Millennium Project
Factors Required for Successful Implementation of Futures Reserach in Decision Making


Chapter 1. Examples of Futures Research used for Decisionmaking

This chapter shares ten examples of successful uses of futures research in timely decisionmaking, as one source of information to identify factors required for successful implementation of futures research in decisionmaking.

Futures consulting continues to be a booming growth industry. More and more organizations from all over the world - public, private, commercial, nonprofit, public interest, or special interest - have discovered that it is not only desirable, but also possible, to do foresight effectively, and to use information about the future to guide their actions in the present. Some futurists believe it helps to reorient and change the attitude of an organization. It helps to make the individuals within the organization to be better aware of change and their options to address the changes.

Depending on how one defines "success", as well as how one defines "foresight", there could be many success stories - many, differing examples which could be given to substantiate the claim made above. Some people consider foresight to be successful if it helps an organization avoid a danger it might not otherwise have avoided or to take advantage of an opportunity it might otherwise not have known about. Others consider foresight successful if it helped a firm beat a competitor or to secure greater market share. Some organizations rely on external futures consultants to point out dangers and opportunities. Other organizations (far fewer, but an increasing number) develop an internal foresight capacity for themselves. Some believe successful foresight points out exceptional developments, while others believe that while useful foresight should point out unusual situations, it is best when vision and foresight become part of routine decisionmaking.

The examples of the use of futures research in decisionmaking that are presented below describe applications in different types of organizations, for different purposes and in different circumstances.

Most examples are related to strategic planning. In such cases, futures research is used to try to identify future developments that afford opportunity or threaten the viability of plans, and the consequences - both intended and unintended - of contemplated actions.

One example is given of competitive analysis. Here futures research is used in an attempt to understand what competitors might do, given the anticipated evolving circumstances so that counterplans can be established at the earliest time.

Another example is given of futures research for stimulation of innovation. Here it is used to help establish the range of the possible to facilitate the selection of development goals by the initiating agency.

In performing the research leading to these descriptions, an effort was made to include reference to the means used to overcome any impediments to initiation and use, although this information is usually not readily available. The descriptions also include a reference to the players involved, and the desired outcomes.

1.1 Futures in the Virginia Judiciary: A Continuing Success Story
 

1. Focus: State
2. Sponsor: Government agency (executive branch)
3. Application Domain: Strategic Planning
4. Techniques Employed: Visioning, Environmental Scanning, Participatory Methods

Impediments: There were no impediments to be overcome. A respected Virginia Judge heard futurist James Dator give a talk. The Judge who was on the board of the new State Justice Institute (SJI) secured funding for "Futures and the Courts". He got the Virginia Court of Justice and court administrator to apply for the funds and received a SJI grant; set up the judiciary's Futures Commission, which did its works over two years, resulting in the process described below. The key was an initial study which produced a mission statement and outlined 10 visions for the state judiciary; leaders who understood what foresight is and is not; expectation that the study would produce operating guide lines.

Players involved: Academics, representatives of the judiciary, and a group of people broadly representative of the state of Virginia.

Desired outcomes. Visions that could be used to develop action items and operating recommendations.

Measures of success: Approximately 70% of the actions recommendations have been adopted, the work continues with scanning and an annual updating process; creation of a Futures Commission which will reassess the future with citizen and professional input.

The Virginia Judiciary case has many features that proved to be beneficial in the design and outcome of this work:
 
  1. Visionary and continuing leaders who understood what foresight is, and is not (especially that it is not fortune telling; not "predicting" the future), and who expected foresight to help guide daily routine decisions;

  2.  
  3. An initial visioning process which brought all (or representatives of all) of the stakeholders in the organization together in a lengthy and sustained processes which resulted in a clearly-articulated and widely-shared vision for the preferred future of the organization;

  4.  
  5. A broadly-participative and iterative process which then used that vision to develop a detailed strategic plan for the organization;

  6.  
  7. Administrative decisions and actions, which then defined each of the strategic goals as specific tasks which were then assigned to specific people (or offices), with specific targets for completion, and sufficient budget and personnel assigned. These tasks are then monitored until they are completed;

  8.  
  9. An ongoing internally-led process which regularly scanned the environment of the organization for new challenges and opportunities which might impinge on the vision and/or the tasks, which information was then evaluated by senior administrators, and the previously-assigned tasks modified as deemed appropriate;

  10.  
  11. Occasional scans contracted from external sources, which were then internally evaluated and used to make necessary changes;

  12.  
  13. And the entire visioning process was itself revisited at appropriate (perhaps ten-year) intervals, again in a broadly-participative and extensive way.
Chief Justice Harry Carrico, Circuit Judge John Daffron, Executive Secretary (the chief court administrator) Robert Baldwin, and Judicial Planner Kathy Mays (later joined by Beatrice Monahan) provided the initial and continuing leadership for the activities from the 1980s. The State Justice Institute (a federal funding agency) in 1987 supported the creation of a judicial futures commission, chaired by Robert M. O'Neil, President of the University of Virginia. This Commission carried out extensive and intensive futures activities throughout the State, and eventually developed a mission statement and a set of ten visions for the future of the Virginia Judiciary. These were formally presented to a group of people broadly representative of the State of Virginia who gathered, in 1988, in the historic Rotunda, designed by Thomas Jefferson, on the campus of the University of Virginia.

The Commission's Report, Courts in Transition:

"...offered ten visions to serve as a foundation for the courts of the next century and to paint a picture of the preferred future for the courts. Likewise, 131 specific recommendations were developed to provide a sense of direction for the future. The report then was presented to the Judicial Council of Virginia. The Council is the Virginia judiciary's highest policy-making body.... Following wide distribution of the report within and outside the court system and a comprehensive review by the Council, 90% (118) of the Commission's recommendations were adopted.

