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1 The Challenges of Robust Foresight: Why Look Across Adjacent Sectors?

The silence was deafening. The chief scientist of the world’s largest agri-tech company had just casually revealed that his company had developed a variety of corn that could sweat oil. For a while, nobody spoke. Seizing the moment, he went on to elaborate that they were planting it in such a way that meant the oil would be pumped out of the fields directly into storage and processing facilities. There was more silence.

Silence was not something that this group of people was accustomed to. As some of the most forward-thinking minds in Shell,Footnote 1 just a few minutes earlier, they were quite confident that they knew enough about biofuel developments to be able to sleep well at night. From the look on their faces, now sleep might not be so forthcoming that night.

It was 2004, and in addition to agriculture scientists, the small group of 40 people in the room included experts in online finance, robotics, aerospace, architecture, fast-moving consumer goods, and a plethora of other areas. With the exception of the hosts from Shell, none of them knew much about fossil fuels, and that was the reason they were there.

The Shell Technology Futures program had brought them together for 3 days to get a glimpse of how the next 20 years looked through their eyes. This group was assembled in Texas in the USA, but other groups had also convened in the EU with the same intention. The premise of the program was straightforward: to explore unfamiliar territory to uncover both risks and opportunities for the company.

Most foresight programs undertaken by organizations usually stay in familiar territory to develop their own particular view of the future. In doing so, they run the risk of being blindsided by developments outside their core business. They also miss the opportunity to proactively investigate potential high margin opportunities.

Furthermore, many strategy teams inside large organizations fail to fully comprehend that the most disruptive changes do not originate from the core of their sector, but from the edges when disciplines spark off each other.

Perhaps the most well-known example of this is how Apple has come to dominate the music industry. In 2000, prior to the introduction of the iPod, it is safe to say that music industry executives would have paid little notice to the potential impact that a computer manufacturer could have on their business. In doing so, they failed to see how digitalization of a business model leaves it open to disruption from the fringes of their industry.

At Shell, Technology Futures was an initiative that specifically addressed these issues by seeking insights from specialists outside the core business. The mix of experts assembled was chosen because their backgrounds overlapped at a sweet spot: the intersection between new technologies, societal trends, and consumer behaviors.

Each specialist was selected through an intensive research process that first identified a technology that had the potential to either disrupt the core business or provide an opportunity. This selection required the involvement of technology watchers, commentators, and analysts to supply the depth of knowledge necessary to narrow the extensive list down to a handful of sectors and industries.

Following this process, a shortlist was drawn up of the most promising thought leaders in each of the target fields. The criterion for selection was not only limited solely to one profession within that field, but also included academics, entrepreneurs, specialist journalists, and commentators. Structured interviews were undertaken with each candidate before the final list was drawn up. Those that made the cut were then invited to spend 3 days in immersive debate and discussion at various locations around the world.

The final mix of attendees included experts from the area of architecture, information technology, technology ethnography, urban planning, synthetic biology, space robotics, and superconductivity. Organizations represented were equally diverse—ranging from Victoria University in New Zealand to Nokia in Tokyo. This diversity was critical in order to introduce insights from adjacent sectors that were outside of the normal areas that Shell would scan.

The focus for each of the sessions was to look 20 years out to identify drivers and impacts not only in their respective specialties, but also to identify cross-over points between fields that might create entirely new opportunities. Careful and expert facilitation was then required to separate probabilities from possibilities.

Each session was operated under Chatham House rules: “When a meeting, or part thereof, is held under the Chatham House Rule, participants are free to use the information received, but neither the identity nor the affiliation of the speaker(s), nor that of any other participant, may be revealed.” This set the environment for attendees to have a much more open discussion than they would normally consider and share insights that would normally remain behind closed doors. There were no competing organizations present, and one of the foundations of the sessions was that attendees would take away from the sessions as much as they contributed.

The most critical aspect of any program like this is the return on the investment, and this hinges on how the output is framed. By identifying potential opportunities and positioning them on a timeline, Technology Futures made it possible to make well-informed bets on areas that warranted further investigation. In addition, the program also identified likely technology pathways and technology-enabled impacts and did so in a format suitable for linking into existing scouting, scenario, and business strategy processes.

