In choosing the key numbers and trends, you are automatically narrowing the kinds of data that can influence your model — and health care especially is an ineluctably complex system, exhibiting all the features predicted by the science of complexity. The assumptions built into choosing key sets of numbers and trends can be rooted out only by the discipline of creating specific scenarios incorporating a broad array of data, then testing those scenarios against more data.
The importance of not knowing
An important part of the discipline is a dogged “suspension of belief,” adding in the right amount of “I don’t know,” of “living in the question.” And this is a principal way in which the experience of the superforecasters is interesting and instructive but insufficient for our purposes. For the purposes of the test, they of course had to make predictions, and they would find out if they were right — and being right was the prize.
In the real world, forecasting is only one piece of strategy design, and the rest of the design influences how you think about forecasting. The questions are not abstract; they are about “What do we do now to prepare for the future?” And our organizations and careers depend on getting the answers right — or at least right enough to power some useful thinking. If we lock down our opinions too soon, we often miss the next big thing that could change that opinion or give us a deeper insight into the problem.
The question for the superforecasters was just, “What can we know about this particular future? With what degree of probability?”
For our purposes, we have to add further questions, such as: “What do I really need to know? How soon do I need to know that in order to act on it in a meaningful way? What would be interesting to know but not useful to drive strategy? What will we really need to know, but not until a year from now, when we will have more information?”
So, forecasting for driving strategy is different from pure forecasting. Here are some parameters of forecasting for strategy:
Treat forecasting as a serious discipline, a key part of your continual strategy planning effort. On the other hand:
Live in the question as long as possible. Keep your mind open until you have to take action — and even then, keep your mind open, watch the signs and be ready to shift if necessary.
Build capacity in advance of need as often as possible. For instance, if you imagine going into the on-site clinic business, start one now as a pilot to build your capacity. Organizational capacity — the workforce, expertise and experience that will be needed — is the hardest to build. Second hardest is finding the necessary capital, partners and affiliates to back the plan. Physical plant, the sheetrock and shelves and machines, is much more malleable. Some things take years to ramp up to full capacity, so start on suspicion — start something that at least will begin to expand your organizational experience and capacity in that direction.
Stake out territory ahead of time using these pilots and forays, by building capacity and engaging with possible clients and partners.
Seek out need. Don’t just run scenarios on the businesses you are currently in. As part of your forecasting, seek out specific needs and construct scenarios in which you could provide a solution for which someone might pay you, even if it’s not someone you are used to thinking of as a payer. Think: “OK, here’s a need to which we could provide a solution. For whom else is this a problem? The state? The Centers for Medicare & Medicaid Services? Area employers? Possible distant clients in a medical tourism model? Could we provide a better and cheaper solution to their problem?”
Build generalized reserve capacity, organizational capacity, financial reserves and bonding capacity, as well as general networking and affiliation strengths, as much as possible. Much of the recent consolidation in the health care field is driven by this need to simply be bigger in order to have reserve capacity to deal with unanticipated change. For smaller and rural organizations, this is the compelling argument for affiliation, if not outright sale to some larger organization or network: As things shift, sometimes radically, sometimes more quickly than imagined, smaller organizations that have been operating close to the line often do not have the reserve capacity they need to survive. Such affiliation need not be outright sale, but it has to have an interdependent form that puts others at some risk for your survival.
Forecast or fail
Are you taking this seriously? If you’re not, that’s fine. You don’t have to worry about it. Organizations and individual health care leaders and managers who don’t take it seriously won’t have to worry about it at all for too much longer because they most likely will find the whole problem taken out of their hands.
Those who don’t continually try to parse the future and shift their strategy based on their shifting vision of the future will find the next several years to be a real struggle. Those who take seriously the discipline of thinking about the future in a sophisticated way will be much better armed and prepared for that future.
Joe Flower is a health care futurist and CEO of The Change Project Inc. and its health care education arm, Imagine What If. He also is a regular contributor to H&HN Daily and a member of Speakers Express.