The Journal of 2020 Foresight

Reports from the Knowledge Labs about our recent findings, research topics, and interviews with lifestyle leaders who are creating their own futures.

How to stimulate your own powers of foresight. Consider the following thought provokers. Ask yourself, in these categories what are the brand new trends and forces? Which are the ones growing in importance? Which current forces are loosing their steam? Which have peaked or are reversing themselves? Which are the "wildcards" about to disrupt us in the future? POLITICAL AND TECHNICAL thought for food: Electronics, Materials, Energy, Fossil, Nuclear, Alternative, Other, Manufacturing (techniques), Agriculture, Machinery and Equipment, Distribution, Transportation (Urban, Mass, Personal, Surface, Sea, Subsurface, Space), Communication (Printed, Spoken, Interactive, Media), Computers (Information, Knowledge, Storage & Retrieval, Design, Network Resources), Post-Cold War, Third World, Conflict (Local, Regional, Global), Arms Limitation, Undeclared Wars, Terrorism, Nuclear Proliferation, Weapons of Mass Destruction, Governments (More/Less Power and Larger or Smaller Scale), Taxes, Isms: Nationalism, Regionalism, Protectionism, Populism, Cartels, Multinational Corporations, Balance of Trade, Third Party Payments, Regulations (OSHA, etc.) Environmental Impact, U.S. Prestige Abroad. SOCIAL AND ECONOMIC Food for thought: Labor Movements, Unemployment / Employment Cycles, Recession, Employment Patterns, Work Hours / Schedules, Fringe Benefits, Management Approaches, Accounting Policies, Productivity, Energy Costs, Balance of Payments, Inflation, Taxes, Rates of Real Growth, Distribution of Wealth, Capital Availability and Costs, Reliability of Forecasts, Raw Materials, Availability and Costs, Global versus National Economy, Market versus Planned Economies, Generations: Y, X, Boomers, Elderly, Urban vs. Rural Lifestyles, Affluent vs. Poor, Neighborhoods and Communities, Planned or Organic Growth. Got Knowledge?

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Thursday, August 08, 2002

Spending Waves, Turning Points, and Strategic Breakers
Chapter One

By Steve Howard, CKO
The Knowledge Labs

Table of Contents
Chapter One: Basecamp
Chapter Two: The Ridge
Chapter Three: The Outpost
Chapter Four: The Tribal Territories

"When the forces of change are weak but growing with relatively low resistance, look for a turning point in the industry; when the forces of change are strong and growing against strong resistance, look for a breakpoint. Many companies are not even aware of the established trends in their environment, not to mention the timing of potential turning points and cycles. Distinguish between new game strategies that will be relevant if the forces of change prevail, and turning point and breakpoint strategies appropriate for the transition between the old and new games."

Paul Strebel, "Breakpoints"

Pathfinder arranged a meeting with the original Dana Harbor crew. We sat around a bonfire steps from the beach looking out on the Pacific Ocean not far from the scene of their first voyage.

Journal of 2020 Foresight: Pathfinder described your sailing synchronicity experience in the beginning -- how you all found a way to set a future course for yourselves both individually and collectively. You've been running these learning expeditions as a way of making good on your last principle. Is that right?

Lost Explorer: Over the past few years we've been able to collect a wealth of experience and knowledge as individuals, teams, and leaders journey from Basecamp to the Ridge, the Outpost, and, finally into the Tribal Territories.

We make it all available to expedition members with the caveat that they to find a way to create a better opportunity for those who would follow them.

J2020F: So what patterns have you four noticed? And what value have expedition members reaped from their adventures?

Trailblazer: I normally guide learning expeditions at the Ridge, after they?ve analyzed past changes, turning points, trends, paradigms that have influenced their current situation.

Most tell me they are shocked to discover how much of their daily lives had been influenced by extraordinary changes.

J2020F: How do you mean?

TB: The old-not-seeing-the-forest-for-the-trees phenomenon. We have undergone extraordinary changes in the last thirty years in terms of the alteration of the old rules and regulations of our lives.

They wish they had anticipated some of those changes. They marvel at what might have happened if they had known, for sure, about just one of those major changes?

J2020F: Can you give us an example? What would you have been able to do with that information?

TB: For instance, what if you had anticipated the growth of PCs, say back in 1976 when it was still only a dream of two hackers? Think of the investment opportunities you could have had.

Lone Eagle: Or my personal favorite, how about the move toward healthy, less fattening foods like yogurt? Who would have guessed it would become so popular?

Pathfinder: No matter who you are or what you do, it would have made a big difference. At the very least you would have been subject to less surprise, less 'future shock.'"

TB: At the very most, you could have made millions of dollars, perhaps even billions of dollars -- if you had had the knowledge that Bill Gates had.

