Inflection Points 1: Introducing Artemon Strategy
Our Founding Principles
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Artemon Strategy was launched yesterday, with the goal of helping businesses to navigate this age of unprecedented uncertainty. Our website is here.
Artemon’s Foresight capabilities help businesses identify how their strategic operating environment might change. This enables organisations to get on the front foot in a world of uncertainty and upended assumptions. We use Foresight to help business get ahead of emerging challenges and gain first-mover advantage around emerging opportunities.
You can find more details about Artemon Strategy here. Please drop me a line at david@artemonstrategy.com if you want to chat about the services we provide.
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My email is david@artemonstrategy.com and Twitter is @djskelton and @artemonstrategy
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Now on to business… I want to send this newsletter out on a regular basis and to use it as a deep-dive about a specific area of tech policy or business strategy. Or both. I’ll be back this Sunday with a deeper dive and will then aim to adopt a weekly cadence.
But this week I’m keen to start with the basics - why have I decided to leave my secure job with a global tech firm to set up a company dedicated to using Foresight Capabilities. And why do I think this is so important? These are the Founding Principles behind the company.
Founding Principles
1. The world is more uncertain than ever. This is a permanent condition.
The Collins English Dictionary said that “permacrisis” was their word of the year in 2022. They define this as “an extended period of instability and insecurity, esp one resulting from a series of catastrophic events”. Collins argue that this word “sums up quite succinctly” the current global condition. They’re right. Recent years have seen one level of uncertainty after another. To name just a few, we have seen a banking crash, global pandemic, decoupling of the United States and China, surging populism, Brexit, blocked supply chains, the invasion of Ukraine, rising inflation and a backlash against new technology. As the IMF’s Managing Director argues the “theme” of the 2020s is “rising uncertainty.” This uncertainty is not going away. Business needs to be able to adjust to an environment of high uncertainty and to both manage risk and exploit opportunity. The use of Foresight capabilities allows organisations to see through the mist of uncertainty and chart the right path.
2. Business leaders who came to prominence in a time of “world is flat” globalisation need to update their capabilities and mindsets.
Francis Fukuyama famously declared that the end of the Cold War meant that we had reached the “End of History”. Thomas Friedman suggested that the “world is flat”, with the “golden arches theory” suggesting that no countries with McDonalds would ever go to war with each other. The many adherents of this theory believed that liberal globalisation and tech-driven borderless trade would usher in an era of certainty and rising prosperity, in a utopian, neo-liberal order. Many of today’s business leaders came to prominence during this era and have the mindset attached to this. But the era that gave birth to this mindset is over. We have now reached the End of the End of History. A phase of stability and certainty has been replaced with a cycle of turbulence and uncertainty. Business leaders need to update their mindset and capabilities to ensure success in the age of uncertainty. Artemon has a new approach for a new age and is designed to help leaders update their capabilities.
3. The Signal is more important than the noise. Never believe the hype.
The ability to make out signal from noise is a concept that reaches back to the intelligence gathering of the early 20th Century. And for businesses, separating the signal from the noise has never been more important. We’re living in an age of breathless noise. Not a week goes by without a new bandwagon to jump on or new hype to get excited about. To paraphrase Spinal Tap, in an age of limitless information, social media turns the noise up to eleven. The internet has massively increased the amount of information and data available and generative AI seems certain to multiply the noise still further. Daniel Kahneman rightly suggests that noise often leads to poor and distorted judgements. With so much hype and so much shouting, it’s never been more important to see beyond hype and understand the signal, not the noise. This means understanding the broader forces that will shape the future environment rather than constantly being distracted by noise. Artemon will give you the capabilities to do this.
4. The trend always bends. Don’t get caught out by recency bias.
A few years ago, trend-watchers were clear that we were now living in an era of perpetually low and stable inflation and continuing liberalisation of international trade. That was, after all, what the trends showed. But, as the famous business saying suggests, “a trend, is a trend, is a trend… until it bends.”
Executives are not immune to “recency bias” and such a bias can be lethal. In a world of growing uncertainty, strategising based merely on the assumption of continuing trends is a reckless exercise. Instead, it’s important to develop Foresight capabilities that help you get ahead of the pack and consider when trends might be bending and how to make the most of the opportunities that creates. The role of the devil’s advocate is critical in really understanding all the variables, and this role is incredibly difficult to deliver ‘in-house’ well, given the need to actively oppose corporate orthodoxy. Even if you could find candidates within the business, those who oppose corporate orthodoxy are unlikely to be doing any favours to their career trajectory.
5. The important should get more attention than the urgent. Day-to-day firefighting can mean missing big picture changes and can limit medium-term growth and resilience.
The great Second World War General, and post-war President, Dwight Eisenhower said that, “I have two kinds of problems: the urgent and the important. The urgent are not important, and the important are never urgent.” This principle, which gave birth to the Eisenhower Matrix, neatly summarises the tension at the heart of modern business. In an environment where everything is urgent and firefighting urgent problems becomes a raison d’etre, how do firms consider the big picture? Equally, how do firms consider what the next fire might be, so responding to it doesn’t result in a blind panic that distorts a company’s use of resources? Artemon’s capability building allows you to consider what “the next problem” might look like and to gain a better idea of the merging landscape. Businesses that ignore their future operating environment in favour of a focus on the urgent are leaving themselves exposed. Artemon also allows for this focus to be delivered in a cost effective way.
6. “Business as usual” is never enough. Lethargy and bureaucracy can be lethal in an age of innovation and uncertainty.
