro, Atacama Desert, Chile.
"As you pass through the Devil's Throat
– as the locals call the desert's sand
gorges where you can ride your bike
through – you get this glimpse from
darkness into bright light that I wanted
to open my series on dark matter."
D A R K M AT T E R Think:Act 34 41
Fishermen's market, Valdivia, Chile. "Strolling through the market, I captured the birds' shadows on the roof. The mysterious
dark figure, his huge wings stretched out, was peering over the edge. Pictures like this contain for me some sort of personification of
dark matter – it is the indirect slippery image of something that is only momentarily visible through light."
THE UNKNOWN
Near Cerro paranal, Atacama Desert, Chile. "Not far from the Cerro Paranal, where researchers are using some of the
biggest ground-based telescopes to solve some of the universe's mysteries. Strange patterns of salt deposits on the ground
leave me puzzled, reminding me of traces, effects and influences that makes it possible to investigate dark matter."
Moon Valley
(Valle de la Luna), San Pedro,
Atacama Desert, Chile, March 2020
"Salt stones and sand. Near San Pedro
is this famous moon valley where
you can see the desert shift to very
different shapes. Some places really
make you think you’ve left the earth."
46 Think:Act 34 D A R K M AT T E R
THE FUTURE:
WHEN
IT’S ABOUT
GENERATIONS shift the future time frame from long-term to
THE UNKNOWN
super long-term, and there's a shift in who makes >>y Detlef Gürtler
2080
THE UNKNOWN
2130
that. Knowing (and being you manage, the more your lifestyle, or what adjustments
able to manage) the side portfolio decisions shape we should make to it. But
effects would be key. our way into the future. we are getting closer.
50 Think:Act 34
DATASCAPING
THE UNKNOWN
FOR THE
21ST
CENTURY
CAN ALGORITHMS PREDICT THE FUTURE FOR US?
YOUR BUSINESS COULD BENEFIT FROM EVER
CHEAPER DATA-DRIVEN SOFTWARE FORECASTING
TOOLS. BUT BEWARE. THEY ARE ONLY AS GOOD
AS THE DATA DRIVING THEM AND, OF COURSE,
AS THE PEOPLE READING THEIR OUTPUT.
by Steffan Heuer
dataviz by NetBase Quid
READING TIME:
00:06:36
D ATA M O D E L I N G Think:Act 34 51
THE UNKNOWN
surfacing the important details or tying exploration with follow-up questions.
separate data points together to find "Getting to know what you don't know
emerging clusters. San Francisco-based involves helping people learn how they
Quid was one of the pioneers to let can ask better questions." To be sure,
corporate clients ask big. Its co-founder spotting trends is not the same as "pre-
and president Bob Goodson had the dicting the future." It's more like getting
vision early on to sift through huge the timely data to supercharge your
amounts of both human- and machine- intuition and then applying human ex-
P
generated text to spot trends and pres- pertise to make a truly educated guess
icture this: You're a real ent a landscape of possibilities. As the on the future.
estate company and want company puts it: "Quid powers human Datascaping for the 21st century
to know what urban life intuition with machine intelligence, en- stretches from product development
will look like in five years. abling organizations to make decisions and marketing to more strategic deci-
Or a car manufacturer is that matter." Its clients are big compa- sions. Take Walmart, a brand with $559
curious whether or not shared mobility nies such as Walmart, Hyundai, Pepsi billion in revenues and over 2 million
solutions post-Covid are worth really and Sony. In early 2020, it merged employees. It posed an ambitious ques-
big bucks. Or you are a global brand with social media analytics company tion back in March 2017: Which topics
and want to prepare for the three big- NetBase Solutions, expanding its data will pose the biggest reputation risk to
gest risks to your reputation, even if trawling to social media and images, the company? "Our reputation risk fore-
they have little to do with your business. changing its name to NetBase Quid. casting model told them that racial
Marketing, resource allocation or The combined offering hit a nerve. inequity would be the biggest thing in
long-term strategic choices, companies "I've seen the growing need for compa- the coming one to two years out of 20
and government organizations face the nies to be agile given the incredibly fast other reputation risks," Goodson says.
same fundamental problem. Generally, pace of change," says Goodson. "CEOs "The model correctly foresaw rising frus-
they know what they don't know. But are most concerned about reading sig- tration and tension building that spilled
there are many cases where they also nals from the world around them and over in 2020." As a result, Walmart in
don't know what they don't know. To how their company needs to adapt if it 2018 launched two major programs to
rise to the challenge, they increasingly doesn't want to die." He provides an ex- create more workforce opportunity and
rely on algorithms. It's no small feat to panding circle of users with tools to ask reduce exposure. Aaron Bernstein, the
identify the events, people, products questions and see a visually compelling company's senior director of
52 Think:Act 34 D ATA M O D E L I N G
BRIDGING NODES
between two clusters
indicate an intersection
between two concepts.
