A better way to think about the future
(NOTE: This is a modified version of a “Show & Tell” talk I gave internally at Olark Live Chat)
I’ve always enjoyed thinking about and the future. Learning about the past helps me appreciate how far we’ve come, and I can only imagine how different our lives might be 10, 20, or even 100 years from now.
In that sense, I guess it’s only natural that I ended up gravitating towards the tech industry, where change is constant and everyone is trying to make the future happen just a little bit faster than it otherwise might have.
I try to read and learn as much as I can from noteworthy futurists and entrepreneurs, but I started to realize that the more I read about the future, the more confused I would get. Every new “insight” I came across was simply piling on top of an incoherent mess of disjointed information in my brain, drawing me further and further away from any kind of Truth.
For example, take this (abridged) quote from Jeff Bezos, founder and CEO of Amazon:
I very frequently get the question: ‘What’s going to change in the next 10 years?’ […] I almost never get the question: ‘What’s not going to change in the next 10 years?’ And I submit to you that that second question is actually the more important of the two — because you can build a business strategy around the things that are stable in time. […] In our retail business, we know that customers want low prices, […] fast delivery, [and] vast selection. (Link to full quote)
That sounds really smart, right? I certainly thought so. But then I came across this quote by Peter Thiel, the respected entrepreneur and venture capitalist (and the first outside investor in Facebook):
Whenever I interview someone for a job, I like to ask this question: “What important truth do very few people agree with you on? […] A conventional truth can be important, but it won’t give you an edge. It’s not a secret. […] The business version of [this] contrarian question is: what valuable company is nobody building? Every correct answer is necessarily a secret: something important and unknown, something hard to do but doable.
This also sounded really smart, until I realized that the two quotes are in direct conflict with one another. Jeff Bezos says that focusing on the obvious, unchanging needs of customers is a key to Amazon’s success, and yet Peter Thiel claims that such “conventional truths” won’t yield any kind of edge in business…
These kinds of contradictions forced me to look for a more fundamental way to think about the future. Something that anyone can use and apply, regardless of their size and regardless of their industry. Where every new input becomes a piece of a larger puzzle, bringing me one step closer to Truth.
Here’s what I ended up coming up with. It’s a super-simple, three question framework that I’ve found useful:
- What will definitely change?
- What will definitely NOT change?
- What is uncertain and could go either way?
Individually the questions are unremarkable, but thinking through them together makes all the difference. Together they are collectively exhaustive, mutually exclusive, and simple enough for even a child to understand.
Questions #1 & #2 — The Safe Bets
Answers to Question #1 (“What will definitely change?”) refer to aspects of the future that have become “inevitable”. Examples include:
- The world’s population will continue to grow for the foreseeable future
- Mobile messaging and commerce will continue to grow in the next year
- Historically, computing power has roughly doubled every two years (aka Moore’s law)
Meanwhile, answers to Question #2 (“What will definitely NOT change?”) tend to revolve around:
- Human nature e.g. Amazon customers want low prices, fast delivery, and vast selection
- Human biology e.g. everyone needs to eat, so restaurants are in no danger of becoming obsolete anytime soon
- Slow-moving institutions e.g. government laws and regulations
On the surface, #1 and #2 might seem like sure things and a great foundation on which to build a business. But actually, businesses based on #1 and #2 tend to be the domain of large, dominant companies (and startups that can quickly grow to that scale). When something is a sure thing and everyone knows it, execution and leverage become paramount, and that’s where larger companies have a clear edge.
However, there is also opportunity for smaller companies (like startups) in the time it takes an uncertain idea from Question #3 to be validated and become accepted and mainstream (#1), which brings me to my next point…
Question #3 — The Big Bet(s)
This is where Peter Thiel’s “secrets” come from. These are potential future outcomes that are inherently uncertain in some way due to 1) timing, 2) probability of success, 3) potential payout, or all of the above.
#3 is where startups can thrive and established companies become vulnerable to disruption. The unpredictability results in less competition and a more even playing field, deterring large incumbents looking for more steady, predictable cash flows from “sure things” (#1 and #2).
Once a secret (#3) is validated and starts to become inevitable (#1), it becomes a big company’s game. This explains why companies like Uber and Slack are forced to grow so quickly. Once the cat is out of the bag, everyone will want in on those big profits, including the sleeping giants, and you better be ready when they wake up.
Bringing things full circle
The two quotes from Jeff Bezos and Peter Thiel now fit together perfectly, when viewed through the lens of the Three Questions.
Amazon’s current strategy is based on Question #2, which makes sense given that they are the most dominant ecommerce company in the world. They can leverage their massive scale to deliver on their promises of low prices, fast delivery, and vast selection in a way that competitors and smaller startups cannot.
However, back when Amazon was itself a small startup, they actually started out with a big bet (#3), which was that focusing on books would be a great starting point for becoming an ecommerce giant in the early days of the Internet. That was not obvious at all back then, but they were proven right. Today, Amazon is in a position to dominate online retail (#2) while also continuing to make multiple bets on the uncertain future (#3) like invisible interfaces (Echo), streaming video (Prime), etc.
Other notable examples — Uber & driverless cars
Let’s look at a few more past and current examples of companies and trends through the lens of The Three Questions.