2 Linking the Long and Short Term: How Technology Futures Was Used In-House?

Building physical and conceptual towers to look further out into the horizon has been a well-established approach in Shell since the late 1960s. Scenario planning—preparing for possible future contexts—has been a preferred route to consider how uncertainties might impact the current context. The Black SwanFootnote 2 (Taleb 2010) cannot be predicted: we do not know what we do not know. However, what-if? questions can be formulated within a certain context/scenario so that one is prepared if the Black Swan hits the windshield.

Scenario planning produces a small set of possible contexts that a firm may be in, contexts that are unfolding beyond the control of that firm. The methodology is especially valuable for activities that have long-lead times for technological innovation, and capital expenditures that are financed over decades, such as those in the oil industry.

However, a shift happened in the last decade.

In an increasingly turbulent world, “old-fashioned” long-term planning based on forecasts becomes impossible. Uncertainty rules and the turbulence of our business environment reaches a new climax year after year. The end of strategic planning is in sight.

The main culprit and accelerator here is technology development. Who would have thought that networking tools, developed to amuse teenagers, such as Twitter and Facebook, would be able to overthrow governments?

It has been said before: the Stone Age did not end due to a lack of stones. One technology break-through in battery technology or superconductivity might completely change the energy world and, with it, the massive oil and gas companies that now fuel the world economy.

So if strategic planning process no longer works, then what?

Global companies, to survive now, need another skill apart from being prepared for major unexpected events with their scenarios: they need the right, leading-edge technologies to become available the moment they are required. As new technology takes several decades to develop, this means that technology and long-term scenarios have to relate in unprecedented ways.

Scenario planners and strategists deal with the strategic options that possible future contexts may close down or open up. On another spectrum, technologists and scientists are monitoring how whole families of technology options (such as GMOs, nano-technologies, super-conductivity, bio-engineering, etc.) may convert current impossibilities into future possibilities.

To this end, when the Technology Futures program was started as part of Shell’s strategic innovation effort in 2003, the underlying philosophy was based on known information. Shell Research was already tasked with understanding what Shell did not know and an in-house innovation program called GameChanger addressed information that the company did not know that it knew, as presented in Table 11.1. What remained was the knowledge completely outside Shell’s core business, outside its scientists’ research portfolios and outside of its unmined internal knowledge.

Table 11.1 The Shell GameChanger team was tasked with discovering the unknown unknowns. Other domains of knowledge were already allocated to various groups within the company
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Essentially, what was left was the knowledge that Shell did not know that it did not know.

To address this, a team of scouts was established to scan the world of technology outside the company: talk to unknown people in the unknown Silicon Valleys of this world, find the unknown technology threats, and identify unheard of opportunities.

The Technology Futures workshops were organized in support of this search. In each workshop, the assembled thought leaders asked which technology breakthrough they saw coming in their industry in the next 20 years. This generated technology pathways for different technology areas, such as medicine, IT, communication, agriculture, and more. Sometimes, two pathways would cross, indicating a possible disruption. These crossovers were discussed and further documented. The end result was a technology map for the next 20 years.

So how were these pathways used in the scenario process?

Within the contextual possibilities scenarios offer, various possible futures of a company can be identified. With two or three purpose-built scenarios, it is possible to develop a handful of possible future portfolios for a company. These pathways then need to be built to obtain strategically dominant positions within each of these futures; that is, one needs to find out what one will need to have in place (both technology and business-wise) to start moving the firm in the new direction of the aspired portfolio via one or more paths. The pathways connect (aspired) Company Future to (actual) Company Now.

New and unknown technologies and new business models based on new technologies shape each of these pathways. It is in these very pathways where technologists and strategists must coproduce new plausibilities in a ground neither of them owns alone, and this was the essence of the Technology Futures program.

