In today’s volatile, uncertain, complex, and ambiguous (VUCA) world, corporate foresight has become an essential discipline for organizations that want to survive and grow far into the future. Unforeseen trends and events can disrupt your business out of nowhere; that is if you don’t have a corporate foresight practice in your organization.
Corporate foresight is the reason why many global corporations dominate their industry and continue to succeed even decades after they started operating. Shell has successfully used it to weather crises and envision its future.
Embiggen incorporates corporate foresight into its corporate venturing and innovation management to take advantage of this opportunity. This is a pioneering approach that is revolutionizing the industry.
But before defining and diving deep into corporate foresight, it is important to know two very related disciplines: Futures Thinking and Strategic Foresight.
Futures thinking & strategic foresight
According to Jose Decolongon, Embiggen’s and resident futures thinking and corporate foresight expert, futures thinking is a structured way of looking at the future.
The Department of the Prime Minister and the Cabinet (DPMC) of New Zealand described futures thinking as a way to analyze drivers of change, and explore the implications of various scenarios that may happen in the future. It does not predict what will definitely happen in the future, as the future is uncertain. Instead, it examines the many possibilities that may happen in the future and aids planning and informs decision-making in the process.
Decolongon said that futures thinking is not a new discipline.
The energy company Shell, for example, has been developing and visualizing scenarios to help them prepare for their future since the 1970s. According to Shell, developing and visualizing possible future scenarios has helped them prepare for times of change like the 1973 oil shock.
Strategic foresight on the other hand looks into what may happen in the future that may affect an organization, according to the Organisation for Economic Co-operation and Development (OECD). It identifies the possible opportunities and threats in these possible futures so that organizations can anticipate and prepare for the future.
Strategic foresight aids the strategic planning process. It explores the many possible futures and their implications, thereby informing the plans developed during strategic planning, according to the OECD.
Futures thinking and strategic foresight are related to corporate foresight as the two form the backbone of corporate foresight.
What is corporate foresight?
Corporate foresight is the application of Strategic Foresight and Futures Thinking in a profit-oriented organization. According to Decolongon, “Corporate foresight is both a process and an ability to identify, anticipate and respond to changes in an organization’s future.”
As an ability, organizations need to be capable of identifying various alternative futures that may come. It is the ability of an organization to create preferable, probable, projected, plausible, possible, and preposterous future scenarios.
Organizations should go beyond visualizing and planning for the future scenarios that they see as preferable, probable, projected, plausible, and possible. They should also be able to visualize and plan for preposterous future scenarios or ‘wildcards.’ These are the scenarios that have a low probability of happening but will have a high impact, according to this study by Joseph Voros.
One example in the recent past that can be categorized as a preposterous future scenario or a ‘wildcard’ is the COVID-19 pandemic. Before 2019, no one knew exactly when and if a pandemic would take place. However as we observe today, it has had a great impact on people’s lives and has drastically changed the way corporations do business.
As a process, corporate foresight mainly follows the Generic Foresight Process Framework by Joseph Voros. There are 6 steps under this framework.
- Inputs. This first step consists of gathering information on competitors, industries, and markets using a variety of techniques and methods. One method Voros gave as an example is brainstorming sessions wherein groups of people are asked to share ideas and insights about what may happen in the future.
- Analysis. The Foresight work begins in this step. The information gathered in the first step is analyzed to find some trends or an order. Voros wrote that the main question asked in this step is “what seems to be happening?”
- Interpretation. The trends or orders identified in the previous step are then further analyzed to discover “deeper [structures] and insights” such as the causes behind the events, trends, or orders. The main question asked here is “what’s really happening?”
- Prospection. This step is where future scenarios are ideated and examined based on the outcomes of the previous 3 steps. These ideated future scenarios may be classified as “possible, plausible, probable, or preferable” futures. As such, the main question asked in this step is “what might happen?”
- Outputs. The past 4 steps lead up to the creation of outputs based on the results of each step. These outputs may be reports, workshops, and presentations that lay out the possible strategic options that can be taken to address the future scenarios that have been ideated.
- Strategy. Strategic planning comes into play in this last step. Decision-makers implement plans that take into account the results of the foresight process. Voros wrote that the results of this step are fed back into the ‘Input’ step to analyze, reassess and identify if there is a need for course correction.
