The animal kingdom of

unexpected events

Black swans
Unexpected events of
large magnitude that
seem impossible until
they occur.

White leopards
Hidden or camouflaged
risks that can have
large impacts.

Source
Ziauddin Sardar and John Sweeney: “The menagerie of
postnormal potentialities".

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 Black elephants
widely predicted
events that are
rejected as unlikely
until they actually
occur, after which
they are dismissed
as unpredictable
black swans.

Grey rhinos
Obvious risks that
are ignored.

Black jellyfish
Known and normal
risks that unexpectedly
escalate out of control
due to positive feedback.

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WILD CARDS: Expect drastically change the course of histo-
ry, at least in the short to medium term,
the unexpected but sometimes even the long term if the
event turns out to be a trigger event.
Some wild cards will almost certainly
happen eventually, but it is impossible
to predict exactly when. Global pande-
mics, financial meltdowns, and asteroid
impacts are examples of such events:
In futures studies, the term ‘wild card’ They have happened in the past and
(or wildcard) is used to denote a future will almost certainly happen again in
event of low predictability, but of large the future, but could equally likely hap-
consequence in the short (and possibly pen next year, next decade, or next
long) term. To be a wild card, an event century, with little or no advance war-
must happen fairly quickly and with little ning.
warning, making it difficult to anticipate Wild cards are an addition to foreca- .

except in the broadest sense. Unlikely sting and scenario planning (See page .
.
things happen all the time, so you should 6 for explanation of these terms). The .
always expect the unexpected – or, at extreme unpredictability of the times we
least, that something unexpected is live in, with an ongoing pandemic, a vo-
going to happen. In this article, we exa- latile geopolitical situation, and rapid
mine wild cards and related topics like technological advances, increases the
black swans, disruptive innovation, and importance of foresight analysis but
blind spots. weakens the anticipatory power of fo-
The Copenhagen Institute for Futures resight, making wild card analysis, whe-
Studies (CIFS) has worked with wild card re scenarios are explored that are ba-
identification and analysis since at le- sed on various wild card events, a more
ast 1990 and introduced the method to important tool than ever in foresight and
the futurist world in 1992 in Wild Cards: A when developing scenarios. .
Multinational Perspective,1 a joint publi- Wild card scenarios can be used to 1 Copenhagen Institute
for Futures Studies,
cation by CIFS, BIPE Conseil, and Insti- challenge the increasingly unlikely idea
BIPE Conseil & Institute
tute for the Future. It is also described in of the future as a direct continuation of for the Future: Wild
CIFS’ 1996 members’ report Managing past events, and organisations can use Cards: A Multinational
Perspective, Institute for
the Future. The term was more widely wild card scenarios to test how robust
the Future (1992).
popularised by John Petersen in his bo- their strategies are: could we survive
ok Out of The Blue – How to Anticipate such scenarios – or even thrive in 2 John L. Petersen: Out
of the Blue: How to
Big Future Surprises (1996).2 As such, them? While a given wild card event is
Anticipate Big Future
wild cards are not a new thing in futu- unlikely to occur within a specific time Surprises, Madison

res studies and foresight, but given the frame (for example 10 years), it is very Books (1999).

high level of unpredictability facing our likely that some wild card event (or se-
world today and the rapid pace of veral) will happen every decade, and it
change certain in the coming decades, may be a very good idea to fashion
they have gained new importance. strategies that are resilient to such dra-
Wild cards are improbable but possi- stic changes, even at the cost of po-
ble events that have the potential to tential short-term profits.

24 SCENARIO reports N O
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FH
P OO
TO : J: P S N A P P Y G O A T
TO
Wild cards can be used in scenario ger larger events or long-term shifts
processes when describing the paths that would probably happen anyway
that lead to scenarios (backcasting - at a later time, triggered by another
see page 6). One wild card event may event. Certain stresses have built up
set developments on a path leading to over time, and the wild card event is
a certain scenario, while another event simply the straw that breaks the camel’s
could le-ad to a different scenario. back. The 1914 assassination of Arch-
Even though wild card events are not duke Franz Ferdinand is an example of
necessarily needed to make a scena- such a trigger event. Given the geopo-
rio plausible, they can help make sce- litical situation of the time, it was very li-
narios plausible that are very different kely that a major armed conflict would
from today. soon erupt in Europe, but the assassi-
nation determined where and when it
Selected examples of past happened (and to some extent, how it
wild card events: played out). Similarly, the 9/11 terrorist
• The 1918 H1N1 influenza epidemic attacks triggered the US-led invasion
• The discovery of penicillin of Iraq and Afghanistan, both of which
• The Wall Street crash of 1929 would likely have happened at some
• The oil crises of the 1970s time anyway given the geopolitical pri-
• The collapse of the Soviet Union orities of the US administration at the
• The 1997 Asian Financial Crisis time. Hence, in some cases, the wild
• The terrorist attacks of 9/11/2001 card trigger event itself may be unpre-
• The financial crisis of 2007-08 dictable, but what follows is not.
• The current COVID-19 pandemic The current COVID-19 pandemic may
well turn out to be a trigger event for
Examples of possible future one or more shifts. For one thing, the
wild cards: pandemic has forced a lot of people to
• A digital pandemic; a computer virus work from home and to exchange phy-
destroys all internet-connected data sical meetings for video meetings. Or-
• Breakthrough in fusion power ganisations for which this shift has been
• Global hyperinflation a positive one may turn to operating
• A sudden unexpected release of via entirely virtual offices. The pande-
methane hydrate increasing mic may also trigger an end to the slow
global warming erosion of public healthcare that we
• Scientific breakthrough allowing have seen in much of the world over
dramatic extension of human the last half century or so, since coun-
lifespan tries with strong public healthcare (and
• Global stock market collapse welfare in general) overall have hand-
• Superhuman AI develops led the pandemic far better than coun-
consciousness tries with more privatised healthcare.
• Crop disease pandemic causes Whenever an event occurs that can
global starvation be categorised as a wild card, it can
be helpful to consider if it may trigger
TRIGGER EVENTS some nascent shift and what that shift
Sometimes wild card events may trig- could be – as well as what it would

