Drucker's Questions, AI's Answers: A Strategic Roadmap for the Three Horizons

Over the past few weeks we discussed the 3 Qs from Drucker, how they fit with the Three Horizons Framework and last week, I partnered with Paul Edginton to explore how to use this as Trajectories for strategy making and execution.

Today, we continue our AI journey to explore how AI can make a difference.

Drucker asked three key questions for organisational transformation.

1. What is our business? (Traditional Focus) This question prompts an honest assessment of your current business model, market position, and core competencies. It's about understanding your strengths and weaknesses in the context of your industry landscape.
2. What will it be? (Transitional Focus) Here, we shift our gaze to the emerging trends shaping your industry. Are you adapting to changing customer needs, technological advancements, and regulatory shifts? This question encourages experimentation and exploration of new possibilities.
3. What should it be? (Transformational Focus) This question challenges the very foundations of your business. Is your mission still relevant? Does your purpose need to evolve? Are you prepared to embrace new business models and core competencies to thrive in the future?

We looked earlier how this is aligned with the Three Horizons framework. The Three Horizons model divides an organisations potential futures into three categories:

• Horizon 1 (H1): This represents your current core business – the "business as usual." It's about maintaining and optimising existing operations.
• Horizon 2 (H2): This is the space of emerging trends and disruptive innovations. It's where you experiment and test new ideas that could shape your future.
• Horizon 3 (H3): This is the visionary horizon – the radical innovations that could fundamentally transform your industry and create significant value.

This can seem very hard at the start. Where do I start? There are numerous things we can do at various stages. Let’s explore how we can use AI.

Created with X.Ai

What is our business or H1 : Optimising as the focus

• Analyze the Current Landscape: Conduct a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats) to understand the competitive landscape, market trends, and the organisation's core competencies.
• Identify Key Areas for Improvement: Determine opportunities for incremental innovation within the existing business.
• Develop Strategies for Sustainability: Formulate strategies for enhancing profitability, market share, and customer satisfaction.

Imagine you are a disability organisation in the current Australian context. Can AI provide some ideas?

1. Service Delivery Optimisation:

Personalised Care Plans: Develop a robust system for creating personalised care plans that are truly tailored to individual needs and preferences. This might involve using technology to collect and analyze data, conducting more in-depth assessments, or offering a wider range of service options.

2. Participant Engagement and Empowerment:

Enhanced Communication: Improve communication channels with participants, including clear and accessible information about services, rights, and responsibilities. This might involve using online platforms, multilingual resources, or simplified language.

3. Workforce Development and Retention:

Career Pathways: Create clear career pathways within the organisation to encourage professional growth and career development for support workers. This might involve providing opportunities for advancement, leadership development, or specialisation in specific areas.

4. Business Efficiency and Cost Optimisation:

Data-Driven Decision-Making: Leverage data analytics to identify areas where operational efficiency can be improved, such as service delivery scheduling, resource allocation, and financial management.

5. Innovation for Specific Needs:

Assistive Technology: Explore and implement new assistive technologies that can improve the lives of participants and support workers. This could include tools for communication, mobility, daily living, or access to information.

What will it be or Horizon 2: Expanding the Business

• Identify Emerging Trends: Conduct market research, analyze industry trends, and monitor competitor activities to identify emerging trends.
• Develop New Products and Services: Leverage emerging technologies and trends to create new products, services, or business models.
• Build Partnerships and Alliances: Collaborate with other companies, research institutions, or startups to access new technologies and expertise.
• Experiment and Prototype: Invest in prototyping and testing to validate new ideas and build confidence in their potential.

Say you're a tech-based marketing and sales startup and exploring what is coming on the horizon. Can AI help you?

1. Market Research:

• Shifting Consumer Behaviour: Research how consumer behaviour is changing in the tech space.
• Industry-Specific Trends: Focus your research on the specific technology sector(s) you serve.

4. Identifying Emerging Trends:

• The Rise of Social Commerce: Social media platforms are becoming increasingly important for e-commerce, with users making purchases directly through social channels.
• Artificial Intelligence (AI) in Marketing: AI is revolutionising marketing, enabling personalised experiences, automated campaigns, and predictive analytics.
• Voice Search Optimisation: Voice search is becoming increasingly popular, requiring businesses to optimise their content and website for voice-based queries.
• The Metaverse: While still emerging, the metaverse presents potential opportunities for innovative marketing and customer engagement.

What should it be or Horizon 3: Visioning and Future-Proofing

• Explore Radical Possibilities: Engage in brainstorming and ideation sessions to envision transformative opportunities and explore radical concepts.
• Develop Scenarios: Create multiple scenarios for the future that explore different possibilities and potential disruptions.
• Challenge Assumptions: Question existing assumptions and consider how emerging trends might reshape the industry landscape.
• Invest in Research and Development: Commit resources to exploring new technologies, scientific breakthroughs, and emerging trends with the potential for radical innovation.

Now you are a multinational in the agricultural sector, what does that mean for future-proofing?

Let’s explore some scenarios to stress test our strategies or create new business models relevant for that scenario.

1. Climate Change Scenario:

• Description: This scenario explores the impacts of severe and more frequent climate events like droughts, floods, and extreme temperatures.
• Possible Impacts:
• Opportunities:

3. Regulatory Shift Scenario:

• Description: This scenario explores potential changes in regulations and government policies affecting the agricultural sector, such as increased environmental protection, food safety standards, and ethical sourcing practices.
• Possible Impacts:
• Opportunities:

This is just a start. Ofcourse, AI can hallucinate, so take all of this with a big grain of salt and let the human be in the loop and stress test it. However, like solving writer’s blocks, these are good starting points for strategy or innovation blocks. They help kickstart the thinking and approach and enable us to think through how we approach what can look like a big challenge.

For an example, check out this emerging trends report generated by AI for the agriculture business.

Share your experiences. And if you want to experiment or build your capability, reach out to me.

Reader Pointers:

• Consider how AI could be integrated into your organisation's existing strategic planning processes.
• Start experimenting with AI tools and platforms to identify potential applications for your specific industry and challenges.
• Remember to always critically evaluate AI-generated outputs and use human judgement to make informed decisions.