CONNECTIONS
represent similar
language used
across nodes.
PERIPHERAL
CLUSTERS
could represent
niche takes on
THE UNKNOWN
the topic.
CENTRALLY
LOCATED NODES his now-defunct startup Seldn, named
are core concepts in as a play on sci-fi legend Isaac Asimov's
"THE the network and share
language with many
Foundation series. The story tells how
math professor Hari Seldon comes up
MODEL other nodes.
with "psychohistory," a probabilistic
method to predict the future in order to
FORESAW
are important signals in news, social Radhika after backpacking through
media and other forms of open-source strife-torn Central America in 2014. "We
data that help us to face the unknown. decided to build technology to predict
TENSION Having been utilizing technologies such
as Quid for several years, we've seen this
black swans and picked supply chain
management as a market to go after."
THAT field of technology come on in leaps and
bounds. The March 2017 reputation
They developed a product to demo
to companies. Seldn's algorithms would
SPILLED risk analysis was a good example." apply lessons from complexity theory,
specifically looking for areas where data
Predictions that are right tend to be points that were previously unrelated
OVER IN remembered and amplified, of course, suddenly showed a strong correlation.
while the ones that didn't come true are Customers would see those predictions
2020." quickly forgotten. Software doesn't care
much for this human predicament.
of "unfortunate events" on a monthly
basis, albeit with a probability of 66%.
Executives, however, have to look at a "They were blown away until the moment
— BOB GOODSON landscape of possible futures and even- I typed in their own company name and
PRESIDENT AND tually pick one that they can explain to gave them a labor strike prediction," the
stakeholders and shareholders. data scientist recalls. "They went pale
CO-FOUNDER OF An AI researcher and entrepreneur, when they realized they'd have to shoul-
NETBASE QUID Travis Dirks ran into that problem with der the responsibility to move business
Think:Act 34 53
and Actions, machine learning as it's DATA DEFINITION & the real challenge lies less in building
sold and told today still relies on an old ACQUISITION: more powerful technology than in rec-
idea the astronomer Edmond Halley Ingest fast and slow data sources – ognizing the human effort required.
came up with when he composed his immediately available information and Some of that human factor can be pre-
that which takes time to accumulate
"life tables" to document death in the packaged. Quid, for example, has built
THE UNKNOWN
– as well as social media text and
17th century. "Halley had stumbled upon 20 standard – or "productized" – types
images. This includes defining queries
the fact that prediction requires no early on with a desired topic and then of questions, according to Goodson.
physics. Unknown outcomes, be they pointing it at the relevant datasets. Another 20 questions can be answered
future or unobserved, often follow pat- with existing technology, plus varying
terns found in past observations," the levels of human effort. But involving
two computer scientists write. "This 02 experts for several weeks can be costly.
empirical law would become the basis It begs the question: what comes next?
ANALYTICS, NATURAL
of consequential decision-making for LANGUAGE PROCESSING, Goodson points to more powerful
centuries to come. But going from MODELING: AI such as an algorithm rolled out by the
patterns and predictions to successful This can sometimes include pre-built OpenAI research lab. It's called GPT-3
actions is a delicate task." or "out-of-the-box" analytics, as (Generative Pre-trained Transformer 3)
That balancing act still describes well as the ability to opt for more and it's a powerful piece of code. GPT-3
the state of affairs for trying to look over customizable models that take longer has read most of the written word on
or require human intervention.
the horizon. "Across AI, there is a notion the internet, hate speech included, and
of models built on inferences vs. those used it to develop 175 billion parame-
that reason and use expert systems. The 03 ters that define its language. The thing
first has had explosive growth, but is so smart that it will pass as human
inference-based systems bring perils VISUALIZATION AND content – and quickly go off on entirely
EXPLORATION:
with their promise," warns Margaret non-PC rants as well. "Internet-trained
Build landscapes that users can
Holen, a lecturer in operations research explore to find insights and use to drill models have internet-scale biases," its
and financial engineering at Princeton down and ask follow-up questions. developers wrote in explaining why
who has advised investment banks to access to GPT-3 is limited.
