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The further we look into the future, the more difficult it is to predict it and prepare for it. But its uncertainty and variability make it so interesting for us. Which technologies will become popular? Which industries will continue to develop, and which will completely transform? How do we know what to focus on right now not to lose money? Such questions raise our curiosity, we want to look ahead and find out what’s next. There are various tools and techniques out there that can help us explore and form the future. In this article, we propose to get acquainted with one of such tools – the foresight methodology.

How to work with the future

By now we all understand the necessity of working with innovations. To have effective business development, it is not enough to be aware of the present, you need to look into the future. And not just look into it, but actively study, make forecasts, and form changes. Today we already know how to work with innovations in the short term – up to 5 years. We have learned how to use user-centered approaches (such as design thinking or service design). Such methodologies put the end-users at the center, study their primary needs and pains, and then based on these findings start developing new products or services.

But what about innovations in the longer term? What will happen 10 or 20 years from now? Today it is difficult to predict the needs of users from the future. We cannot know in advance what they will be interested in, what problems they will have, what solutions they will want to see, what technologies they will use. Here we face the limitation of all those approaches that work well in creating innovations in the nearest future.

Foresight

Foresight helps when businesses need to look years ahead into the future. The term “foresight” came into use in the late 80s, not only to predict the development of various scientific and technological innovations but also to use this knowledge to make managerial decisions in the long term [1].

The methodology combines various tools to create a common vision of the future that will be shared by all stakeholders [2]. A distinctive feature of the methodology is that it is not just about predicting the future, but about deep understanding and conscious formation of the future. Foresight uses patterns of the past, current reality, and future trends, to understand how the future can be managed.

What is a foresight study? This is usually a project that uses various methods to assess and evaluate the future. The participants of such a project – a group of stakeholders – analyze possible options, discuss them, and together develop the most preferable scenario for the future. In foresight, participants do not predict the future but develop a system of measures that will allow them to achieve the desired future result.

The foresight methodology has its origins in the field of military technologies. It was first used by US military research centers in the 1950s [1]. RAND Corporation attempted to assess the prospects of various technologies in terms of their application in the defense sector. To do this, RAND used the Delphi expert assessment method, which has since become one of the main foresight methods [2, 3].

Foresight is actively used not only in the corporate world to develop strategies for large enterprises. It is also used to plan the development of individual cities, regions, and even countries. We would like to share a few cases of successfully implemented foresight tools to show how this methodology works.

1. Royal Dutch Shell

In 1965, Shell launched a new long-term research initiative. This was the beginning of long and fairly successful use of scenario planning to determine the company’s strategic moves in the future. Already in 1967, Shell created its first planning department, which explored the company’s long-term perspectives in the form of alternative scenarios of the future.

This tool of scenario planning proved to be effective. It was not a simple prediction of the future. Its main value is that the described scenarios were integrated into the company’s organizational and strategic processes. The scenarios influenced the results of the operation processes and ensured the interconnection of various elements within the company. Thus, Shell was able not only to predict crises in the oil market, but also to prepare the company and the internal processes in advance, and to take risks into account.

Scenario planning is still used in Shell now. Within the timeframe of over 50 years, there were both very successful periods and times when the value of this method was questioned. However, it is the unique long-term initiative in which results cannot be quantitatively measured, and which does not use accurate forecasts, but rather highlights the uncertainty of the future.

2.  Deutsche Telekom

Deutsche Telekom actively uses methods of foresight as well. Deutsche Telekom researchers study so-called weak signals to identify opportunities and threats of the future. A weak signal is a qualitative piece of data that has partial information about current trends and allows you to conclude changes in these trends in the future.

Source: www.telekom.com/en/media/media-information/archive/

Weak signals can become external impulses for changes in the company, for its development, as well as for attracting new customers. So, in the case of telecommunications, the tendency of people to devote more time to their health can reduce the time they spend on their phones. On the other hand, widespread urbanization and the development of small towns may lead to the need for greater mobile coverage. If the company notices these small signals in advance and can link them to the future needs of its users, it will help them understand and plan their development strategy.

For strategic foresight, Deutsche Telecom uses a variety of IT tools integrated into a common future research approach. These systems track changes in weak signals, interpret possible causes and consequences of such changes and launch certain management decisions [4]. Thus, the company successfully integrates computer technologies into the use of foresight, thereby helping to implement its results at the operational level.

3. Development of Helsinki and other northern cities

Experience has shown that foresight methods can be used not only to shape the future in corporations [5]. The Center of Sustainable Communications at the Royal Institute of Technology Helsinki investigated how urban life can be improved in the future and how northern cities will change with the development of modern smart technologies. For this study, the researchers used foresight techniques such as scenario planning and retransmission.

With the help of scenario planning, three alternative scenarios of the future for smart cities were formed. Each scenario took into account possible strategies for changing various areas of the city’s life: energy, transport, local business, overall consumption, etc. The most likely options for the development of these areas served as the input for the formation of scenarios.

Then, after determining the most desirable future, a team of scientists formed certain steps to make this future possible. Scientists have developed special programs for each of the studied areas, as well as business models for the development of cities and achieving a certain future. This method is called retransmission.

Source: www.helsinkismart.fi/about/

Get to know foresight

At SAMSONOWA & Partners, we actively use foresight techniques to help our clients implement these methods in their business processes. Our educational module “Future Business Opportunities” will help your company to study modern trends deeply and formulate a relevant vision of the future.

Sources:

  1. Sokolov, A.V. (2007). Foresight: a look into the future. Strategies, №1 (1)
  2. Dalkey N.C., Helmer-Hirschberg O. An experimental application of the Delphi method to the use of experts. RAND Report RM-727-PR, 1962.
  3. Bondar, A. V. (2017). Theoretical foundations of foresight: strategic management and innovative development.
  4. René Rohrbeck, Nico Thom,  Heinrich Arnold. (2015). IT tools for foresight: The integrated insight and response system of Deutsche Telekom Innovation Laboratories. 
  5. Ilyina, I. N. (2012). Foresight: scenarios of the right future. Intelligence and technology. № 1. с. 82-83.