As the rate of change in every sphere of human existence is ever increasing, the very manner in which we deal with change needs constant re-evaluation and adaptation. Up to thirty or forty years ago change occurred in a more or less linear and predictable manner which made strategic planning and long term predictions fairly easy and safe.
However, as early as the 1980’s, companies such as General Electric came to the conclusion that the mounting rate of change had reached a point where it could no longer be predicted or anticipated. Realizing that conventional strategic planning increasingly failed to deal with non-linear and exponential change in this environment, GE re-designed its organizational structures and management systems, opting for a reactive approach to change. The aim was to make the entire company more flexible, enabling what they termed a “quick response” to change. In practice the transformation was achieved by focusing on leadership training and following a four-step process: prioritization; integration;operationalization; and calibration.1
Steven Kerr, GE Vice President of Leadership Development at the time, explained their change strategy with this quip:2
“We are learning how to move very quickly. We will continue to be surprised, but we won’t be surprised that we’re surprised. We will anticipate the surprise. Companies that continue to rely on forecasting, trying to anticipate the future, are going to be surprised, but they’ll be surprised that they’re surprised. They’ll probably spend six to nine months denying reality … giving GE a competitive advantage.”
While this approach might have served GE some good for a while during the 1990’s, it might also help explain the company’s heavy losses during the current worldwide recession. In 2008, its shares dropped with about 60%, considerably more than the 32% fall of the Dow Jones industrial average during that period.3 The fact is, while a reactive approach to change is a great leap forward from resisting change, it no longer suffices in an environment where rapid change has become the only constant. No matter how flexible an organization becomes, at some point it is bound to reach a point where the speed of change surpasses its ability to react in time.
Instead, today’s successful organizations need to harness the growing expertise of futuring and forecasting specialists and methods in order to anticipate future change and not be surprised by it. By using futuring methods and instruments such as horizon scanning, scenario construction, high quality forward views are created which help organizations gain valuable strategic foresight that enables them to apply emerging insights about the future to their benefit. Ideally, this means these organizations are able to implement timely strategies to not only react to future change or even anticipate it, but to influence such change to help form the future they desire.
1. Grant, R. M. (2004). General Electric: Life after Jack. Retrieved on February 6, 2009 from http://www.blackwellpublishing.com/grant/docs/16GE.pdf
2. Kerr, S. and Ulrich, D. (1995) Creating the boundary less organization: The radical reconstruction of organizational capabilities. Planning Review, September/October. pp. 41-45.
3. Jones, B. (2009). GE profit falls 46%, meets analysts’ lowered expectations. USA Today, 23 January 2009.