make sense of an uncertain future. Nobody knows what those eloquent
There's a lot to learn from past data, 04 algorithms will be used for, but it's safe
she adds, but we don't record – or have MONITORING/CONTINUOUS to say they will wind up in some crystal
access to – everything that may be rele- INTELLIGENCE: ball applications. Just type "In five years,
vant and even large samples may be Use dashboards, reports and alerts our competitors will …" and watch your
biased statistically, sociologically and that take into account and keep an software finish the thought. But beware:
politically. Experts like to refer to those overview of updates and changes. It learned from humans, with all their
blind spots as "dark data." It's another liabilities and limitations. ■
READING TIME:
00:07:09
Think:Act 34 55
GERLINDE
KALTENBRUNNER
MOUNTAIN CLIMBER
THE UNKNOWN
"On such occasions, I have always trust-
ed my gut feeling, which has become
more pronounced and stronger over the
years. I know I can rely on it."
Be patient
"If there is a lot of snow and high winds,
the avalanche danger is often too great
to climb, which means we have to
change plans and wait for the condi-
tions to improve," Kaltenbrunner says.
"Sometimes we have to wait for days or
even weeks, but most of the time our pa-
tience gets rewarded and we can climb
in good conditions and fine weather.
High-altitude mountaineering certainly
teaches us to slow down and be patient,
as this is the only way to have a success-
ful expedition."
Have faith
Even after major reversals, such as the
death of teammate Fredrik Ericsson on
their first attempt to scale K2 in 2010,
Kaltenbrunner later decided to try
again. "Basically, I am convinced that
life is for us and not against us, and we
should look forward and not back," she
says. "I consciously decided to trust in
life again."
56 Think:Act 34
"ASKING
FOR HELP IS
A SIGN OF
STRENGTH, NOT
OF WEAKNESS."
HENRY MARSH
NEUROSURGEON
SCOTT KELLY efforts and attention on the stuff you SCOTT KELLY
ASTRONAUT can control and ignore everything else," *****************
Kelly continues. "I think that kind of age 57 years
Now retired from NASA, Kelly once held helps in dealing with stressful situa- author of ENDURANCE,
the record for more time in space than any tions in a calm way." MY JOURNEY TO THE STARS
other US astronaut – 520 days in total flight record He holds
including a one-year tour of duty on the If you have a rocket science problem, the USA's No. 1 spot
International Space Station (ISS). listen to the rocket scientist for the longest single
"Sometimes it makes sense to be the flight in space: 340
days on the ISS.
think like an astronaut on a critical dictator – when there is a fire and you
mission: Take care of your team are in space and you need to make twin purpose His record
ISS flight measured the
"I think part of leadership and teamwork split-second decisions," Kelly says. "But
effects of extended
is taking care of each other ... checking oftentimes, I've found, it makes more stays in space against
in on each other: How are you doing? sense to seek out the person of your his twin brother,
How are you feeling? How are things at team who may know more about what fellow former astronaut
and current US Senator
home? How’s your family?" you're trying to do than you do or what
for the state of
the situation is than you do and let Arizona Mark Kelly, who
Focus on things you can control them decide or get their opinion." stayed on the ground.
Kelly credits his ability to focus under
pressure in part to a tough childhood.
"When I grew up, my parents didn't get
along very well and there was a lot of
THE UNKNOWN
stress and conflict in our house, so I
think that prepared me well for dealing
with stress and conflict," Kelly says.
Later, the military trained him further
in what he calls a "philosophy of com-
partmentalization," the basic idea of
which is "there are things we have con-
trol over and things that we don't have
control over – and better to focus your
"OFTENTIMES,
I'VE FOUND,
PPhotos: Francesco Guidicini, The Sunday Times/Robert Markowitz
IT MAKES MORE
SENSE TO SEEK
OUT WHO MAY
KNOW MORE ABOUT
WHAT YOU'RE
TRYING TO DO
THAN YOU DO."
58 Think:Act 34
"THE ART
OF CRISIS
MANAGEMENT IS
TO SEE THIS
COMING BEFORE
IT ARRIVES."
