Backcasting

I came across this term in a recent presentation by a venture firm. When you start your product management career, the first advice you get is to talk to your customer and build a product that solves customer problems. You will hear this in a variety of ways - "be customer-obsessed," "build painkiller not a vitamin," "put yourself in your customer's shoes.

There is absolutely nothing wrong with this approach, and most successful companies are born out of solving customer problems. The current tech startup landscape is an extreme version of this (particularly in the enterprise space). We see new companies emerging daily to solve a specific and narrow problem, especially in the sales and marketing space, like recording and analyzing sales calls. These are all useful tools, but this approach is not generating breakthrough companies.

The breakthrough companies like Facebook, Twitter, SnapChat, AirBnB, SalesForce, or Lyft didn't come through the traditional "putting yourself in the customer shoes" approach. People didn't say that not being able to express in 140 characters is a major pain point for me, or I need to send a photo that disappears or need to make money off this extra couch in my living room. ." These breakthrough companies emerged because founders "backcasted" from the future rather than "forecasted" from the present on the nature of communication, hotels, and taxis.

The "forecasting" looks at the current state of things, forecasts the future from present and incrementally builds products to take the present in the future, which is not radically different. The "backcasting" envision a radically different future from the present and connects the dots backward to build breakthrough products.

The "backcasting" and resulting breakthrough products rely on riding a major technical or non-technical shift that points toward a radically different future. Uber/Lyft became possible with mobile internet, SnapChat with camera-enabled smartphones, AirBnB with sharing economy hitting an inflection point. Going a bit further in the past, Microsoft was born out of the PC revolution, Google, when the internet hit an inflection. On the enterprise side, virtualization and high-speed internet paved the way for cloud computing. Breakthrough builders follow the inflections to uncharted territories and build radically different products.

What are the latest external changes that will create breakthrough products? Blockchain is slowly getting to the inflection point, will decentralize computing (ethereum), storage (filecoin.io), and network (helium.com). After decentralized infrastructure (possibly will disrupt big clouds), platforms (e.g., federated machine learning systems) and applications will get decentralized (happening to some extent with crypto-currency, DeFi, NFT, Twitter is looking at the decentralized social network).

Autonomy, virtual reality, quantum computing are a few other technological shifts, not yet at the inflection point though. COVID is absolutely a major external force creating or accelerating some breakthrough technologies like mRNA.

There is space for incremental products based on the 'forecasting' and breakthrough products based on 'backcasting'. So, still, listen to your customer, be customer obsessive and build to solve customer pain points. But, also envision a radically different future of your product and backcast.

-Mukesh