26 SCENARIO reports N O
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 mean for your market. Likewise, if you swans – perhaps ignoring how much
feel that a certain radical shift is on the planning and effort was put into many
horizon, it can be useful to analyse what of these events.
events could trigger this shift and then Some of what Taleb calls black swans
be prepared when it comes. However, are rather directed but radical innovati-
it should be noted that, due to political ons that create new markets and value
or social inertia, a wild card event may networks, eventually disrupting existing
not necessarily trigger a nascent shift, markets and value networks – some-
even when such a shift seems needed. thing that Clayton Christensen in 1995
The financial crisis of 2007-08 revealed termed disruptive innovation (or simply
a lot of instabilities and weaknesses in disruptors).5 The rise of internet shop-
the financial sector, and while some ping is an example of such disruptive
measures against a repeat event have innovation; it grew organically from the
been introduced, critics warn that more invention of the internet (which in itself
comprehensive changes are needed wasn’t very disruptive in its first deca-
to prevent a new financial crisis within des) and rapidly and radically disrup-
3 Victor Li (Villanova the next decade or two.3 ted the global retail market. A future true
School of Business):
self-driving car will also be a disruptive
“The next financial
crisis: Why it is looking THE ANIMAL KINGDOM OF innovation rather than a wild card.
like history may repeat UNEXPECTED EVENTS The success of Taleb’s black swan
itself”, CNBC (2018),
Wild cards are closely related to the theory has triggered several other re-
cnb.cx/2HjGWwe.
‘black swan’ theory developed by Nas- lated forecasting terms named for ani-
4 Nassim Nicholas Taleb: sim Nicholas Taleb in his 2001 book Fo- mals. ‘White leopards’ are hidden or
Fooled By Randomness,
oled By Randomness and later ex- camouflaged risks that can have large
Random House 2001;
The Black Swan: The panded upon in his 2007 book The impacts, ‘grey rhinos’ are obvious risks
Impact of the Highly Black Swan.4 The term ‘black swan’ was that are ignored, ‘black jellyfish’ are
Improbable, Random
used in Europe for something impos- known and normal risks that unexpec-
House (2007).
sible until actual black swans were tedly escalate out of control due to po-
5 Clayton M. Christen- discovered in 1697 by explorers in sitive feedback, and ‘black elephants’
sen, Michael E. Raynor,
Australia. Wild cards and black swans are widely predicted events that are
& Rory McDonald:
“What is Disruptive share many characteristics, but there rejected as unlikely until they actually
Innovation?”, Harvard are also differences between the two. occur, after which they are dismissed
Business Review 2015,
Wild cards are scenarios we can imagi- as unpredictable black swans. As the-
bit.ly/35KaH2Y.
ne (although we may be poorly prepa- se kinds of events can all be understo-
re for dealing with them), while black od and prepared for with better fore-
swans seem unimaginable before they sight as well as research into and a-
occur. Taleb observes how unexpec- wareness of risks, they can be catego-
ted events of large magnitude have rised as blind spots (or blindspots). Even
had major consequences in the past though blind spots aren’t wild cards,
and posits that they collectively play the fact that they catch decision-makers
vastly larger roles in history than regu- unprepared means that they are worth
lar occurrences. Taleb sees almost all discussing in this context.
major scientific discoveries, historical Blind spots, according to Michael Por-
events, and artistic accomplishments ter, are items of conventional wisdom
as undirected and unpredicted black which no longer hold true but still guide

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03 SCENARIO reports 27
business strategy.6 They are incomple- 6 Michael Porter: Com-
petitive Strategy, Free
te, obsolete, or incorrect assumptions Press (1980).
in a decision-maker’s understanding of
7 Benjamin Gilad:
the environment, and blind spot analy-
Business Blindspots:
sis can be used to uncover such erro- Replacing Your
neous assumptions. In his 1993 book Company’s Entrenched
and Outdated Myths,
Business Blindspots,7 Benjamin Gilad
Beliefs and Assumptions
introduced a three-step model for un- With the Realities of
covering blind spots: Today’s Markets, Probus
Professional Pub (1993).

Step One: Conduct an analysis of Mi- 8 “Porter’s Five Forces:

chael Porter’s five-force industry struc- Understanding
Competitive Forces to
ture, augmented with identification of
8
Maximize Profitability”,
possible change drivers: trends with the MindTools.com,
potential to profoundly affect the balan- bit.ly/3dOENVg.

ce of power between the five forces.

Step Two: Collect competitive intelligen-

ce on the target company’s top exe-
cutives’ assumptions regarding the a-
bove industry structure, using available
sources such as interviews, talks, and
annual reports, or through strategy re-
verse engineering, which looks for the
underlying assumptions that could rati-
onalise existing strategy.

Step Three: Compare the results of

Step Two with the analysis in Step One.
Any contradiction between the two is a
potential blind spot.

Whether we call unforeseen risks or fu-

ture events wild cards, black swans, or
blind spots, it is certain that they will cha-
racterise the coming decades, perhaps
even more so than past decades given
the many fields of great impact that
show sign of great unpredictability: ge-
opolitics, economy, AI and robotics, ge-
netic technology, climate change, the
current pandemic and possible future
ones. This makes exploration of wild
cards and their implications a very im-
portant part of any strategy process . ¢

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