3 An Example of a Power Company

To illustrate how this works, consider an artificial example of a cheap, coal-burning power company. Let us assume that two scenarios have been developed:

  1. (a)

    An “open doors” scenario where the world would have further globalized, free markets rule, and global warming is seen as a global issue that can be solved together.

  2. (b)

    A “closed doors” scenario where the world would have become much more confined, regional power structures have formed, and no global agreements can be reached on anything.

The current pathway, as a trend projection, would keep the company in the future producing cheap energy by the continued burning of (hydro)-carbons, as it is doing now. However, if the company considered the first scenario as unfolding, in which not becoming green becomes prohibitive, a first possible company future would entail becoming a green energy company that burns carbon cleanly.

If it instead considered that the world might unfold as per the second, closed-door scenario, a good option for it would be to enter new energy systems early. That option, through first mover advantages in its protected regions, would allow it to dominate market segments there. These two futures are relatively small deviations from the current strategy of being a cheap (hydro-)carbon-burning power producer.

Two more extreme future possibilities are at the edges of what is considered plausible today.

In the “open doors” scenario, it is possible to imagine a radically different business with the company becoming a virtual power player with no self-owned assets like power plants. In developing such a future for itself, the company might become a global trader in electrons, green certificates, and carbon credits; making money on a unique ability to optimize global energy flows and store electrons when they are cheap and sell when expensive.

In the “closed door” scenario, the firm may instead determine to pursue another radical pathway, where it would abandon large-scale power generation and focus on distributed energy; with small combined heat and power units for individuals, or industrial parks or city scale operations where it can again profit form first mover advantages.

The five possible future configurations for the company, all illustrated in Fig. 11.1, are plausible and realistic, but each has a distinct, unique development path. For example, in pursuing its path toward becoming a green (hydro-) carbon-based power company, it would need to invest in and master gas turbines, clean coal, and CO2 capture and storage activities.

Fig. 11.1
figure 1_11

Five possible future configurations for a power company

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If instead the company wanted to transform itself into a new energy systems player, it would have to master marine, solar, wind, hydro, and osmotic power, as well as electron storage technologies and business models. Insights obtained by developing the Technology Futures would fill the pathways with technologies previously unknown to the power company developed for a completely different industry.

During this exercise, technologists must leave the comfort of their own specific deep (“vertical”) expertise and relate it to similar expertise in other fields based on other projects in their domain. This is not as wide as considering the whole corporate set of options, but wider than their everyday thinking. In the same way, strategists must obtain deeper understanding of what different technologies offer (and cannot deliver) so that they can compare apples and oranges together and make sense of how to make alternative pathways to the future develop best. The “so what” significance of these activities relate the pathways they articulate to the fit of the strategy and with the overall contextual future scenario that is under consideration.

4 Shell’s GameChanger Methodology

Linking long-term global scenarios to technology futures thus connect two forms of innovation—the top-down perspective and the bottom-up one that Hamel’s idea of “bringing Silicon Valley inside” large companies famously espoused in the 1990s (Hamel 1999).Footnote 3 It connects both possibilities in an ecosystem in which both can live, flourish, and help each other.

The content of the new and specific projects on the pathways can come from a variety of sources; scientists, developers, customers, partners, or users.

Any company, however, would benefit from a structured innovation-generating and assessment methodology. The methodology used within Shell is called GameChanger, which funnels ideas from internal and external sources and pushes these ideas through a series of assessment teams. The first group is the GameChanger team, plus a number of peers, followed by a senior panel, and ending with the executive committee, until only the technically and financially feasible ideas are left on the table.

After emerging from the GameChanger funnel, approved ideas are converted into action projects. These projects can range from in-house research and development to joint ventures with outside companies. In-house R&D results in new technology for the company. External partnerships and spinouts create new businesses in which the domain can be explored and the appropriate skills-sets can be acquired. Projects that do not fit or spawn a domain are quickly abandoned.

In summary, linking long-term scenarios to technology futures offers a rigorous approach for connecting long-term aspirations and short-term projects, strengthening the otherwise weak and mixed middle.