"Very importantly, the Council then selected a sub-set of the recommendations to be implemented within the next biennium. These recommendations formed the basis of Foresight 2000: The Judiciary's Strategic Plan for FY 1990-92. Approximately 70 percent of the action items selected for implementation during this time frame have been accomplished. Among others, the direct results include: 1) the establishment of alternative dispute resolution programs within the court system to expand the types of forums in which the public can choose to resolve legal disputes; 2) the introduction of numerous automated systems to link court system data bases with attorney's court-related agencies, and the public, for improved efficiency, accountability and convenience in using the courts; 3) the passage of legislation to create a family court system to provide a more effective and more comprehensive means of addressing family disputes; and 4) the establishment of a consumer research and service development project. The purpose of this latter project is to provide continuous information to decisionmakers within the judiciary from citizens, litigants, and others on the substantive law changes and new products and services they desire from the courts." (Kathy Mays, p. 33)

Foresight 2000 has been updated by the judiciary planning staff every two years to coincide with the budget cycle. The themes outlined in Virginia's Courts at the Millennium: 1999-2001 Strategic Plan Themes, as identified by environmental scanning, consumer research, and constituent research, are "1. Surrounded by Technology: Life in the 21st Century; 2. Keeping Pace with Change; 3. Providing Justice in an Increasingly Segmented Society; 4. Fulfilling the Service Imperative; and 5. Therapeutic Justice: Redefining the Role of the Courts."

It is doubtful that so many of these accomplishments would have been attained without the careful accounting and monitoring process, which the Virginia Judiciary also developed and put in place. As Kathy Mays describes it:

"To help ensure that the judiciary's plans for its preferred future actually are realized, the state court administrator's office maintains an annual management planning process. Through this process, responsibility for assisting the local courts in implementing the specific action items contained in the up-dated strategic plan is divided among the office's various departments. Without this means for accountability and follow-up, there would be no way to translate the full strategic plan into annually obtainable objectives. The importance of this implementation process cannot be over-emphasized. And, as has been demonstrated time and again in planning efforts, the absence of such a link invites 'pie in the sky planning' as opposed to pragmatic agenda setting for the courts." (Kathy Mays, p. 34)

A flow chart of the overall activities just described, as developed by the Virginia Judiciary, and titled, "The Judiciary's Strategic Planning and Management System," is shown in Figure 1

Appendix E contains several attachments related to the "Futures in the Virginia Judiciary: A Continuing Success Story". Attachment One shows the Mission Statement and the ten Visions from the Strategic Plan for Virginia's Judicial System, originally promulgated in 1988. Attachment Two shows the Objectives and Tasks associated with just one of those Visions (Number Four) as an example of the objectives and tasks assigned for each of the ten visions. Attachment Three is a page from "The Special Projects" spread sheet for FY '95, and Attachment Four is a page from the Project Monitoring System computer printout, showing who is assigned to each task, how many hours are to be devoted to it (and were actually spent on it) and a start and finish date for each task.

A new Futures Commission, which seeks to reassess the future anew with increased citizen and professional input indicated on the flow chart in Figure 1, is anticipated as the foresight cycle begins again.
 

Figure 1

The Judiciary’s Strategic Planning and Management System


Consumer Research
Constituent 
Input
Futures 
Commission
(Once a Decade)
Environmental
Scanning
(Continuos)
- Citizens

- Consumers

- Stakeholders

 

- Judges

- Clerks of Court

- Magistrates

- Bar

- Mission

- Vision

- Values

- Emerging Trends

- Trend Analysis

- Future View

2 USAID: Jamaica 2015 as input to USAID/Jamaica’s Country Strategy Plan
 

1. Focus: National
2. Sponsor: Government agency
3. Application Domain: Strategic Planning
4. Techniques Employed: Environmental Scanning, Snowball Delphi, Scenarios, and

Vignettes

5. Impediments: disbelief in positive change and value of looking at longer-range futures

Keys to overcoming impediments: Strong support of the futures thinking by the USAID Mission Director and involvement of local participants.

Players involved: Futurist consultant, staff of the sponsoring organization (USAID), and a cross-section of Jamaicans.

Desired outcomes: Creation of a country strategy plan, to be used for allocation of USAID funds.

Measures of success: Resulted in a modification to USAID’s Jamaica development strategy.
 

Figure 2

(to be inserted)
 
 

The USAID Mission Director for Jamaica visited Santa Fe Institute. As a result, she was interested in bringing a futures perspective to their planning.

USAID creates a "country strategy plan" for each country in which it works. This plan is the basis for the allocation of funds and programs. The USAID Mission in Jamaica contracted a futurist in 1995 to produce a report on the future of Jamaica that was used as a common reference by sector consultants (agriculture, education, etc.) to revise the country strategy for Jamaica. The report called Jamaica 2015: A Discussion of Possibilities, Policies, and Strategies lead to the introduction of information technology as an "overarching theme" (along with donor coordination and community development) to the USAID/Jamaica program which focuses on economic growth, environmental management, and increased opportunities for disadvantaged youth. The information technology theme is to be considered in each of these programmatic foci. About ten percent of their five-year program budget was allocated to this new theme.
 

During the two weeks given the futurist to work in Jamaica, several methods were used:
 

1. Environmental Scanning via the use of a range of reports, government data, articles, and listening to talk radio shows to identify a preliminary set of trends and issues to prepare the futurist to conduct a Snow Ball Delphi through a series of interviews.
 

2. Snow Ball Delphi asked: a) what were the forces that shaped Jamaica over the last 20 years; b) how are they likely to change over the next twenty years, c) what policies and developments could alter these; and d) what new developments or forces are possible to shape Jamaica by 2015. The Snow Ball Delphi was conducted as a series of interviews based on the accumulation of previous responses. It began by interviewing several senior staff within USAID to involve them in the process early. This helped identify key documents to study, and which Jamaicans to interview. These initial interviews also collected their judgments about trends, potential futures, and other factors that could shape the future of Jamaica in 2015. These judgments were then used as the basis for interviews with a cross-section of Jamaicans. The snowball "effect" is from sharing the previous views with the next interviewees and using their suggestions as to the next people to interview. Interviewees were assured that no attributions would be made.

