Alireza Hejazi shares his thoughts with us about “creating value by foresight” in this blog post for our Emerging Fellows program. The views expressed are those of the author and not necessarily those of the APF or its other members.
Talking to an architecture company CEO recently, I was confronted with this question: “How can corporate foresight create value in my company?” I wanted to offer a “business-as-usual” response, but I changed my mind by remembering Rohrbeck and Schwarz’s (2013) clear-cut response identifying four faces of value creation through corporate foresight. Basing my response on their view, I told my CEO friend that corporate foresight may create an enhanced capacity to perceive, interpret and respond to change, an enhanced capacity for organizational learning, and more impacts on other actors.
In fact, the philosophy of applying corporate foresight is to reduce the uncertainty by scanning the unknown in the environment. If this is the least and perhaps the most value it can create, then employing corporate foresight is worthy enough to be considered by managers and leaders. I also suggested my CEO pal to form a multi-disciplinary team who might lower the risk of disregarding and misunderstanding the change factors. In this way, his company wouldn’t fall into the traps that might be made by personal biased assumptions about future.
My suggestion for shaping a multi-disciplinary team originated from Gracht and Stillings’ (2013) observation maintaining that interdisciplinary cooperation not only could solve the problem of biases, but also satisfies the future needs of the target customer. In this sense, techniques like scenario planning may sound useful as far as they depict the picture of the future market and introduces new product concepts that might provide new opportunities and development routes for the market and the technology. Corporation decision makers can enrich their short-, medium- and long- term decisions significantly through alternative scenarios or by technology road-mapping.
However, as Rohrbeck and Schwarz admit, the implementation of corporate foresight activities is still limited due to uncertainty in getting desirable outcomes and return on investment and the degree of their value creation for strategic planning. On the other hand, too much focus on current conditions and activities makes the organizations inattentive to small changes that are taking place in the wider environment but impactful in the future.
Rohrbeck and Schwarz’s review of foresight research in the European context reveals that foresight can create value for innovation and strategic management through utilizing appropriate methods in the process of decision-making and strategic planning. Companies who practice foresight in different sectors gradually find out that foresight is a tool of value-creation. It contributes to their survival in the competitive business environment, especially in time of discontinuous change. More importantly, the application of corporate foresight methods can lead to the improvement of organizational responses and thereby improving values in innovation management. This shapes Rohrbeck and Schwarz’s (2013) paradigm that links knowledge creation to value generation.
In my view, if the value of foresight is to influence decision, then foresight practitioners should extend their efforts beyond conventional business decision making to discover alternative methods and analyses that might enrich businesses, organizations and policy makers with new solutions. The simple world of Shell Company and its well-known six scenarios in oil crisis is evolved into a complex world of STEEPV interactions and interpersonal relations where the survival of values is tested every day. Today, value networks are drenched in intangible value exchanges that create their strategic advantage in the market.
Corporate foresight is able to aid companies which create value by connecting clients and customers that prefer to depend on each other. These companies create and distribute tangible and intangible values through networks that are webs of dynamic relationships and exchanges between two or more individuals, groups or organizations. In my view, the success of corporate foresight in the future depends on the contributions that it would make to the development and management of these networks. For such success to happen, effective interpersonal networks must be built on a foundation of expertise, trust and shared understanding. I think that APF is exactly established to build that foundation now and in the future.
Rohrbeck, R. & J. O. Schwarz. (2013). The value contribution of strategic foresight: Insights from an empirical study on large European companies. Technological Forecasting and Social Change, 80(8), 1593-1606.
Von der Gracht, H. A., & Stillings, C. (2013). An innovation-focused scenario process: A case from the materials producing industry. Technological Forecasting & Social Change, 80, 599-610.