One of the most crucial steps in this process is the ‘inputs’ step. This is where organizations scan for and identify signals. According to Prof. Decolongon, signals are examples of the future that are found in the present. These can be found in the news, books, journals, online, and a variety of other sources. Signals will inform the rest of the corporate foresight process.
Having the ability to do corporate foresight and having the processes in place to do corporate foresight may be the factors that influence an organization’s growth and success in the coming years.
Anticipating the future
Being able to anticipate what might happen in the future and prepare for the future is crucial for any organization that wants to survive, thrive and dominate in the next decade.
“The future doesn’t exist yet but it doesn’t mean that we don’t have any influence on it. What we think and plan now influences the future,” said Decolongon.
Corporate foresight allows organizations to influence their future in an informed and systematic manner. It also allows organizations to do the following:
- See what might happen. Corporate foresight can help organizations systematically identify signals and trends that show where the future is headed. It can also help create scenarios of what may happen in the future and determine which scenarios are likely or unlikely to happen.
- Anticipate and plan for the future. Through the foresight process, organizations can better create plans that anticipate and respond to the opportunities and threats of change. For example, foresight has allowed organizations to better prepare for times of change and crisis.
- Get to the future ahead of the competition. Corporate foresight builds the competitive advantage of an organization. It identifies opportunities that organizations can take advantage of now so that they can lead their industry in the future.
Corporate foresight provides systems for organizations to explore, analyze and anticipate the future. By building up a corporate foresight capability, an organization can sustainably plan for its future. Corporate foresight also gives the following benefits to organizations:
- Future-proofing. Corporate foresight helps position organizations for long-term success by providing a system to identify opportunities for new products and services based on today’s signals, trends, and changes.
- Organizational resilience. Corporate foresight helps organizations prepare for the future in this VUCA world by exploring possible future scenarios and planning accordingly.
- Competitive advantage. Corporate foresight works hand in hand with strategic planning and innovation to keep an organization ahead of its competition and ensure its dominance in an industry.
Building corporate foresight capabilities
Corporate foresight may be unfamiliar to many corporations. These corporations may find it difficult to introduce corporate foresight into their organization alone, as the discipline is highly specialized and complex.
Embiggen Foresight offers 3 services that can help organizations build up and develop their corporate foresight capabilities:
- Corporate Foresight Strategy. Our experts help develop the corporate foresight strategies of organizations to help build their capacity to identify, anticipate and respond to changes in the future.
- Foresight-Driven Strategic Planning. Our experts help enrich organizations’ strategic planning with corporate foresight to develop future-proof plans that will deliver results.
- Futures Research & Advisory. Our experts help organizations explore a particular area of interest to create a comprehensive study of the future of an organization’s industry.
Corporate foresight tools
Corporate foresight practitioners rely on a variety of tools to explore the future. These tools systematize and organize the way organizations look at the future. The tools can be considered as a guide for organizations to identify and analyze signals and their consequences.
Here are some of the commonly used ones:
- Futures Wheel. According to Mind Tools, the Futures Wheel was created by Jerome Glenn in 1972 and is used to identify the direct and indirect consequences of a certain change, trend, or event. Organizations can identify the possible future outcomes of today’s changes using this tool.
- Horizon Scanning. According to the DPMC of New Zealand, Horizon Scanning is used to find and identify signals that may disrupt a topic being studied, such as your organization’s future. The identified signals are further analyzed and the analysis is used to inform planning and decision-making.
- Backcasting. According to the DPMC of New Zealand, Backcasting helps organizations identify ways to achieve their desired future by working backward from an organization’s vision. It will help create a plan and identify the steps to take to achieve the organization’s vision.
This is not an exhaustive list of all the corporate foresight and futures thinking tools organizations and experts use to explore the future. These are some common tools your organization can use today to better prepare for the future.
Your next steps
Corporate foresight is all about being able to anticipate and plan for your organization’s future. Through this, your organization can be prepared for changes and make decisions accordingly.
Are you ready to start practicing corporate foresight in your organization? Embiggen offers several corporate foresight services to get you started.
Schedule a consultation with our experts to find out what your organization needs to build and develop your corporate foresight capabilities.