A standard Delphi with repeating questionnaires asking panelists to offer and rate positions is an objective process. But a Snowball Delphi is more subjective, because the interviewer is developing the on-going synthesis from a linear sequence of interviews. Hence, the interviewer must be knowledgeable about the subject. The Snow Ball Delphi produced a rich array of information used to write a set of scenarios.
 

  1. Three scenarios to the year 2015 were produced:
Business-as-usual: extension of current trends and dynamics Tele-Jamaica: connecting Jamaicans working overseas to the development process at home The Pits: unlucky conditions and unwise policies from current dynamics

The scenarios made clear that policy intervention was necessary, because business-as-usual resulted in an undesirable future. These scenarios packaged a large amount of information in digestible pieces that demonstrated that the most cost-effective strategy was information technology (IT) based. In addition to giving the Jamaica 2015 report to the sector consultants, USAID required that they also address how IT could affect the future of their sector in Jamaica. As a result, IT became one of the three themes to be included in each of the three elements of USAID Jamaica’s development strategy. To further develop this new area of USAID/Jamaica programming, the futurist was contracted a second time to give further detail to the TeleJamaica scenario with several vignettes - stories within a scenario to give greater detail to illustrate concepts within an overall scenario. The vignettes were used to identify and prioritize the initial set of development activities under the IT theme of their strategy.

1.3 The Shell Case

1. Focus: Organizational
2. Sponsor: Corporate
3. Application Domain: Strategic Planning
4. Techniques Employed: Scenarios
5. Impediments: First generation scenarios were rejected because they provided little basis for managers to exercise judgment; management at first was blinded to the inevitability of some changes that were made to seem more likely by their inclusion in plausible scenarios.

Key to overcoming impediments: Broadening of scenarios by including world forces external to the corporation and separating uncertainties. Demonstration of an impending crisis. Acceptance by management.

Players involved: Planning staff of the corporation and outside consultants

Desired outcomes: Creation of scenarios that informed planning.

Measures of success: Positioned Shell to handle the oil shocks better than its competitors.

Shell International Petroleum Company (Royal Dutch/Shell Group) began using scenarios prior to the 1973 oil shock. It was developed within the company by Pierre Wack and Edward Newland. This approach helped Shell anticipate the rise and subsequent fall of oil prices. In the mid-1980s, Shell began creating scenarios focusing on the future of the Soviet Union because it was a major competitor in the European gas market. Shell's success with scenarios spurred utilization of this technique in the private sector.

Their story is:

Pierre Wack recounts the process through which he came to understand the necessity for the scenarios, so grounded in the "outer space" of the world outside the corporation - a world of supply and demand, shifting prices, new technologies, competition, business cycles, and so on - to come alive in "inner space", the manager's microcosm where choices are played out and judgment exercised. Three decades ago, in the early days of their work with scenarios, Shell planners initially developed "first generation" scenarios which simply quantified alternative outcomes or obvious uncertainties (for example, the price of oil may be $20 or $40 a barrel in a given year). Managers found such scenarios to be useless for long-term planning and decisionmaking, as they provided nothing more than a set of plausible alternatives that included no reason to assume that one or another would come about, offering no basis on which managers could exercise their judgment. Such scenarios resembled the straight line forecasting that Shell and other companies had engaged in for years, and ultimately rejected as inadequate for the complexities of the contemporary world.

Back at the drawing board, the Shell planners, led by Wack, zeroed in on the notion that there are forces at work in the world that seem well-nigh inevitable, unstoppable save by a major miracle or worldwide disaster that would mean the end of life as we know it. They called such forces predetermined elements, and sought in their futures planning to identify such elements and carry them through each of the scenarios they developed, sorting themout carefully from uncertainties. The art of scenario development, they found, revolves around careful research out in the world to identify the predetermined elements, and only then to weave stories around the interaction of these predetermined elements with the myriad of uncertainties future-seers must face.

For example, in the early 1970s, a period of recession in the oil industry because of low prices resulting from an oil surplus after the development of huge fields in the Middle East, Shell planners began to look at the world from the point of view of the oilmen of the Middle East whose countries small and sparsely populated did not have the means to absorb all of the wealth flowing into them from their one valuable resource. That growing surplus of cash would have to be reinvested, but where? No bank holding, or piece of real estate could appreciate in value as fast as the oil in the ground, especially if less oil were produced in order to keep the price high. Thus the Shell team was able to predict the emergence of OPEC and the rising price of oil as predetermined elements for the 1970s, forces that would drive the global system. Repercussions of these predetermined elements would of necessity involve shock waves to the economies of countries dependent on oil imported from the Middle East.

Uncertainties involved various countries' likely attempts at solutions, such as price freezes, or simple inaction, which would result in an energy crisis. So the Shell planners presented to top management, in 1972, a set of scenarios which took these predetermined elements and uncertainties into account. These scenarios varied so sharply from the implicit worldview then prevailing at Shell - explore and drill, build refineries, order tankers, and expand markets - that the planners realized they were unlikely to be taken seriously. So they constructed another set of "challenge scenarios" that postulated a continuation of present trends and business as usual.

These challenge scenarios included "miracles" in exploration and production, such as the discovery of major new fields in non-OPEC nations, willingness on the part of oil producers to deplete their resources at the will of the consumer to keep prices low and no natural disasters or wars that would generate a need for spare production capacity. The sheer improbability of these events forced the Shell management to realize that their business - as usual mentality - was blinding them to the inevitability of the coming changes. As a result, during the 1970s Shell was better positioned to handle the oil embargo and the dramatic rise in oil prices and in the power of the OPEC cartel than many of its competitors.

