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How To Cope With Decision Fatigue
When members of Lowe’s Innovation Labs first began talking with the home improvement retailer’s senior executives about how disruptive technologies would affect the future, the presentations were well received but nothing stuck.
“We’d give a really great presentation and everyone would say, ‘Great job,’ but nothing would really happen,” says Amanda Manna, head of narratives and partnerships for the lab.
The team realized that it needed to ditch the PowerPoints and try something radical. The team’s leader, Kyle Nel, is a behavioral scientist by training. He knows people are wired to receive new information best through stories. Sharing far-future concepts through narrative, he surmised, could unlock hidden potential to drive meaningful change.
So Nel hired science fiction writers to pen the future in comic book format, with characters and a narrative arc revealed pane by pane.
The first storyline, written several years before Oculus Rift became a household name, told the tale of a couple envisioning their kitchen renovation using virtual reality headsets. The comic might have been fun and fanciful, but its intent was deadly serious. It was a vision of a future in which Lowe’s might solve one of its long-standing struggles: the approximately US$ 70 billion left on the table when people are unable to start a home improvement project because they can’t envision what it will look like.
When the lab presented leaders with the first comic, “it was like a light bulb went on,” says Manna. “Not only did they immediately understand the value of the concept, they were convinced that if we didn’t build it, someone else would.”
Today, Lowe’s customers in select stores can use the HoloRoom How To virtual reality tool to learn basic DIY skills in an interactive and immersive environment.
Other comics followed and were greeted with similar enthusiasm—and investment, where possible. One tells the story of robots that help customers navigate stores. That comic spawned the LoweBot, which roamed the aisles of several Lowe’s stores during a pilot program in California and is being evaluated to determine next steps.
And the comic about tools that can be 3D-printed in space? Last year, Lowe’s partnered with Made in Space, which specializes in making 3D printers that can operate in zero gravity, to install the first commercial 3D printer in the International Space Station, where it was used to make tools and parts for astronauts.
The comics are the result of sending writers out on an open-ended assignment, armed with trends, market research, and other input, to envision what home improvement planning might look like in the future or what the experience of shopping will be in 10 years. The writers come back with several potential story ideas in a given area and work collaboratively with lab team members to refine it over time.
The process of working with writers and business partners to develop the comics helps the future strategy team at Lowe’s, working under chief development officer Richard D. Maltsbarger, to inhabit that future. They can imagine how it might play out, what obstacles might surface, and what steps the company would need to take to bring that future to life.
Once the final vision hits the page, the lab team can clearly envision how to work backward to enable the innovation. Importantly, the narrative is shared not only within the company but also out in the world. It serves as a kind of “bat signal” to potential technology partners with capabilities that might be required to make it happen, says Manna. “It’s all part of our strategy for staking a claim in the future.”
Companies like Lowe’s are realizing that standard ways of planning for the future won’t get them where they need to go. The problem with traditional strategic planning is that the approach, which dates back to the 1950s and has remained largely unchanged since then, is based on the company’s existing mission, resources, core competencies, and competitors.
Yet the future rarely looks like the past. What’s more, digital technology is now driving change at exponential rates. Companies must be able to analyze and assess the potential impacts of the many variables at play, determine the possible futures they want to pursue, and develop the agility to pivot as conditions change along the way.
This is why planning must become completely oriented toward—and sourced from—the future, rather than from the past or the present. “Every winning strategy is based on a compelling insight, but most strategic planning originates in today’s marketplace, which means the resulting plans are constrained to incremental innovation,” says Bob Johansen, distinguished fellow at the Institute for the Future. “Most corporate strategists and CEOs are just inching their way to the future.” (Read more from Bob Johansen in the Thinkers story, “Fear Factor.”)
Inching forward won’t cut it anymore. Half of the S&P 500 organizations will be replaced over the next decade, according to research company Innosight. The reason? They can’t see the portfolio of possible futures, they can’t act on them, or both. Indeed, when SAP conducts future planning workshops with clients, we find that they usually struggle to look beyond current models and assumptions and lack clear ideas about how to work toward radically different futures.
Companies that want to increase their chances of long-term survival are incorporating three steps: envisioning, planning for, and executing on possible futures. And doing so all while the actual future is unfolding in expected and unexpected ways.
Those that pull it off are rewarded. A 2017 benchmarking report from the Strategic Foresight Research Network (SFRN) revealed that vigilant companies (those with the most mature processes for identifying, interpreting, and responding to factors that induce change) achieved 200% greater market capitalization growth and 33% higher profitability than the average, while the least mature companies experienced negative market-cap growth and had 44% lower profitability.