Back in 2010, Uber was only a year old, was still in beta, and wouldn’t officially launch to the public until a year later. How would they have answered the Three Questions back then?
- Definitely will change: Mobile usage will keep growing, and mobile location tracking and navigation will continue to get better
- Definitely won’t change: People want to get from point A to B as quickly, cheaply, and safely as possible
- Uncertain: Lots of people will trust total strangers with no professional driving experience as much as they do licensed, experienced cab drivers.
With Uber, the growth of mobile from #1 was key to “de-risking” their big bet on #3. Taxicabs have always had trust and safety issues, but the growing ubiquity of smartphones meant that every passenger and driver could now be tracked and kept accountable via the cloud, creating a new foundation for trust.
Let’s take a look at another hot topic nowadays — Driverless Cars. What do The Three Questions look like for innovators in this space?
- Definitely will change: The artificial intelligence and machine learning powering driverless cars will keep getting better
- Definitely won’t change: (Same as Uber, plus) People hate traffic, and the traffic problem in big cities won’t get better anytime soon
- Uncertain: Humans will willingly trust a machine with their lives on a daily basis, laws & regulations will change in a timely manner, and there will be no freak fatal accidents involving driverless cars
Driverless car technology has come such a long way, but driverless cars do not operate in a vacuum — we can’t forget that their fundamental purpose is to transport human beings. In other words, the viability of driverless cars is not a technology problem, but rather a human trust problem.
For example, how would you feel if you were told while boarding an international flight that there would be no professional pilots on board? Now take that feeling and multiply it by 1 billion (the number of cars on the road today worldwide), and you get a sense of the adoption bottleneck that driverless car makers face. Driverless cars may be inevitable, but it’s anyone’s guess as to how quickly they’ll become as commonplace as we all imagine.
What do the Three Questions mean for you?
No industry changes more quickly than tech, and this has broad implications for society as well — As technology changes, it becomes important for all of us to adapt our skill sets and plans to an ever-evolving world and workplace.
That kind of rapid, unpredictable change can be intimidating for anyone, businesses and individuals alike.
Anytime you’re feeling like Théoden at the Battle of the Hornburg, remember what Mufasa said…
When in doubt, always start by clearly defining your answers for Question #2 i.e. the things you know won’t change. For individuals, this can be thought of as your “purpose” and core beliefs. For companies, the answer to #2 is often contained in their mission statement. Your answer(s) to this question is your “North Star”, and without it you are directionless — nothing you do will have any real rhyme or reason.
In the case of Olark, the live chat software company where I work, these are the fundamental reasons our customers use our product:
- Making More $$ i.e. more leads and higher closing %
- Keeping existing customers happy (customer support) at minimal cost
- Positive high-stakes interactions i.e. sales, crises, and customer research
These motivations are a core part of Olark’s mission and will not be changing anytime soon, no matter how much our world changes in that time.
However, a mission statement that only contains answers to Question #2 is generally not a good mission statement. If no one can disagree with your mission statement (i.e. it only contains obvious truths), then no one will care, either.
Great mission statements usually have a hint of uncertainty and a bold vision for the future (#3) that will get skeptics talking about you and visionary early adopters flocking to you. Great mission statements tend to be quite controversial, and the people espousing them tend to be seen as a bit crazy.
This is true for companies and I think it’s true for individuals as well. There’s nothing wrong with choosing a conventional life, but if you want an extraordinary one, you’ll have to make some big bets (#3) along the way.
However, balance is important. For any bet or investment, you want to make sure that you have a good balance of safe (#1 & #2) and risky (#3) ones in your “portfolio”. That way, even if things don’t play out exactly like you had hoped, you’ll still have a solid foundation to fall back on.
Invest too much in #1 and you’re a mindless follower (FOMO); too much in #2 and you become ordinary; too much in #3 and you might crash and burn (YOLO).
Creating a better future
Love him or hate him, Steve Jobs is one of the most influential futurists we’ve seen in tech, and for good reason. He knew that the proliferation and miniaturization of computers was inevitable (Question #1), but much less certain (#3) was what those computers would be like. It wasn’t obvious at all back then that computers should be human-friendly, and that computers should be tailor-made for humans, and not the other way around. Apple helped usher in a different and better future than the one that was originally in store for us if IBM or Microsoft were to win, and the world is a better place for it when it comes to computer interfaces.
Now take a second and imagine — How would the world be worse off if you were no longer in it? What does the future look like to you right now, and what can you today and tomorrow to make it an even better one?
The world is a big place, with lots and lots of people, and it’s really easy to fall into the trap of thinking that you’re just a cog in this giant machine and what you do doesn’t really affect anything. I’m sure everyone has wondered, at one point or another, what would happen if they were to just disappear — How soon would people notice, if at all? And would anyone really care?
You don’t have to be in a large organization to “put a dent in the universe”. In fact, in most cases it probably hurts more than helps. History has shown time and again that it’s often small groups of people doing bold things that end up changing the course of history.
Here’s one of my favorite quotes from one of the most famous examples of a “small” person changing the course of the future:
Life is a series of bets on the future, some riskier and bolder than others. What will you be betting on?
