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Five modern lessons from a 55-year-old technological forecast
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Five Modern Lessons from a S-Year-Old Technological Forecast Steven P. Schnaars, Swee L. Chia, and Cesar M. Maloles III
The first comprehensive forecast of technological trends and social implications by the U.S. government was published by the National Resources Committee in 1937. It focused on 13 major innovations. In their article, Steven Schnaars, Swee Chia and Cesar Maloles examine the accuracy of those forecasts and draw some conclusions based on their review of that report.
One of the most prominent, comprehensive and systematic studies of the future was released to the public on July 18, 1937. The 388-page, double-column report was entitled Technological Trends and National Policy, Including the Social Implications of New Inventions [ 11. Authored by the National Resources Committee on the Social Implications of New Inventions, its forecasts were widely publicized in the business press.’ Technological Trends also claimed to be the first time the government had studied the future systematically and comprehensively. As the authors of the study noted in a letter to President Franklin Delano Roosevelt, to whom the forecasts were presented, “This
Address correspondence Marketing, Baruch College, NY 10010.
to Steven P. Schnaars, Department of 17 Lexington Avenue, Box 508, New York,
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’ For example, see “American Nomads Aided by Trailers,” New York Times, 20, July 18 (1937); ‘Calls Television Propaganda Peril, ” New York Times, 21, July 18 (1937); “Inventions Point to Changed World,” New York Times, 20, July 18 (1937); “Job Lag a Factor of Technical Gain,” New York Times, 20, July 18 (1937); Laurence, William, “Inventions Survey Finds Major Changes Imminent; Urges Labor Safeguards,” New York Times, 1, 20-21, July 18 (1937); Laurence, William, “A Forecast of Changes Which May Soon Affect Our Social and Economic Life,” New York Times, 6, July 18 (1937); “Man With Hoe Losing to Tractor,” New York Times, 2 1, July 18 (1937); Meyer, Cl., “Note on Technological Trends and Social Planning,” American Journal of Sociology, 951-963, May (1938): “Predicts Papers Printed in Homes, “New York Times, 2 1, July 18 (1937); “President Commends the Report as Guide to Nation’s Development,” New York Times, 20, July 18 (1937); “Report on Technoiogical Trends in Major Industries .,” Commercial and Financial Chronicle, 539-541, July 24 (1937); “Roosevelt Takes on Cruise Social Studies of Technological Trends, Jobless and Slums, ” New York Times, 1, July 11 (1937); “Statecraft Tied With Inventions,” New York Times, 20, July 18 (1937); “Technology and National Planning,” Commercial and Financial Chronicle, 505-507, July 24 (1937); “Technological Trends and National Policy: Summaries,” Science, 7-8, July 23 (1937); “Tomarrow’s Inventions,” New York Times, 8, July 18 (1937); “Topics of the Times,” New York Times, 18, July 22 (1937); “Trends and Tides: Television Hailed as Aid in Teaching, New York Times, 5, July 25 (1937); “Urge U.S. Planning Board,” Business Week, 15, July 24 (1937).
0737-6782/93/$6.00
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BIOGRAPHICAL
SKETCHES
Steven P. Schnaars is Professor of Marketing and Chairman of the Department of Marketing at Baruch College in New York City. His research interests focus on growth market forecasting and marketing strategy. Professor Schnaars is the author of Megamisfakes: Forecasting and the Myth of Rapid Technological Change, 1989, and Marketing Strategy: A Customer-Driven Approach, 1991, both published by The Free Press. His articles have appeared in the Journal of Marketing Research, California Management Review, Business Horizons, Long-Range Planning and numerous academic journals. Swee L. Chia is an instructor and Cesar M. Maloles III is an adjunct lecturer in marketing at Baruch College, City University of New York. Both are Ph.D. students in Marketing at the Graduate Center of City University.
document is the first major attempt to show the kinds of new inventions which may affect living and working conditions in America in the next 10 to 25 years” [p. v]. (All page citations refer to the report itself unless otherwise noted.) We thought that after more than 50 years it might be interesting, as well as instructive, to see how well this serious and concerted effort at technological and social forecasting turned out. The 1937 study was a broad-based vision of the future that focused on 13 major innovations. As the authors noted, “The reports herewith presented reveal the imminence of a few very important inventions that may soon be widely used with resultant social influences of significance” [p. x]. Those inventions were 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.
television, facsimile transmission, air conditioning, mechanical cotton picker, plastics, synthetic rubber, artificial cotton and wool fiber substitutes from cellulose, photoelectric eye, steep-flight aircraft, prefabricated houses, automobile trailers, tray agriculture and gasoline from coal.
made
Our evaluation of the 1937 report focuses on four issues regarding those 13 technological forecasts: 1. Market impact: whether those new technologies had the profound impact on business and society the forecasters thought they would;
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2. Timing: whether those technologies experienced significant market growth within the lo- to 25-year time frame set by the forecasters; 3. Product uses: whether those technologies were put to the use predicted and 4. Social implications: whether the social implications of those new technologies developed as predicted.
Thirteen Technological Innovations The 1937 report focused only on major technological innovations. To offer perspective, the authors compared their 13 innovations with six inventions that had greatly influenced the first third of the twentieth century: (1) the telephone; (2) the automobile; (3) the airplane; (4) motion pictures; (5) rayon and (6) radio. The forecasters’ methods were simple, but not naive. Basically, the National Resources Committee relied on expert opinion. The authors compiled facts and drew conclusions. They did not rely overtly on mathematical models, although more structured forecasts may have influenced their judgement. There is very little discussion of formal forecasting methods in the source document. We evaluated their forecasts in much the same way. We compiled facts from subsequent reports and judged outcomes. Our review of the 13 forecasts is rank ordered from the most to the least accurate. Television Predicting a growth market for television was the easiest forecast to make. Television had been technically feasible for more than a decade and incremental improvements in picture clarity and size were progressing steadily. Television had the profound impact on society the forecasters thought it would. They noted that television, as well as other communications innovations, seemed “destined to alter habits of life and social and economic institutions associated with entertainment and information” [p. 291; they were right. The report also correctly foresaw the eventual emergence of color television, but made the common mistake of predicting that three-dimension television would follow; it did not. In terms of timing, the report correctly predicted the “imminent” diffusion of television, although World War II intervened, postponing growth for another decade. The report also did well when it came to predicting
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the uses and social implications of television, although there were some notable mistakes. First, the authors correctly noted that “[it] seems reasonable to expect that the most popular type of entertainment by television will be the drama (rather than music)” [p. 291. Dramas would be recorded, not presented live. The consequences of widespread broadcasting were that big firms would benefit from economies of scale in national advertising; that also happened. So did the prediction that censorship would be imposed to protect children, and that advertisers, through their purchase of air time, would influence programming so as not to offend viewers. Second, in addition to broadcasting, the authors correctly foresaw cable television. “By wire will be broadcast all sorts of visible entertainment not sufficiently popular [for broadcasting] . . . but which could pay for themselves through charges for the wire service” [p. 311. Third, television would profoundly affect political campaigns. “Political addresses will be more effective when the candidate is both seen and heard.” As John Kennedy so vividly illustrated, “good looks and presence will help” [p. 301. Fourth, the report was less prescient when it came to predicting educational uses of television. The authors predicted that “gradually, the use of television, as well as the radio, direct talking moving picture, and phonograph may be expected to reach . . . down to the primary grades” [p. 311. Fifth, the report also erred in its belief that television would be a purveyor of the “high arts.” This error was a common one. Many early forecasters, such as Gilfillan in 1912, made the same mistake: On some evening in 1930 we may find in the newspaper such a program as follows: Tschaikowsky’s Pathetic Symphony, . . . Coppelia by the National Corps de Ballet South America. . . Francesca of Rimini, grand opera, Anthony and Cleopatra by William Shakespeare . . . [and even] a reading by Sharemas O’Sheel of some of his poems [2, p. 8881.
