Tackling Uncertainty Featured Pattern: P1470 March 2020
Abstracts in this Pattern:
Wall Street Journal business columnist John D. Stoll claims that "businesspeople are haunted, and sometimes paralyzed, by uncertainty. This monster, however, can be a friend." His article summarizes some considerations about how to tackle uncertainty. For example, climate scientist Judith Curry highlights that instead of becoming paralyzed, decision makers should take small steps toward possible solutions to climate change. Stoll argues that a similar attitude works for decision makers in business environments. Berkshire Hathaway (Omaha, Nebraska) chairman and CEO Warren Buffett points out that many decision makers should not worry about uncertainty as much as they do and highlights that worthwhile projects will be worth investing in even under uncertainty.
In a recent article, PwC US (PricewaterhouseCoopers International; London, England) principals Sundar Subramanian and Anand Rao—who leads PricewaterhouseCoopers International's global artificial-intelligence efforts—suggest building "disruptive strategic flywheels" as a source of stabilization. They view AI, deep learning, and gaming solutions as tools for gaining a handle on disruptive developments. The authors discuss a case in which an auto manufacturer asked a consulting firm to gauge its competitive position in relation to a specific type of start-up. The consulting firm created a game that pitted the automaker against its competitors, and an AI system used data from the game to run numerous simulations that "suggested many strategic bets, option-value bets, and 'no-regret strategies,' or moves that made strategic and financial sense in a multitude of situations."
An approach to understanding the uncertainties of the future that Future Today Institute (New York, New York) founder and CEO Amy Webb suggests makes use of tools that are similar to Scan™. Her recommendation is that the president of the United States should create a "Strategic Foresight Office"—a government agency that analyzes probable futures by continually assessing sources of change, identifying emerging trends, and tracking the direction and speed of changes. Webb's concern is that although existing agencies "each marshal some aspect of a strategic foresight function, there is no entity charged to focus on strategic foresight across domains equipped with the resources to undertake a comprehensive approach."
The Development of this Pattern
Wall Street Journal business columnist John D. Stoll claims that "businesspeople are haunted, and sometimes paralyzed, by uncertainty. This monster, however, can be a friend."
PwC US principals Sundar Subramanian and Anand Rao—who leads PricewaterhouseCoopers International's global artificial-intelligence efforts—suggest building "disruptive strategic flywheels" as a source of stabilization.
Future Today Institute founder and CEO Amy Webb suggests that the president of the United States should create a "Strategic Foresight Office."
P1470 — Tackling Uncertainty
Decision makers are struggling with how to address uncertainties about future commercial environments, but various potential approaches exist.
- SoC369 — Prediction Is the Future (May 2009)
Technologies now exist that can anticipate a variety of phenomena, from crime to illness. For a whole host of industries—from security to marketing to health care—prediction is the future.
- P0103 — New Predictive Tools (September 2010)
Companies and consumers alike will find practical applications for several novel predictive capabilities that researchers develop, although privacy considerations will become a topic of debate.
- P0678 — Mining the Future (September 2014)
New data-mining methods promise to reveal information about developing events and technological advances, perhaps offering a glimpse into the future.
- SoC753 — The Art or Science of Forecasting (October 2014)
Precise but inaccurate forecasts result in incorrect conclusions that lead to misguided strategies.
- P0779 — The Future of Forecasting (May 2015)
Recent efforts show the very different ways that researchers are trying to develop foresight methods for the twenty-first century.
- P0913 — Certainty of Uncertainty (May 2016)
Predictions likely will become even less accurate than they currently are. The only valid prediction is that the world is uncertain.
- SoC885 — Uncertain Predictability, Predictable Uncertainty (August 2016)
Experts in a variety of fields recently raised the chilling prospect that even understanding potential future developments is becoming increasingly difficult.
- SoC1003 — Living in a Predictive World (March 2018)
Predictive capabilities enable users to identify issues early and potentially avoid problematic outcomes.
- P1400 — Forewarned Is Forearmed (September 2019)
Enhanced prediction technologies can offer important benefits for a range of complex and highly dynamic environments.