Every summer, for the past 12 years, my family has visited the Hamptons. After inching our way out of Long Island traffic, the road opens to a narrow escape. Trees and oceanfront villages dot the side of Route 27. The first glimpse of waves always fills me with an unfailing sense of serenity.
We stay in Montauk, visiting our favorite beach clubs and restaurants. It’s a peaceful getaway for us—one that we hope to come back to for many years—but lately, there’s a threat looming in the background of our joyful vacation.
Of course, we’ve been aware of the potential impacts of climate change for years. But this year, Montauk is considering taking action to prepare for a future when rising sea levels will eat away at the borders of the town. One solution high on the town board’s agenda is a “managed retreat”—a planned relocation of vulnerable homes and businesses to higher ground, before nature necessitates it.
Concrete plans are still in development, but according to the proposal, the hotels and businesses most likely to be affected by worsening storms and rising seas would be moved inland, closer to predictions of where the future water level will be.
The thinking is strategic—prepare for the five- to 10-year horizon while maintaining the core offerings of the business. Montauk visitors would enjoy similar amenities, albeit in a location safe from flooding and erosion. The tradeoffs are up for debate among many coastal resorts and towns—will the same guests want to stay a mile further from the sea? But Montauk’s experiment sparks new thinking for all industries.
Developing your managed retreat
If you’re in a business, industry, or product market whose future looks significantly different, or whose existence might be threatened a few years down the line, what is your managed retreat … from business as usual … from today’s status quo?
With digital transformation accelerating, social and environmental disruption becoming more common, and the pace of change ever increasing, there aren’t many businesses that won’t need to think about some form of planned retreat over the next decade. To figure out what your own might look like, consider the following questions:
- How will climate change, increased regulations, new technologies, or shifting societal preferences impact your industry over the next 10 years? Are any of your core products or services in jeopardy of becoming obsolete?
- What would a “managed retreat” look like for that business model? Are there substitutions that might open up new opportunities? (For example, a hotel further from the ocean may appeal to today’s climate-conscious, price-conscious, or traffic-sensitive consumer.)
- What would be the timeline for your managed retreat? What immediate steps would you take today if you knew your business model would cease to exist in five or 10 years?
Advice from chief strategy officers
Chief strategy officers in the Outthinker Strategy Network spend their days conducting scenario planning exercises just like this one. They are often responsible for driving business model innovation and future preparedness for companies that are already experiencing success under today’s conditions. By foreseeing and defining what their industry will look like in the future, they remain steps ahead of competitors and external disruption and ensure that success continues.
These additional resources offer their perspectives as you think about your managed retreat:
- Four Steps for Developing a Corporate Sustainability Strategy
- Three Principles for Business Model Innovation
Photo by Bernd Dittrich on Unsplash