Looking Outside the Margins
“Most organizations lack sufficient capacity to detect, interpret, and act on the critically important but weak and ambiguous signals of fresh threats or new opportunities that emerge on the periphery of their usual business environment,” write George S. Day and Paul J. H. Schoemaker in their book Peripheral Vision.
But that’s exactly where effective future planning begins: examining what is happening outside the margins of day-to-day business as usual in order to peer into the future.
Business leaders who take this approach understand that despite the uncertainties of the future there are drivers of change that can be identified and studied and actions that can be taken to better prepare for—and influence—how events unfold.
That starts with developing foresight, typically a decade out. Ten years, most future planners agree, is the sweet spot. “It is far enough out that it gives you a bit more latitude to come up with a broader way to the future, allowing for disruption and innovation,” says Brian David Johnson, former chief futurist for Intel and current futurist in residence at Arizona State University’s Center for Science and the Imagination. “But you can still see the light from it.”
The process involves gathering information about the factors and forces—technological, business, sociological, and industry or ecosystem trends—that are effecting change to envision a range of potential impacts.
Seeing New Worlds
Intel, for example, looks beyond its own industry boundaries to envision possible future developments in adjacent businesses in the larger ecosystem it operates in. In 2008, the Intel Labs team, led by anthropologist Genevieve Bell, determined that the introduction of flexible glass displays would open up a whole new category of foldable consumer electronic devices.
To take advantage of that advance, Intel would need to be able to make silicon small enough to fit into some imagined device of the future. By the time glass manufacturer Corning unveiled its ultra-slim, flexible glass surface for mobile devices, laptops, televisions, and other displays of the future in 2012, Intel had already created design prototypes and kicked its development into higher gear. “Because we had done the future casting, we were already imagining how people might use flexible glass to create consumer devices,” says Johnson.
Because future planning relies so heavily on the quality of the input it receives, bringing in experts can elevate the practice. They can come from inside an organization, but the most influential insight may come from the outside and span a wide range of disciplines, says Steve Brown, a futurist, consultant, and CEO of BaldFuturist.com who worked for Intel Labs from 2007 to 2016.
Companies may look to sociologists or behaviorists who have insight into the needs and wants of people and how that influences their actions. Some organizations bring in an applied futurist, skilled at scanning many different forces and factors likely to coalesce in important ways (see Do You Need a Futurist?).
Do You Need a Futurist?
Most organizations need an outsider to help envision their future. Futurists are good at looking beyond the big picture to the biggest picture.
Business leaders who want to be better prepared for an uncertain and disruptive future will build future planning as a strategic capability into their organizations and create an organizational culture that embraces the approach. But working with credible futurists, at least in the beginning, can jump-start the process.
“The present can be so noisy and business leaders are so close to it that it’s helpful to provide a fresh outside-in point of view,” says veteran futurist Bob Johansen.
To put it simply, futurists like Johansen are good at connecting dots—lots of them. They look beyond the boundaries of a single company or even an industry, incorporating into their work social science, technical research, cultural movements, economic data, trends, and the input of other experts.
They can also factor in the cultural history of the specific company with whom they’re working, says Brian David Johnson, futurist in residence at Arizona State University’s Center for Science and the Imagination. “These large corporations have processes and procedures in place—typically for good reasons,” Johnson explains. “But all of those reasons have everything to do with the past and nothing to do with the future. Looking at that is important so you can understand the inertia that you need to overcome.”
One thing the best futurists will say they can’t do: predict the future. That’s not the point. “The future punishes certainty,” Johansen says, “but it rewards clarity.” The methods futurists employ are designed to trigger discussions and considerations of possibilities corporate leaders might not otherwise consider.
You don’t even necessarily have to buy into all the foresight that results, says Johansen. Many leaders don’t. “Every forecast is debatable,” Johansen says. “Foresight is a way to provoke insight, even if you don’t believe it. The value is in letting yourself be provoked.”
External expert input serves several purposes. It brings everyone up to a common level of knowledge. It can stimulate and shift the thinking of participants by introducing them to new information or ideas. And it can challenge the status quo by illustrating how people and organizations in different sectors are harnessing emerging trends.
