Exploring the value creation of corporate foresight

Corporate managers and scholars alike have been wondering if any of the foresight work in companies does create any value. Interesting insights on this question can be found in Frank Ruff’s article, where he discusses different examples of the work of Daimler’s “Society and Technology Research Group“.

He identifies five application fields of foresight in firms:

• predicting long-term market developments, by analysing mega-trends (such as demographic change, increasing individualism. etc.)
• identifying changes in customer needs, by anticipating not-articulated needs and actively shaping future customer needs
• prospective evaluation of innovations, by proactive scanning of technologies and market opportunities
• facilitating business process and organizational change, by linking environmental changes with change in internal processes and organizational structures
• scanning and monitoring of the environment, by multi-disciplinary teams that are highly networked (and operate in a similar fashion as scouting networks)

For the first four application fields he provides short examples to illustrate the implementation at Daimler and to show the contributions to the business. He explains that the foresight projects were able to contribute to

• strategic planning for the Chinese market (long-term market developments)
• understanding the target group for the Smart “ForTwo” (identifying customer needs)
• identification of new product features in Daimler Vans (evaluation of innovations)
• enhancement of internal IT management (business process and organizational change)

These findings relate also on our view (discussed in our post and article) that corporate foresight contributes to the innovation success of a company through

• providing strategic guidance (Frank’s “strategic planning“)
• initiating innovations (Frank’s “identifying customer needs“, “evaluation of innovations”, “business process and organizational change”, “scanning and monitoring”)
• challenging ongoing R&D projects

Only the last point of our model seems not to be implemented at Daimler. One reason for that could be that the Society and Technology Research Group seems to have more the character of a internal “think tank”, while we observed the challenging (or Opponent role as we call it) task with foresight units that were part of the R&D organization.

Full reference of the article: Ruff, F. 2006. Corporate foresight: integrating the future business environment into innovation and strategy. International Journal of Technology Management, 34(3-4): 278-295.