In the early 1990s one of the scenarios written by the Shell planners foresaw the likelihood of a rapid arid dramatic decline in the price of oil as the result of the discoveries of new fields outside of the OPEC sphere of influence, in combination with the energy conservation measures increasingly taken by consumers who did not want after the debacle of the 1970s, to remain overly dependent on imported oil, and who were increasingly aware of the finite nature of "non-renewable" resources such as oil. Positioning itself accordingly, Shell rose from fourteenth to second place among the oil multinationals during the mid-1980s as prices fell and other companies heavily over-invested, lost billions.

1.4 The Mont Fleur Scenarios
 

1. Focus: National
2. Sponsor: Private Foundation for Government
3. Application Domain: Strategic Planning, Public Ethics
4. Techniques Employed: Scenarios, Participatory Methods
5. Impediments: Political inertia

Key to overcoming impediments: Involvement of local participants, all political parties, and the media; prevailing feeling of crisis.

Players involved: Team of scenario writers who conducted workshops with interest groups to develop the scenarios.

Desired outcomes: Peaceful resolution of South African political differences.

Measures of success: Brought together opposition political parties; stimulated a national agenda and discussion, and may have contributed to peaceful resolution of differences in South Africa.

The Mont Fleur scenarios take their name from the Mont Fleur conference center outside Cape Town where a diverse group of 22 prominent South Africans met in 1991 (three years before the end of Apartheid) with a team of scenario writers from Shell Oil Company to create four scenarios. Funded by a private foundation, the scenarios were intended to "stimulate debate on how to shape the next ten years" for South Africa. This is one of the few examples available where futures work has been done in very visible public forum, and impacts could be seen both in the short and longer term.

One of the first successes of this project was to bring together the people and ideas from the extremes as well as the center, including the South African government, the African National Congress (ANC), the Inkatta, and the far right wing extremists. The discussions were facilitated by Adam Kahane, a Shell employee at that time. The key axes to create the scenario space were political settlement and economic policy. The outputs were series of papers and a very effective video presentation of the scenarios. The results were four scenarios:

1. Ostrich, in which a negotiated settlement to the crisis in South Africa is not achieved, and the government continues to be non-representative.

2. Lame Duck, in which a settlement is achieved but the transition to a new dispensation is slow and indecisive.

3. Icarus, in which transition is rapid but the new government unwisely pursues unsustainable, populist economic policies.

4. Flight of the Flamingos, in which the government's policies are sustainable and country takes a path of inclusive growth and democracy." (www.gbn.org/scenarios/fleur/fleurintro.html)

In a very simple manner (using cartoons and bird fables) the scenarios highlighted the dangers ahead if a political settlement was not reached between the anti-apartheid movement and the Government. It also indicates the impact that bad economic policies could have on the future of South Africa. The scenarios were credited with nudging the National Party towards a negotiated settlement and convincing the ANC about the need for a sensible economic policy.

The scenarios were published in a 14 page insert in The Weekly Mail and The Guardian Weekly, major South African newspapers. Over the rest of the year, the team presented the scenarios to more than 50 influential groups throughout South Africa. A thirty-minute video presenting the scenarios was also released.

After the completion of the exercise, it was presented to all the major groups in South Africa, including the ANC and the apartheid Government of the day. The Mount Fleur scenarios exercise was an example of futures studies as a change agent and a tool for changing mind-sets. President Nelson Mandela of South Africa, then the leader of ANC requested to be shown the video more than twice as did then President De Klerk, the Cabinet, leaders of the ANC and other associations. A road show was undertaken in and outside of South Africa to present the scenarios. It was also shown to the World Bank and in several European capitals.

The success here is that the scenarios became widely discussed in South Africa at all levels, including taxi drivers and talk radio shows. The extent of the influence of the scenarios is not measurable, but seven years later we know that South Africa made a peaceful transition to representative government. It could have been much different.

1.5. Strategic Planning for the OPM Finance and Insurance Company
 

1. Focus: Organization
2. Sponsor: Philanthropic
3. Application Domain: Strategic Planning
4. Techniques Employed: Scenarios, Gaming, Participatory Methods
5. Impediments: Political inertia

Key to overcoming impediments: Involvement of executives in a series of workshops that let them take "ownership" of the scenarios; belief that old norms were disappearing and a new and uncertain regime was emerging.

Players involved: The consultant company as well as executives from throughout the company.

Desired outcomes: A cohesive basis for planning in a rapidly changing world.

Measures of success: The scenarios have been distributed company-wide as a learning exercise for company personnel to nurture strategic thinking; in addition, scenarios were used by senior management to develop core strategies for the corporation.
 

Figure 3 (to be inserted)
 

OPM (this real company has been given a fictitious name) was experiencing a rapid and fundamental shift in two aspects of its business environment Significant deregulation had taken place and the telecommunications and information processing technologies upon which it depended were changing at an unprecedented rate. New competitors with new products presented OPM with fundamentally new opportunities and risks by attracting the first-time attention of a whole new range of customers in a market rapidly becoming global. OPM's managers needed a fresh look at their medium (3-5 year) and long-term (10-15 year) goals and strategies. A perceived fundamental shift in the business environment, therefore, was the key motivation for taking up scenario-based planning. That understanding affected portions of the project as it proceeded - particularly the people involved, the topics addressed in the scenarios, and the kinds of workshops that were run. The fundamental need to more effectively manage the uncertainties in the future business environment remained the principal goal of the process.

In many ways this was a classic scenario planning assignment. The culmination of intensive interviews and a rigorous workshop process defined five plausible but very distinct future business environments (scenarios) focused on the planning needs of OPM. Those scenarios were developed in refined detail, each sufficient to suggest its own unique set of opportunities and challenges relevant to OPM business needs. Each scenario narrative was about ten pages and included a future history of social, economic and political events that quite plausibly led the reader from 1990 to 2005. Each narrative provided rich detail about business and society in 2005 and contained a significant number of scenario-contingent forecasts of employment, labor productivity, interest rates, federal deficit, and other indicators that corresponded to the assumptions and key forces for change in that scenario.

