Dealing with uncertainty

The Three Horizons present a powerful concept that helps us think about the future, that gives structure to our vision and ideas, our plans and concerns. This concept derives its strength from acknowledge the emergent character of the future, introducing three time horizons that coexist at any point in time, though in an evolving pattern.

The first Horizon (H1) dominates the near-term future, it is essentially characterised by the certainty of knowing the rules, the processes, the key actors and their roles. At the other end of the spectrum, the third horizon (H3) provides a vision and ambition for the far-term future. In-between the two, it is the second horizon (H2) builds the mid-term bridge from where we are today to where we want to be in the future.

And that’s where we have to come to terms with the uncertainty of the future: Do we embrace the opportunities (the H2 plus view, or H2+) or do we fear the risk (an H2 minus view, or H2–)? This choice defines how we address the second horizon: either actively shaping the future towards H3, or preserving as much as possible of the present certainty of H1.

To think this through, let’s take driverless cars as an example: If you see driverless cars as your vision for the future (H3), then it is clear that you cannot simply jump directly from today’s dominance of personal piloting to autonomous cars. The technology is not yet fully developed, so you’ll need some progress there. And you’ll face legal constraints as well, for you cannot simply prohibit all human-piloted cars from one day to another. Rather, you must devise the intermediate stage (H2) to act as the necessary feasible stepping stone. And this would need to tackle the technological as well as the legal challenges in order to develop all the bridging technologies and the transitory legislation that will allow for the coexistence of piloted and autonomous cars.

Moving from the certainty of today (H1) to the achieve our vision for the far-term future (H3), we have to overcome the uncertainty in the mid-term (H2) to build our bridge from H1 to H3. Dealing with this uncertainty, we have to choose our approach somewhere within the spectrum between two extremes: the proactive view (H2 plus) and the preserving view (H2 minus).

An H2+ approach will view the mid-term uncertainty as an opportunity, as the essential precondition even, to shape a better future according to the H3 vision: H2 is just the transition on the path to get to H3. In our example, such an approach would promote technological progress as well as societal acceptance and adoption of driverless cars. While aware of the challenges that such new means of transportation will have for any of the current users and providers of today’s technologies, the H2+ approach is focused on promoting and facilitating the innovation that is necessary to realise the H3 vision: and that innovation must tackle technological (feasibility) as well as legal (regulatory) and social (acceptance) questions. H2+ is driven by the long-term vision, firmly committed to take the mid-term bull by the horns.

An H2– approach observes the same uncertainty in the mid-term, but comes to a fundamentally different assessment. Viewing the uncertainty of the future through an H1 lens, H2 presents a threat to the achievements of today. Such an approach would perceive driverless cars as a risk to the established modes of transport and seek to protect them from the competition of the new. An H2– approach would be fairly passive on the technology side, and rather focus on the legal and societal aspects: e.g., defining new safety standards, protecting market incumbents, voicing concerns over the potential social impact of change. H2– is biased towards today, stubbornly striving to preserve as much of the present as possible.

Of course this is only a rough black-and-white sketch; in reality, our approach towards the future will almost always be somewhere between the two extremes. But it’s good to be aware of those extremes, as we might be faced with some fierce opposition to our own plans: the Three Horizons can help us understand “What’s eating them?“

Ultimately, H2 takes shape as a battle for dominance, a battle of vision vs. control, H3 vs. H1. And H1 has significant advantages in this battle: the here and now of H1 controls all resources (financial capital, trained and skilled workforce, even attention), H1 is characterised by a high degree of organisation, and H1 can draw from its long-term legacy. These are all positive elements that give credibility and predictability to the H2– approach: it’s easy to agree. At the same time it’s difficult to change against the established organisations and control mechanisms. And there is a lot to loose: reputation, market volume, market share, economic and political power, even entire business models and value propositions. All these considerations support the preservationist H2– approach. And even though this is difficult to accept for the visionary H2+ perspective, society’s stability and integrity requires the checks and balances that is ensured by the caution and reservation of H2–.

I see the main difference between H2+ and H2– in the awareness of the further future, i.e., in the acknowledgement of the pockets of the future in the present. H2– is firmly rooted in H1, and has no reading of or even interest in H3. In comparison to the H2+ and its focus on the H3 future vision, H2– holds a shorter perspective of the future that doesn’t look beyond the mid-term. The defenders of H2– are focused on what they have. Their role is more passive and static; driven by a sense of risk and loss, they seek to preserve the known and resist to change. In stark contrast, the proponents of H2+ will concentrate on what they want. They play the more active and forward leaning role, driven by their sense of opportunity and improvement, seeking progress and promoting change.

I’m firmly convinced that we need both perspectives for shaping our future; it’s all a question of finding the right balance.