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FUTURE VIEW
68 THE FUTURIST July-August 2007 www.wfs.org
A funny thing happened in the music industry afew years ago.
Record companies began suing theircustomers. The Recording Industry
Association ofAmerica (RIAA) filed lawsuits against, among
other defendants, 13-year-old girls in order to stemthe rising
tide of Internet downloading of MP3files. Most would agree that
lawsuits are a less thanperfect way to relate to people who buy
your prod-ucts, especially since the industry normally
spendsmillions to attract teenagers. The record compa-nies peculiar
choice illustrates why, in this rapidlychanging world, foresight is
so essential.
When you look back to the 1990s, it is importantto recognize
that record executives are not stupid.The marketing and strategic
planners at companieslike Sony, Atlantic, and Universal were and
con-tinue to be experts in finding talent, market segmenta-tion,
retail channels, branding, and promotionall thethings you need to
compete in the entertainment indus-try. They were right on top of
their competitors, scan-ning their marketplace for new trends in
customer taste,tracking the moves of other record companies, and
evenlooking out for substitute products. Video games andcable
television were as much potential competitors asanother record
label with a hot band. These executivesdid what most people dothey
looked at their competi-tion and their customers and tried to
anticipate the nextmove.
What they did not do was follow a couple of key tech-nological
trends outside of their industry. Throughoutthe 1990s, home
computer ownership was increasing. At
the same time, more and more computers were capableof accessing
the Internet. On the horizon were new im-provements in software
that enabled audio to be com-pressed into a small amount of data
while retaininggood sound quality. The file format called MP3, or
Mo-tion Picture Engineering Group Audio Layer 3, wasborn. Unlike
previous attempts to digitize music into asmall package, MP3 files
actually sounded like music.Unlike copying music onto cassette
tapes, you couldmake an unlimited number of copies at the touch of
abutton. This technical revolution occurred at the exactmoment that
consumers everywhere were connecting to
the Internet at homeor at work.
If you recognize theword Napster, therenegade free file-sharing
site, then youremember the chaosthat resulted. By late1999 and
2000, freemusic poured out ofthe Internet with nocost to consumers
and
few technical difficulties. Napster was so terrifyingly
ef-ficient at connecting consumers with one another toshare their
music that anyone with a computer couldquickly find any song with a
simple Web search. Musicno longer was a physical product made of
plastic; it wasnow an ethereal concept that could be stored on a
harddrive and shared at will, broadcast to anyone with a fewmoments
to do a Web search.
Moreover, market research showed that young peopletrading MP3
files had significantly different values thantheir elders when it
came to the legality and morality ofdownloading. Appeals to younger
consumers by theRIAA to equate the trading of MP3s with shoplifting
fellflat. The industry sued, and came off looking like bulliesin
the process.
If industry executives had spent a little more timethinking
about how technologies could affect their busi-ness, we might have
had iTunes five years earlier andfewer teenagers hiring attorneys
to defend themselvesfrom record labels!
The Transformative Power of Trends
In todays world, you need to think not just aboutyour own
future, but also about the future of nearly
Getting Ahead by
Looking AheadA practicing futurist explains why
foresight can make the difference
between success and failure.
By Eric Garland
continued on page 66
Eric Garland
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fully in one of my earlier books (The NewRules of Corporate
Conduct).
I, for one, would not argue that suchconcerns are tangential to
the crafting ofscenarios. . . . Social values and expecta-tions are
an integral part of the corporateenvironmentand so of nearly
everyscenario project.
Ian WilsonSan Rafael, California
A Prominent Role in the Future
Thank you for sharing Ed Cornishsmemoirs in THE FUTURIST. I
foundCornishs account of the development offutures studies and his
personal role in it
truly fascinating. When the definitive his-tory of the field is
someday written, hismemoirs will figure prominently in it.
Wendell Bell,Professor Emeritus,
Department of SociologyYale University
66 THE FUTURIST July-August 2007 www.wfs.org
FEEDBACK
continued from page 4LETTERS: The editors welcome readers
responses to material appearing in THE
FUTURIST. Mail may be addressed to
Feedback, THE FUTURIST, 7910
Woodmont Avenue, Suite 450,Bethesda, Maryland 20814. E-mail:
[email protected]. Letters will normally
be shortened and edited prior to
publication.
FUTURE VIEW
everything. Now, if you are a recordcompany, you arent just
worriedabout other entertainment providers;youve got to be looking
at electron-ics in the home and computers in theworkplace and the
next technologi-cal innovation to see tomorrowscompetitive
challenge.
Like the record industry 15 yearsago, businesses today are
facing aspecial kind of challenge. They arentjust dealing with
traditional threatsfrom new competitors, substituteproducts, and
shifts in the market,but are instead seeing entire indus-tries
turned on their heads in incred-ibly short periods. This
significantlymore difficult phenomenon occurswhen too many changes
occur at onetime and, in effect, begin to fold inon one another. I
call this supercon-nection, or the interaction of multipleforces in
society and technology at
one time. Of course, there have beendisruptive technologies and
socialtrends in the past, but today, thingsare accelerating so
rapidly, and glob-alization spreads change so quickly,its as if it
were all happening inyour backyard.
Today, the sciences have begun tooverlap as biotechnology,
chemistry,and physics advance to becomenanotechnology.
Globalization meetsnew information technology, and
your customer service reps suddenlyspeak with a foreign accent.
Yourbiggest market segment is suddenlyretired people, because the
babyboomers are aging. Indias middleclass is nearly as big as the
popula-tion of Europe. Traditional competi-tors fade; completely
new ones ap-pear. Your own customers become asbig a threat as your
fiercest rival.Companies in countries youve neverheard of begin
outproducing yourfactories. Chaos seems to reign.
But chaos is not impossible tomanage if you give yourself
enoughtime to look at external forces beforethe problem lands in
your lap.
Competitors, product substitu-tions, and changes in the market
arenot new. But the speed and complex-ity of these changes are
giving lead-ers whiplash. One minute, you areselling records; the
next, you are de-posing little Brittany Johnson fromdown the street
for swapping MP3s
with her friends.The changes are circling around
us, popping up in the headlines andappearing in the form of
newrealities in our businesses. The popu-lation of Italy is getting
older, justlike Japan, Russia, the United States,and most Western
nations. Biotech-nology is getting cheap. Nobody hasa solution for
the addiction to oil.The ethnic face of France is chang-ing. China
has too many boys. The
richpoor gap is increasing. It is in-teresting to read about,
but leadingan organization in the face of thisseems daunting at the
very least.This brings us to the subject of you.
Not every industry is facing suchdramatic changes forcing
life-or-death decisions. Maybe you run abowling alley and just want
to knowwhat the customer of the future willwant for entertainment.
Maybe youare considering a second career andwonder what jobs will
be hot in thenext few years. You could be an in-vestor trying to
get in early to profitfrom what the future holds. Onceyou
understand how to see whatscoming next using such tools as sys-tems
thinking, trend analysis, andscenario generation, your view ofthe
world will change and you willbe better prepared. Onward to
thefuture!
About the Author
Eric Garland is the principal of CompetitiveFutures Inc., a
futures consultancy,
www.competitivefutures.com. His last article
for THE FUTURIST, Can Minority Lan-
guages Be Saved? Globalization vs. Cul-
ture, appeared in July-August 2006.
Adapted from Future, Inc.: How Businesses
Can Anticipate and Profit from Whats Next.
Copyright 2007 by Eric Garland. Pub-
lished by AMACOM Books, a division of
American Management Association, New
York, New York. Used with permission. All
rights reserved. www.amacombooks.org.
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