The frameworks developed during research, from case study research of two large Swiss organisations and worldwide foresight experts in conjunction with theory, include a similar set of processes and methods, which have been used to inform the best practice framework.
This framework for advancing strategic corporate foresight is based on the integration of weak and strong signals into scenarios to analyse potential consequences as a result of the changing environment and create response strategies. An additional benefit is the building of a foresight continuum in the organisation to reduce uncertainty and foresight boundaries in support of long-term innovation and growth.
Figure 1: Best Practice Foresight Framework Emerging from Research (© Marc K Peter / FutureScreening.com™)
The environmental analysis (environmental scanning), which incorporates information from both the internal and external environment, includes all sources from which signals can be identified. Weak signals are either active in terms of being accessible through the organisation’s environmental scanning and monitoring activities, or passive, which prevents them from being identified in the scanning efforts. Of course, over time, the signal’s behaviour can change, and a signal which was hidden yesterday could be visible tomorrow. Strong signals (or emerging/mega trends), which to some degree are already well known, have to be considered as well, as they indirectly provoke competitive movements because of their open exposure to the market, and therefore have an influence on the organisation’s actions. They are utilised later in the process to enrich scenario workshops and do not require the application of special methods. Finally, wildcards are weak or strong signals with much more radical impacts, even potentially catastrophic consequences, but with a low probability of actually occurring. Again, wildcards are used later in the process, during the scenario workshops.
As an organisation’s ability to capture all (active) signals is limited, only part of the signals can be caught by the corporate surveillance radar; these signals are called “identifiable” signals. Qualitative methods (method set 1) need to be used to deal with (primarily) weak signal throughout the identification and collection process, such as by trend scanning, observations, expert interviews, networking, laboratories and internal foresight networks. The literature, foresight experts and case study research all confirm that available qualitative methods need to be utilised and that traditional planning approaches (i.e. PEST and SWOT) do not support foresight apart from offering a classification system.
The signals that the organisation manages to identify and collect are placed into a signals database, in which weak signals and strong signals are stored separately due to their different applications in the foresight process. The signals, especially weak signals, need to be analysed and described; this may include the classification and prioritisation of signals and identification of relationships. In the next step, these signals are combined to create scenarios (images of the future), using mainly qualitative methods (method set 2), as scenario building in a complex and dynamic environment with a high degree of uncertainty should be carried out by scenario building methods with a non-econometric approach, preferably by combining signals in a meaningful way via creative workshops and conversations. This is seen as the “top-down” component of the frameworks, as these scenarios are mostly developed by a smaller team, utilising internal and external resources (for instance the foresight or strategy department in combination with foresight experts). The outcome of this process is a set of draft scenarios, which need to be enriched and validated through input from managers and other stakeholders in scenario workshops. The creation of multiple possible scenarios or futures in strategic planning is necessitated by an unpredictable and changing future environment.
Once developed, scenarios help to challenge stakeholders within the organisation with the threats and opportunities inherent in the potential futures outlined in the scenarios. Stakeholders, in turn, assess their current strategies, plans and products against the outcomes of scenarios and start to tailor their future actions or response strategies (stress tests). This can take place in scenario or future workshops, where stakeholders will defend and describe the current strategy as well as products, services, channels and brands in the presented scenarios. Here, strong signals and wildcards will be integrated to enrich the conversation. This is seen as the “bottom-up” component of the scenario development process and requires qualitative methods (method set 3), such as scenario games and open creative conversations. In such workshops, actions are described as corporate initiatives and future projects, summarised as strategic programme management, and will be disseminated to all affected areas of an organisation, with any necessary strategy adaptation. The scenarios will be finalised and potential consequences and response strategies described. In addition, the core strategic topics will be described and discussed, thereby educating stakeholders and influencing the organisation’s strategy development process. This “scenario transfer” will help to prepare an organisation for the future, by both building strategic alternatives/actions (future projects) and keeping the organisation fit for future change (cultural dimension).
