How You Can Prepare for the Future Using Strategic Foresight
You may not be able to predict the future, but you can prepare for it. Foresight uses research to map out educated possibilities for the future. The more you consider these possibilities, the more you can prepare yourself, and your organization for what’s to come.
This post will introduce you to using strategic foresight, outline examples of signals and trends, (including the rise of Netflix), and get you started with an exercise that will help prepare your organization for the future.
Change may be a constant, but that doesn’t mean it’s easy. Consider all of the technological, social, economic, and political changes that have occurred even in the past ten years. Get your organization on the path that’s the most likely to lead to success using strategic foresight.
Why Foresight is Important
10 years ago, Twitter was barely a year old. It was called “Twttr” and it claimed, “If you have a cell and can txt, you’ll never be bored again.” In 2018, over 300 million people used Twitter. It’s also the primary marketing tool of the President of the United States and how he communicates with his base of 32 million followers.
The decision an organization makes and how it adapts to change has lasting consequences. In the Spring of 2000, Netflix—a small company that was losing money on its DVD-by-mail rental service—approached Blockbuster with a business venture. More on that story below.
It's imperative that your organization plans for the future and understands the impact that even slight changes can have on your industry. A well thought out foresight plan will help your organization prepare for whatever the future might bring.
What might the future look like 10 years from now? 20 years from now? 50 years from now?
And how does your organization survive and thrive in that future?
Netflix: A Case Study
Let’s look at Netflix. What if Blockbuster Video or cable companies saw the possibility of the online streaming services we use today?
Netflix began in 1997 as a DVD-by-mail rental service. By 2000, they had a modest online following but were losing money. Netflix’s CEO, Reed Hastings, had a meeting with Blockbuster and proposed the sale of 49% of Netflix to Blockbuster. Netflix would take the name “Blockbuster.com” and work exclusively for them as their online service.
Blockbuster turned that offer down.
Seventeen years later, Blockbuster is a distant memory. Could Blockbuster have predicted their own demise and the tremendous success of Netflix? Probably not.
But they could have analyzed trends and behavioural patterns that indicated increases in online pirating, a shift to "binge" media consumption, increasing streaming speeds, and the downturn in video-store rentals. There were plenty of signals and trends indicating this shift in media use if Blockbuster had been looking for them.
As it turns out, Netflix might have been the only thing that could have saved their business. What if Blockbuster had looked to the future when Netflix approached them? If Blockbuster or cable companies knew how to use foresight to examine possibilities for the future, they may have been able to put themselves in a better position to evolve with people’s changing habits.
How to Foresight
Foresight is a process that explores the many alternate paths that the future may take. Spending time thinking about how your organization might adapt now will help ensure future success.
It’s not about predicting the future since the future is always changing and has yet to be determined; foresight is about understanding the future.
Foresight begins by examining current signals—small indicators of change—such as an increase in online pirating or rental stores going out of business. A grouping of related signals suggests a trend that may lead to important changes in the future. In the early 2000s, online pirating and increased streaming speeds were signals of a larger online viewing trend that would lead to the rise of Netflix and many other streaming services.
Understanding current signals and trends helps you determine where your organization might better focus efforts to prepare for an uncertain future.
Trends on the rise today
Car Share or Bike Share programs are an indicator of more and more sharing or rental options. The future of “things” may be here quite soon. What if you didn’t need to own your own power tools? A ladder? A lawnmower? What if you could share these items like library books for a small yearly or monthly fee?
Alexandra Jaik, whose master’s research was on the Berlin Library of Things says, “Think of it like any other library, except, instead of borrowing your favourite book you can borrow tools, camping equipment, and other items you use infrequently.”
In some cities, this type of sharing is already a reality.
🛠 An annual membership to The Hamilton Tool Library lets you borrow from thousands of tools.
It claims you can “borrow thousands of items including camping and sports equipment, house party supplies, board games and toys for $50/year.”
What do libraries for “things” mean for the future of power tool or tent manufacturers? How might the marketing industry change with the next social media trend? What might the future of transportation look like with the emergence of self-driving cars?
The future lies ahead whether you’re prepared for it or not.
How to begin preparing for the future today
How might your organization get on the path that’s the most likely to lead to success?
THE THREE HORIZONS EXERCISE
Working through three horizons can help your organization identify uncertainty and become more skilled at addressing future changes.
💡 Try talking about the future as a part of your team leadership retreat. It’s an extremely valuable group activity that gets your own team thinking about and planning for the future. Learn more in our post 5 Innovative Leadership Retreat Ideas Your Competitors Haven’t Thought Of.
You’ll begin with two different horizons that outline where your organization is at right now, and where you would ideally like it to be in the future. Then you will draw a middle horizon that reflects on the steps your organization would need to take in order to get from horizon one to horizon three.
- Create the first horizon (H1) by outlining your organization’s current way of doing things. This is what you can expect if your industry doesn’t change at all, and behaves in exactly the same way for years to come.
- Next, you’ll move to the third horizon (H3), which focuses on the future. For the third horizon, outline a new system of existence—envision how we will work and live in the future. These futuristic systems and ideas will likely seem unrealistic, and that’s great! They should seem like quite a leap from the present day reality outlined in H1.
- The second horizon is a transition zone between H1 and H3. The second horizon focuses on any evolving advances that connect to what’s missing in H1, and it foresees the possibilities of your future horizon: H3.
The three horizons exercise is only the beginning of creating a foresight plan, but working through even the basics can get you and your team thinking beyond today and tomorrow.
Using foresight, you can better understand where there may be implications today that will affect how your organization operates tomorrow.
Since there’s nothing you can do to prevent change, give your organization the information it needs to find itself in the best possible scenario. Prepare your organization so that you never pass up on your Netflix opportunity.
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