With leadership comes planning. The future is truly undeterminable, so to plan appropriately we may look at previous trends and make forecasts.
Traditional planning involves taking historical data and trends and generate a good enough prediction. It works well for short-term predictions but is inaccurate for long term.
Scenario planning prepares for the long term (10-30+ years) which involves simulating a handful of potential future scenarios all at once. Because number of possible futures are infinite, it is important to choose a set of future scenarios that best represent the diversity of all possible futures with relevant uncertainties.
In scenario planning, we anticipate for multiple possible scenarios such that we are prepared for any actual scenario that occurs. There is also no need to predict any specific event, but rather what will happen if an event occurs.
For example, PC system integrators (selling pre-built PCs) sources computer components from many manufacturers (Intel, AMD, Gigabyte, etc.), and any number of events (supply shortage, bitcoin miners hoarding, etc.) may reduce the supply stock for the PCs. For the company, there is no need to predict specific events. Instead, it is important that the company prepares for what to do should supply be reduced.
Material consumption improve human well-being?
Bhutan had achieved carbon neutrality (net 0 carbon emissions) and is now carbon negative (absorbs more GHGs than emissions) because of government policies. The constitution ensures that at least 60% of land shall remain under forest cover.
Gross National Happiness (GNH) is a sustainable approach to balance material and non-material values. It consist of four pillars:
Fundamentally, Bhutan strives to improve GNH rather than GDP. (i.e. the government invests in education, cultural celebrations, health care, and other public goods). The country is carbon neutral because it is able to offset it’s GHG emissions via ecological capital that sequesters CO2 (e.g. it’s forests).
Adaptive leadership starts by engaging in an iterative process of 3 steps:
Step 1 and 2 are referred to as personal reflection. The key elements of personal reflection consists of: making sense of experience, stand back and view the bigger perspective, repetition, deep honesty or “strive after truth”, take everything into account, clarity, understanding, and drawing conclusions.
Leadership involves risks and danger because leaders sometimes need to do unpopular actions, or voice unpopular opinions. The risk being failing to achieve their goals and the goals of the people.
Adaptive problems require leadership often require majority of people to change their perspective or behavior.
Components of “honoring one’s word”
In 1982, tampered Tylenol capsules caused many deaths and Johnson & Johnson failed to keep their word that the capsules were safe to consume. They did honor their word by recalling call bottles and replacing the product with safety-sealed bottles.