Get There Early: Outrage and Insurance

[This is an extract from Chapter 3 of Bob Johansen's new book, Get There Early: Sensing the Future to Compete in the Present. The previous extract, on responses to the "VUCA opportunity" in science and leisure, is here; on health and education, is here; a discussion of "the VUCA opportunity" is here; the introduction to the chapter is here. -Ed.]

The Outrage Industry. Out of all the companies with which I have worked, Target is the only one for which a community relations person has been present at every workshop I have done—across the company. Target’s relationships with its local communities are a visible part of its corporate strategy. Target stores are in local communities, and the corporation makes a noble attempt to be active local contributors. Five percent of Target’s profits are dedicated to the local communities they serve.

Just as it is difficult for large corporations to develop intimate relationships with individual customers, it is difficult for a large corporation to engage with many different local communities. Even within a single community where a single Target store is located, there are many different kinds of people and many different views on most issues. Target is very community minded, but the communities it serves are extremely diverse. It is difficult if not impossible to please all community members. Target’s community commitment gets played out in the real world of communities in which people do not always agree on what is appropriate.

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For example, Target team members (Target employees) are trained to be inclusive and situational in dealing with their local communities, to honor whatever cultural values and traditions are appropriate for a particular guest. Team members offer greetings in the stores appropriate to “the holidays,” not just Christmas, although they are also taught to be situational. If a guest says that she is buying a Christmas present for her mother, for example, Target advises its team members that it is appropriate to say “Merry Christmas” to the guest when she is leaving.

Target’s flexible and situational holiday language, however, was perceived by a portion of the Christian community as an affront to their beliefs. During the 2005 holiday season, Fox News reported that Target had instituted a policy against “Merry Christmas” greetings at their stores. From what I could gather by talking with Target people, Target had no new policy. Rather, Target was making an ongoing effort to be inclusive of the diverse people in the local communities where their stores are located. The Fox News challenge, however, was polarizing, and it implied that a new policy was in effect: Target was accused of killing “Merry Christmas” and telling its employees to replace it with “Happy Holidays.” For Fox News, it was an engaging story of the controversial sort that it seems to love—even though the story was not true, as best as I could tell.

Target was forced to engage with a range of diverse community groups on an issue on which it was impossible for everyone to agree. There was no single greeting that would please everyone in all of Target’s local communities. Not surprisingly, some community voices were louder than others. I spoke with Target employees who fielded some of the calls in response to this story. Some impassioned Christian callers were outraged and did not want to hear Target’s side of this story. The Target representatives listened and tried to put the Fox story in context.

Target’s organizational dilemma is about how to keep its strategic commitment to communities while also engaging positively with the very different parts of each community where Target has a store—some parts of which will never agree with one another.

This story is an example of what is starting to be called the “outrage industry,” referring to news or entertainment personalities who focus on stimulating outrage—with no particular purpose in mind other than stirring things up. In other words, the outrage industry practitioners are not advocates of a better way; they just want to stimulate outrage. Indeed, Fox News has made a very successful business out of stimulating outrage. People love a colorful story, even if it is not true. Outrage can come from the right or from the left, but the result is increased amplification of stories and anecdotes that contain both information and misinformation, to which retailers and others must respond.

Chapter 2 and the Forecast Map talked about the driving force of extreme polarization. The outrage industry is an artifact of the VUCA world, which fuels polarization. Many of the people with strong opinions are sincerely interested in a particular kind of change, but their voices become mixed easily with those from the outrage industry who are churning stories. Being on the receiving end in this world of dilemma by innuendo is usually a no-win game, yet many corporations have to play the game. As one executive said to me, “We often have a choice, when confronted with accusations like this, of looking stupid or looking evil. When I’m faced with this choice, I always choose looking stupid. It is easier to recover from looking stupid than it is from looking evil.”

Insuring against loss in a VUCA World. What is insurance in a VUCA world? It seems like an overpromise to sell insurance in a world that has fewer and fewer guarantees. Insurance has traditionally meant indemnification of loss if something bad happens. Indemnification is still possible, but nothing can be truly insured. Readiness is a much more believable and more useful promise, a stance that prepares people for possible loss without overpromising with assurances that nobody can really provide with any degree of certainty.

One example of this readiness is the geoweb and the world of sensors, described on the Forecast Map inside the book jacket and in Chapter 2, that provides, for example, new resources for home monitoring of water leaks, fires, or other risks that homeowners take. These kinds of ambient intelligence are becoming possible, where what used to be static objects can be transformed into aware surroundings as digital technology becomes embedded in physical objects that are part of our daily lives. Using sensors, pattern recognition, and user profiles, new services can monitor and respond as needed. Today’s household alarm systems only hint at what will be possible as geoweb technology advances and as services are introduced to take advantage of these new readiness technologies.

State Farm Insurance, for example, is moving toward readiness in its services, while still providing indemnification along the way. The company helps homeowners assess their risk and develop their own readiness strategies. There is a basic shift underway in the insurance industry as consumers realize and accept that nobody can really “insure” that bad things won’t happen. This was always true, but it is even truer now. Rather than assurances that may be unrealistic anyway, we must all prepare for and take risks that we choose to take—with a good understanding of the tradeoffs and the readiness procedures that are appropriate. Indeed, the insurance industry is gradually evolving toward a focus on risk, risk transfer, risk advice, and readiness services. Although most businesses hate risk, the VUCA world is fueling a crop of companies that thrive on it.

I did a series of workshops in London, and beforehand the meeting organizer presented an evacuation plan in the event of an emergency. I did a meeting in Geneva, Switzerland, after that, and an executive from London kicked off the meeting. He asked if an emergency briefing was required in Geneva and, before getting an answer, said, “I’m going to do an emergency briefing anyway, since it’s the right thing to do.” In Jerusalem, such routine readiness preparation is even more evident than it is in London. In the United States, however, most people still pretend that we will solve the “terrorist problem” and someday return to normal. The VUCA world is here to stay; it is the new normal.

This world is riddled with safety and personal risk dilemmas. People want to be better prepared, more ready for the uncertainties we are all facing. We are all becoming more conscious of these risks and more open to services that help us prepare. We all want assurances, and we’d love to have our safety insured, but nobody can do that. The dilemma for insurance companies is to figure out how they can continue to offer indemnification as appropriate while also beginning to offer new serv- ices that encourage people to be more prepared for and able to deal with a world where nothing can really be insured.

Networks of empowered people will want to be better prepared, more ready for the uncertainty that we are all facing. Smart networking will make it much easier to share these practices, some of which will be shared in an open-source way and some of which will be provided as services by insurance companies and other risk advisers. Interest and advocacy groups, including those with extreme views, are likely to have major impacts on the emerging field of readiness technology and services. Insurance companies do not have a great reputation in many parts of the world, so they will have reputation management challenges. If traditional insurance companies cannot respond to this emerging market demand, new players and new services will arise in their place.

The VUCA world is affecting all aspects of life, as the cases above suggest, and the responses are becoming increasingly interesting. Each response illustrates an open-ended learn-as-you-go style of learning that moves beyond traditional problem-solving styles of leadership.