5 Beyond Technology Futures: Future Agenda

Arguably, the thought leaders in foresight are Shell and IBM, and with the Technology Futures approach echoed in the IBM GIOFootnote 4 initiative, clearly the method of such programs has considerable merit.

However, just as both programs evolved from a need to stay abreast of fast-moving technologies, how would such a program itself evolve?

This was the question that triggered the birth of Future Agenda—the world’s largest foresight initiative (see Fig. 11.2 below for a view of the online resource). The essence of the initiative boiled down to a thought experiment focusing on one of the insights from Technology Futures: What would happen if you took one of the dominant changes in computing—open source software—and applied the philosophy to the field of foresight?

Fig. 11.2
figure 2_11

Screenshot of the Future Agenda Web site

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This drove the development of Future Agenda.

Sponsored by Vodafone Group, the discussion began by identifying 16 issues that were viewed as the most important for the next decade, such as water, connectivity, choice, and migration. A number of experts from academia and industry were then invited to offer an initial view on these issues.

These expert-led perspectives were then distributed online and used in the next stage of the program to stimulate debate and discussion in workshops around the world. In total, Future Agenda held 50 workshops in 25 locations around the world gathering insights from 2000 people. The audiences included sector experts, entrepreneurs, government ministers, scientists, CEOs, and innovators from many countries, including Australia, New Zealand, China, India, Germany, Spain, the UK, and the USA.

In contrast to closed corporate foresight programs, all the discussion from the workshops was posted online as the program developed. In this manner, people who had not been able to attend the events could give feedback and comment on the material in the same way as those who had attended. Online posting of the material also allowed participating organizations to immediately feedback some of the material into their own strategic processes.

From the start, the original intention for running the Future Agenda program was not just to create a broader, deeper, and richer view of the future. It was also to provide this view openly for all to use. To further this, a key part of the design of the program was the wide dissemination of the output. As such, the output was provided in a number of forms, including a book, presentations, downloadable documents, and a Web site with linkages and data (http://www.futureagenda.org). On top of that, a card-based version of the insights was designed for use in workshops, and in some cases, iPhone and iPad apps were created and shared.

6 In Practice: Using the Insights from Future Agenda

As sponsor of the program, Vodafone Group has clearly used the insights for a wide range of activities, but other companies and organizations have also been making use of the insights for a wide range of purposes. These organizations can be split into three core groups:

First, organizations familiar with foresight have been implementing the Future Agenda program outputs into their ongoing activities. Shell, IBM and the Government of Singapore are just some who have used the books, presentations, and Web site to share the insights across parts of their organizations and integrate them within current scenario development and foresight activities. Although only a few of the insights from the Future Agenda program are totally new to these organizations, many have found the perspectives have complemented existing views and others have added different takes.

Second, other companies have moved straight into using the Future Agenda insights as stimulus for innovation—either identifying new spaces to potentially explore and develop totally new products, or as input to incremental brand and category development activities.

The likes of PepsiCo, Mars, Discovery Channel, Abbott, and Castrol were some of the first to do this during the early stages of the program, but as the insights were more widely shared, more and more companies across the USA, the EU, and Asia have also joined in. Although at the time of writing, none of the corresponding new innovations have hit the market, we can see a wide range of products, services, and businesses moving through varied development pipelines.

What is significant about many of these innovations is that they are inherently cross-disciplinary in nature. They are taking insights from one region or sector and using them to stimulate new thinking within another area. They are mixing outside-in and inside-out approaches to identify and detail new opportunities beyond the usual portfolio.

A third group of organizations have used the Future Agenda insights less for immediate innovation activities, but instead focused on challenging assumptions and broadening thinking outside the usual core sectors or time horizons. Companies, such as Microsoft, Reckitt Benckiser, and IBM, have used some of the insights within their businesses as catalysts for wider debates on emerging challenges and opportunities and how to address them.

While Vodafone Group has also done most of the above efforts in different parts of the world, additional approaches have also been undertaken. In the UK and the USA, Vodafone Global Enterprise has used the Future Agenda insights as a core element within collaborative innovation events with some of its major corporate customers. For example, in Brussels, a series of debates around some of the core issues, such as trust, privacy, identity, and choice, have been used to engage the EU in new ways, and at the Group level, insights from the program have been put through a mobility lens to create a more sector-focused view on the future of mobile over the next decade.