This is not to say that there are no instances of highbrow television but that those instances are rare relative to broadcasts of popular entertainment. Finally, the report erred when it predicted that “there is a danger from propaganda entering the schools [and the home]” [p. 331. Television is clearly capable of such manipulations, but most modem-day
critics would argue that banality is a more common problem than mind control.
Facsimile Transmission The ubiquitous facsimile (fax) machine has also had an impact on current day business practices to the extent that Technological Trends forecasters said it would; however, their timing was too optimistic. The technology did not create a growth market until almost 50 years after the 1937 forecast. Only then did costs decline and performance improve to a level that made the machine practical. Facsimile transmission was a common forecast throughout most of the twentieth century. Although the basic notions of the device were known as early as the late 18OOs, it took more than 100 years to field a successful product. The report correctly foresaw some product uses of facsimile but missed others. The forecasters recognized the business use of fax. The machine would transmit “whole pages from ledger books, pages of checks with authenticated signatures, bills of lading, invoices, and the multitude of other records which are in everyday use” [p. 2171. It would also find business use in the home “where it is possible for [an executive] to receive daily reports typed and signed at headquarters” [p. 2171. Mistakenly, but consistent with other forecasts from the 1930s to the 196Os, the report predicted the “eventual transmission of entire newspaper pages” [p. 2171. Some fifty years later the likelihood of faxing newspapers directly into the home seems unlikely. The report correctly foresaw the social implications of facsimile transmission. The report predicted that developments in electronic communication devices would quicken the pace of ordinary and business life. The report also held that advances in communication technologies would increase employment, but only for those with specialized skills. That forecast ran counter to the depression-era fear that technology would cause further unemployment.
Air Conditioning The market impact of air conditioning was also correctly predicted by the 1937 report. Air conditioning, it noted, “is likely to be extended gradually as it becomes cheaper and as more thought is given to the efficiency and comfort of the worker” [p. 261. The timing of market growth was also accurately
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predicted. Air conditioning grew rapidly after the second world war, and was widely available by the 1962 deadline set by the report. The predicted use of air conditioning was also accurate: it would be used mostly to cool and dehumidify factories and homes in the warmer regions of the United States. Most impressive was the report’s foresight conceming the implications of economical air conditioning. It would spawn the industrial growth of southern U.S. cities, and that is exactly what happened. Practical air conditioning was a primary impetus for the postwar growth of southern cities. The report also predicted that air conditioning, would increase the economic might of southern states. The report asks
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Committee correctly predicted that plastics would be widely used as substitutes for metal and wood. Their popularity was noted as follows: “Their [plastics] development and use have reached the place where one contemplating a new product is most likely to enquire first of all out of what plastic might it be molded?” [p. 3061. The report also correctly predicted home uses for plastics as kitchenware, telephones, toys, appliance cabinets, resilient flooring, piping, siding, furniture and electrical insulation. The report deferred predicting the social implications of plastics: “It is most difficult to forecast what the social implications may be as we go forward with chemical research and the applications of its results” [p. 3141.
Is
it too much to predict that air conditioning of the working and living quarters of other residents of more humid areas may cause more [industrial] activity in those parts that will open up to use natural resources beyond our imagination? [p. 3241
Mechanical
Cotton Picker
The mechanical cotton picker was another invention that greatly affected the South. In 1937, a practical device did not exist, but researchers were closing in on a workable machine. Economics would decide whether a device would be successful. The report is hesitant on the timing of market growth. In hindsight, its hesitation proved justified. By 1952, only 18 percent of the U.S. cotton crop was harvested by mechanical devices. By 1967, however, 95% of the cotton crop was harvested mechanically. Diffusion was somewhat slower than the 1962 deadline predicted in the report. The report focused mostly on the economic and social implications of this innovation. Most of those implications proved correct. First, it was predicted that the expense of the mechanical picker would lead to a concentration of farm ownership. Second, the report recognized that tens of thousands of unskilled workers would lose their livelihood. Third, it correctly foresaw that massive numbers of black Americans would “pour into the North and seek employment in industry” [p. 1431. That is exactly what happened.
Plastics Plastics may be ubiquitous industry was in its infancy.
today, but in 1937 the The National Resources
Synthetic Rubber The 1937 report also correctly foresaw the substitution of synthetic for natural rubber. At that time there were two leading substitutes-neoprene and thiokol. Both cost more than natural rubber, but had special properties that made them viable in certain applications. Their forecasts were based on an analogy drawn between synthetic and natural rubbers and synthetic and natural dyes. They asked, “will there some day be another indigo causing acres and acres to go out of production of this national product, as did synthetic indigo not so many years ago?” [p. 3061. Their prediction was aided by World War II, which hastened the timing of substitution because natural rubber came from the Far East and Brazil, and supplies were cut off during the war. Scarcity sped the development of synthetic rubber.
Artificial Cotton and Wool Fiber Substitutes The myriad synthetic fabrics that are also so ubiquitous today were largely unavailable in 1937. Instead, natural fibers, such as cotton and wool, faced competition from chemically treated, regenerated cellulose fibers such as rayon. In essence, these forecasters predicted a continuation of that trend. The 1937 forecasters correctly foresaw that synthetic fibers would continue to steal market share from natural cotton and wool, but their focus on rayon, and its underlying technology, was myopic. Subsequent synthetic fibers, such as nylon, which are not based on cellulose, have had a much more profound impact on our lives than rayon. Nylon, for example, accounts for
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over 70% of all fibers consumed by U.S. textile mills. Rayon, in contrast, constitutes only about 6% of total synthetic fiber production. The 1937 report also predicted massive unemployment and industrial obsolescence due to the rise of this artificial fiber. Those social implications proved unfounded. The natural cotton industry was never dismantled because of Rayon.
