The New Normal
How can we deal with the big uncertainties about the future? What can we learn about this from the oldest companies in the world?
One thing I know for sure. If we continue to look, think, and believe as we have always done, then little or nothing changes. We humans are creatures of habit. I remember an American study that showed that 63% of people continue to smoke after a heart attack for a year. Change is anything but easy for humans. Even if it hurts. However, it often seems that, as humanity, we do not naturally start to move until the water reaches our lips. Well, right now the world is on fire. The pandemic turns into an endemic. Meanwhile, humanity faces a series of other major challenges alongside this endemic. Not to mention the biggest humanitarian problems in the world.
In all areas of society, we need breakthroughs. In the short term. In our own lives, in the workplace and in society. No matter how big and confusing the challenges are on a large scale, I love to see what I can do myself in my own piece of life. Both in private and in business. If every human being truly helps one fellow man move forward meaningfully, then the world will look different tomorrow.
If we can learn anything from the pandemic, it is that life, entrepreneurship, and coexistence is unpredictable. A small virus is capable of flattening almost the entire world. It teaches us to accept uncertainty, which in turn creates space for beautiful new ideas and initiatives. We learn new things and see and feel again how important the value of freedom is. Control, the idea of complete mastery of life, turns out to be an illusion. Extraordinary times call for pushing our boundaries, inventing new methods, and experimenting in new directions. I experience that learning to think about the future in different scenarios, is one way which is very helpful.
Planning a scenario
No one can predict the future. Nobody knows what is coming. More than ever, humanity is invited to embrace the unknown. It is an art of looking in a way we have not looked at things before. Scenario planning helps me a lot. It gives a new framework of thinking to look towards the future in different ways. It helps to find new ways and remain creative in my thinking process.
A scenario is a story that describes a possible future. It includes remarkable events, and key individuals/organizations with their motivations, which gives a sense of the complicated dynamics of the world. Building and using, different scenarios help people to imagine the often-uncertain future in a better way and thus find solutions of how more easily things can be done, rather than 'impossible'.
Looking at the unknown
In the 1970s, Shell discovered that the old planning systems had been developed for a stable, familiar world where everything was 'more of the same'. If the future is no longer stable or secure, any attempt to make that one correct prediction is doomed to fail. Scenarios should not look for the certainties but focus on the uncertainties and structure them. Arie de Geus was working with Shell at the time and already saw how scenario-thinking helped management to change their perception of reality. Shell did not predict the 1973 oil crisis, but the company was prepared for it. While other oil companies were surprised by the oil crisis, Shell was prepared for what could come. The economic gains of these positive preparations ran even into the billions. A new way of planning was not focused on planning and control but was based on a thorough analysis of uncertainties. It makes sense to work out different scenarios for the future again. Simulation techniques can help with that. That helps us to look, think and believe differently. Daring to acknowledge 'not knowing everything', looking at the unknown, with all the uncertainties that entails, immediately broadens our insight.
Oldest companies in the world
In the long term, most companies do not survive 'earth shock' damage from to change and competition. This applies not only to small companies and organisations but also to very large ones. In his book "The Living Enterprise, about living and working in a turbulent environment" Arie de Geus investigated how already in the beginning of the 21st century what the oldest companies in the world had in common. Think about, for example, of Stora Enso, the oldest public limited company that started as a copper mining company in 1288 and has reinvented itself several times over the centuries. Eventually it changed into an iron ore mine, after which it gradually shifted from mining to forestry. Now, the listed company is one of the forerunners in the field of ecological-friendly packaging, fully in line with the contemporary circular economy.
Stora Enso is just one example, but please take a look at the list of the oldest companies in the world and discover how they have managed to reinvent themselves again in good times and bad.
The research of Arie de Geus shows that the world’s oldest companies have four golden rules to a long and healthy life as an organisation- namely:
- Sensitivity to the environment and the ability to adapt.
- The ability to build their own identity and connect employees to
- Tolerance and decentralisation; the realisation that the environment will not be controlled in the longer term and that experiments and activities on the margins are useful to increase insights.
- Conservative financial policy - in which profit is seen as oxygen, but not as a goal. And where money is always kept under control for the future.
Without wanting to downplay the serious challenges in the world, I recognize myself in the insights of De Geus. If you look at companies that have been able to adapt and renew themselves for centuries, and sometimes for more than 1,000 years, are not afraid to sometimes fall and get up quickly, why should we not be able to do it? At Eurapco, I am lucky to work with eight leading European primarily mutual insurance companies that naturally carry the forementioned golden rules in their business DNA. There is a lot to be achieved from strength. From our mutual background, we know that together always yields much more than just being on your own. There are problems enough in this world, but how often do we dare to acknowledge that we ourselves are often the biggest problem? Shall we focus on what is possible? And how is it possible? Thinking in different scenarios for the future helps us to use the energy of challenges for something new. Welcome to the new normal!
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