J2020F: I know I didn't make billions. But, c'mon, in 20/20 hindsight that's all perfectly obvious. In the late '70s nobody predicted the growth of PCs when mainframes in big glass houses dominated the information processing industry.

LsEx: Exactly. The leverage that is gained by discovering these kinds of changes is profound, because these rule changes are not foreshadowed by trends.

PF: That is why, for many people, even (and, in some cases, especially) for the experts, they seem unpredictable.

J2020F: So the kinds of changes you monitor, then, are changes in the fundamental rules?

TB: Right, we?re monitoring what Joel Barker called paradigm shifts.

Eagle: Those breakpoints, strategic inflection points, perfect storms whatever you want to call them -- all have something in common. They create new trends or dramatically alter trends already in place. That makes them very special.

J2020F: So identifying trends isn't simply a matter of extrapolating historical curves.

TB: We may be getting a little ahead of ourselves, here. But, what I help expeditions focus on at the Ridge is the more difficult aspect of future trend analysis.

Explorer: A little, maybe, but the lesson I learned when I completed Basecamp and hiked up to the Ridge is how important it is to understand brand new forces, within the context of current forces that will cease to exist in the future.

Eagle: And, for me it was identifying major discontinuities in trends that might occur.

PF: Over the years we?ve helped learning expeditions investigate shifts in technologies, economics, social trends and political forces.

J2020F: And can you give an example of what they've found?

PF: Sure. You remember our 100 Predictions event about baby boomers?

J2020F: I believe you've listed a learning expedition comparing The David Letterman generation to the Bob Hope generation, right?

PF: David Letterman or Jay Leno even Bill Clinton or George W. The generation that gained notoriety in Time magazine when its cover story played up the first generation gap.

TB: And the beat goes on.

Eagle: Surf's up!

Explorer: Enough already.

Eagle: No, really the surf's up. Look at those waves.

J2020F: Right. Back to the topic. The David Letterman generational wave, is what, crashing?

PF: Well, the generation came of age in the '70s and '80s. They became the early adopters for PCs and defined and drove that technology market fueling it with their earning and spending power.

TB: Not only the impact on technology and the economy, but what about its major influence on social values.

Eagle: Which, as Alvin Toffler would extrapolate, equates to consumer segment buying power, fads, and tastes. We buy our identity.

LsEx: By the early '90s -- say prior to '94 or '95 their outlook cast a dark shadow over the economy. Not unlike a decade later.

J2020F: By that you mean, what?

LsEx: Lynn Smith wrote a piece for the LA Times Magazine entitled, "Oh, Grow Up," about boomer angst. Against the backdrop of a declining economy, with children going off to college and elderly parents the Bob Hope generation moving into their high medical cost years, the boomers felt squeezed for the first time.

LoEa: How did she describe it? As the "Loss of the Future".

TB: In the early '90s, then, boomer middle managers (earning middle incomes) entered midlife -- a significant developmental turning point. And, then for the first time they were the ones laid off during recessions.

PF: Earlier in their lives, they felt the future was always open to them. They felt anything was possible. But with the first signs of aging on top of a sluggish economy they felt a lot of their options had dissipated.

J2020F: You said early '90s as the time frame. What happened in '94 or '95?

LsEx: They earned and spent their way our of a lack luster economy to many economists surprise. The baby boomers began up a steep earning and spending curve that peaks some time around age 49 -- based on data from past generations.

LoEa: Marketers in the he last half of the '90s enjoyed the benefits of boomers in the economic mainstream adopting new technologies and products.

TB: Wasn't it Harry Dent who said something like, "When this happens, the new technologies experience a growth explosion, supplanting old technologies with the same vigor with which automobiles replaced railroads as the primary industry in the Roaring Twenties."

PF: And he also points out that the current stage for the boomers is the transition into the power structure of business and industry between ages 40 and 60. All the workplace rules and structure change to fit their tastes and values.

LoEx: So that's roughly a 20-year spread in age and a 20-year time frame for the last segment of the generation to exit the peak spending and earning stage.

J2020F: Then what happens?

PF: Dent predicts The United States and the rest of North America with Europe progressively moving into a close second position regain world economic dominance from the 1990s to 2010 and even beyond.

J2020F: That's good right?

PF: Should we tell him is second prediction?

J2020F: What do you mean?

PF: That period of prosperity is followed by the "mother-of-all-depressions" as Dent describes it. Starting sometime in 2010 and lasting until 2025.

TB: But, we're getting ahead of our story here. We explore future scenarios at The Ridge. For now, we'll continue to examine how past trends converged to define today.

Got Knowledge?
Copyright ©2002 - 2006 Aarnaes Howard Associates. All rights reserved worldwide.

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