Photoelectric
Eye
The National Resources Committee, like many forecasters of the 193Os, believed that the photoelectric eye would profoundly affect our everyday lives. They predicted, “silently into our lives is creeping a new technological brain-child” [p. 321-3221. The electric eye would be used mostly to perform mundane, repetitive tasks such as opening doors for approaching waitresses. But it would also be used in situations that required rudimentary decision making, such as monitoring assembly-line processes, selecting defective products and acting to remove defective products from the process. The 1937 forecasters listed hundreds of potential applications for the electric eye-from smoke detectors to matching false teeth [p. 3221. The electric eye was expected to displace 250,000 workers. “That it will cause unemployment is obvious . . . Indeed it brings the automatic factory and the automatic man one step closer” [p. 51. Those forecasts proved partly right, albeit extreme. There are currently many market applications for the electric eye, but, overall, the forecasters overestimated its role. They were correct, for example, in predicting that the electric eye would be used to regulate auto traffic, time horse races, and serve as an automatic door opener. They were wrong in predicting that it would revolutionize our lives. Basically, the electric eye has influenced our lives in far fewer ways than envisioned in 1937. Even the massive unemployment it was expected to create proved unfounded. In hindsight, international competition had a far more profound impact on factory jobs than did advances in electric eye technology.
Steep-Flight
Aircraft
Steep-flight aircraft as envisioned by the 1937 forecasters covered three different designs: (1) helicopters; (2) tilt-rotor aircraft, which the report called vertaplanes-“a biplane whose upper wing is rotated for
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reconnoitering and landing but fixed for efficient ordinary flight,” [p. 281 and (3) the autogiro, an airplane/helicopter hybrid. The 1937 forecasters foresaw a bright future for the “roof-hopper.” It would be used primarily to transport passengers and mail from city centers to suburban airports and for short, intercity flights; that would occur in the near-term. Further out, more than a decade away, was steep-flight aircraft for personal use. The report speaks of “types of autogiro or airplane already demonstrated, which can land on any usable field, fold up like a beetle, and proceed along the highway like an automobile, to be housed in the home garage, have intriguing recreation possibilities” [p. 281. One conclusion was clear: “eventual success seems certain.” In retrospect, another conclusion seems even clearer: with the exception of helicopters, steep-flight aircraft never became commercially commonplace, and personal use is virtually nonexistent. Helicopters have successfully served some of the predicted uses but, tilt-rotor aircraft are still strictly experimental. The autogiro is almost completely forgotten. Proponents of tilt-rotor aircraft continue to claim that such planes will someday serve as intercity shuttles, but the added cost of buying and maintaining such complex machines, not to mention potential safety problems, have kept such forecasts firmly planted in the future.
Prefabricated
Houses
The National Resources Committee recognized that housing construction was one of the last sectors of the economy to adopt modem, factory-based, automated production efficiencies. Its members observed that “the detached houses which were built in the largest number in 1936 were not essentially different from many of those built in urban areas 100 years or more ago. In both 1936 and 1836 the materials: Brick, stone, sawed lumber, sand, and lime where delivered to the site and erected in much the same manner” [p. 370-371.1 It was a commonplace observation, and it led the committee to the commonplace prediction that future housing construction would rely heavily on shop fabrication. Housing parts were constructed in a factory then shipped to a building site for quick assembly. Prefabrication covered many schemes, ranging from packages of precut lumber to complete factory-made wall, ceiling and floor panels with insulation, electrical and plumbing preinstalled, which were simply welded together at the site.
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It was expected that steel would substitute for wood as the primary structural member of residential houses. Production efficiencies would lead to lower costs and prices, which would make prefabricated housing more affordable. As a result, slums would be eliminated. The report also foresaw a “tremendous increase in the comforts and conveniences available” (p. 372). The committee correctly recognized that two factors would influence the ultimate success of prefabricated housing. First, existing building codes and the cooperation of local construction trade unions would be required. Second, banks and dealers would have to be willing to finance these radical structures. Those factors turned out to be as crucial as the report said they would, but financing problems and a lack of cooperation from local trade unions hindered, rather than helped, prefabricated housing. The report also erred badly when it came to predicting the economic consequences of prefabricated housing. First, the committee missed the efficiencies gained using traditional “stick” building techniques, which lessened the advantage for prefabrication. Second, and more important, land values rose to represent the largest part of housing costs, a factor that affects all types of houses. Third, the perceived quality of prefabricated houses was poor, relegating the genre to the bottom of the market. As a result, the 1937 report overestimated the extent to which prefabricated houses would become an important source of affordable housing. In hindsight, prefabricated housing has played a minor housing role. Automobile
Trailers
The National Resources Committee was unsure whether to classify auto trailers as housing or transportation. What was certain was “that this is a rapidly growing industry of large possibilities and wide social implications” [p. 1831. The reason for that forecast was simple. The demand for trailers in the mid-1930s was greater than the supply. That trend was expected to continue. In two parts [pp. 183 and 3731 the report specifically predicts that “half the population of the United States will be living in trailers within the next 15 to 20 years.” The 1937 forecasters envisioned the auto trailer as part mobile home and part recreational vehicle (RV). The success of the auto trailer was tied closely to a related forecast that called for an increasingly mobile population. Homes would be hooked to automobiles and hauled around the country. The trailer was a
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natural market extension of the automobile itself, and the mobility it allowed. The social implications of the auto trailer would be profound. Large numbers of people would move with the seasons. Smaller houses would lead to smaller family sizes. There would be a breakdown of traditional neighborhoods as families perpetually moved on. Families, however, would become more cohesive as they had to rely on themselves rather than neighborhood. It is ironic that many of these predictions came true but for different reasons than those anticipated by the authors. Families have become smaller, and extended families living together under one roof have virtually disappeared. The automobile trailer, however, had little to do with either trend. Furthermore, although many people today do live in mobile homes, those homes rarely move. They are towed to a lot where they remain. What started out as an automobile trailer became inexpensive rural housing of the sort called for by the 1937 report’s vision of prefabricated housing. But even the mobile home industry has been declining steadily for years. Today, truly mobile homes often combine the automobile and the trailer into a single unit-the RV-that serves not as affordable housing but as a vacation alternative for a sightseeing populace. In that limited respect the report was correct. Tray Agriculture Experiments in the 1930s found higher crop yields for plants grown in a nutrient-rich liquid rather than soil. Those results caused the National Resources Committee to predict that tray agriculture, or hydroponics, would serve as an important supplement to traditional growing methods in the United States. The key advantage of hydroponics was that food could be grown in great quantities near major population centers, thereby saving on transportation expenses. There were many potential problems with tray agriculture, most of which the report underplayed. “While the economics of this method of producing food have not been fully explored, the potentialities seem great” [p. 3071. In hindsight, it proved less expensive to transport produce from distant farms than it was to use tray agriculture. As a result, tray agriculture is more scarce today than open land near large cities. Once again, the social implications of this innovation were cast in terms of the issues of the
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day-the unemployment prevalent during the great depression. What would farmers do when their farms disappeared, replaced by a more scientific solution? It was a bleak picture painted in bleak times. Gasoline from Coal Finally, the National Resources Committee predicted that the fuel supply would become diversified by producing gasoline from coal. This happened in Germany during World War II, when traditional gasoline supplies were otherwise unavailable, and it is the case today in South Africa, an isolated nation, but it does not occur in the United States or most of the rest of the world. Only after the energy crises of the 1970s did the United States attempt to diversify the fuel supply via synthetic fuels. The Synthetic Fuels Corp., a federal agency, was established to extract oil from shale. But the huge cost, the large amounts of fossil fuels needed, and severe environmental problems kept prices too high to be competitive. Those factors, along with the demise of the energy crisis, resulted in the demise of the Synfuels project as well as the prospect that gasoline would be produced from coal.