The goal is not to come up with one definitive future but multiple possibilities—positive and negative—along with a list of the likely obstacles or accelerants that could surface on the road ahead. The result: increased clarity—rather than certainty—in the face of the unknown that enables business decision makers to execute and refine business plans and strategy over time.
Plotting the Steps Along the Way
Coming up with potential trends is an important first step in futuring, but even more critical is figuring out what steps need to be taken along the way: eight years from now, four years from now, two years from now, and now. Considerations include technologies to develop, infrastructure to deploy, talent to hire, partnerships to forge, and acquisitions to make. Without this vital step, says Brown, everybody goes back to their day jobs and the new thinking generated by future planning is wasted. To work, the future steps must be tangible, concrete, and actionable.
Organizations must build a roadmap for the desired future state that anticipates both developments and detours, complete with signals that will let them know if they’re headed in the right direction. Brown works with corporate leaders to set indicator flags to look out for on the way to the anticipated future. “If we see these flagged events occurring in the ecosystem, they help to confirm the strength of our hypothesis that a particular imagined future is likely to occur,” he explains.
For example, one of Brown’s clients envisioned two potential futures: one in which gestural interfaces took hold and another in which voice control dominated. The team set a flag to look out for early examples of the interfaces that emerged in areas such as home appliances and automobiles. “Once you saw not just Amazon Echo but also Google Home and other copycat speakers, it would increase your confidence that you were moving more towards a voice-first era rather than a gesture-first era,” Brown says. “It doesn’t mean that gesture won’t happen, but it’s less likely to be the predominant modality for communication.”
How to Keep Experiments from Being Stifled
Once organizations have a vision for the future, making it a reality requires testing ideas in the marketplace and then scaling them across the enterprise. “There’s a huge change piece involved,”
says Frank Diana, futurist and global consultant with Tata Consultancy Services, “and that’s the place where most
businesses will fall down.”
Many large firms have forgotten what it’s like to experiment in several new markets on a small scale to determine what will stick and what won’t, says René Rohrbeck, professor of strategy at the Aarhus School of Business and Social Sciences. Companies must be able to fail quickly, bring the lessons learned back in, adapt, and try again.
Lowe’s increases its chances of success by creating master narratives across a number of different areas at once, such as robotics, mixed-reality tools, on-demand manufacturing, sustainability, and startup acceleration. The lab maps components of each by expected timelines: short, medium, and long term. “From there, we’ll try to build as many of them as quickly as we can,” says Manna. “And we’re always looking for that next suite of things that we should be working on.” Along the way certain innovations, like the HoloRoom How-To, become developed enough to integrate into the larger business as part of the core strategy.
One way Lowe’s accelerates the process of deciding what is ready to scale is by being open about its nascent plans with the world. “In the past, Lowe’s would never talk about projects that weren’t at scale,” says Manna. Now the company is sharing its future plans with the media and, as a result, attracting partners that can jump-start their realization.
Seeing a Lowe’s comic about employee exoskeletons, for example, led Virginia Tech engineering professor Alan Asbeck to the retailer. He helped develop a prototype for a three-month pilot with stock employees at a Christiansburg, Virginia, store.
The high-tech suit makes it easier to move heavy objects. Employees trying out the suits are also fitted with an EEG headset that the lab incorporates into all its pilots to gauge unstated, subconscious reactions. That direct feedback on the user experience helps the company refine its innovations over time.
Make the Future Part of the Culture
Regardless of whether all the elements of its master narratives come to pass, Lowe’s has already accomplished something important: It has embedded future thinking into the culture of the company.
Companies like Lowe’s constantly scan the environment for meaningful economic, technology, and cultural changes that could impact its future assessments and plans. “They can regularly draw on future planning to answer challenges,” says Rohrbeck. “This intensive, ongoing, agile strategizing is only possible because they’ve done their homework up front and they keep it updated.”
It’s impossible to predict what’s going to happen in the future, but companies can help to shape it, says Manna of Lowe’s. “It’s really about painting a picture of a preferred future state that we can try to achieve while being flexible and capable of change as we learn things along the way.” D!
About the Authors
Dan Wellers is Global Lead, Digital Futures, at SAP.
Kai Goerlich is Chief Futurist at SAP’s Innovation Center Network.
Stephanie Overby is a Boston-based business and technology journalist.
Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.
Traditional BI helps hospitals cope with shifting payment plans
Go to any healthcare-focused IT conference today and you’ll hear a lot of talk about analytics. In particular, the realms of big data and predictive analytics generate huge excitement.
