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Losing the Future

October 4, 2013

During work with the European Commission, Gill Ringland of SAMI Consulting encountered Ilkka Tuomi, Founder and Principal Scientist at Oy Meaning Processing Ltd, who had some interesting thoughts on Nokia.  He is pleased to share these thoughts with you on our blog today.

Why did Nokia fail?  This was the question I asked the ex-CEO and Chairman Jorma Ollila of Nokia a couple of years ago.

How is it possible that Apple stole the show?  Why Nokia, the clear leader in mobile phones just a few months earlier, was now sinking like a piece of rock?

Ollila’s reply is something that all foresight practitioners should think carefully about.  He explained about the unexpected difficulty in creating ecosystems. I asked again.  And then he said it: “We listened to our customers.”

Ollila told that, of course, the guys with touch-screen technology first tried to sell their product to the market-leader.  And Nokia did what all excellent companies do. They evaluated technology, created prototypes, and presented touch-screen phones to potential customers and focus groups. The response was not very excited, at best.

We don’t really see how this would be useful.  Who would want to use this for texting? How can you use this when it is freezing cold and you have your gloves on?

With all the careful study, evidence, and facts on the table, top-level management in Nokia concluded that touch-screens were not a great idea.  No demand.  And then Steve Jobs came in and showed people what they were not able to dream.

What does this story tell about foresight?  First, it shows that innovation creates futures that are fundamentally unpredictable. We do not have facts or data about things that do not exist yet.  When a mobile phone becomes an internet device with sensors, touch screens, and broadband access, it becomes a new thing.  If you ask your existing customers what they like, the answer will always be about incremental improvements.  When you ask about the future, the answer will always be about history.

This is like the Europe 2020 strategy.  The problem is framed in terms of the past. “How can we get back to the old growth path?”  “How can Europe regain its competitive position?” “How can we get back to full employment.”

The future of Europe is now all about how to get back to the 1960s with new materials, big data, ubiquitous connectivity, and more innovation.  If there is a vision of the future, it is a picture in a rear-view mirror.  We look forward, and see the past.  While the industrial age is fading, we try to make sense of the future with historical concepts that are already outdated.  Innovation is understood as a means to get us back where we used to be.

The most important innovations, however, are not incremental. They create new realities and new spaces for action.

Ten years ago presidents did not tweet.  There was no data that could have been used to forecast the growth and impact of tweeting simply because there was no tweeting.  At best, there were imaginative visions, fuzzy ideas, and loose analogues.  Only after some young
innovators moved mobile phone texting to the internet, tweeting came to existence.  And now, ten years after, elections are won and lost by tweeting.

Innovation expands reality.  This “ontological expansion,” has important consequences on how we do foresight.  When innovation becomes important, the world becomes fundamentally unpredictable, and foresight has to take innovation more seriously than before.  Future is not anymore an epistemic problem.  It becomes a problem of articulation, design and experimentation.  Foresight and innovation become integrated.  We do not have data on tweeting before we create a twitter, and we don’t know what counts as data until
we have experimented with the idea.

When innovation is radical, when it changes the rules of the game and creates important social and economic consequences, there are no existing customers or “users” who can tell whether the idea is good.  Innovation creates new social practices and new realities.  This is why “user-centric” innovation rarely generates breakthroughs.  Nokia should have known this, as its success was based exactly on this fact.

When the mobile phone industry took off in the early 1990s, this was because teenagers invented short message texting.  Quarter after quarter, industry forecasts underestimated the growth of the business because no one had thought that messaging would become important.  The “dream team” of Ollila was, however, like Steve Jobs: fast learner, full of energy, and driven more by emerging opportunities than by existing facts.  When they learned that teenagers misused their phones, they quickly created infrastructure and phones that were increasingly fun to misuse.

This is the essence of what I have called the “next-generation” foresight.  Its primary aim is not to predict the future or to prepare for it. Instead, its aim is to design possible futures, test what works and what does not, and in the process learn what the future is and could
be.

This turn to design-oriented foresight has clear implications for strategic decision-making and foresight practice.  In the current state-of-the-art, foresight clearly separates strategic intelligence and sensemaking from decision-making.  Foresight is understood to provide the
facts and insights that high-level policy makers can then use to select from alternative choices.  With this division of labor, foresight experts can create more or less revolutionary visions of the future.  Foresight plays in its own sandbox, and policymakers can pick and choose whatever ideas they find useful, if any.