S. P. SCHNAARS ET AL.
2. 4 (or 31%) have had a moderate impact; 3. 1 (or 8%) has had only a weak impact, and 4. 2 (or 16%) have had no impact. Given the dismal record often attributed to long-term forecasting, these forecasters seem to have tallied an enviable record. Their successes suggest that a serious and concerted effort at long-range forecasting can foresee the market impact of emerging technologies, even over lo- to 25-year time frames.
Market Timing In regard to market timing, three outcomes were possible: (1) an innovation could have taken longer than expected to have had an economic impact-an error of optimism; (2) an innovation could have taken less time than expected-an error of pessimism or (3) the forecasters could have accurately gauged the timing of an innovation’s market acceptance. Using a rating scale that covered these three possible outcomes, it is clear that optimism was the most prevalent result. Table 2 illustrates that l
8 (or 62%) of the innovations expected to penetrate their whereas
l
5 (or 38%) experienced significant market growth within the lo- to 25-year time horizon projected by the study and
l
0 (none) of the innovations diffused quickly than expected by the forecasters.
Summary and Conclusions All 13 innovations were expected to have a profound impact on business and society within lo-25 years of the date in which the forecasts were made. Table 1 summarizes the predicted uses and social implications of each of the 13 innovations covered by the National Resources Committee. Table 2 evaluates those predictions in terms of the four criteria presented at the beginning of this paper: (1) market impact; (2) market timing; (3) predicted product uses and (4) social implications. The following conclusions are drawn.
took longer than served markets;
more
The results of market timing suggest that major innovations such as those considered by the 1937 report take longer to create an economic impact than generally expected.
Predicting Product Uses Market Impact With the exception of tray agriculture and gasoline produced from coal, all of the remaining 11 technologies have played at least some role in today’s economy. Using a rating scale ranging from “strong impact,” to “moderate impact,” to “weak impact,” to “no impact,” we conclude 1. 6 (or 46%) of the predicted technologies have had a strong impact on business and society in subsequent decades;
Although the 1937 forecasters did well when predicting the impact an emerging technology would have on future business and society, they did less well when predicting the actual uses to which those technologies would be put. Typically, the forecasters foresaw a technology as being used in more than one way. We conclude that l
5 (or 38%) of the uses made of the new technologies were rated as either right or mostly right;
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Table 1. Forecast Summary Invention
Predicted uses
Predicted social imnlications
Television
Drama Cable TV Political ads Education “High arts”
Propaganda
Facsimile transmission
Newspaper by fax Transmission of records/pictures
Faster business pace Increase employment
Air conditioning
Industrial applications
Foster industrial growth in the South Balance “buying power” between North and South
Mechanical
Obvious
Farm concentration Massive unemployment Northward migration
Plastics
To replace light metals and woods
None offered
Synthetic rubber
Lower cost substitute
None offered
Cotton wool substitute
Continued growth of rayon
Dismantling
Electric eye
Replace human control
Technological
City to airport Short intercity personal use
Recreational
Mass source of cheap housing
Eliminate slums Comforts/Convenience
Alternate form of housing Mobile population Vacation home
Smaller families Breakdown of traditional neighborhood Strengthen family bonds and values
Steep-flight Prefabricated Automobile
cotton picker
aircraft housing trailers
Tray agriculture Gasoline from coal
l
l
Supplement Supplement
in factories
conventional
farming
natural fuels
another 5 (or 38%) had a mixed record, some of the uses have been correctly foreseen, whereas others did not materialize (e.g., reading the newspaper by fax) and 3 (23%) were predicted to have uses that proved either wrong or mostly wrong.
Social Implications Not surprisingly, the National Resources Committee fared worst when it came to forecasting the social implications of the 13 inventions. It correctly predicted the social implications of only three (27%) of the 13 inventions: (1) facsimile transmission; (2) air-conditioning and (3) the mechanical cotton picker. The social implications foreseen for the remaining eight technologies (for which implications were
of the cotton industry unemployment opportunities
Lower food costs Change urbanization
trend
Maintain industrial and economic life of country
offered) were either all or mostly wrong prefabricated housing would eliminate slums).
(e.g.,
The report did poorly at predicting the social implications of the 13 innovations because their insight was colored by the massive unemployment of the day. The 1937 report viewed nearly every invention in terms of how it would impact future employment. That focus clouded their view of the future.
Five Modern Lessons A careful review of the 1937 report suggests five simple lessons and observations that can aid today’s forecasters. First, avoid overoptimism when forecasting the timing of market success for new technologies. It typically takes a long time for a major new technology
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Table 2. Evaluation of Forecasts Invention
Market impact
Market timing
Predicted uses
Social implications
Television
strong
On target
Mostly right
Mostly wrong
Facsimile transmission
Strong
Optimistic
Mixed
Right
Air conditioning
Strong
On target
Right
Right
Mechanical cotton picker
Strong
On target
Right
Right
Plastics
Strong
On target
Right
None offered
Synthetic rubber
Strong
On target
Right
None offered
Cotton/wool
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Weak
Optimistic
Mostly wrong
Mostly wrong
Tray agriculture
Virtually none
Optimistic
Wrong
Wrong
Gasoline from coal
Virtually none
Optimistic
Wrong
Wrong
substitute
Electric eye Steep-flight Prefabricated Automobile
aircraft housing trailers
to make its effects felt fully. Second, new technologies work their way into practical products in different and often unforeseen ways. Although some uses for new technologies are foreseeable, others are not. Some uses may seem feasible in the beginning, but never materialize. Third, minimize attempts to predict the social implications of new technologies. Those implications are the most difficult aspect of a new technology to foresee. Fourth, what stands out most prominently after 55 years is the sensibleness of the 1937 forecasters. Their analyses contains no emotionally laden talk of entering “new eras” or “ages.” Nor did they rely on elaborate mathematical models with hidden assumptions. Nor did they rely on fancy growth curves that point inexorably skyward. Instead, those forecasters constructed a logical, economic and historical analysis for each of the innovations they examined. Today’s forecasters could learn much from their methods. They are anything but primitive. They are
insightful, resourceful and broad-sweeping in their scope. That leads to the last, and most important, lesson to be learned from the National Resources Committee report-that a careful, studied approach to assessing future technology can yield valuable insights and reasonably accurate predictions. For that, we should be envious of their forecasting record. Those forecasters showed that the development and uses of major technologies may be foreseeable 25 years into the future.
References Technological Trends and National Policy, Including the Social Implications of New Inventions. Report of the National Resources
Committee on the Social Implications of New Inventions, 75th Congress, (1937). Giliillan, (1912).
