Uncovering future paths through strategic foresight
A recently published longitudinal study found out that future-prepared firms outperform the average by a 200% higher growth. Companies with mature foresight practices are also clearly more profitable. But what is future-preparedness, and how can it be strengthened?
It is easy to imagine one preferred future. Strategic foresight starts by understanding that there are multiple futures. Some of them are comfortable and easy to deal with, while others may cast a dystopian shadow over us, or inspire us about a better view forward. Besides creating an optimistic scenario, it is our duty to think about inconvenient and critical paths.
Build organizational capacity to think systematically about the future
The operating environment of companies is more complex and less predictable than before. It is characterized by volatility, uncertainty, complexity, and ambiguity – often described as the VUCA world. In 1958, the average lifespan of S&P 500 companies was 61 years. Today, it is 18 years.
Apparently, today’s companies often fail to adapt to the changes in their competitive landscape. Strategic foresight helps build more resilient organizations which are not only able to adapt to the changes, but also anticipate and build on them.
However, future-preparedness should not be just a buzzword among others but the foresight process should always result in real value for the organization and drive growth. At its best, foresight is a continuous activity, not a one-off exercise.
Understand, experience and act
MC Strategy follows three guiding principles in foresight work: understand, experience and act. This means moving between knowledge, immersion and execution. The approach is framed by the combination of futures thinking, systems thinking and design thinking.
The work starts by understanding the landscape the client operates in, and identifying the crucial trends, signals, and phenomena that impact on the operating environment. For a holistic overview, a STEEP framework can be used for clustering the findings. This means paying attention to social, technological, economic, ecological and political progress. The co-dependency and connectedness of things can be analyzed with systems modeling. The development phases of trends and innovations can be structured with adaptation cycles and emerging issues analysis.
To strengthen the human perspective, qualitative data is collected by interviewing influencers, experts and key stakeholders. Innovation benchmarking studies cover the customer journey from consideration to bonding. To understand the customer of the future, vivid descriptions of future customer personas are crafted. To be as concrete as possible, the design fiction approach helps exploring possible futures by creating scenarios narrated through designed, physical artifacts.
To understand trends comprehensively, all senses need to be alert. Visual and experiential information enrich the perspective. For example, a trend safari in London or Berlin helps grasp the changing retail landscape. Gamified workshops fuel creative thinking and remind of the importance of play.
Uncover transformative spaces for growth – go beyond the obvious
Foresight work should always be co-created. Involving different stakeholders in the different stages of the process ensures that multiple perspectives are covered, and a mutually shared future vision can be created.
Instead of predicting the most likely future, MC Strategy wants to create transformative spaces for growth and challenge generic assumptions about the future. This means going beyond the most obvious, the surface of phenomena. For example, with causal layered analysis, it is possible to dive below the surface, to reveal new perspectives, opportunities, and solutions – even on the level of myths and metaphors.
Foresight widens the company’s perspective and leads to improved quality of decision-making. A future-prepared company is not only aware of the coming changes but is ready and willing to adapt its strategy to the changing environment. Such a company can identify the meaning and consequences of the change, and capitalize on new opportunities before competitors. With foresight, we can use the future today.
There should always be a strong link between the foresight process and strategy. Actually, it is difficult to separate the two. In strategic decision-making, companies always think about the future. MC Strategy’s job is to make this thinking as good as possible and translate the learnings into future-prepared leadership.