SIR DAVID OMAND
FORMER DIRECTOR OF
GOVERNMENT COMMUNICATIONS
HEADQUARTERS (UK)
CLOSING THOUGHTS ON
THE UNKNOWN
"THERE
ARE KNOWN
UNKNOWNS;
THAT IS
TO SAY WE
Wide
angle
Read on for
diverse insights
into the wider
world of business
and ideas.
Urban Change Think:Act 34 61
Building
back better
The pandemic has shaken many of our certainties
about city life. But far from predicting dystopia,
urbanists suggest that any perceived losses brought by
Covid-19 are counterbalanced by huge potential gains.
We just need to be daring enough to embrace them.
utopia now
There's never
been a better
time to create a
better blueprint
for urban living.
62 Think:Act 34
U
ntil March 2020, it seemed to stand
as a universal truth: "Whenever and
wherever societies have flourished and
prospered rather than stagnated and
decayed, creative and workable cities
have been at the core of the phenomenon." It
might once have seemed unthinkable to counter
the wisdom of Jane Jacobs, author of The Death and
Life of Great American Cities and one of the most re-
spected urban and social theorists. For millennia,
cities have undeniably been the focal point of cul-
ture, commerce, education, work and recreation.
Enter Covid-19 and suddenly these clusters of
human endeavor had a problem: A disease spreads
rapidly through person-to-person contact, render-
ing human proximity potentially fatal. Urban cen-
ters emptied, the safety of vital amenities such as
public transport was compromised, working prac-
tices changed radically overnight and lifestyle and
leisure pursuits such as retail and the arts were
shut down. Now, over a year since Covid-19's global
spread began, fear and uncertainty are tempered
by optimism – new vaccines offer the hope to
tackle the virus and its variants. Yet many agree
that it could be some time before people every-
where – and city dwellers in particular – feel that a
return to pre-Covid practice is possible.
an 'unreasonable' man
Daniel Ek made his name
with his focused ambition,
something he wants to
see more of in Europe.
D ANI E L E K Think:Act 34 67
I have a stream
Pioneering music streaming mogul Daniel Ek has transformed the music
business. Now he is focusing on changing how people consume audio.
Spotify's CEO unpacks his idea of "the European dream," how creatives
might benefit more from the platform and why innovation is everything.
S
potify founder Daniel Ek isn't fazed by Today, Ek's unreasonable side is focused on raising
a tough challenge. Back in 2006, the European companies' ambitions. He's famous in
Swedish entrepreneur was repeatedly tech circles for railing at Europe's entrepreneurs
rebuffed when he told the record labels Daniel Ek for selling out too early or, worse, relocating to the
that they should stop selling expensive United States. Now he's putting his own hard cash
plastic discs at huge margins and instead give to work by fighting what he sees as the continent's
is the co-founder
away their music for frictionless digital streaming. and CEO of Spotify. lack of drive to build the world-class companies of
Eventually Ek persuaded almost all the main Before starting the tomorrow. He recently committed $1.2 billion of
labels to work with Spotify – which ended its first company in 2006 his personal wealth to funding "moonshot" proj-
day as a public company in April 2018, valued at at the age of 22, he ects in Europe that use deep technologies such as
$26.5 billion. had already created artificial intelligence to build the next "super-
Since then, Spotify has become the world's a web development companies." These businesses will work with gov-
largest music streaming service, with 155 million empire out of his ernments, scientists, universities and investors to
subscribers and 345 million users in 170 markets. parents' house, make a significant positive dent in solving "the in-
And it's still growing at 30% a year. But Ek, who starting at just finitely complex problems" that confront us,
13 years old. At
is now 38, isn't ready to stop pursuing his own whether in health or in climate.
one point he
agenda. No wonder he hung a George Bernard
was reportedly
Shaw quotation on the wall above his desk in his earning $50,000
Could Spotify have become the success it is had you
Stockholm office, alongside a Fender Stratocaster, a month through been born in the United States?
the iconic archetypal electric guitar: "The reason- the enterprise You know, I don't think so. And for two reasons.