1st Session,
House Document
Vol. 18, No. 360, July 18
S. C., The Future Home Theater.
Independent 886891
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Five Modern Lessons from a S-Year-Old Technological Forecast Steven P. Schnaars, Swee L. Chia, and Cesar M. Maloles III
The first comprehensive forecast of technological trends and social implications by the U.S. government was published by the National Resources Committee in 1937. It focused on 13 major innovations. In their article, Steven Schnaars, Swee Chia and Cesar Maloles examine the accuracy of those forecasts and draw some conclusions based on their review of that report.
One of the most prominent, comprehensive and systematic studies of the future was released to the public on July 18, 1937. The 388-page, double-column report was entitled Technological Trends and National Policy, Including the Social Implications of New Inventions [ 11. Authored by the National Resources Committee on the Social Implications of New Inventions, its forecasts were widely publicized in the business press.’ Technological Trends also claimed to be the first time the government had studied the future systematically and comprehensively. As the authors of the study noted in a letter to President Franklin Delano Roosevelt, to whom the forecasts were presented, “This
Address correspondence Marketing, Baruch College, NY 10010.
to Steven P. Schnaars, Department of 17 Lexington Avenue, Box 508, New York,
0 1993 Elsevier Science Publishing Co., Inc. 655 Avenue of the Americas, New York, NY 10010
’ For example, see “American Nomads Aided by Trailers,” New York Times, 20, July 18 (1937); ‘Calls Television Propaganda Peril, ” New York Times, 21, July 18 (1937); “Inventions Point to Changed World,” New York Times, 20, July 18 (1937); “Job Lag a Factor of Technical Gain,” New York Times, 20, July 18 (1937); Laurence, William, “Inventions Survey Finds Major Changes Imminent; Urges Labor Safeguards,” New York Times, 1, 20-21, July 18 (1937); Laurence, William, “A Forecast of Changes Which May Soon Affect Our Social and Economic Life,” New York Times, 6, July 18 (1937); “Man With Hoe Losing to Tractor,” New York Times, 2 1, July 18 (1937); Meyer, Cl., “Note on Technological Trends and Social Planning,” American Journal of Sociology, 951-963, May (1938): “Predicts Papers Printed in Homes, “New York Times, 2 1, July 18 (1937); “President Commends the Report as Guide to Nation’s Development,” New York Times, 20, July 18 (1937); “Report on Technoiogical Trends in Major Industries .,” Commercial and Financial Chronicle, 539-541, July 24 (1937); “Roosevelt Takes on Cruise Social Studies of Technological Trends, Jobless and Slums, ” New York Times, 1, July 11 (1937); “Statecraft Tied With Inventions,” New York Times, 20, July 18 (1937); “Technology and National Planning,” Commercial and Financial Chronicle, 505-507, July 24 (1937); “Technological Trends and National Policy: Summaries,” Science, 7-8, July 23 (1937); “Tomarrow’s Inventions,” New York Times, 8, July 18 (1937); “Topics of the Times,” New York Times, 18, July 22 (1937); “Trends and Tides: Television Hailed as Aid in Teaching, New York Times, 5, July 25 (1937); “Urge U.S. Planning Board,” Business Week, 15, July 24 (1937).
0737-6782/93/$6.00
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BIOGRAPHICAL
SKETCHES
Steven P. Schnaars is Professor of Marketing and Chairman of the Department of Marketing at Baruch College in New York City. His research interests focus on growth market forecasting and marketing strategy. Professor Schnaars is the author of Megamisfakes: Forecasting and the Myth of Rapid Technological Change, 1989, and Marketing Strategy: A Customer-Driven Approach, 1991, both published by The Free Press. His articles have appeared in the Journal of Marketing Research, California Management Review, Business Horizons, Long-Range Planning and numerous academic journals. Swee L. Chia is an instructor and Cesar M. Maloles III is an adjunct lecturer in marketing at Baruch College, City University of New York. Both are Ph.D. students in Marketing at the Graduate Center of City University.
document is the first major attempt to show the kinds of new inventions which may affect living and working conditions in America in the next 10 to 25 years” [p. v]. (All page citations refer to the report itself unless otherwise noted.) We thought that after more than 50 years it might be interesting, as well as instructive, to see how well this serious and concerted effort at technological and social forecasting turned out. The 1937 study was a broad-based vision of the future that focused on 13 major innovations. As the authors noted, “The reports herewith presented reveal the imminence of a few very important inventions that may soon be widely used with resultant social influences of significance” [p. x]. Those inventions were 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.
television, facsimile transmission, air conditioning, mechanical cotton picker, plastics, synthetic rubber, artificial cotton and wool fiber substitutes from cellulose, photoelectric eye, steep-flight aircraft, prefabricated houses, automobile trailers, tray agriculture and gasoline from coal.
made
Our evaluation of the 1937 report focuses on four issues regarding those 13 technological forecasts: 1. Market impact: whether those new technologies had the profound impact on business and society the forecasters thought they would;
67
2. Timing: whether those technologies experienced significant market growth within the lo- to 25-year time frame set by the forecasters; 3. Product uses: whether those technologies were put to the use predicted and 4. Social implications: whether the social implications of those new technologies developed as predicted.
Thirteen Technological Innovations The 1937 report focused only on major technological innovations. To offer perspective, the authors compared their 13 innovations with six inventions that had greatly influenced the first third of the twentieth century: (1) the telephone; (2) the automobile; (3) the airplane; (4) motion pictures; (5) rayon and (6) radio. The forecasters’ methods were simple, but not naive. Basically, the National Resources Committee relied on expert opinion. The authors compiled facts and drew conclusions. They did not rely overtly on mathematical models, although more structured forecasts may have influenced their judgement. There is very little discussion of formal forecasting methods in the source document. We evaluated their forecasts in much the same way. We compiled facts from subsequent reports and judged outcomes. Our review of the 13 forecasts is rank ordered from the most to the least accurate. Television Predicting a growth market for television was the easiest forecast to make. Television had been technically feasible for more than a decade and incremental improvements in picture clarity and size were progressing steadily. Television had the profound impact on society the forecasters thought it would. They noted that television, as well as other communications innovations, seemed “destined to alter habits of life and social and economic institutions associated with entertainment and information” [p. 291; they were right. The report also correctly foresaw the eventual emergence of color television, but made the common mistake of predicting that three-dimension television would follow; it did not. In terms of timing, the report correctly predicted the “imminent” diffusion of television, although World War II intervened, postponing growth for another decade. The report also did well when it came to predicting
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the uses and social implications of television, although there were some notable mistakes. First, the authors correctly noted that “[it] seems reasonable to expect that the most popular type of entertainment by television will be the drama (rather than music)” [p. 291. Dramas would be recorded, not presented live. The consequences of widespread broadcasting were that big firms would benefit from economies of scale in national advertising; that also happened. So did the prediction that censorship would be imposed to protect children, and that advertisers, through their purchase of air time, would influence programming so as not to offend viewers. Second, in addition to broadcasting, the authors correctly foresaw cable television. “By wire will be broadcast all sorts of visible entertainment not sufficiently popular [for broadcasting] . . . but which could pay for themselves through charges for the wire service” [p. 311. Third, television would profoundly affect political campaigns. “Political addresses will be more effective when the candidate is both seen and heard.” As John Kennedy so vividly illustrated, “good looks and presence will help” [p. 301. Fourth, the report was less prescient when it came to predicting educational uses of television. The authors predicted that “gradually, the use of television, as well as the radio, direct talking moving picture, and phonograph may be expected to reach . . . down to the primary grades” [p. 311. Fifth, the report also erred in its belief that television would be a purveyor of the “high arts.” This error was a common one. Many early forecasters, such as Gilfillan in 1912, made the same mistake: On some evening in 1930 we may find in the newspaper such a program as follows: Tschaikowsky’s Pathetic Symphony, . . . Coppelia by the National Corps de Ballet South America. . . Francesca of Rimini, grand opera, Anthony and Cleopatra by William Shakespeare . . . [and even] a reading by Sharemas O’Sheel of some of his poems [2, p. 8881.