In several workshop settings the senior management team of OPM was introduced in detail to the scenarios (some were already quite familiar with them, having worked in the development process). The workshops were designed to let executives experience each scenario as if it were real and help them to plan and operate the company in that particular future.

Once the executive team learned to "live" in a scenario and temporarily make it their "real world", the next step was to use it to "stress-test" current corporate strategies. How effective is today's strategy set in "their" world of 2005? That provided the foundation from which the team crafted new goals and strategies to respond to the characteristics of their scenario. This process was repeated, though not always with the same people, in each of the scenario worlds. At the end of that process, OPM had five sets of scenario-contingent goals and strategies fine-tuned to ensure OPM competitive advantage in the five alternate scenario environments.

The next step in the process was a synthesis of lessons learned from each of the scenario excursions. This was in effect, a search for the elements of the goals and strategies that were robust enough to be viable across the range of scenarios examined. The usual goal is to consider whether there is a core set of strategies that will work no matter how the future evolves. In this case something extra emerged. The planning "trips" taken by the management team into a number of very different future environments lead several executives to question the very definition and purpose of their firm. To survive they had to consider exactly what business they should be in and what role they wanted for themselves.

Based on this work, the senior management team developed a set of core strategies and they have continued to use scenario back-drops to test and amend those strategies. Primarily those strategies resulted from scenario-derived insights into how their customers' needs and expectations would be changing. A new segmentation scheme has been adopted, and an entirely new set of services and marketing approaches has been initiated.

A program has also been instituted to acquaint people at all levels of the corporation with the scenarios. Corporate staff are introduced into each of the various futures worlds but less as a planning exercise and more as a learning exercise. The program is encouraging and nurturing strategic thinking throughout OPM. Among other results, it has improved employee morale and led to some locally initiated new business ventures.

1.6 An Example of the Use of Futures Techniques for the Stimulation of Innovation

1. Focus: Organization
2. Sponsor: Corporate
3. Application Domain: Stimulation of Innovation
4. Techniques Employed: Morphological analysis, Delphi, Participatory Methods
5. Impediments: Internal disagreements and lack of communications between two divisions

Key to overcoming impediments: Involvement of executives in workshops; use of techniques that separated hard information and judgments from the originators of the information and judgment.

Players involved: The consultant company as well as executives from appropriate divisions.

Desired outcomes: A set of new products based on proprietary technology already owned by the company.

Measures of success: New products based on existing proprietary technology were identified and pursued by the appropriate divisions.

Figure 4
 

The Innovation Case (to be inserted)
 

The marketing department of a consumer products company was frustrated by its company’s lack of new products. There had been some great market successes in the past but recently, it seemed, the flow had stagnated. Yet the research department of this company was well endowed and they were turning out patents at a fair clip. Somehow, the patents did not manifest themselves into new products. How, they asked, can we get the ball rolling again?

A Delphi questionnaire was prepared and sent to people in research, in marketing, and in their advertising agency asking on the one hand for descriptions of proprietary inventions on which new products might be built, and on the other, the products that seemed to be most needed on the basis of recent market research. In the analysis of these data, the top new product candidates were listing, and in the fashion of the Zwickey morphology, dissected into subsystems and subsystem elements. For example, a new soap might have subsystems of odor, texture, surfactants, etc. Each of these in turn were broken down into all possible means of accomplishment. The number of possible permutations was very high.

However, each of the subsystem elements was "scored" according to the possibility of being proprietary (from the Delphi) and meeting forecasted changing market conditions and changing consumer needs. These scores were used in a computer program to rank order the permutations by level of overall attractiveness.

A workshop was held which all contributors to the Delphi attended. The top rated hypothetical products were discussed in detail and "invented" by the group. They found that patents already on the shelf had excellent potential applications and further development programs were designed and implemented. Communications between the market and research personnel improved.

1.7 Entry Strategy Based on Analysis of Competitive Possibilities

1. Focus: Organization
2. Sponsor: Corporate
3. Application Domain: Strategic Planning, Competitive Analysis
4. Techniques Employed: Environmental scanning, numerical modeling
5. Impediments: Uncertainty that someone from outside the industry could understand the nuances of competition and could generate sufficient information from available sources

Key to overcoming impediments: Involvement of executives who will use the data; demonstration that useful information could be obtained.

Players involved: The consultant company as well as executives from appropriate divisions.

Desired outcomes: Insight into potential market niches unfilled by competitors.

Measures of success: Development of a new product that filled a market niche moves.

Competitive analysis by a company within an industry is an attempt to use futures research techniques to forecast how a competitor might act or react to changing circumstances. Thus this activity involves gathering information about the competitor’s products and markets from publicly available sources, and inferring a decision process that might also be in place when the competitor is confronted with changing circumstances in the future. Although large corporations dedicate significant resources to competitive intelligence, business intelligence is a crucial asset for new firms poised to enter developing markets. Through competitor analysis of established firms, new companies gain knowledge that leads to market-share and success.

As an example, a start-up company, the New York Bulb Company, employed competitive analysis. As a small manufacturer and distributor of light bulbs to businesses and residences across the New York Metro area, New York Bulb discovered that General Electric's and others' standard light bulbs had a shorter life-span just in the greater New York area. Company research and testing showed that New York City's power supply was to blame for the shortened life spans of these traditional light bulbs. The city's electrical infrastructure is the nation's oldest: voltage fluctuations are common. These power surges cause damage to traditional light bulbs designed to operate at a consistent voltage. The end result: standard incandescent light bulbs only last 750 hours in the city that never sleeps.

