On Path-dependence and Foresight

October 31, 2015

In my previous posts I had focused on understanding the nature of value, the ecosystems that create that value with the participation of a multitude of stakeholders, and how these ecosystems and the contexts in which they live are dynamic and co-evolving.

I also touched upon the enterprise as a participant in the ecosystem, though the extent to which it co-creates and is completely integral to the value creation act is a strategic choice, something that it must consider in the evolving world.

Thinking of value ecosystems and the platforms that inform it, one is naturally led to thinking in terms of economies – not just economies of exchange (see Bill Sharpe – Economies of Life), but in the broader sense of all dimensions of value. The core challenge an enterprise that has an intent to make the ecosystem better faces, is to understand the economics of value – ‘what is the currency that makes meaning for all the stakeholders in the system?’.

That understanding then becomes the basis of creating context, content, community and commerce.

In my last post I talked about a continuum of time from the past into the future on which value ecosystems and enterprises find themselves. One of the concepts I find useful in this context is the notion of path-dependence.

Manuel de Landa in his excellent book – A thousand years of non=linear history, opened my eyes to the notion, that the history we are most comfortable with, is mostly a linear narrative. A sequence of events that neatly fit together into a storyline, something we construct to give meaning to our own lives, as much as we do collectively as enterprises and societies.

De Landa vividly explains how that is far from the truth. All histories are replete with chance events, some externally driven, some the result of deliberate choices. (There is much literature on the idea of path-dependence and path-creation other than de Landa).

Out of this complex interplay of forces and actions, and of course the complexity increases the higher up one goes into the systems hierarchy, paths are created that are neither foreordained nor obvious. In the process of creating neat explanations, we often leave out these contingencies, things that could have been different if only some other conditions had been present or we had acted differently.

This realization is extremely crucial from the point of view of how we see the future. Extrapolating our preferred narratives into the future can be very misleading if it ignores path-dependence. The future too just like history will result from a confluence and collision of many drivers and vectors of change, and as much as we are students of history, we must be students of the future in order to act meaningfully now – in order to create the paths that will lead to desired outcomes for all.

Our purpose after all is to make an enduring impact, and we must guide our coevolution along the paths that open up or we actively create.

I will elaborate further in other posts on ideas I believe are relevant to this practice of foresight, but for now, I will mention a couple of key concepts that guide me.

Firstly, the practice of foresight is not some isolated thing one does, but integral to the practice of being that seamlessly integrates histories, the many futures, and the now into one seamless whole.

I like the concept of time horizons – every entity requires time to re-architect itself to be on a different path – the more radically different it is, the more challenging the change and the time it will take to respond. Every enterprise must therefore have a sense of how much into the future it must be able to anticipate if it should be able to respond in a timely fashion when conditions demand so.

Accommodating the future and its many possibilities is fundamentally an architectural challenge, one of knowing possible, plausible and preferred variations that one must accommodate in one’s being.

One response to this need to accommodate variation is agile and lean thinking, and the notion of discovery-driven planning etc., but one can easily be blinded to that many paths that run alongside the one you are on. A foresight practice must inform all these approaches, or one might not realize that a radically different future is coming to birth that might eventually invalidate one’s designs.

Finally, a foresight practice is first and foremost a cognitive practice. It is about opening up one’s mind – traveling into the future like a stranger on an adventure in unknown lands. If all you come back with are familiar stories one might say you have not experienced the future.

That then brings us back to frames – the one we discussed in my previous post. If you carried your frames into explorations of the future, you probably saw only one part of the proverbial elephant. As extensive as the exploration of the outside world is, as deep must be the inquiry into one’s own deeper truths – one’s architecture, in order to develop meaningful foresight.