Three-quarters (75%) of organizations are not prepared for the pace of change in and around their industry. Across sectors, we all need to rethink how we operate to both survive and thrive in the future. Foresight can help individuals and organizations be more future prepared, innovative and agile.
As Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), recently said: “[We are moving] from a world of relative predictability … to a world with more fragility – greater uncertainty, higher economic volatility, geopolitical confrontations, and more frequent and devastating natural disasters – a world in which any country can be thrown off course more easily and more often.”
While these disruptions and crises require immediate response and action, they cannot solely be approached through the lens of crisis management. They are likely to be symptoms of deeper shifts and transformations.
According to the PwC 26th Annual Global CEO Survey,nearly 40% of CEOs do not think their companies will be economically viable a decade from now if they continue on their current path and do not transform. Research also shows that 75% of organizations are not prepared for the pace of change in and around their industry.
This should be a wake-up call, pushing us to deeply rethink how we operate, reimagine how we create, distribute and capture value – not only to survive and thrive but also to address the transformational challenges of the coming decades.
This is not only about the future, it’s also about helping us do what we can and should do, here and now. In this context, there are three challenging things all of us need to get much better at: future thinking, system thinking and exponential thinking.
Foresight as a key strategic capability
Foresight is a set of approaches that help explore, imagine and anticipate the future in an open but structured way. It can help identify and explore challenges and opportunities emerging from multiple signals and drivers of change shaping the future. It is also critical to inform decisions and act as a trigger for developing strategic options in a context full of unknowns.
Should you start thinking about bringing this in your organization? Absolutely.
Should you double down on your organization’s futures literacy and foresight capabilities if you have already done work in this space? Certainly.
This is a concrete and powerful way to build future preparedness for individuals, organizations and more broadly for our society as a whole – and it is now more needed than ever.
Managing internal change by foresight, rather than by crisis, is only possible if the change in the environment is seen on time." – Arie de Geus
While foresight is a wide, rich and constantly evolving field that we cannot do justice to in a short article, we hope to help highlight a few of its core principles, approaches and use cases to make it tangible, and hopefully trigger interest.
Some of the fundamental underpinnings of foresight include the recognition and acceptance that the future is a space of possibilities that cannot be predicted; the need to focus on the long-term, and embrace peripheral and systemic views, looking above and beyond; and also the inclusion of a multiplicity of perspectives to overcome potential individual and group biases.
Two of the most well-known and powerful methods used in foresight are highlighted below:
This helps capture, identify, categorize and make sense of a multitude of drivers of change, insights or signals of relevance when exploring the future of a specific topic or issue.
Some of the elements that can be identified through horizon scanning include megatrends, trends, weak signals, wild cards and uncertainties.
Ageas, an international insurance company based in Belgium, recently developed its Think2030 Horizon Scan project as a response to the deep changes we are witnessing in a wide range of domains.
This aims to help the company reflect on what this change means for the industry, for the business and its entities. Think2030 builds on a mix of internal knowledge from staff from across functions, businesses and markets, as well as on artificial intelligence.
It enables the company to identify and categorize trends as below:
No brainers: Short-term impactful trends that should be embedded in the current business plans.
Speed-ups: Trends evolving faster than thought, which may demand immediate action.
Alarms: Trends for which further investigation may be urgently required.
Observatory: Trends with considerable impact, but only to materialize mid/long-term.
Parking: Trends with very low impact on the insurance industry.
Those are then used to inform and fine-tune Ageas’ strategic discussions and choices. They have also contributed towards increasing future literacy of staff and infusing this thinking across the entire organization.
The World Economic Forum’s Strategic Intelligence platform is another illustration of the potential of horizon scanning and a different use case for this approach. It aims at helping the Forum’s corporate and government partners – as well as the wider public – to explore, understand and monitor global, regional and industry trends and signals.
The platform crowdsources the insights from a network of leading experts, universities and international organizations and complements them withthe machine analysis of more than 1,000 articles per day from trusted publishers, think-tanks and research institutions.