In order to solve the problem and fill this niche, The New York Bulb Co. developed a multi-support filament that compensates for New York City's voltage fluctuations. This new design modification to a century-old product resulted from analysis of customer needs and already-existing market information. The newly designed New York Bulb has a 3500-hour life span-four times the life of an ordinary incandescent light bulb. Lower cost-per-hour, as well as less frequent installations of these long-life bulbs helped The New York Bulb Co. capture the city's market for light bulbs. According to a New York Bulb Co., General Electric has lost more supermarket shelf space recently in New York City than it has in the past fifty years combined.

New York Bulb demonstrated that industry knowledge paired with competitor analysis helps niche product development, filling a market need.

1.8 The Slidell Priorities Convention

1. Focus: Local
2. Sponsor: Government
3. Application Domain: Strategic Planning
4. Techniques Employed: Visioning, Participatory Methods, and Strategic Planning
5. Impediments: Institutional Inertia

Key to overcoming impediments: Involvement of local citizens; the mayor was the champion.

Players involved: Stakeholders.

Desired outcomes: A strategic plan for Slidell, LA.

Measures of success: Vision is being pursued, witness the issuance of bonds for key projects and construction of transportation and convention facilities. Also a new feeling of community.

In early 1985 Salvatore Caruso was elected mayor of Slidell, Louisiana. In November of that year he convened a meeting of 524 citizens (stakeholders) representing every segment of the community for the purpose of establishing priorities for strategic planning of the city's future, and creating a vision for that future. After filling out a long questionnaire dealing with city priorities, they were divided into thirty groups where they discussed revenue sources for the city as well as commercial/industrial development. Following the convention study groups were formed among the city employees and among the general citizenry.

Among the quantifiable benefits resulting from this strategic planning/visioning exercise have been a $31 million bond issue used for drainage, flood control, water and infrastructure. A park-and-ride facility was constructed for the benefit of commuters working in New Orleans, a result of recognizing Slidell's position as a bedroom community in the need of better transportation solutions. A new water tower has been constructed on the south side of Slidell which improves both water pressure and circulation in that area. A new convention center is in the works now. A sizable non-quantitative benefit has been the development of an attitude of community among the citizens.

It is interesting to note that this strategic planning and visioning project originated with the mayor (a member of the World Future Society) and was carried out under his direction. There was some assistance from the University of Louisiana particularly with the analysis and tabulation of the survey results.

1.9 San Angelo Regional/Urban Design Assistance Team (R/UDAT) Project
 

1. Focus: Local
2. Sponsor: Professional Association
3. Application Domain: Strategic Planning
4. Techniques Employed: Visioning, Participatory Methods
5. Impediments: Institutional Inertia

Key to overcoming impediments: Involvement of local citizens; concern about current directions of change.

Players involved: Stakeholders; academics; architects who convened the sessions (but stood to benefit from the results).

Desired outcomes: A strategic plan for San Angelo.

Measures of success: Vision is being pursued, witness construction of new facilities, changes in real estate values, new feeling of community.

The Regional/Urban Design Assistance Team (R/UDAT) is a program of the American Institute of Architects. In 1992 a R/UDAT team met with a group of San Angelo citizens who were concerned about their deteriorating city. Several meetings involving hundreds of citizens followed, bringing out the concerns of the citizens about their heritage (Fort Concho), their ethnicity (equal parts Hispanic, Afro American and Caucasian) and the future of their community.

The meetings led to a vision and then to a workable comprehensive plan. City Hall came aboard reluctantly then became a strong part of the team, raising $2.7 million which was then leveraged to $10 million plus private investments. With those funds the city completed the key elements of their plan: celebration Bridge, a pedestrian Bridge which links parts of the city separated by a river, bringing the community closer together; a park near Celebration Bridge, an area that had previously been vacant land; a visitor's center at Fort Concho; renovation of the old Santa Fe railroad depot; restoration of the formerly vacant Cactus Hotel; an assortment of restorations and civic improvements.

As a result of this community effort property values have increased thirty percent in three years, and vacancy rates are very low, plans are in the works for a community center, a fine arts museum and permanent farmers market. The American Institute of Architects considers the San Angelo project to be the most successful R/UDAT (Regional/Urban Design Assistance Team) project ever. As to the question, "Is this a successful futures project?", we would have to qualify our answer. Yes it was successful. Yes it included visioning and strategic planning, but the "futuring" was guided, at least in part, by the architects who hoped to win the contracts for the physical facilities that resulted. At first glance, that may appear to taint the results, but in fact it is little different then strategic planning in a corporation with the effort guided by management who plans to profit by increasing productivity. Information about R/UDAT may be found at http://www.aiaonline.com

1.10 National Foresight Programs

1. Focus: National
2. Sponsor: Government
3. Application Domain: Strategic Planning
4. Techniques Employed: Environmental Scanning, Delphi, Scenarios
5. Impediments: For large scale projects, funding can be an issue; credibility of results; and - for some countries at least - aversion to planning at a national level.

Key to overcoming impediments: Involvement of key persons, support of government.

Players involved: Government agencies and large expert samples.

Desired outcomes: Background information for R&D and industry; in some countries, agendas for government sponsored research.

Measures of success: The number of countries that have instituted such exercises and incorporated the results into national plans.
 

Government foresight programs are, in general, systematic efforts to identify promising technology and science directions that may have importance to national policy. Many governments undertook, then dropped such projects, but now interest is again high and foresight programs now exist in Japan, Central Europe, Holland, Australia, UK, France, Spain, Italy, Korea, Finland, and elsewhere. Governments that have begun more focused studies include China, Singapore, Costa Rica, and Russia. Furthermore similar programs have been initiated by international organizations, including United Nations Educational, Scientific, and Cultural Organization (UNESCO), the Forward-Studies Unit of the European Commission, Organization for Economic Cooperation and Development (OECD), the Africa Futures project of United Nations Development Program (UNDP), and others. The principal tools of these studies are Environmental Scanning, Delphi and scenarios.

