The Value of Foresight in a VUCA World

In contrast to reacting to short-term developments in the business environment, strategic foresight is meant to help organizations anticipate long-term change to make better decisions in the present day. But how do you measure and articulate the impact of strategic foresight? What is the difference between an organization that uses foresight effectively and one that doesn’t? 

To find out, the Nuremberg Institute for Market Decisions and Institute for the Future partnered to conduct 400 personal telephone interviews with high-level executives from large Europe- and U.S.-based companies and asked them about their current practices related to strategic foresight. What we learned is that executives from companies that rated highly in the “foresight performance” metric we applied in the study are more aware of larger issues beyond those specific to their industries, such as climate change and environmental degradation, even if the impacts of those issues may be felt on a time horizon that is longer than the usual 2-3 year planning cycles. There is also some evidence that better foresight allows organizations to better deal with major system-level shocks like the COVID-19 pandemic, which took many companies by surprise. 

This report highlights what foresight professionals can learn from how top foresight performers organize their work and create value. Overall, our research shows that a relatively low number of executives rate foresight information sources in their companies as helpful for making decisions with strategic implications. We suggest redesigning foresight from an internal client perspective in addition to communicating the value and limitations of foresight more clearly to executives to set the right expectations.