This is not to say that there are no instances of highbrow television but that those instances are rare relative to broadcasts of popular entertainment. Finally, the report erred when it predicted that “there is a danger from propaganda entering the schools [and the home]” [p. 331. Television is clearly capable of such manipulations, but most modem-day
critics would argue that banality is a more common problem than mind control.
Facsimile Transmission The ubiquitous facsimile (fax) machine has also had an impact on current day business practices to the extent that Technological Trends forecasters said it would; however, their timing was too optimistic. The technology did not create a growth market until almost 50 years after the 1937 forecast. Only then did costs decline and performance improve to a level that made the machine practical. Facsimile transmission was a common forecast throughout most of the twentieth century. Although the basic notions of the device were known as early as the late 18OOs, it took more than 100 years to field a successful product. The report correctly foresaw some product uses of facsimile but missed others. The forecasters recognized the business use of fax. The machine would transmit “whole pages from ledger books, pages of checks with authenticated signatures, bills of lading, invoices, and the multitude of other records which are in everyday use” [p. 2171. It would also find business use in the home “where it is possible for [an executive] to receive daily reports typed and signed at headquarters” [p. 2171. Mistakenly, but consistent with other forecasts from the 1930s to the 196Os, the report predicted the “eventual transmission of entire newspaper pages” [p. 2171. Some fifty years later the likelihood of faxing newspapers directly into the home seems unlikely. The report correctly foresaw the social implications of facsimile transmission. The report predicted that developments in electronic communication devices would quicken the pace of ordinary and business life. The report also held that advances in communication technologies would increase employment, but only for those with specialized skills. That forecast ran counter to the depression-era fear that technology would cause further unemployment.
Air Conditioning The market impact of air conditioning was also correctly predicted by the 1937 report. Air conditioning, it noted, “is likely to be extended gradually as it becomes cheaper and as more thought is given to the efficiency and comfort of the worker” [p. 261. The timing of market growth was also accurately
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predicted. Air conditioning grew rapidly after the second world war, and was widely available by the 1962 deadline set by the report. The predicted use of air conditioning was also accurate: it would be used mostly to cool and dehumidify factories and homes in the warmer regions of the United States. Most impressive was the report’s foresight conceming the implications of economical air conditioning. It would spawn the industrial growth of southern U.S. cities, and that is exactly what happened. Practical air conditioning was a primary impetus for the postwar growth of southern cities. The report also predicted that air conditioning, would increase the economic might of southern states. The report asks
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Committee correctly predicted that plastics would be widely used as substitutes for metal and wood. Their popularity was noted as follows: “Their [plastics] development and use have reached the place where one contemplating a new product is most likely to enquire first of all out of what plastic might it be molded?” [p. 3061. The report also correctly predicted home uses for plastics as kitchenware, telephones, toys, appliance cabinets, resilient flooring, piping, siding, furniture and electrical insulation. The report deferred predicting the social implications of plastics: “It is most difficult to forecast what the social implications may be as we go forward with chemical research and the applications of its results” [p. 3141.
Is
it too much to predict that air conditioning of the working and living quarters of other residents of more humid areas may cause more [industrial] activity in those parts that will open up to use natural resources beyond our imagination? [p. 3241
Mechanical
Cotton Picker
The mechanical cotton picker was another invention that greatly affected the South. In 1937, a practical device did not exist, but researchers were closing in on a workable machine. Economics would decide whether a device would be successful. The report is hesitant on the timing of market growth. In hindsight, its hesitation proved justified. By 1952, only 18 percent of the U.S. cotton crop was harvested by mechanical devices. By 1967, however, 95% of the cotton crop was harvested mechanically. Diffusion was somewhat slower than the 1962 deadline predicted in the report. The report focused mostly on the economic and social implications of this innovation. Most of those implications proved correct. First, it was predicted that the expense of the mechanical picker would lead to a concentration of farm ownership. Second, the report recognized that tens of thousands of unskilled workers would lose their livelihood. Third, it correctly foresaw that massive numbers of black Americans would “pour into the North and seek employment in industry” [p. 1431. That is exactly what happened.
Plastics Plastics may be ubiquitous industry was in its infancy.
today, but in 1937 the The National Resources
Synthetic Rubber The 1937 report also correctly foresaw the substitution of synthetic for natural rubber. At that time there were two leading substitutes-neoprene and thiokol. Both cost more than natural rubber, but had special properties that made them viable in certain applications. Their forecasts were based on an analogy drawn between synthetic and natural rubbers and synthetic and natural dyes. They asked, “will there some day be another indigo causing acres and acres to go out of production of this national product, as did synthetic indigo not so many years ago?” [p. 3061. Their prediction was aided by World War II, which hastened the timing of substitution because natural rubber came from the Far East and Brazil, and supplies were cut off during the war. Scarcity sped the development of synthetic rubber.
Artificial Cotton and Wool Fiber Substitutes The myriad synthetic fabrics that are also so ubiquitous today were largely unavailable in 1937. Instead, natural fibers, such as cotton and wool, faced competition from chemically treated, regenerated cellulose fibers such as rayon. In essence, these forecasters predicted a continuation of that trend. The 1937 forecasters correctly foresaw that synthetic fibers would continue to steal market share from natural cotton and wool, but their focus on rayon, and its underlying technology, was myopic. Subsequent synthetic fibers, such as nylon, which are not based on cellulose, have had a much more profound impact on our lives than rayon. Nylon, for example, accounts for
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over 70% of all fibers consumed by U.S. textile mills. Rayon, in contrast, constitutes only about 6% of total synthetic fiber production. The 1937 report also predicted massive unemployment and industrial obsolescence due to the rise of this artificial fiber. Those social implications proved unfounded. The natural cotton industry was never dismantled because of Rayon.