able man adapts himself to the world; the unrea- and had hired a First, back in 1997 I already had access to fiber-
sonable one persists in trying to adapt the world to team of 25 by the optic internet, 100 megabits downstream and 100
himself. Therefore, all progress depends on the time he was 18. megabits upstream, funded by the Swedish govern-
unreasonable man." ment. They wanted everyone to have a PC in
68 Think:Act 34 Daniel Ek
their home with broadband access, and for me that fantastic. But we still need to do more to get the
was a glimpse at the future. It was just the Nordics snowball to move even faster, because with more
and South Korea then. There was no Netflix, no supercompanies we can provide more inspiration
YouTube – nothing where you could consume to talent and investors. We're two decades behind
content. The only thing that existed besides text mature ecosystems like Silicon Valley and Seattle.
and images was Napster and piracy, which the A lot of catching up is about daring to go for the
internet used to distribute almost everything you IN NUMBERS long haul.
can imagine. It was kind of awesome.
62
And that links to the second reason – because You talk a lot about innovation – and a global
of that shift, piracy had eradicated the Swedish pandemic that's hit all sorts of business models is
music industry completely. No one bought CDs, forcing leaders to rethink how they do things. What
and buying downloads from iTunes was just not advice would you give leaders on innovating their
something that a lot of consumers did. So the way out of today's challenges?
The number of
music industry really didn't have a lot to lose when languages Spotify Innovation is a continuous process. So I would
Spotify came around, because the alternative was announced it will soon build an innovation system at your company to see
to pack up and go home. Not only did we offer a operate in as part of how you can harness ideas from as many places as
solution to what would eventually become a bigger its expansion into 80+ possible – and then ideate on them. Take one very
new markets.
and bigger problem in the rest of the world, but we concrete example here at Spotify. We have some-
also did it at a time when the music industry had thing called 'hack weeks.' It's a very simple notion:
$25+
nothing to lose. I don't think we would have We put some time aside for people to work on a
succeeded if we had first launched in the US – that product they want to exist. We see a lot of
market had more than 10 times the number of bottom-up innovation as a result. Truthfully, many
competitors and the music industry had a lot more billion of the greatest innovations at Spotify in the last few
to lose, so they'd stifle innovation. years have come from the hack week. Discover
How much revenue Weekly [the personalized music recommendation
Your $1.2 billion commitment to investing in Spotify has paid to algorithm] was one. I actually wanted to kill the
European "moonshots" is hugely ambitious. How, rights holders since its idea because I didn't like it – and ironically enough
launch in 2008.
apart from in financial returns, will you judge it's one of our most successful things. So provide
19
whether you've succeeded a decade from now? many paths to having ideas circulated, and [for
The real success for me will be a whole lot more ideas] to bubble up – with more paths to "YES."
supercompanies in Europe – and ideally ones that
make a positive dent in the world by tackling some After 14 years of Spotify's journey, I get a sense that
of the big challenges. Whether it's climate change you see yourself still at the relatively early stages.
or educational access or a better health care system, How many companies When I started using Spotify, I thought it was a
Spotify has acquired
there are many areas where we need to move fast, music service, but now you're talking about
in total since its first
to invest, and do it with great urgency. acquisition, music an "audio-first" strategy. You're buying podcast
discovery app Tunigo, companies, and now I can get access to audiobooks,
Do you think that Europe is changing in terms of in May 2013. and a Daily Drive playlist with news. What is S
potify
entrepreneurial ambition? long-term?
Yeah, I think it is. In Sweden in particular, we have Well, the amazing thing is, I'm not even sure I
this word lagom, which means "just about right":
you don't want to achieve too much, nor too little. $235 know. If you take audio as an example, we learned
by accident that in Germany a lot of record labels
But that's shifting. When I started, entrepreneur- million were uploading other forms of audio content [such
ship wasn't something that you did. I remember as audiobooks] on Spotify. It was a pretty terrible
when I started the company – I was 22 – explaining The price Spotify paid
user experience, yet people were still consuming it.
to people at parties and a lot of people said: "OK, to acquire podcast And then we studied why people in the US weren't
great, but what's your day job?" It was just not advertising and using Spotify more in the car. One of the big
thought of that you could launch your own compa- publishing platform reasons was that they wanted more news, weather
ny. But there's been a big shift in the last decade in Megaphone in and traffic that they get from local radio. And so, if
November 2020.
Europe. It's become not only socially acceptable to you put those two things together, you start realiz-
become an entrepreneur, but it's become maybe ing that, even with our vision of music, by adding
the thing to try. So we have more people than ever audio we're going to be better for even the music
trying their hand at entrepreneurship, which is listeners. So one plus one equals three or four.