“Something can never happen” until it happens. The status quo is the status quo until it suddenly becomes the Ancien Regime. The age of uncertainty means that complacency and a focus on business as usual are even more Complacency around market position has historically proven to be catastrophic (just ask Blockbuster, Nokia and Kodak). The lethargy induced by past success and business growth can be even more catastrophic at a time when consumer behaviour is more volatile and, as the McKinsey chart below shows, corporate longevity is dramatically shortening over time. Indeed, by 2030, the average time spent in the Fortune 500 is expected to have halved in 50 years.
In such an environment, concentrating purely on the day-to-day and maintaining the status quo might feel comforting. But, in reality, a pure focus on the day-to-day can be lethal. At a time when technology and other driving forces are reshaping economies and operating environments, it’s crucial to get ahead of uncertainty. A heads down focus on the day-to-day can mean that a response to an emerging future is taken out of your hands: you become reactive recipients rather than proactive shapers. Artemon can give you access to these Foresight capabilities so you can focus with more confidence on the day-to-day.
7. Uncertainty creates opportunity as well as risk
Too many regard the new age of uncertainty merely through the prism of the risks created. And risk is an important part of the story, but it’s far from the whole story. Turbulent times often give rise to some of the most important innovations and steps forward. Uncertainty and turbulence (including rapid technological advance) also means that opportunities for rapid business and revenue growth will exist for those companies who are able to identify them early and gain first mover advantage. The foresight capabilities that Artemon provide help companies to identify opportunities ahead of their competitors. Good use of Foresight capabilities can identify a window of opportunity well before many competitors are even aware it exists.
8. Foresight is pointless if it isn’t accompanied by action. Everything should be guided by creating business value.
The OODA (Observe, Orient, Decide and Act) Loop was first developed by the US Military to guide military operations. Its lessons are deeply applicable to business - namely that strategy is worthless if it isn’t accompanied by decisions and actions, taken quickly and executed properly. As the strategy Godfather, Richard Rumelt, argues, there is too much bad strategy today, which is often merely a list of goals and buzzwords, and too little good strategy, which has a kernel of diagnosis (which Foresight helps provide), a guiding policy and a set of coherent actions. This is at the core of what Artemon believes.Artemon will support you in assessing your emerging operating environment and, crucially, in translating this to decisions and actions. We will ensure that you are guided by foresight based strategy to deliver genuine business value. As the chart below shows, we believe in using Foresight to Ancipate, Adapt and Act.
9. Evaluating regulatory and geopolitical risk is now an essential part of generating business value.
Public policy and geopolitics have produced some of the biggest hits to corporate bottom lines in recent years. Decoupling and deglobalisation have upended supply chains. Increased regulation across sectors has led to massive hits to the bottom line and has impacted product development. Growing protectionism and populism have considerably increased the cost of doing business. Despite this, many companies adopt to regulation and geopolitical changes that might have long been coming with too little preparation and too much last minute panic. Most companies can still do more to evaluate emerging patterns in geopolitics and regulation so that they can pivot corporate strategy accordingly. Artemon’s founder has decades of experience at the intersection of policy, tech and business, combined with the capabilities we provide means that we can help you navigate regulatory uncertainty. Companies who ignore this critical aspect of business will ultimately fail.
10. A global view is essential to value creation
According to both Goldman Sachs and The Economist, Indonesia is on track to be one of the biggest economies in the world over the next few decades. India is set to be the world’s third biggest economy by 2030 and is already the world’s most connected nation. South East Asia is expected to be the largest growing bloc in the world by trade volume over the next five years. Governments around the world are implementing protectionist legislation, notably in the field of “digital sovereignty”. But still too much business decision making is focused on the familiar or the close to home. Too much commentary obsesses on the familiar or the existing and misses the opportunities that are being created in new and growing markets. It also misses the “regulatory innovations” that might be kicking off in other markets but quickly replicated “closer to home”. Artemon believes that a global view is essential when considering an emerging operating environment. Our experience in markets across Asia Pacific, Europe and the United States leaves us well positioned to take the global view.
11. Technology is driving change and uncertainty. Understanding emerging tech is crucial to understanding uncertainty
Emerging technology has given people extraordinary access to information and has given businesses access to markets that would previously have been out of reach. Billions have been pulled out of poverty worldwide because of technology. Further advances in AI and quantum computing promise untold advances in the fields of medicine and science.
Artemon’s founder spent almost a decade working with Silicon Valley and we’re unapologetic tech enthusiasts and tech optimists. But we also understand that the pace of advance has brought problems and appreciate the regulatory and societal impulses that have arisen because of social media, user generated content and the sheer scale of information available. And, of course, the creation of (much) more noise does not necessarily mean better signals in and of itself! Artemon’s experience in developing global strategy for big tech will be invaluable to help companies plot a route through tech driven disruption and change.
12. Groupthink should be challenged and the counterintuitive embraced. The corporate Koolaid should be avoided.
Too much of what is marketed as insight merely represents a repetition of what has been published widely in that week’s newspapers. Too much of what is described as strategy is merely a series of goals or shouty buzzwords or a recreation of strategic designs for other clients. Too much of what is marketed as expertise is merely undisputed conventional wisdom and consensus narrative. And too many businesses have drunk too much of the corporate Koolaid to be able to think clearly about the emerging environment.
At Artemon, we believe in delivering compelling insight and insight that clients will not have read about in the newspapers. We believe in being counterintuitive and critically interrogating corporate groupthink. Our quest is to create corporate value and help our clients think in a way that puts them several moves ahead of their competitors.