Future makers vs. future takers: Long-term thinking

The long viewThe notion of future maker vs. future taker is a mindset issue. It is the difference between seeing the future as a good thing, filled with disruptive innovation that will extend your mission, or seeing it as a bad thing, filled with disruptions that will only upset your current market share and profitability. Typically, insurgent companies view themselves as future makers; incumbents gradually come to behave like future takers. As we discussed in a previous post, this can lead to radical differences in how a company views innovation. In this post, I want to talk about how it affects long-term thinking.

In business, the long term is about dreams. The near term is a frenzy of a hundred skirmishes to produce the numbers, to deliver on time in full, to manage stakeholder communications, etc. The medium term is just as frenzied, but with slightly longer deadlines and slightly more discretionary resources. Incumbents are masters at managing for the short and medium term. Insurgents typically operate in only two modes—the short-term battle for daily survival and the long-term goal of massive industry disruption.

When insurgents think long term they think about reshaping industries, offering customers fundamentally new things, pursuing profound innovation. They brainstorm about world domination. The whiteboards fill up with first-, second-, third-generation moves in which the tiny insurgent somehow expands its market power and influence in ever-expanding circles, like the shock waves of a meteor strike. For incumbents, it’s different. As future takers, their long-term discussions are mostly ghost stories, filled with massive threats on the horizon—some fully formed, others only floating specters. Both future takers and future makers use long-term discussions to dream. But for future takers, the dreams are nightmares, not ambitious visions of how they can mold the future.

Let me provide an example. I reviewed the long-term strategy of one global industrial company and, in summary, it had three elements: a) respond to low-cost insurgents offering far better price points, b) respond to consumer concerns about environmental impact and c) respond to pure-play service providers that are picking off high-margin projects from our best customers. The long term was filled with nightmares, and the long-term strategy was the sum of actions to react to them. There was no positive action included. No dream to shape the future. Instead, this company was prepared to let others shape the future for it, and its strategy was to respond as best it could.

Some companies spend so much effort fighting the future that their strategy starts to look like an all-out effort to freeze time. It reminds me of the Phoebus cartel, a group of companies that conspired to fight the future by, among other things, limiting the life of light bulbs. Operating from 1924 to 1939, they had built-in obsolescence for their light bulbs to guarantee volume growth. They weren’t just fighting the future; they were extending the present indefinitely.

Let me contrast this with a recent conversation I had with John Vincent, CEO of Leon Restaurants, the healthy fast-food chain based in the UK. John and I discuss Bain’s work on the Founder’s Mentality® regularly, and John shares lessons from Leon. He’s kindly included me on all companywide emails, so my inbox is filled daily with dozens of examples of great customer feedback. Here’s an example from yesterday morning:

“Just a quick note about your guys in the Tooley [Street] Leon. … As someone who also works within food and hospitality, my colleagues in the office are probably bored stiff of me going on about various magic moments from the guys in there, wishing I could bottle whatever they are on. Not only are they open, natural and friendly, but you have obviously empowered them to deliver great service by really owning the customers’ experience. … I just love the confidence in the product and the way each customer is treated as an individual. We employ over 2,500 staff in my business and I would be so proud if we consistently delivered service with that degree of natural charm.”

As CEO, John only operates on two levels, near term and long term. He’s either pouring over the daily/weekly sales reports to gauge current performance (see “The clarity of the order book” ) or he’s drawing up plans for Leon to transform the world as a true wellness brand. He plans to change the world of food, the world of retail, the world of employment—he even throws in a smattering of social transformation. The point is, he’s a future maker and aspires to lead or participate in every new trend and disruption. He never talks about direct competitors in his industry, because he is worried about more than just his industry. His long term is full of extraordinary dreams, and while some might be pure fantasy, I’d bet on him before I’d bet on most future takers.

Just as we asked you to look at your innovation discussions to see whether you pursue them as a future maker or future taker, we ask you now to think about how your company talks about the long term. Are you pursuing dreams to reshape the future on behalf of your customers, or are you fighting nightmares, reacting to the changes of others around you? Is management devoting time to fighting the future or to building a better one, where your team is in the forefront of driving positive change?

This entry was posted in Frontline obsession, Lost voices from the front line by James Allen. Bookmark the permalink.

About James Allen

James Allen is a senior partner in Bain & Company's London office and recognized as a leading expert in developing global corporate and business unit strategy. He is co-head of Bain’s Global Strategy practice and a member of Bain & Company's European Consumer Products practice. He is co-author, with Chris Zook, of Repeatability (HBR Press, March 2012) and Profit from the Core (HBR Press, 2001 and 2010).

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s