Strategic foresight provides a framework for challenging assumptions and imagining new scenarios in today’s fast-moving world. Doing so helps leaders move forward with more confidence and less emotion, and take a proactive, rather than reactive, stance to new obstacles and trends.
Essential to strategic foresight is the concept of signals. According to the Institute for the Future (IFTF), a signal is a “a small or local innovation or disruption that has the potential to grow in scale and geographic distribution.” These include new products, new policies, new technologies, events, issues, and more.
Often, the signals of change are all around us, but leaders fail to recognize them or act. For example, in 2008, the CEO of Blockbuster dismissed the then-emerging prominence of Netflix and Redbox: “Neither…are even on the radar screen in terms of competition.” Blockbuster overlooked several key signals, such as the meteoric rise of new, more convenient distribution models for customers (i.e., first mailing DVDs and then online streaming), as well as the value of AI-driven personalization based on in-depth user data. Their resistance to change meant the company lost its dominance on at-home entertainment and eventually shuttered down.
Being attuned to signals can reap great rewards, though. In the 1970s, for example, Royal Dutch Shell’s Pierre Wack famously used scenario planning to anticipate oil prices surging and ultimately helped the company better weather the energy crisis. By challenging inward-looking biases, such as the belief that Western-dominated stability would always prevail, Wack’s team concluded that an energy crisis stemming from tensions in the Middle East was inevitable; this prediction helped the company proactively prepare for the challenges ahead, instead of being caught by surprise.