Perhaps the earliest example of this genre is the very large scale Delphi study undertaken by the Japanese in the early 1970s in which they asked a panel composed largely of scientists and engineers to provide judgments about the timing of technological advances and inventions. The time table produced by this study guided technology policy in that country, at both the governmental and industrial levels, and the study has been repeated continuously at five year intervals ever since.

Terutaka Kuwahara recently described the scope, design and impact of these studies. He summarized the studies as follows:
 


Technology Forecast Surveys

Survey period Fields Topics Forecasted period Effective responses

First survey 1970-71 5 644 30 years to 2000 2,482

Second survey 1976 7 656 30 years to 2005 1.316

Third survey 1981-82 13 800 30 years to 2010 1,727

Fourth survey 1986 17 1,071 30 years to 2015 2,007

Fifth survey 1991 16 1,149 30 years to 2020 2,385

Sixth survey 1996 14 1,072 30 years to 2025 3,586

Most Delphi studies assume that relatively small sample sizes will produce useful answers; the studies are not taken to produce statistically valid data but rather are assumed to yield judgments of a particular expert group. The Japanese studies, on the other hand, involved thousands of respondents. The studies covered essentially all science and technology fields, including materials and processing, electronics, information, life science, space marine science and earth science, resources and energy, environment, agriculture, forestry, and fisheries, production and machinery, urbanization and construction, communication, transportation, health, medical care, and welfare.

Kuwahara describes the process, which is under the direction of the Science and Technology Agency (STA):

Prior to a survey, a technological forecast Steering Committee is formed, with 13 subcommittees set up around it. The leader of each subcommittee is a member of the Steering Committee.... Leaders of technological fields and subcommittees are appointed by the National Institute of Science and Technology Policy, which implements the surveys, after consultation with expert groups and the appropriate ministries/agencies.... More than 100 senior researchers are involved in the design of the survey and in the analysis of the results. They have responsible and effective positions in their institutes, universities, and enterprises. Furthermore, approximately 3,000 researchers participate in the survey as respondents.

The surveys have been financed by a research fund controlled by the Council for Science and Technology for use in policy planning, with the survey results submitted to the council as a report.

He reports that the work indeed facilitated decisionmaking in Japan: As it is such a large-scale survey conducted on a regular basis, its findings are widely used by the Council for Science and Technology and various ministries and agencies as basic data for the formulation of national science and technology policy, as well as for the industrial sector.

Let us add two selected policy cases... The foresight activities on early earthquake detection were always corrected toward the further future in subsequent STA forecasts.... Yet even before the Kobe disaster, which was completely unforeseen, foresighting activities kept this issue on the agenda in technology policy, admittedly on a low level.... In 1993, before the Kobe earthquake, a special measures law for earthquake disaster prevention passed the Diet. The research and development budget was at about 16 billion yen in 1996. Foresight studies and the constant shifting of realization times were helpful in pointing to the unresolved issues in years of no earthquakes.

The second example is solar cells, which have been a top Japanese priority for many years. The forecasts were initially delayed, but since the mid-eighties, they have been stable. Clear impacts of STA foresighting on MITI's priority programs are visible. Some firms overdid their research and development investment because they were as optimistic as the early forecasters but MITI backed this overinvestment and thus accelerated the real progress - a case of self-fulfilling prophecy? Also based on the forecasts, diverse regulation opportunities helped get mass production started. Judging from these observations, Delphi results in Japan not only are considered learning techniques-that is, sources of valuable general insight for policy makers and managers - but also in some important cases have triggered action plans, even in cases in which the time estimation was not very accurate.

The designs and results of several foresight studies conducted by government agencies in other countries are reported below:

In the Netherlands two government organizations have been involved in formalized future studies: the Ministry of Economic Affairs which performed a Delphi-like study of leading edge technologies, and the Ministry of Education and Science. Within the Ministry of Education and Science was established a Foresight Steering Committee. Here the foresight process is constructed to assure that priorities in S&T make contributions to society and that priorities take account of the characteristics of the field in the Netherlands. The method used is primarily scenarios. More quantitative methods of the past have given way to qualitative approaches. Studies are sectoral and detailed (e.g. nanotechnology). The goal of much of this work is not prediction (as in the case of the Japanese work) but is designed to stimulate discussion and to "influence national and other strategies."

In Germany, foresight work generally has the objectives of: "direction setting, determining priorities, anticipatory intelligence, consensus generation, advocacy, and communication and education." The principal agency responsible for coordination at the national level... contracts for the performance of the work. Several different methods have been used. One study, "Technology at the Beginning of the 21st Century", used relevance tree techniques to identify critical technologies (see Case Study 2.6: An Example of the Use of Futures Techniques for the Stimulation of Innovation which employed a morphological approach); another major study was built on the Japanese experience and used their data as the basis for a large scale Delphi to forecast developments that could contribute to the formation of S&T policy. A second such Delphi exercise is now underway. The studies are viewed as providing information for political choices.

Austria’s work is coordinated by the Ministry of Science, Traffic and Arts. The method employed is Delphi. The general objective of foresight work is to promote innovation.

In Hungary, foresight studies have been discussed but not yet implemented; when the studies are performed they will focus on strength and weaknesses in Hungarian science and technology and utilize a Delphi inquiry modeled after the UK foresight work.

A large-scale foresight program is also underway in Britain. The objectives of this program were stated as follows:
 

(a) to increase UK competitiveness, (b) to create partnerships between industry, the science base and government, (e) to identify exploitable technologies over the next 10-20 years; and (d) to focus the attention of researchers on market opportunities and hence to make better use of the science base.

The program has been organized by the Office of Science and Technology (OST) in cooperation with other government departments, and has involved extensive use of consultants. It has been overseen by a Steering Group made up of leading figures from industry, universities, and government. In addition, 15 panels (again consisting of experts from industry, academia, and government) have directed the foresight efforts in different sectors.