Think:Act 34 69
Let me ask about the original clientele, the music One last question. I know you spend a lot of time
industry. How well are you getting on with them reading, thinking, going for conversational walks
these days? with people. What ideas are percolating that you
A lot in the industry worried whether streaming haven't quite formed into products?
could replace and even compensate for any short- Oh, wow. Well, it's really eclectic at the moment.
fall in download revenue. Now we have the answer: I'm really into philosophy and thinking a lot about
Yes, and it keeps on growing by healthy numbers whether or not we're in a path-dependent world. If
each year. That changed the tone [of the conversa- you think about society at large, you have this idea
tion]. It's the classical hype cycle. At the beginning of liberalism and democracy and our current iter-
you're met with skepticism, then you start seeing ation of it for the past few hundred years. And ob-
some optimism and then, at the end of that curve, viously now we have fantastic platforms, as well as
they're like: "Well, yeah, I always believed in this a lot of things that we, as a society, need to address.
and of course it was going to work." We're at that Philosophy as a whole is an understated art that is
point now, with everyone streaming, and that's not getting as much attention as it should. I'm
incredibly gratifying for someone like myself who's thinking about how we can bring it more to the
been working on this problem for 14 years. forefront and raise philosophy's stature. ■
70 Think:Act 34 gender equality
Dear
white
men,
Despite a broad consensus on
gender equality, women still find
it hard to establish their place as
equal partners. You shaped our
modern world of work and have
enjoyed the advantages of your
position – even if you're unaware
of your privilege. Will you help
to quicken the pace of change?
A
diverse workforce is surely a force
for good. It makes simple, common,
commercial sense to imagine that
Photo: Burt Glinn/Magnum Photos/Agentur Focus
sticking to conventional male norms may simply a boy in childhood translate into perceptions of
be the easier option. "In order to get organizations gender in adulthood and these learned patterns
to the next level we need to get to the root causes. overlap with our established leadership norms.
We need to identify the problems, but also why the The pervasiveness of white male privilege forms
problems are what they are," says Alixandra Pol- another powerful discussion in the workshops and
lack, vice president at Catalyst, a global non-profit recognizing how evident it is in everyday life, she
says, is an eye opener.
Many men who have worked hard to get to
online exclusive where they are consider their success to be down
See the Short Takes interview video to what they have earned rather than any privilege.
with Lean In's Rachel Thomas online: The MARC workshops help them to understand
rolandberger.com/en/thomas that privilege is most often about all the issues they
Think:Act 34 73
over 1/3
over 1/5
over 1/10
don't have to navigate at all in their working lives. Western Europe never be easy conversations, but they need to take
Not having to worry about family or money prob- and North America place in a safe and open space to make the next
lems, disability and prejudice, or responsibility for Eastern Europe steps. "We equip people with the tools they need to
children and household chores puts a person at an and Central Asia act confidently. These tools are much needed: 80%
advantage. The programs show that gaining a good East Asia of men are committed to interrupting sexism but
understanding of one's own situation is vital in and the Pacific only 31% report being confident in their ability to
developing the empathy necessary for change. South America do so," says Pollack.
"Dissent is a critical part of the learning process," According to Elena Essig, co-author of the 2019
says Pollack. "We need to get these thoughts and paper Re-thinking gender inequality in the workplace
questions to the surface. We can be sure that one – a framework from the male perspective, under-
source: the global gender gap report 2020
person's thought is in fact shared by many others." standing men's perspectives is the foundation for
a solution. Her research revealed that there are very
One issue hardly ever spoken out loud is the fear few studies examining the male perspective. "There
that women's gain will be men's loss. According to seems to be a problem, but no one is talking about
Catalyst's research, such zero-sum thinking is a it," she says. She and co-author Richard Soparnot
major barrier. Men may also fear that they will lose set out to shed light on this side of the equation as
face among peers – or in the eyes of a superior – if a means of pushing the argument further.
they address sexism or other inequalities in the Essig and Soparnot discovered that the system,
workplace or themselves deviate from the well- as it stands, does not work all that well for men
established male norms and behaviors. These can either. In traditional male-dominated indus-
74 Think:Act 34
73%
about gender equality most people think about no need to self-censor." Photo: Burt Glinn/Magnum Photos/Agentur Focus
Robert Shiller
What's
the story?