Photoelectric
Eye
The National Resources Committee, like many forecasters of the 193Os, believed that the photoelectric eye would profoundly affect our everyday lives. They predicted, “silently into our lives is creeping a new technological brain-child” [p. 321-3221. The electric eye would be used mostly to perform mundane, repetitive tasks such as opening doors for approaching waitresses. But it would also be used in situations that required rudimentary decision making, such as monitoring assembly-line processes, selecting defective products and acting to remove defective products from the process. The 1937 forecasters listed hundreds of potential applications for the electric eye-from smoke detectors to matching false teeth [p. 3221. The electric eye was expected to displace 250,000 workers. “That it will cause unemployment is obvious . . . Indeed it brings the automatic factory and the automatic man one step closer” [p. 51. Those forecasts proved partly right, albeit extreme. There are currently many market applications for the electric eye, but, overall, the forecasters overestimated its role. They were correct, for example, in predicting that the electric eye would be used to regulate auto traffic, time horse races, and serve as an automatic door opener. They were wrong in predicting that it would revolutionize our lives. Basically, the electric eye has influenced our lives in far fewer ways than envisioned in 1937. Even the massive unemployment it was expected to create proved unfounded. In hindsight, international competition had a far more profound impact on factory jobs than did advances in electric eye technology.
Steep-Flight
Aircraft
Steep-flight aircraft as envisioned by the 1937 forecasters covered three different designs: (1) helicopters; (2) tilt-rotor aircraft, which the report called vertaplanes-“a biplane whose upper wing is rotated for
S. P. SCHNAARS
ET AL.
reconnoitering and landing but fixed for efficient ordinary flight,” [p. 281 and (3) the autogiro, an airplane/helicopter hybrid. The 1937 forecasters foresaw a bright future for the “roof-hopper.” It would be used primarily to transport passengers and mail from city centers to suburban airports and for short, intercity flights; that would occur in the near-term. Further out, more than a decade away, was steep-flight aircraft for personal use. The report speaks of “types of autogiro or airplane already demonstrated, which can land on any usable field, fold up like a beetle, and proceed along the highway like an automobile, to be housed in the home garage, have intriguing recreation possibilities” [p. 281. One conclusion was clear: “eventual success seems certain.” In retrospect, another conclusion seems even clearer: with the exception of helicopters, steep-flight aircraft never became commercially commonplace, and personal use is virtually nonexistent. Helicopters have successfully served some of the predicted uses but, tilt-rotor aircraft are still strictly experimental. The autogiro is almost completely forgotten. Proponents of tilt-rotor aircraft continue to claim that such planes will someday serve as intercity shuttles, but the added cost of buying and maintaining such complex machines, not to mention potential safety problems, have kept such forecasts firmly planted in the future.
Prefabricated
Houses
The National Resources Committee recognized that housing construction was one of the last sectors of the economy to adopt modem, factory-based, automated production efficiencies. Its members observed that “the detached houses which were built in the largest number in 1936 were not essentially different from many of those built in urban areas 100 years or more ago. In both 1936 and 1836 the materials: Brick, stone, sawed lumber, sand, and lime where delivered to the site and erected in much the same manner” [p. 370-371.1 It was a commonplace observation, and it led the committee to the commonplace prediction that future housing construction would rely heavily on shop fabrication. Housing parts were constructed in a factory then shipped to a building site for quick assembly. Prefabrication covered many schemes, ranging from packages of precut lumber to complete factory-made wall, ceiling and floor panels with insulation, electrical and plumbing preinstalled, which were simply welded together at the site.
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It was expected that steel would substitute for wood as the primary structural member of residential houses. Production efficiencies would lead to lower costs and prices, which would make prefabricated housing more affordable. As a result, slums would be eliminated. The report also foresaw a “tremendous increase in the comforts and conveniences available” (p. 372). The committee correctly recognized that two factors would influence the ultimate success of prefabricated housing. First, existing building codes and the cooperation of local construction trade unions would be required. Second, banks and dealers would have to be willing to finance these radical structures. Those factors turned out to be as crucial as the report said they would, but financing problems and a lack of cooperation from local trade unions hindered, rather than helped, prefabricated housing. The report also erred badly when it came to predicting the economic consequences of prefabricated housing. First, the committee missed the efficiencies gained using traditional “stick” building techniques, which lessened the advantage for prefabrication. Second, and more important, land values rose to represent the largest part of housing costs, a factor that affects all types of houses. Third, the perceived quality of prefabricated houses was poor, relegating the genre to the bottom of the market. As a result, the 1937 report overestimated the extent to which prefabricated houses would become an important source of affordable housing. In hindsight, prefabricated housing has played a minor housing role. Automobile
Trailers
The National Resources Committee was unsure whether to classify auto trailers as housing or transportation. What was certain was “that this is a rapidly growing industry of large possibilities and wide social implications” [p. 1831. The reason for that forecast was simple. The demand for trailers in the mid-1930s was greater than the supply. That trend was expected to continue. In two parts [pp. 183 and 3731 the report specifically predicts that “half the population of the United States will be living in trailers within the next 15 to 20 years.” The 1937 forecasters envisioned the auto trailer as part mobile home and part recreational vehicle (RV). The success of the auto trailer was tied closely to a related forecast that called for an increasingly mobile population. Homes would be hooked to automobiles and hauled around the country. The trailer was a
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natural market extension of the automobile itself, and the mobility it allowed. The social implications of the auto trailer would be profound. Large numbers of people would move with the seasons. Smaller houses would lead to smaller family sizes. There would be a breakdown of traditional neighborhoods as families perpetually moved on. Families, however, would become more cohesive as they had to rely on themselves rather than neighborhood. It is ironic that many of these predictions came true but for different reasons than those anticipated by the authors. Families have become smaller, and extended families living together under one roof have virtually disappeared. The automobile trailer, however, had little to do with either trend. Furthermore, although many people today do live in mobile homes, those homes rarely move. They are towed to a lot where they remain. What started out as an automobile trailer became inexpensive rural housing of the sort called for by the 1937 report’s vision of prefabricated housing. But even the mobile home industry has been declining steadily for years. Today, truly mobile homes often combine the automobile and the trailer into a single unit-the RV-that serves not as affordable housing but as a vacation alternative for a sightseeing populace. In that limited respect the report was correct. Tray Agriculture Experiments in the 1930s found higher crop yields for plants grown in a nutrient-rich liquid rather than soil. Those results caused the National Resources Committee to predict that tray agriculture, or hydroponics, would serve as an important supplement to traditional growing methods in the United States. The key advantage of hydroponics was that food could be grown in great quantities near major population centers, thereby saving on transportation expenses. There were many potential problems with tray agriculture, most of which the report underplayed. “While the economics of this method of producing food have not been fully explored, the potentialities seem great” [p. 3071. In hindsight, it proved less expensive to transport produce from distant farms than it was to use tray agriculture. As a result, tray agriculture is more scarce today than open land near large cities. Once again, the social implications of this innovation were cast in terms of the issues of the
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day-the unemployment prevalent during the great depression. What would farmers do when their farms disappeared, replaced by a more scientific solution? It was a bleak picture painted in bleak times. Gasoline from Coal Finally, the National Resources Committee predicted that the fuel supply would become diversified by producing gasoline from coal. This happened in Germany during World War II, when traditional gasoline supplies were otherwise unavailable, and it is the case today in South Africa, an isolated nation, but it does not occur in the United States or most of the rest of the world. Only after the energy crises of the 1970s did the United States attempt to diversify the fuel supply via synthetic fuels. The Synthetic Fuels Corp., a federal agency, was established to extract oil from shale. But the huge cost, the large amounts of fossil fuels needed, and severe environmental problems kept prices too high to be competitive. Those factors, along with the demise of the energy crisis, resulted in the demise of the Synfuels project as well as the prospect that gasoline would be produced from coal.