A monitoring system will ensure that the signal database is up to date and that changes in signals’ behaviour are noticed and the scenarios modified and updated accordingly. It will inform stakeholders of the potential for existing scenarios to become reality and alert the organisation to immediate opportunities and threats (strategic surprises) arising from environmental change. The proposed tool to support monitoring activities is a time map, which visualises the collected signals over a time horizon.
Finally, performance reviews support the learning capabilities of the organisation by instigating the assessment of policies, the analysis of training and skills needs, the implementation of reward and recognition programmes and optimisation of the foresight framework, if necessary.
A future agent network is an important virtual organisational unit designed to support the process by scanning the environment, identifying and gathering signals, helping to build scenarios and share foresight insights throughout the organisation. A think tank or strategy committee can be utilised to discuss strategic impacts, deliver strategic imperatives from business units and align foresight with strategy development.
In order for the scanning activities to be targeted and meaningful, the development and implementation of a scanning strategy is required, elements of which need to be defined, including scanning fields, sources, methodologies and processes. All these foresight activities contribute to the building of a foresight continuum.
Implementing the initiatives and activities in the best practice foresight framework discussed above will offer enhanced flexibility, innovation capabilities and ongoing learning through strategic debate. Research has identified these to be key benefits of foresight activities, which are complemented by the long-term benefits arising from scenario transfer. Working with signals and scenarios not only increases an organisation’s chances of survival and competitive advantage, but also initiates a learning process that will ultimately help the organisation to stay dynamic, and improve its innovation capabilities.
The Importance of Information Systems Support in Operationalising the Foresight Framework
It should be noted that it is evident from the literature, case study research and foresight experts that there is minimal information systems support for foresight in practice. As an example, one case organisation tries to limit the level of technology support in its foresight process and word processors/spreadsheet software seem to be the most utilised tools. The company’s view is that foresight data is quickly outdated and a human to human exchange of foresight knowledge adds more value to the organisation than sophisticated foresight software. Software tools are perceived as being incapable of supporting the process of translating qualitative insights/results into a quantitative framework or database.
On the other hand, systems may become necessary as a result of the volume of weak and strong signals and their complexity. Through the linking of signals with scenarios, a system could support organisational efforts to monitor signals and signposts and, as soon as a signal or signpost changes, facilitate the amendment or adaptation of its connected scenario/s in response to changes in the opportunity/risk profile. In addition, the signals database would help to produce reports for senior management, business units and strategy planners. The scenarios database would manage the created scenarios, including descriptions, characteristics, consequences and visualisations. However, it would not “create” the scenarios, as qualitative methods are recommended for scenario building.
One of the key elements is the linking of underlying drivers (signals) with their strategic consequences, including strategic alternatives and response strategies. These potential response strategies are stored in a strategic actions database. The three databases would work in conjunction to manage, maintain and present the logic (connections) between signals, scenarios and response strategies. However, as mentioned above, practice evidence shows that organisations do not necessarily want to utilise IT driven foresight databases and systems.
Practice Implications Derived through the Research
An important element of foresight is the balance between top-down and bottom-up communication channels, to sustain a platform where foresight can be experienced by all employees. Therefore, the foresight process must be ongoing and requires a multi-level approach with continuous feedback loops, accessible by various stakeholders. This balance is demonstrated in the combination of a top-down approach to building, describing and visualising scenarios, with the help of various stakeholders in an innovative environment, and challenging the organisation with the outcomes of scenarios in future workshops through the involvement of a wider group of managers (bottom-up).
As a rule, organisations need to overcome the major hurdles which hinder foresight, such as lack of internal resources or user friendly methodologies, money, time and management support, structural issues and cultural barriers. Therefore, to drive foresight, management must support the programme culturally and monetarily and establish user friendly processes and methodologies. Foresight should be centrally funded to allow continuity, but managed in a decentralised way without constant approval from senior management being required for every step in the process. The use of information systems is not supported through the research, but might add value in complex, high volume, foresight projects.