But scratch the hype and you’re likely to find that hospitals see the most value from their traditional BI implementations.
“It’s critical,” said Thomas McGill, M.D., CIO and vice president of quality and safety at Butler Health System in Butler, Pa. “The information tools help align the team effort and coordinate the effort.”
Traditional BI may not generate the excitement that more advanced analytics does among healthcare providers, but in some ways, it’s just what the doctor ordered for a changing healthcare landscape.
BI reporting tools good for business
At Butler, BI impacts both the clinical and administrative sides of operations. McGill helped deploy an Information Builders BI reporting tool called WebFOCUS, which care teams use to track clinical quality measures. That allows them to see how individual doctors are doing when it comes to things like prescribing medication according to evidence-based guidelines or preventing infections.
Such capabilities are good for patients and good for business, according to McGill. Starting in 2013, the Centers for Medicare and Medicaid Services, the federal agency in charge of paying medical claims made to those two programs, started penalizing hospitals for avoidable readmissions. McGill said that first year, Butler paid close to the maximum amount allowed under the law in penalties. But the hospital cut its penalties the next year by 60%, and the following year by an additional 30%.
McGill wouldn’t give all the credit for that improvement to the traditional BI reporting tools and reports used by care teams — they’re also using a risk modeling tool to identify patients most likely to be readmitted. But he said BI has played an important role in getting doctors to be more consistent in delivering high-quality care, which has paid off clinically as well as administratively.
“We have to change how we do care in terms of figuring out what we want to happen and making sure that happens all the time,” McGill said.
Despite these benefits, hospitals are still generally most excited by more advanced analytics applications. According to a recent survey of 245 hospitals conducted by TechTarget and the College of Healthcare Information Management Executives, traditional BI isn’t the top priority for most hospitals. General data analytics was the most common area respondents said they are investing in. Clinical data analytics was the top analytics tool respondents said they plan to use in the next two years. BI was the second most common response to both questions.
BI useful tool in healthcare
Although hospitals seem to prefer advanced analytics tools over traditional BI, there is no shortage of reasons why BI is a useful tool in today’s healthcare system. Aside from penalties for preventable readmissions, many providers also face more general changes to the way they are paid. Instead of receiving payment for each patient visit they complete or procedure they perform, many hospitals are being paid based on quality. Both governmental and private health insurers are moving hospitals into accountable care programs, which essentially give the hospital a set budget for treating patients. It’s up to the hospital to work within that budget.
“It was a drastic switch from fee-for-service to fee-for-value,” said Colby Lutz, a BI analyst at Trivergent Health Alliance, a management services company formed by three hospitals in Maryland, including Western Maryland Health System, where he does most of his work. The health system operates under a pay-for-performance program through Medicare.
Lutz has worked on a major initiative to improve continuity of care, which involved tracking patients from the moment they’re admitted to a hospital, through their treatment and discharge, and on to any follow-up care required. The goal is to ensure patients receive optimal services at each point in order to reduce unexpected and costly emergency room visits down the line.
BI tools help improve bottom line
Lutz and his team use a BI tool from Dimensional Insight, called Diver, to pull data from the health systems’ electronic health record systems to identify frequent users of ER services. This enables doctors to discuss other options with these patients the next time they show up. They’re also tracking readmissions to identify process improvement opportunities.
Since bringing on the BI platform in fiscal year 2013, Western Maryland has seen a $ 1.3 million improvement in revenues. Lutz didn’t attribute that gain entirely to the BI tool, but he said that “being able to track and trend was significant.”
One of the main benefits of the BI reporting tool, Lutz said, is that it allows hospital administrators to track patients through their entire interaction with the health system to learn what’s working, what’s not and where the hospitals can improve. This enables the administrators to make smarter decisions about how to allocate their budgets.
“We felt that if you couldn’t access the data in any of our systems, there was a pretty big care gap,” he said.
These changing standards for payment are raising the profile of traditional BI among healthcare providers, said Glenn Gutwillig, managing director for consulting services to health providers at Accenture Analytics. But, he added, hospitals could better leverage the technology. Although the potential benefits are large, he said most providers still struggle with deploying the fundamental technologies that support BI.
Still, as the benefits become better understood, adoption is likely to tick up. “The majority of our healthcare provider clients are becoming increasingly aware of the need to deploy BI,” Gutwillig said.