The dynamic visual framework helps connect the dots by pointing out and explaining interrelations between diverse topics, enabling more contextual awareness for Forum’s partners as well as for its own work on a wide range of issues.
Scenarios are simulations of possible futures, they are not predictions. They often articulate trends, megatrends, weak signals, wild cards and uncertainties in stories about the future, and help us project ourselves in an unpredictable future environment, serving as lighthouses into the future and helping educate stakeholders on potential changes and their implications.
Shell Global, the multinational energy and petrochemical company, has been a pioneer in corporate foresight, developing scenarios for more than five decades to help generations of executives in the company explore possible futures.
In its work with scenarios, Shell asks “What if?” questions when consideing developments that may only be remote possibilities to push its thinking. The company goes way beyond traditional energy outlooks and tends to include a broader set of drivers, looking at trends in the economy, politics and the broader society.
In the public sector, Singapore’s government was one of the earliest adopters of scenarios planning, making this a key part of its strategic planning and budget cycles. Due to its size and vulnerability to external events, Singapore’s engagement in strategic foresight has been a key source of comparative advantage.
“Our key challenge is to sustain a good governance when the road ahead is unmarked,” said Peter Ho, founding father of Singapore’s Centre for Strategic Futures. Singapore has since complemented scenario planning with other methodologies and tools including horizon scanning.
By failing to plan, you are preparing to fail." – Benjamin Franklin
How could this look like in your organization?
Decades of trial and error bringing foresight into organizations have shown that there are two critical ingredients to building this capability successfully.
First, it needs to be championed by an organization’s top leadership and decision makers. This means allocating space and resources for building this capability and, most importantly, ensuring openness and willingness from decision-makers to be challenged and to potentially rethink their strategic choices based on the outcomes and insights coming out of foresight work.
Second, the organizations that are leveraging foresight in its most powerful form, tend to have in common a drive to democratize foresight across its staff. Foresight is not only practiced by a central unit, but also approached as an organization-wide skill, capability or even culture.
Foresight can support organizations building future preparedness through exploration, orientation, innovation, visioning, strategy and innovation, as laid out in the visual below.
What if future literacy matched global literacy rates?
In 1820, only 12% of the global population was literate, today this figures stands at 87%, up to 99% in most developed countries. What if future literacy and foresight were to follow the same development path as the global literacy rate?
Would we still witness environmental degradation such as over-fishing and deforestation? Would we still see speculative bubbles, reckless lending and recessions? Would we still witness current levels of inequalities? Would quarterly reporting still be a thing in publicly listed corporations? Would civil servants still be exposed to short-term political pressure and short-term needs from election cycles?
We hope that future literacy follows the same story and development as literacy. We believe that raising the strategic importance of foresight across organizations and sectors, could help deliver this. It should become part of the core curricula of basic education, universities, business schools and core to any individual and organization capabilities.
This would not only help organizations be more future prepared, innovative and agile, with an engaged workforce. We need this not only to survive and thrive but to address the transformational challenges of the coming decades.
This is not just about the future; it is also about helping us do what we can and should do here and now.
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Paulo Carvalho is a professor, researcher and expert in Strategic Foresight, Innovation and Entrepreneurship, with more than 20 years of experience in these fields. He is an Associate Professor at ISEG – School of Economics and Management at the University of Lisbon (www.iseg.ulisboa.pt). He has been working in consulting and research projects in the fields of foresight, scenario planning, strategy and innovation with public and private organizations in different industries. In 2019 he founded "IF Insight & Foresight" (www.ifforesight.com) a Futures think tank and a consulting studio that blends Foresight, Strategy, and Innovation in order to create lasting value and meaningful experiences for people and organizations.
Olivier Woeffray is Practice Lead, Strategic Intelligence at the World Economic Forum. He has more than a decade of experience at the intersection of the private and public sector helping organizations make sense of complex and emerging issues tapping into strategic foresight, expert networks and systems thinking.
Olivier has researched and written about future preparedness with leading academic partners from around the world. He regularly designs and facilitates workshops for companies and coalitions of organizations from across sectors. Olivier is passionate about the power of collective intelligence and collective action to drive change within and across organizations.