Early warning (Part 2)

April 16, 2013


Continuing on this occasional topic, yesterday I was reading a profile of the company that was touting its early warning system. The company described how it’s set up a team to monitor and deal with “megatrends”, trends at least 5 years out that could have a material impact on the business. To summarize it, a senior officer was selected to identify these overarching trends and their potential impact on the business. Following the definition of the trends, a team analyzed the impact of the trends on the company’s strategic planning and how it would affect its efforts in the future. The entire company’s planning team was then taken through a series of workshops on the process to integrate the megatrends into their planning, to identify potential successes and the routes to get there.


There are at least three things wrong with this, maybe more:

  • First is the process of identifying the so-called “megatrends”. Without more on the process, it seems very introverted and therefore likely to miss the trends that really matter, because they are almost by definition the trends that are not being noticed by the company at present.
  • Second, this process is relatively static, in that it appears that the identification of the “megatrends” is a one time or, optimistically, an annual effort. However, megatrends do not show up and grow on schedule. For a case example of that, witness the relatively fast creative destruction of the American newspaper and magazine industry by the Internet.
  • Third the whole process seems to be premised on the fact that if the company can identify megatrends then it can identify new opportunities for the future. It totally ignores the fact that some megatrends may well provide only threats not opportunities.

The first stages of the early process are among the most important, and require not a top-down team, but an integrated effort using employees from across the company as well as consultation with outside experts. This example is one that will not go well.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s