S. P. SCHNAARS ET AL.
2. 4 (or 31%) have had a moderate impact; 3. 1 (or 8%) has had only a weak impact, and 4. 2 (or 16%) have had no impact. Given the dismal record often attributed to long-term forecasting, these forecasters seem to have tallied an enviable record. Their successes suggest that a serious and concerted effort at long-range forecasting can foresee the market impact of emerging technologies, even over lo- to 25-year time frames.
Market Timing In regard to market timing, three outcomes were possible: (1) an innovation could have taken longer than expected to have had an economic impact-an error of optimism; (2) an innovation could have taken less time than expected-an error of pessimism or (3) the forecasters could have accurately gauged the timing of an innovation’s market acceptance. Using a rating scale that covered these three possible outcomes, it is clear that optimism was the most prevalent result. Table 2 illustrates that l
8 (or 62%) of the innovations expected to penetrate their whereas
l
5 (or 38%) experienced significant market growth within the lo- to 25-year time horizon projected by the study and
l
0 (none) of the innovations diffused quickly than expected by the forecasters.
Summary and Conclusions All 13 innovations were expected to have a profound impact on business and society within lo-25 years of the date in which the forecasts were made. Table 1 summarizes the predicted uses and social implications of each of the 13 innovations covered by the National Resources Committee. Table 2 evaluates those predictions in terms of the four criteria presented at the beginning of this paper: (1) market impact; (2) market timing; (3) predicted product uses and (4) social implications. The following conclusions are drawn.
took longer than served markets;
more
The results of market timing suggest that major innovations such as those considered by the 1937 report take longer to create an economic impact than generally expected.
Predicting Product Uses Market Impact With the exception of tray agriculture and gasoline produced from coal, all of the remaining 11 technologies have played at least some role in today’s economy. Using a rating scale ranging from “strong impact,” to “moderate impact,” to “weak impact,” to “no impact,” we conclude 1. 6 (or 46%) of the predicted technologies have had a strong impact on business and society in subsequent decades;
Although the 1937 forecasters did well when predicting the impact an emerging technology would have on future business and society, they did less well when predicting the actual uses to which those technologies would be put. Typically, the forecasters foresaw a technology as being used in more than one way. We conclude that l
5 (or 38%) of the uses made of the new technologies were rated as either right or mostly right;
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Table 1. Forecast Summary Invention
Predicted uses
Predicted social imnlications
Television
Drama Cable TV Political ads Education “High arts”
Propaganda
Facsimile transmission
Newspaper by fax Transmission of records/pictures
Faster business pace Increase employment
Air conditioning
Industrial applications
Foster industrial growth in the South Balance “buying power” between North and South
Mechanical
Obvious
Farm concentration Massive unemployment Northward migration
Plastics
To replace light metals and woods
None offered
Synthetic rubber
Lower cost substitute
None offered
Cotton wool substitute
Continued growth of rayon
Dismantling
Electric eye
Replace human control
Technological
City to airport Short intercity personal use
Recreational
Mass source of cheap housing
Eliminate slums Comforts/Convenience
Alternate form of housing Mobile population Vacation home
Smaller families Breakdown of traditional neighborhood Strengthen family bonds and values
Steep-flight Prefabricated Automobile
cotton picker
aircraft housing trailers
Tray agriculture Gasoline from coal
l
l
Supplement Supplement
in factories
conventional
farming
natural fuels
another 5 (or 38%) had a mixed record, some of the uses have been correctly foreseen, whereas others did not materialize (e.g., reading the newspaper by fax) and 3 (23%) were predicted to have uses that proved either wrong or mostly wrong.
Social Implications Not surprisingly, the National Resources Committee fared worst when it came to forecasting the social implications of the 13 inventions. It correctly predicted the social implications of only three (27%) of the 13 inventions: (1) facsimile transmission; (2) air-conditioning and (3) the mechanical cotton picker. The social implications foreseen for the remaining eight technologies (for which implications were
of the cotton industry unemployment opportunities
Lower food costs Change urbanization
trend
Maintain industrial and economic life of country
offered) were either all or mostly wrong prefabricated housing would eliminate slums).
(e.g.,
The report did poorly at predicting the social implications of the 13 innovations because their insight was colored by the massive unemployment of the day. The 1937 report viewed nearly every invention in terms of how it would impact future employment. That focus clouded their view of the future.
Five Modern Lessons A careful review of the 1937 report suggests five simple lessons and observations that can aid today’s forecasters. First, avoid overoptimism when forecasting the timing of market success for new technologies. It typically takes a long time for a major new technology
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Table 2. Evaluation of Forecasts Invention
Market impact
Market timing
Predicted uses
Social implications
Television
strong
On target
Mostly right
Mostly wrong
Facsimile transmission
Strong
Optimistic
Mixed
Right
Air conditioning
Strong
On target
Right
Right
Mechanical cotton picker
Strong
On target
Right
Right
Plastics
Strong
On target
Right
None offered
Synthetic rubber
Strong
On target
Right
None offered
Cotton/wool
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Moderate
Optimistic
Mixed
Wrong
Weak
Optimistic
Mostly wrong
Mostly wrong
Tray agriculture
Virtually none
Optimistic
Wrong
Wrong
Gasoline from coal
Virtually none
Optimistic
Wrong
Wrong
substitute
Electric eye Steep-flight Prefabricated Automobile
aircraft housing trailers
to make its effects felt fully. Second, new technologies work their way into practical products in different and often unforeseen ways. Although some uses for new technologies are foreseeable, others are not. Some uses may seem feasible in the beginning, but never materialize. Third, minimize attempts to predict the social implications of new technologies. Those implications are the most difficult aspect of a new technology to foresee. Fourth, what stands out most prominently after 55 years is the sensibleness of the 1937 forecasters. Their analyses contains no emotionally laden talk of entering “new eras” or “ages.” Nor did they rely on elaborate mathematical models with hidden assumptions. Nor did they rely on fancy growth curves that point inexorably skyward. Instead, those forecasters constructed a logical, economic and historical analysis for each of the innovations they examined. Today’s forecasters could learn much from their methods. They are anything but primitive. They are
insightful, resourceful and broad-sweeping in their scope. That leads to the last, and most important, lesson to be learned from the National Resources Committee report-that a careful, studied approach to assessing future technology can yield valuable insights and reasonably accurate predictions. For that, we should be envious of their forecasting record. Those forecasters showed that the development and uses of major technologies may be foreseeable 25 years into the future.
References Technological Trends and National Policy, Including the Social Implications of New Inventions. Report of the National Resources
Committee on the Social Implications of New Inventions, 75th Congress, (1937). Giliillan, (1912).
1st Session,
House Document
Vol. 18, No. 360, July 18
S. C., The Future Home Theater.
Independent 886891