In next-generation foresight, policy has a very different role to play.  Foresight starts from an essentially political debate about what kinds of futures we would like to have and what we mean by progress.  The core task and the entry point for foresight is to articulate how we
would like the future to look like. The idea is not to create a “preferred future;” instead, the idea is to design, test, and learn where are the key latent opportunities of the present.  The assumption is that we cannot know the future before we create it—at least in a pilot scale.

Before the reality expands, we cannot have facts and evidence that characterize the emerging reality.

Participants in next-generation foresight processes do not only try to make sense of external and uncontrollable developments and trends.  Instead, foresight and forward-looking activities make it possible for people to design futures, revise design requirements based on process outcomes, and understand what they mean by development.  Only in this broader context facts and data can make sense, and we can know what counts as evidence.

This also means that “strategic intelligence” and information gathering become relevant only after we have negotiated at least a rough sketch for the future.  Foresight does not end with strategic decision-making and policy choice.  On the contrary, policy exploration and
reformulation launch the process of futures design.

Design-oriented foresight is therefore inherently action oriented.  There is no need to “bridge the gap” between knowledge and action.  Design-oriented foresight tries to make visible currently invisible possibilities and to expand the space for possible action.  Its aim is not to “know” the future; instead, it tries to make it happen.

A book that I published in 1999 has a chapter that explains why Nokia became one of the leaders in knowledge management two decades ago.  The title of the chapter is Failing With Future Watch.  It tells a story about Nokia’s first attempt, in 1993, to create a global network and infrastructure to improve its capability to detect weak signals and to use more effectively its globally distributed expertise. The chapter describes quite openly why the early attempts failed and what we learned from them.

It never came to my mind that I should ask anyone a permission to publish the story.  Nokia was a fast and flexible organization, with almost non-existent hierarchy.  In the preface, I say that the most important lesson that I learned was simple: Fail faster than your competitors.

Nokia went on to create quite sophisticated foresight processes.  As expected, the complexity and unpredictability of the world was fought with more data, better evidence, and increasingly sophisticated decision-making processes.  At the end, facts and data dominated, and innovation was lost.

This, basically, is why we need next-generation foresight.  We cannot get to the future using facts.  Facts are retrospective and they exist only for things that used to be important.  To know things that will be important, we have to design, experiment, and learn. The best thing is that all this can be done in fast, agile, and small pilots.  Instead of waiting the future to hit us, we can be proactive and pilot it.

Figure 1: Agile foresight model based on competitive chords. (Source: Tuomi, I. 2013. Next-Generation Foresight in Anticipatory Organisations, p. 35.

Figure 1: Agile foresight model based on competitive chords. (Source: Tuomi, I.2013. Next-Generation Foresight in Anticipatory Organisations, p. 35.

This reflection was written in response to discussion at the European Forum on Forward Looking Activities (EFFLA) meeting, 19 September 2013.  The mission of EFFLA is to help EU in tackling upcoming societal challenges and to device comprehensive and pro-active European Research & Innovation Policies.

Ilkka Tuomi worked at Nokia Research Center in 1987-2001, most recently as Principal Scientist, Knowledge Management and Information Society.  He has written five books, chapters in 23 books and over 40 scientific articles, and he is author of two international mobile communications patents.

His publications include:

  • Tuomi, I. 1999. Corporate Knowledge: Theory and Practice of Intelligent Organizations.  Helsinki: Metaxis.
  • Tuomi, I. 2002. Networks of Innovation: Change and Meaning in the Age of the Internet.  Oxford: Oxford University Press.
  • Tuomi, I. 2012. “Foresight in an Unpredictable World.” Technology Analysis & Strategic Management 24 (8): 735751.doi:10.1080/09537325.2012.715476.
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One Comment leave one →
  1. October 6, 2013 8:32 pm

    Thank you for this wonderful article, indeed, the process of innovating seems only to be rational a posteriori. I would like however to bring one more argument to the debate. Very few people look at the “dynamic view” of innovation, that IMHO, represents well the “circumstances” of the customer (in Christensen’s terms). As an example I have created a representation of the dynamic view of Amazon’s strategy here: http://www.b-mc2.com/2013/02/21/amazon-io/

    The notation I use can be understood from that 5 min tutorial using a well crafted piece of insight from Sir Ken Robinson: http://www.b-mc2.com/2013/07/04/the-power-of-imagination-by-sir-ken-robinson/

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