The program has had three main phases. In the first "pre-foresight" stage, a number of "Focus on Foresight" seminars were held to explain to the industrial and scientific communities what foresight is and why it is important, and to seek their views on how best to carry it out. A "co-nomination" exercise was also conducted in which experts were asked to identify other experts in their area. The resulting database was used in helping to determine the membership of the sector panels, and in constructing a pool of experts on whom each panel could draw for information and advice.

The second stage was the main foresight phase. In this, panels began by holding discussions to set the scene in their sector and to identify strengths and weaknesses. They also consulted with their pool of experts, as well as engaging in wider consultation through regional and topical workshops. In addition, a major Delphi survey was carried out with questionnaires being sent to some 7000 experts. All these information sources were drawn upon by panels in identifying technological priorities for their sector. Each panel produced a preliminary report which was circulated for comment and then revised.... They began by analyzing the sector in terms of its scope, characteristics, contribution to GDP and so on, before benchmarking UK strengths and weaknesses. They identified the main trends, driving forces, barriers and challenges, and analyzed a range of scenarios. Next, they examined a range of technological opportunities for making contributions to wealth creation or improved quality of life. Each report then narrowed these down to a list of priorities together with a set of key recommendations for their implementation and for future technology foresight in the sector."

In New Zealand, an increase in budget for S&T triggered a discussion of priorities for directing the expenditures. The foresight study involved a series of expert panels, each identifying strengths and weakness and opportunities and threats within their areas of expertise; each of the panels produced a report. In addition a quantitative economic analysis was performed to evaluate the public return of research funds. Other studies are planned.

Australia’s program was extensive.

"The major foresight exercise in Australia was carried outbetween 1994 and 1996.... The study was to be a demonstration exercise designed to increase the orientation of Australians toward managing the future and to show that there are robust mechanisms available to help achieve that goal. It set out to examine possible national and global changes over the next 15 years and to identify Australia's key future needs and opportunities which rely on, and could be affected by, scientific developments and the application of technology. The aim was to provide an information base that would enable government and industry to make better informed and longer-term decisions on the development and application of science and technology (S&T).

The methodology was based on the assumption that building rich pictures of alternative futures, combining trends (expected futures), scenarios (possible futures), and visions (preferred futures) should provide a basis for assessing the ability of the current S&T system to meet future national needs in a variety of external circumstances. From this assessment, critical "levers" for change were identified... six Key Issues... were established; innovation and entrepreneurship, a technologically literate society, capturing opportunities from globalization, sustaining the natural environment, continuous improvements in community well-being, and building a forward-looking S&T system. Trend analysis and scenario construction were combined in a roundtable involving about 50 "stakeholders," broadly chosen, for each issue. In addition, in-depth foresight studies were conducted through live partnerships, involving more than 20 major Australian organizations, on urban water life-cycles, broad-band communication technology, neurodegenerative diseases in the aged, shipping, and youth. Each partnership selected and applied their own foresight methodology, under guidance... and produced a set of recommended actions.

The project has demonstrated that foresight is a useful tool in helping to agree and move toward national goals for the future.... As in other foresight programs, the [study] has also shown that foresight can help to build consensus, assist communication between different groups, and act as a focus to developing a longer-term commitment and visions of the future... Nevertheless, although the value of the ASTEC foresight process has been widely acknowledged, the direct outcomes have, to date been somewhat limited. The priorities for action... have largely been implemented or examined in a low key manner... An explicit commitment to continued foresight has not yet been forthcoming, although there has been undoubtedly a marked rise in the use of foresight processes, and in particular scenario planning."

Several foresight studies have been conducted in France at the national and regional levels. One major study replicated the large scale Japanese and German Delphi’s. It found: "that the French culture of prospective tends to favor methods of scenarios rather than Delphi: instead of looking for consensus about big trends, specialists of foresight tend to think in terms of contrasting but internally coherent scenarios.... (In addition) many experts stressed the missing normative dimension. For certain technological innovations, instead of answering on the probability of occurrence they would have preferred to give their opinion on the desirability." One of the other studies resulted in an assessment of technologies "critical" for France, and that work was instrumental in the allocation of industrial research subsidies.

* * *

Given these case studies, what conclusions can be drawn? Certainly there are not enough cases here to form any conclusions that have statistical validity, but at least a few inferences appear. (In the following analysis, the national foresight programs are treated as a single entry.) Examples within the ten cases represent a broad range of levels: corporate, local, state, and national; and a broad range of sponsors: corporate, government agencies, private foundations, and professional associations. Most of the cases were examples of futures research applied to strategic planning, but product innovation and competitive intelligence appeared as well.

Taken together, the techniques were:

Technique Applications
Participatory methods 6
Scenarios 5
Visioning 3
Environmental scanning 4
Delphi (and Snowball) 3
Morphological Analysis 1
Numerical Modeling 1
Vignettes 1
Gaming 1
Strategical Planning 1
Of course other choices would have yielded other distributions of methods, but this distribution may not fall far from the mark: participatory methods are important to eliciting support for such studies (as indicated below) and scenarios are popular as a means of exploring alternate strategies. Morphologic analysis is not well known and while numerical modeling is very important, it is used for special purposes that are not reflected in the choice of cases.

It is very instructive to examine the impediments stated for the cases. We see echoes of the impediments identified by the Global Lookout Panel and the interviews in these cases (see Chapters 3 and 4). Institutional, financial, planning inadequacy, and political factors are all represented.

Among the strategies for overcoming impediments, there was consistency across studies of vastly different sorts. Fully half of the cases stated that involvement of the decisionmakers or participants was a key element in the initiation and success of the projects. In addition, factors aiding in implementation were the existence of apparent crises and a priori acceptance of the process by persons who would be involved in the implementation.

The desired outcomes ranged from the selection of new commercial products to the peaceful change of governments; from influencing public awareness to determining government policy. And measures of success included visible action resulting from the studies, the success of products in the market, and the cohesive views of the future that such studies engender in organizations.



Applications of Futures Research
Futures Books and Reports
Millennium Project Home Page