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Five Factors Affecting the Future
by Jim Seybert

 
       
   

We know that tomorrow will be different from today, because today is not the same as yesterday. Time is an inevitable force. Nothing that existed in the past is exactly the same in the present. Whether physical or metaphysical, what is today will not be exactly the same tomorrow. My personal zeitgeist includes a God that is the same yesterday, today and tomorrow but my perception of and interaction with him is different now than it was and will certainly change tomorrow.

There has never been a time when the future is less likely to resemble the past than right now.

Change is either result of or the reason for new realities. A lot of time is spent these days trying to think “outside” the box. Such activity often provides the catalyst for incremental change that moves an organization forward, but as the rate of change accelerates the box itself will become irrelevant as it’s replaced by a complete new set of rules - a whole box. The new rules will make yesterday’s solutions obsolete. What once worked well, and sort of works today will be as effective tomorrow as that IBM XT/286 gathering dust in your garage.

The dilemma is this: The future is impossible to predict. And it gets worse. The more precise you try to be in your prediction of the future, the greater your chance of being wrong when the future finally arrives. The Apostle Paul wrote that he “sees through a glass darkly” and that his vision of reality won’t be clear until he reaches heaven, so what do we do about preparing for the uncertain inevitabilities of what’s to come while we’re still alive?

The key to navigating a labyrinthian future is to monitor current events, relate them to realities of yesterday and look ahead in anticipation of obstacles, opportunities and new rules that MIGHT lie ahead.

The practice of doing this is commonly called trend-watching. Trends are used to sniff the future, but they are not absolute predictors. Trends are small tears in the fabric of tomorrow, allowing us to catch a glimpse of what might lie in our path. They aren’t the complete story but rather threads  that will be woven over time into what singer/songwriter Carole King referred to as a tapestry that unfolds before us.

The Five Factors

There are five cultural factors that are shaping the foundation for a new set of rules that will govern the future. The rules won’t be passed by a legislature and they won’t all take effect at the same time or with equal strength and influence. My suggestion is that you consider each of the five separately and collectively. Spend time thinking about the effect each might have on your organization. Ask the question, “If this is where the culture is going, how might we prepare?” I encourage you to avoid the temptation to try and “protect” yourself or your company from the changes these factors represent. Doing so could earn you a place of honor in the Where Are They Now? museum.


The Five Factors are:

iTunes/TiVo Culture
Post-consumer Era
Right Brain Influence
Episodic Lifestyles
Consolidation/Fragmentation

 

1) iTunes/TiVo Culture

Brand managers have long measured success by the extent to which consumers altered their lifestyle to use a particular product or service. Product advertisers succeeded when you changed your habits and bought a different brand of toilet paper or toothpaste. The fashion industry is one of many with a foundation built upon getting shoppers to discard their current supply of goods in exchange for something new. The shining example of this must be the way Starbucks has trained the world to leave for work early, stand in line longer and pay a lot more for something that most of us used to brew for pennies a cup at home or in a machine at work.

But all of that is changing. Consumers are no longer satisfied with buying products and services the way they have. Starbucks doesn’t just sell a cups of coffee. There’s an estimated 15,000 beverage combinations at Starbucks. iTunes, the phenomenal music delivery system from Apple, has given shoppers the ability to buy only what they want, when they want. TiVo allows television viewers to watch favorite shows at all hours of the day or night, and to watch them over and over again.

The tables have turned upside down. While brand managers once looked for ways to get people to change their lifestyle to use a product, consumers are now not satisfied unless they can alter the product to fit their lifestyle. As a kid growing up, I was never able to watch The Wonderful World of Disney because it aired on Sunday evenings, and we were always in church. Now, I can be in church on Sunday morning and still watch Meet The Press because the digital video recorder allows me to alter the network’s product to fit my schedule.

I recently read of a publishing house that is giving readers an opportunity to influence the ending of an unfinished novel. My daughter tells me there is an attachment you can buy for your iPod that slips into a running shoe and alters the tempo of the music to match your pace. Internet shopping has changed the business model of retail stores by allowing shoppers to browse the shelves on their own time. You can order M&M candies with your own special message on each little piece.

Consumers have come to expect this level of individuality and are extending their demands for it well beyond typical retail situations. Airlines now allow flyers to choose their own seat assignment online. Auto insurers provide policy holders with a buffet of services from which to choose. Hospitals hand out menus every day so patients can eat what they want (or at least avoid what they don’t want).

