Future Back vs Present Forward

Updated: Mar 9, 2020

As part of strategy planning projects over recent years, I have experienced some emotional discussions among senior executives about the best ways to plan for future.

Despite many methodologies available, at end of the day each of them belong to one of two main approaches - Future Back or Present Forward.

When using Present Forward approach, we analyse historic growth of the business for last 2 to 3 years, look at prognosis for market / industry growth, consider new upcoming products/services, discuss potential investments and competition activities and draft a plan for upcoming period. Employee related costs and challenges in this model are usually based on adding additional headcount needed to deliver new volumes. Advantage of this approach is relatively accurate prediction of future volumes and it's easy to conceptualize. A disadvantage of Present Forward approach is risk of missing out realization of some disruptive trends starting to affect industry and consumer behavior, which can completely change the landscape in few years time. Just think about car sharing as example - how many of us could even imagine few years ago, that consumer preferences could change so drastically from traditional our parents dream to own the car to so rapidly growing concept of sharing the vehicle as best solution to optimize monthly costs for getting from point A to point B, avoiding to worry about parking infrastructure, regular repairs and other. This definitely has affected strategic plans for automotive industry players - both manufacturers and retailers.

Future Back approach suggests, that before starting to plan volumes for future, we start with clean sheet of paper to imagine how 2 - 3 year future could look like. What will be consumer preferences at that time? What impact might new technologies have on future? What could be future demand for services and products? How changes in society and global politics might affect the landscape? What trends in other industries will sooner or later affect also our industry? And how all this will impact our business? Will our current services and products be even relevant at that time? What should be our companies purpose in this future environment? What new skills and talents it will require from our people to be able to service future demand? And then - knowing what the New Future might be, we can start planing Future Back - what should we start doing today to achieve the Future ambition in 2 to 3 years. Future back approach can add some unexpected twist to company's strategic plans, it will help to recognize a future need for new products/services/processes or talent that currently is not existent inside of company. The challenge with Future Back approach is that it requires us to step back from all that we know, it requires ability to honestly admit that maybe some of approaches or products that we value so much today, might be not relevant tomorrow; that maybe some our key talent and roles today will need to significantly transform tomorrow. This is the part when resistance against the approach can come, as it might require a Change.

My personal believe is that Future Back planning can bring enormous value for business growth. If managed well and if strongly supported by executives. What are your thoughts and experiences?

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