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(Virtual) Education Lecture 19 May:  Unconscious Bias
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Strategy Under Uncertainty....

Predicting the future is quite a difficult endeavour.  Even the best practitioners get it wrong almost all the time....

It is an inevitable reality that Management Consultants are asked to guide senior leaders through a host of strategic decisions in an atmosphere of unsettling ambiguity—in markets, regulatory regimes, and global events.  Often companies believe that management consultants have some kind of special crystal ball to peer into the future, which is why they continue to rely on us for advice.

It is true that the profession of management consulting allows one a front row seat on a much broader array of experiences and information than most.  But that is only part of the reason behind our unique ability to formulate strategy.  The bulk of our expertise arises from the process of strategy development.  It is this element that has undergone a fundamental shift in the last decade.

In the past era, we all worked very hard to predict the future—consulting many experts to devise a view of forward markets that we then rest our strategy design upon.  It turns out, however, that predicting the future is quite a difficult endeavour—and even the best practitioners get it wrong almost all the time.

These uncertain times (and are there ever certain times?) call for a very different approach—one that is underpinned by the concept of robustness.

The reality is that at any given moment we have countless plausible futures ahead of us.  One future is where competition is very strong, another where it is weak.  Another future might involve regulatory structure—structure A versus B versus C, and everywhere in between.  As we add up all of these combinations we very quickly reach a large number of possibilities.  The idea behind robustness implies a strategy that works well across many future possibilities as opposed to the strategy that works spectacularly well in a very small number of possibilities.  As obvious as that might seem I personally have been witness to many corporate strategies that have failed due to a lack of robustness.

How can we possibly test thousands or even millions of futures against our strategic options?  With computer models of course, another core tool in the Management Consultant’s arsenal.  Computer models are the centerpiece of any modern strategy discussion.

I have a very strong feeling that mastery of uncertainty will be the defining criteria of the top tier of management consulting practice in the years to come.    Just a hunch.  

 

 

 

 

Freeman George Danner