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DBA skills must evolve, morph to cope with big data technologies
New technologies are shaking up the status quo in data processing. Despite the rush of schema-less NoSQL and Hadoop platforms and associated tools, the change may be moderate when it comes to database administration. But some new skills will likely come to the fore for database administrators (DBAs) as systems based on those technologies get deployed in companies. And the days when the DBA was the sole “keeper of the database schema” seem to be waning.
“There clearly is a shift going on, but it’s not as extreme from the DBA point of view,” said Joe Caserta, president of Caserta Concepts LLC, a New York-based consulting and training services company that focuses on data warehousing and big data deployments. In traditional enterprise data shops, teams of DBAs are still busy keeping well-entrenched relational databases and data warehouses built around familiar SQL running smoothly.
Developers have gained added influence on data design, however, and Caserta said the changes will push some DBAs to obtain added skills.
Things change, things stay the same
For example, the fact that developers can initiate Hadoop and NoSQL projects with little or no upfront schema represents a change in enterprise development methods. Even so, companies are still likely to create reference data models after the fact. And while such modeling may be done by enterprise architects or data architects, some DBAs also play a modeling role — so they’ll need to learn how NoSQL systems work, Caserta said.
“They’ll be using different tools and different modeling strategies,” he said. “We still need someone to come up with the models. We also need someone who knows how to administer these new databases.”
Handling the latter task likely will require new training: A DBA who is certified on the Oracle database is not going to be able to automatically set up and design, say, a Cassandra NoSQL database. “The methods the typical DBA needs to know have to be relearned,” Caserta said, adding that the ability to manage Hadoop clusters will also become a crucial skill for DBAs. In general, “they’ll need to learn how to store data when they don’t have a schema.”
What price agility?
Craig Mullins, president and principal consultant of Mullins Consulting Inc. in Sugarland, Texas, said the NoSQL movement has precedents that will ease the learning process for some DBAs. “It’s not as new as some people think,” he said, noting, for example, the similarity between the mainframe-oriented VSAM file technology and newfangled key-value data stores.
There are some fundamental differences, though. The agility offered by NoSQL software comes at a price as data integrity becomes far more challenging to achieve. But for now, full integrity is taking a back seat to data flexibility in many companies’ Web-based applications. For the DBA, the big challenge is to adjust as design and development styles shift.
“There are some DBAs who are more adaptable than others. We’ve already seen that play out in the last 20 years,” said Mullins, who has more than 30 years of data management experience and is the author of Database Administration: The Complete Guide to DBA Practices and Procedures, first published in 2002 and updated in a second edition in 2012.
Mullins pointed out that, in many organizations, DBAs are already expected to work with several relational database systems. DBAs with those kinds of skills “should investigate the NoSQL options so they can be in the forefront of guiding the organization wisely when and if they need the NoSQL offerings,” he said.
Looking forward, Mullins added, data schema definition may be minimized, but “the availability of systems and the understanding of how data is spread across nodes will become even more important.”
Salad days for DBAs?
In fact, Sue Geuens, president of DAMA International, an association of data management professionals, thinks new data architectures provide opportunities for DBAs to expand their usefulness in organizations. “DBAs have been seen as the techno-geeks who sit in corners and nurse your database servers through all their ups and downs. And I think that DBAs are getting somewhat tired of that label,” said Geuens, who is based in Johannesburg, South Africa, and works as head of data services at EPI-USE Systems Ltd., an SAP-focused software and services provider.
Geuens said we likely will see different types of DBAs in the future, with some being content to stay in a traditional technical and administrative role, while others will look at learning the new technologies and tools for managing big data. “We will see a slew of new job titles for DBAs, and we’ll also see specialization even deeper than the ones we currently have around the specific relational database,” she said.
As Geuens emphasized, adding new skills is nothing new to the DBA job, which already comprises a full menu of capabilities. Pertinent skills include modeling, performance management and basic administration, with specializations for each database brand adding to the job’s complexity.
Such expertise can mean significant pay. TechTarget’s 2014 IT Salary and Careers Survey, for example, showed database administrators among recent gainers with average total compensation of $ 115,630. That’s up 22% year-over-year.
High salary or not, working with new technologies such as NoSQL databases does require you adjust your way of thinking, said Greg Novikov, a database specialist at New York-based insurer MetLife who spoke at the MongoDB Days 2014 event held in Boston in October. “But that’s the reason we’re getting paid the big bucks,” he added — with a wink to the audience.
Jack Vaughan is SearchDataManagement’s news and site editor. Email him at jvaughan@techtarget.com, and follow us on Twitter: @sDataManagement.
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