Corporate Foresight

1
Corporate Foresight

• Judit Gáspár
• Department of Decision Sciences
• Corvinus University of Budapest, Hungary
• WFSF World Conference - Budapest
• 21-24 August 2005

2
Outline

• What is foresight?
• Corporate foresight
• Practice
• Results of a German survey
• American researchers/consultants experience
• Wild card management
• Responsible firm stakeholder management

3
Foresight

• Systematic participatory process, collecting
  future intelligence and building medium-to-long
  term visions, aimed at influencing present-day
  decisions and mobilizing joint actions (EC DG
  Research, 2002).
• Helps the decision making in complex situations
  by discussing alternative opinions.
• Gathers communities with complementary knowledge
  and experience.
• Continuous learning.

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A key element of foresight (Critical future
sciences)

• Time
• visions for the long run acts in the short run

Present here now
Past, memories
Future, expectations hopes
Interpretation
Anticipation
Extended Present
Source Hideg, 2002
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Different levels of foresight
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Organisational foresight paradigms(Cunha 2002)

• Foresight-as-prediction
• time structures are objective and predictable
• future is an extrapolation of the past
• forecasting discipline
• there is a future out there, waiting to be
  predicted
• Foresight-as-invention
• interaction between the way people simultaneously
  construe and are constrained by the temporal
  structures that are both enacted and changed
  through practice
• how are human agents inventing their futures
  through practice?

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Competing for the Future, Hamel, G. Prahalad,
C.K. (1994)

• strategy for shaping the future
• companies need to reinvent competitive space
• innovate their strategy thinking, opening up of
  the definition of strategy (Mintzberg) to include
  patterns, perspectives, and ploys, in addition to
  the more traditional planning and positioning
  (e.g.Porter and others)
• rejected conventional strategic management
  frameworks

8
Crafting Strategy in an Uncertain World Hugh
Courtney (2001)

• McKinseys strategy theory and practice
• In a turbulent and uncertain marketplace such as
  most companies are experiencing nowadays, most
  planners and managers continue to use tools
  originally designed for more stable environments
• Recommendations to embrace uncertainty, explore
  it, slice it, dice it, get to know it and by this
  improve their foresight.

9
Corporate foresight in Germany - 1 CESES papers,
Z_punkt survey 2002/2003

• 60 large businesses in Germany in the year
  2002/3, investigating how (if at all) they
  integrate futures studies methodology in
  strategic decision making, which methods they
  use, which subjects are tackled when doing so.
• The survey was accompanied by 20 in-depth
  interviews with decision-makers in these
  companies who are responsible for long-term
  thinking, and by several workshops.

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Corporate foresight in Germany - 2 CESES papers,
Z_punkt survey 2002/2003

• Businesses work with foresight in order to
• build a knowledge base (reduce uncertainty by
  identifying new and relevant trends, create
  orientation on future developments),
• prepare strategic decisions,
• support innovation processes,
• develop new and future business fields / markets.

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Corporate foresight in Germany - 3CESES papers,
Z_punkt survey 2002/2003

• Methods used in companies
• Publication Analysis ( cp. environmental
  scanning) (used regularly by 79)
• Brainstorms (58)
• Scenario Methods (46)
• Simulations (29)
• Trend Extrapolation (29)
• Expert Surveys or Interviews (33)
• Delphi (only seldom) by 42
• Future Workshops 8

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Corporate Foresight

• Wild cards (low probability high impact events)
  (e.g. Daimler-Chrysler)
• Wild card management systems are based upon two
  components
• weak signals
• organisational improvisation

Source Mendonça et al. 2004
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Responsible firm, stakeholder management

• Being aware of the social and ecological
  embeddedness of the firm
• Stakeholders taking part in the strategic
  management processes, 3 levels
• Rationale
• Process
• Transactions
• Transparency of decisoins

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Responsibility

• If foresight involves not the prediction but
  rather the mindful enactment of a variety of
  possible future scenarios, then it seems
  appropriate to raise the issue of ethical
  obligation in the domain of foresight as a
  question concerning
• what future should we enact?

Statler, Jacobs (2004)
15
References

• CESES Papers. Analysis, Practice, Methodology,
  Theory, News. 11/2004. Special Number on The
  First Prague Workshop on Futures Studies
  Methodology, pp. 115-124
• Courtney, Hugh (2001) 20/20 Foresight Crafting
  Strategy in an Uncertain World, Boston, Harvard
  Business School Press
• Cunha, Miguel Pina E. (2004) Time Travelling,
  Organisational Foresight as Temporal Reflexivity,
  in Tsoukas, Shepherd (eds) Managing the Future
  Foresight in the Knowledge Economy, Blackwell
  Publishing 2004. 133-150
• Freeman, Edward R. (1982) Stakeholder-menedzsment
  in Kindler József, Zsolnai László (eds) (1993)
  Etika a gazdaságban, Keraban Kiadó Budapest,
  169-191 Stakeholder Management in Strategic
  Management A Stakeholder Approach 1984. Pitman
  Chapter 3.
• Gavigan, James P Sciapolo, Fabiana Keenan,
  Michael Miles, Ian (eds.) (2001) A Practical
  Guide to Regional Foresight in Hungary, Budapest
  TEP Office Hamel, Gary Prahalad, C.K. (1994)
  Competing for the Future, Boston, Harvard
  Business School Press
• Havas, A. (2003) Socio-economic and developmental
  needs focus of foresight programmes, Discussion
  Papers, Institute of Economics, Hungarian Academy
  of Sciences, Budapest, 6-7
• Hideg Éva (2002) Implications of two new
  paradigms for futures studies, Futures 34.
  283-294
• Mendonça, Sandro, Cunha, Miguel Pina E., Jari
  Kaivo-oja, Frank Ruff (2004) Wild cards, weak
  signals and organisational improvisation, Futures
  36. 201-218
• Statler, M. Jacobs C.(2004) Practical Wisdom
  Framing the Ontology and Epistemology of
  Foresight, http//www.gsb.strath.ac.uk/worldclass/
  foresight/2004/