Threatcasting Corporate Strategy: Dealing with Excessive Tactical Thinking

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Threatcasting, a practice championed by ex-Intel fellow and futurist Brian David Johnson for the U.S. military, is a Delphi method derivative with roots in science fiction prototyping.

Recently, a broad selection of defense departments, multi-national corporations and one science fiction author issued a threatcasting report related to an anticipated attack on Manhattan using a blend of physical and cyber methods to maximize damage and minimize response effectiveness. Threatcasting in this instance is being used to anticipate and prepare for the next likely domestic attack and either prevent it or mitigate the resulting damage. In May, another session will look more deeply into artificial intelligence, robotics and the growing inability to detect cyberattacks in a timely manner (among other things).

The practice of threatcasting actually has implications for business. If used appropriately, it could help a firm avoid the kinds of issues that have recently plagued organizations like HPE, Yahoo, Palm and Samsung.

The Problem: Excessive Tactical Focus

If you go to the root of most corporate problems, you’ll often find the cause is in some way connected to a decision maker — or makers — who are focused excessively on the short term. They want a quick benefit, a quick fix. This near-obsessive focus on the present, which often revolves heavily around personal compensation or quarterly results, causes them to be blind to long-term trends. As a result, the individual or firm makes huge avoidable strategic errors.

We saw this broadly when Apple first entered the smartphone segment. Among other technology companies, the response was similar to Jung’s stages of grief. First, competing executives denied there was any issue. Then they got angry over Apple’s success. By the time they got to acceptance, Apple owned the market, and they really didn’t have any choice. Apple had a great product and a marketing-focused CEO in Steve Jobs, and he cut through a market dominated by financial types like a hot knife through butter.

I was recently in a session where a company facing a clear competitive challenge that would emerge in the future, argued that there was no veracity in the risk because they’d done very well last quarter. This is like pointing out a cliff that a driver is heading towards as a risk, only to have the driver argue that it was OK, because the car had been running really well of late.

What most companies need is a process that regularly forces executives to think strategically,so they can anticipate problems rather than being pounded into failure as a result of not anticipating them.

Threatcasting may be the answer.

Threatcasting

I was a competitive analyst back when this function was far more popular and far better funded. Sadly, with the shift to an expense-driven tactical focus, many of these groups have been dramatically cut or eliminated. (And those that survived often learned that telling executives what they wanted to hear was far safer than telling them bad news they needed to know. Yes, shooting the messenger is a “thing.”)

The Delphi method was part of this work, but it had one critical flaw: Delphi efforts generally used internal people with an external facilitator who had no industry background. With this over focus on tactical performance, the efforts degraded over time. Threatcasting, done right, includes qualified external participants who are strategic in nature and fill the gaps that a traditional Delphi method effort leaves open.

Much as the referenced Army report showcased how a coordinated cyber and physical attack could devastate a city like New York, so to, this effort could identify competitive, environmental, regulatory or hostile trends and help a company develop a strategy to deal with them before the firm was devastated by them.

AI, Oh My!?!

Threatcasting could dramatically change how companies anticipate and deal with future strategic problems. By moving beyond the Delphi method to better include external views, threatcasting could dramatically improve the long-term survivability of a firm.

Going forward, though, I think this effort could be improved with the addition of a strong deep learning artificial intelligence (AI), which could not only provide the group with accurate and timely information about world conditions but collect the thoughts of the group and then abstract the thinking across firms and efforts to improve the effectiveness of all related activities over time. The aggregated result could be the closest thing we’ll get to a real crystal ball this century.

However we get there, finding a way to overcome this tendency to focus excessively on tactical things will be critical to the survival of many businesses that otherwise likely won’t make it into next decade.

Photo courtesy of Shutterstock.