2) Post-Consumer Era

The little engine that could is running out of steam. The incredible strength of the world economy has been driven hard and fast since the end of World War Two by consumer spending. Western culture especially has had a voracious appetite for buying things. Bigger this and that. More. Faster. Cleaner. Newer. Tastier. Meatier. Healthier. But, the culture that used superlatives as vitamins and aphrodisiacs has begun to spin into the ground and looks unable and perhaps unwilling to stoke the boiler again. “I think I can, I think I can” is being replaced with “I’m tired I’d like to sit down.”

It would be easy to point to the 9/11 attacks as a reason for this rule change, and the financial market meltdown in 2008 is clearly a part of the shift, but signs of this new box taking shape were evident before 2008 and we heard little whispers even prior to September 2001. Oliver Stone’s 1987 film Wall Street suggested that there were downsides to a culture of greed. The decade of the 90s saw many people looking to justify their consumption by purchasing products that made a social statement. It was OK to spend $15,000 on a new shower enclosure for the house if the tiles were crafted by peasants in South America who were paid a living wage and $300 toasters were a responsible purchase because they lasted so much longer than the $30 unit from a discount store.

Whatever historical perspective you accept, the number two factor effecting the future is a scenario where the world economy will no longer be accelerated by consumers living beyond their means. Growth rates will be slower. In a March 2008 Newsweek piece, Robert J. Samuelson wonders what might come along to replace consumer spending as a fuel for the type of growth we’ve grown to expect. He asks if spending on healthcare or technology might be the new engine, and concludes with the question, “What if the answer is ‘nothing?’” What if ‘nothing’ replaces consumer spending? What if the future is driven by something other than economic growth?

This could be the most difficult factor to accept and adjust to. Benchmarks of growth are such an ingrained element of our societal DNA that it might be impossible to imagine a model based on anything else. But, what if Samuelson is correct? The organizations who best adapt to whatever new rules are being written will succeed and those who long for the status quo will get exactly what they ask for.

3) Right Brain Influence

American consumers spent more money on ringtones and personalized cellphone cases in 2005 than they did on the cellphones themselves. That’s one factoid Daniel Pink uses to support his observation that western culture is now being driven less by logic or reason and more by a desire for beauty, meaning and significance.

In his book A Whole New Mind (2005) Pink asserts that affluence, automation and a cheap labor force in Asia have brought western culture to a place where there is very little we actually need. Remove necessity from an equation and people are free to rise higher on Maslow’s hierarchy to a point where creativity, self-esteem and mutual respect are the driving force behind decisions.

If all that sounds like psycho-babble, consider the way automobiles are marketed. When was the last time you came across a car commercial that talked about cubic inch displacement? Fuel economy is still talked about because gas prices go up and down, but buying a car is more about emotion than logic. Even the most empirically driven engineer who examines every mechanical aspect of a car before buying will make his or her final choice based on the color or the comfort of the seats.

The need for good science and sound logic isn’t dead, but rather an expected point of commonality between products and services. Quality, performance, reliability and service are expected minimum standards. What turns on the “buy” switch are attributes that add aesthetics, provide meaning or help the user feel unique.

Why do so many people have a custom ring on their cellphone? Why does every computer operating system provide options for screen savers and desktop wallpaper? Could the current world-wide increase in spirituality be the result of people saying, “I have everything I need, now I want to understand what it all means.”

4) Episodic Lifestyles

Take a breath and consider the juxtaposition of factors number 2 and 3. Do they seem contradictory? If consumers aren’t spending as much and are perhaps tightening their belts, how can we say they have more than they need? Good question. An over-aching factor that will effect the future is that we are living in an Age of Paradox. The most prevalent example of this is the practice of dividing one’s life into separate and distinct silos.

Consider politicians and preachers who rail publicly about immorality and are themselves discovered to participate in the very activities they decry. Otherwise brilliant students with fine prospects for the future post ridiculously incriminating photos of themselves on the Internet. Suburbanites drive fuel-wasting monster vehicles to a local Save The Earth committee meeting. One of the most popular Internet communities is Second Life which since 2003 has given users the ability to create and live out an online persona of their own design, taking on alter egos those who know them would never recognize.

Marketers, demographers and business planners have always been able to count on the predictability of human beings. Despite our individuality, we are rather habitual creatures. On the other hand, the human experience is full of surprising revelations about people we “thought we knew.”