When looking to understand what drives economies
and business, it's ultimately all about the numbers,
right? Wrong. Or so says robert shiller.
The Yale economist and Nobel laureate who
predicted the housing crisis of the late 2000s
argues that people's actions more often depend on
"stories" than hard data and complex formulas.
R
obert shiller read a book later inform policymakers during the
while a student in the 1960s global financial crisis of 2008-09. He
that planted a seed in his also looks at narratives that reemerge –
mind. First published in such as the "plague" stories during
1931, Only Yesterday re- Covid-19. Indeed, narratives also have
counts the events of the previous decade viral qualities, says Shiller. Social media
which led to the Great Depression. The has only accelerated this process.
penny dropped: How people at the time But economics has been slow to
saw the world was a window on collec- recognize the importance and value of
tive decision-making processes that no narratives. Shiller thinks that needs to
mathematical model could capture. change. Rather than assumptions that
Now, over 50 years later, Shiller's decision-making is all self-interested
celebrated book Narrative Economics has processes like maximizing the "utility
taken a detailed and analytical look at function" – or what's best for me – there
the stories we tell ourselves about the are other powerful forces in play.
world, many drawing on deep-rooted
collective memories, or interpretations, Let's start by defining what you mean by
of past events. One example is the Great narrative economics?
Depression and how stories about what Narrative economics would be the study
caused it and how it played out would of popular narratives that spread
78 Think:Act 34 thought leader
via a contagion [and are] similar to Can you give us an example of something
diseases in their transmission. I call that changed people's behavior and had
them "economic narratives" – narratives a meaningful impact on the economy?
that change people's economic deci- A few kinds The labor movement – which I think is
sions, their sense of how the world of economic narrative-driven and changes the power
works or what's important or what the narratives structure within the economy. The idea
dangers are that ultimately affects peo- that workers should bind together and
ple's thinking. It studies the stories that form a union, and then the union has
people tell that spread at certain times. 1 spokespeople who interpret the events.
Really traditional economics looks at The innovation threat:
There were stories of strikes that started
people as rational optimizers who re- Machines taking away to develop and polarize society. In the
spond correctly to new information. jobs was a topic in the 1890s, there was a labor event called the
19th and 20th centuries Haymarket Riot where they ended up
Can you give an example? with automation – battling the police. And that event was
I was impressed that [Frederick Lewis and again today with in the memory of the people in the
Allen's book Only Yesterday, about the artificial intelligence. Great Depression, even though it was
Depression], described a lot of undigni- almost a half a century earlier.
fied talk and fads and fashion changes 2
that affected the economy, rather than The appeal of frugality: Actions in the 1930s about whether to
exclusively central bank policy and tax Conspicuous spending strike or not were informed by shared
policy. I thought: "This is more down-to- can be seen as bad stories about an earlier conflict?
earth, I believe this as the story of the taste during economic People [ask] when they approach a topic
Depression." For example, people were downturns: think of the like the Haymarket Riot: "Is that some-
disturbed when the dial telephone came Great Depression or thing that we should teach our econom-
in [rather than going through a switch- Japan in the 1990s. ics students?" Well, it's not core. The
board operator]. This was striking peo- story of the Great Depression itself is a
ple as typical of the Great Depression, 3 powerful story today. The Haymarket
where jobs were lost to machines. They The gold standard: Riot has been forgotten by most people
thought: "Sooner or later, I am going to Bimetallism in the late but the Great Depression itself is on the
lose my job." That's only one of many 1800s or Bitcoin today, minds of everyone. The story mutated a
narratives that were afloat, and I want- questions of the value bit and then suddenly it becomes viral
ed to think that narrative economics backing currency return again. So, we have a lot of talk of the
would classify the narratives the way again and again. Great Depression during the so-called
ornithologists classify birds. Great Recession of 2007 to 2009.
Does technology play a role in helping Ben Bernanke – the head of the Federal
narratives spread? Reserve in 2008 – was famously a
Information technology has increased student of the Great Depression. Do you
the contagion of narrative – but it has
Don't forget think it guided his actions?
