Corporate Foresight

The starting point of this thesis is a dynamic view of organizations. The dynamic view assumes that organizations need to constantly adapt to their environment to ensure long-term survival and economic success (Levinthal 1992:427; Teece et al. 1997:509; Helfat and Peteraf 2003:1007; Eisenhardt and Martin 2000:1105). A study solicited by the CEO of Royal Dutch Shell found that even the survival of large, globally operating companies is threatened in times of discontinuous change. The study calculated the average life expectancy of a Fortune 500 company (an index covering the largest private companies in the world) to be less than 40 years (De Geus1997a:2–6).

search on corporate foresight has its roots in the term strategic foresight. The reason for choosing the term corporate foresight in this thesis is to emphasize that the research is aimed at understanding foresight applied in private firms as opposed to the application in the public domain.

Building on the literature review, the research aims can be further specified. These aims can be divided into aspects whose purpose is to advance theory and aspects whose purpose is to advance management practice.

Companies wishing to improve their management practices often take the approach of comparing themselves to others, particularly companies that are known to be good at certain practices. This approach – known as benchmarking – has been applied to almost all areas of management, including procurement, research and development (R and D) (Dutta et al. 2005:277), production, marketing, and sales (Mittelstaedt 1992:310). The usefulness of benchmarking arises from the possibility of (1) gaining knowledge about how good one’s own management practices are in comparison to others, and (2) being able to learn from others and improve one’s management practices. To use a definition from Camp (Camp 2003:12):

The following chapter presents eight best practices. They are structured along the capability dimension of the Maturity Model of corporate foresight.

With the presented literature analysis in mind, I began this research with the hypothesis that most firms still lack effective systems to identify, interpret, and respond to external change. This is troubling, because corporate foresight capabilities are closely associated with the ability of a firm to retain its competitive advantage in times of discontinuous change (Levinthal 1992:427; Teece et al. 1997:509; Eisenhardt and Martin 2000:1105; Helfat and Peteraf 2003:1007) and its ability to ensure long-term survival (Stubbart and Knight 2006:79; Anderson and Tushman 1990:604; Audretsch 1995:441). Even though I was able to identify various best practices in specific capability dimensions, none of the firms had implemented a comprehensive, stable, and effective corporate foresight system. Most companies had mature practices in one or two capability dimensions but few capabilities in the others. Thus, the overall implementation level is still troubling and raises serious concerns about the ability of firms to retain their competitive advantage in times of discontinuous change.

Before each interview, a brief introduction of the aim of the study and its relevance to management practices was given.