But the rules of interaction are changing. Homogeneous characteristics that identified members of particular social groups are breaking apart. The so-called boundaries are being changed and lines that once were never crossed are beginning to blur. Segmenting customers into manageable clusters is going to get tougher as this factor spreads.

Exceptions to the rule have always been expected, but the future appears to hold a much looser answer to the question, “Who are you?” An answer that will probably change each time it’s asked.

5) Consolidation and Fragmentation

As we move into the future (or it crashes through our wall) some thing are going to get bigger, and some will get smaller. And, some will do both.

Look at personal entertainment.

TV, recorded music, feature films, art, board games, personal interaction with friends.

Yesterday’s solution to enjoying these was to own a TV and a radio, visit a theater, walk through a gallery, set up the game table and curl up on the couch with a phone.

Today’s solution is to open your laptop. All of these entertainment platforms have been consolidated into a single, portable delivery device. Consolidated content so I can enjoy what I want, where I want, when I want (see #1).

The culture expects and demands the convenience of a one-stop experience. Mega-stores and malls are consolidating the shopping experience into a single place. Mega-churches. Mega-plex theaters. Electronic books that carry hundreds of volumes. Digital music players loaded with tens of thousands of tunes. Shoe stores with thousands of styles. Mexican restaurants adding western-style hamburgers to their menu and budget joints with salsa laced breakfast wraps.

Many trends begin at retail because consumers have been such a strong force. The demand for consolidated convenience won’t diminish in a post-consumer era, it’ll just be transfered elsewhere and customers will go where their desires are met.

Consolidation isn’t only about convenience for shoppers. Little organizations are being folded into larger companies at an accelerating rate and there won’t be much change in that trend for some time to come as corporate managers look for reduced costs in shared operations. The greater efficiencies for owners won’t always be met with support from customers - and that segues into the complimentary factor of fragmentation.

As activity consolidates, it also fragments. Mega-stores consolidate commerce in one location, while at the same time shoppers have a virtually unlimited selection available online. Every entertainment channel and activity one could ever want is consolidated into the little computing box siting on my lap and there are literally millions of entertainment sources from which to choose.

Seth Godin penned the phrase “Small is the new Big” as the title of a book in 2006. He says that for companies to succeed they either need to get bigger or smaller. Small firms need to display a bigness that will attract customers looking for the advantages of a bigger operation and larger companies will need to find ways to operate like smaller firms so they can compete with little guys who are more adept at changing to meet needs.

The paradox is happening in many industries. In publishing, bigger houses are acquiring small houses, consolidating the process of developing new books. Publishers are bringing fewer books to market - consolidating knowledge into fewer titles - while print on demand technology is making it easier for authors to publish even more books on their own. To add another level of nuance to the example, publishers are beginning to repurpose existing titles into smaller pieces for sale on the Internet as stand alone items or as compilations based on topic rather than author.

Globalization is yet another paradoxical scenario. As products and services are fragmented around the world, everything becomes more easily accessible by everyone. As the world gets bigger for some, it grows smaller for others. Video conferencing is one such example. The technology allows participants fragmented in far flung locations to consolidate their interaction in real time around one common screen.

The appropriate question to ask is, “How do we get bigger/smaller?” Use the word that best describes the direction you want to be facing when the future arrives.

Conclusion

When you are anticipating a trip to a place you’ve not been, you study brochures and websites about the place, acquainting yourself with the landmarks and potential activities. You use the research to “get a feel” for your destination but you can’t actually experience the place without being there.

Use this paper as you would a travel guide. Explore the five landmarks. Draw connections between them and consider how your business model will be affected as the future unfolds. As with travel to new places, there are bound to be surprises and unexpected changes. You’ll have a better trip if you’ve studied the options ahead of time.

The degree to which you successfully navigate the future is influenced by the amount of energy you invest in anticipating the journey. Should you wish to take advantage of a tour guide, I’d be happy to chat about your needs.


       
   
 
       
   

The Author

Jim Seybert

LEADERSHIP RE:VISION

Jim Seybert is a private consultant, specializing in “helping companies get unstuck.” He serves clients in a wide range of industries including entertainment, publishing, health care, real estate, retail and non-profits. Jim has authored two books on Leadership: The One Year Mini for Leaders, and Leadership Re:Vision, both released by Tyndale House Publishers. Jim’s wife Rhonda enjoys letting her husband hike the trails of Yosemite National Park with friends, as long as she is not required to go with him.

Visit www.jimseybert.com for additional information.

 
       
   
 
       
   
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Copyright 2009 by Jim Seybert. All rights reserved.

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