[always] played a role, [from] the inven- what's nearly He wasn't [really] a narrative economist,
tion of the printing press by Gutenberg. forgotten but he immersed himself enough in
Then we had the tulip mania [of the 17th that literature to capture some of the
century] and other events that I think narratives. One thing that happened in
Viral narratives have
were helped along by newspapers and 2007 and 2008 was the old admonition
a rise and a fall – and
speeding communication. The effects of that's attributed to Franklin Roosevelt,
both need to be taken
the technology are again limited by the "The only thing we have to fear is fear it-
into account. Just
fact that people can only have so many because a topic is less self," was on their minds – even if it
stories on their mind at a particular fashionable than it wasn't the emphasis of their research.
time. But it has increased the spread of once was shouldn't
good storytelling, good writers. So, the exclude it from To prevent fear sparking panic ...
creativity of narratives [has increased] – analysis. It may still The idea that they had to stop the panic
and the tendency for narratives to exert an influence. led to the Northern Rock [bank] bailout
mutate like diseases. in the UK and similar bailouts in the
thought leader Think:Act 34 79
Deep
dives
Take a deep
dive and find out
more in related
articles and studies.
The carbon
competitive advantage
The message is clear: Climate change some are switching brands to match By embracing the idea that carbon
is having a catastrophic effect on our their values. Investors, supported by e missions are not a cost but a new
planet. The consensus is that if we are shareholders, are following sustainabil- currency, firms can transform climate-
to have any hope of limiting global ity agendas. Taken together, such mea- related risks into opportunities. In this
warming, we only have a decade to halve sures and actions are changing the new competitive model, explained in a
the greenhouse gas emissions that are parameters for business – and their im- fresh study from Roland Berger, a com-
causing the problem. pact on a company's success should not pany's value is reflected in its climate
Governments have seen the need to be underestimated. But can we consider action – and avoiding carbon emissions
act and the Paris Agreement's goal of what we are all doing to be the change becomes one of its profit pools.
limiting global warming by 2°C has led we need? It's possible that it might not The study looks at companies that
to a sharp focus in cutting carbon emis- be just a case of reducing emissions that are already ahead while offering strate-
sions. Stricter policies and regulations is required, but a major rethink. gic recommendations to avoid being left
could be on their way to back up the var- The introduction of carbon pricing behind in a world tackling this change.
ious governments' pledges and good systems could encourage companies to
intentions. But it isn't only policy that reduce their carbon footprints and adapt to a new business climate
promotes change. Individual action is those specific mechanisms will increase Discover the advantages of keeping your
likely to have an effect too. Consumers carbon prices and put profits at risk. Yet approach in step with a changing world:
increasingly pursue green products and decarbonization need not be a threat. https://rb.digital/2QG6Gaq
Are you interested in studies conducted by Roland Berger? Then please email us at: david.born@rolandberger.com
deep dives Think:Act 34 81
trend compendium
Megatrendspotting
to combat crisis
You don't need a fortune teller as 2030, whereas this latest view
to see into the future. There's extends its scope with 2050 as its
next-gen production
plenty of evidence and support- date horizon. Looking at what
HOW TO WIN
Which companies have come out
well from the corona crisis in your
opinion and why?
IN THE POST-
In forcing many interactions to
go remote, Covid-19 has accelerated the
Great Dispersion by a decade or more.
Industries which used to operate in cen-
COVID WORLD
tralized locations – health care, fitness,
office work – are moving into the home
and onto our devices. The winners are
companies that already operated under
this new model, the beneficiaries of our
Strategy and marketing guru scott galloway doesn't mince radical dispersion during the pandemic:
words when it comes to how trends and events can shape the Amazon, Netflix, Slack, Peloton.
future of business. Here he answers three questions concerning Who stands to gain the most in
the post-pandemic landscape. the post-corona landscape?
Platforms. They are horizontal
networks that bypass the tradi-
tional gatekeepers to connect buyers
and sellers, speakers and listeners and
creators and consumers to one another.
They are the infrastructure of disper-
sion. The internet itself is a platform, of
course, as well as serving as the host to
many others: Twitter and Facebook,
YouTube, Etsy, Substack, eBay, Roblox,
and Airbnb. Cloud suppliers (Amazon
Web Services, Microsoft Azure, Google
Cloud) are then platforms for platforms.
They are the connective tissue for bil-
lions of people. They are subeconomies
that have become nation-states.
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SERIAL ENTREPRENEUR AND AUTHOR
OF UNCHARTED – HOW TO MAP THE FUTURE TOGETHER
INTERVIEW ON P.26