However, perhaps most notably, Vodafone Turkey has embraced the Future Agenda program as a platform for stimulating wider discussion and debate on the future of Turkey itself. As well as hosting the global launch and engaging a broad range of stakeholders from the start in Turkey, additional insights on local perspectives were developed through discussion with key business and NGO leaders. In addition, CNN has run a series of programs sharing the insights across a broad platform; other news and print media have made extensive use of the material to discuss pivotal issues, and a number of debates within universities on key topics have also occurred.

Given that Turkey is such a large, high growth economy with a historical position at the East–West frontier, it is notable how the Future Agenda platform has resonated so well as a catalyst for discussion on where the country could be in the future. Championed personally by Vodafone Turkey’s CEO who made herself widely available to the media to inform and discuss the program, other countries and regions are now also using the material for similar purposes.

By its very nature, the Future Agenda program engaged new communities as part of its insight-gathering phase and is increasingly doing the same now that these insights are being shared. New audiences for foresight beyond the usual suspects have been found, new uses of the associated insights are coming to the fore and new propositions are being suggested. Moreover, given the open nature of the program, the team running it only really knows about the uses that they have either been involved with or directly notified of. Based on Google Analytics data for the core Web site, it is clear that many others are also making use of the program output for their own purposes.

7 Open Foresight as a Core Asset

So what is the future of open foresight? How will it be used, and what will be the main advantages that it provides to organizations, be they government or corporate?

To start with, we need to recognize that there is a substantial community of people and organizations that see little or no value in open foresight. Some of these concerns come from the heart of the futures’ community and clearly see this program as a threat to their businesses. From a principled perspective, there is little that can really be said about this, other than open foresight creates a wider audience and opportunities for interpretation.

It is worth highlighting here the associated risk of sticking to the recognized experts and not engaging with the naïve emerging voices. At the start of the Future Agenda program, one notable leader at a renowned academic institution questioned why go to the effort of running numerous workshops around the world when the best brains could be found in his university. He said, “If you need to know what will be important in the future, just ask us.”

Others see that there is inherent risk in relying on the wisdom of crowds and the “Tower of Babel.” How can mass engagement on foresight guarantee the quality and rigor that can be provided by those better trained in the art of foresight? While these concerns are all clearly valid, others would say that one of the biggest problems with today’s foresight methods is that they are focused too much on a narrow community who engage repeatedly with the usual suspects.

As Shell’s Technology Futures programs, IBM’s GIO, and the Future Agenda program have all demonstrated, engaging a wider range of views in a coherent manner can highlight useful left-field views that can take organizations into new areas that traditional scenarios or futures programs have not. Clearly, the noise from white space foresight where anyone and everyone can put in their pennyworth has significant risks that technology cannot yet overcome. For now, however, if focused on specific topics, stimulated but not bound by pre-research and orchestrated in a manner that encourages debate and dialogue, then open foresight programs can clearly deliver additional and complementary views to the futures’ mainstream views.

The above notwithstanding, it is clear to us that open foresight does have a place within the futures’ repertoire. It is not a replacement for other established approaches, but provides a complementary means of gaining access to a wider range of views. While much of the core outputs of an open foresight program may overlap with traditional approaches, there are four areas where we have seen distinctive benefit:

7.1 Sharing Views

Although this is clearly an open program, contributions to the content of Future Agenda are confidential and anonymous. This allows organizations to share perspectives that they would normally hold close. By providing a platform for the open sharing of multiple views, companies and governments can more readily contribute their thoughts and see how others react to them.

7.2 Engaging a Broader Church

The very nature of open foresight programs allows for a wider audience to be engaged. Irrespective of the quality of insights gained, some would argue that there is benefit to be gained from stimulating a larger section of society to think about the future. Interaction with a broader church provides opportunities for new connections to be made outside the norm and hence outcomes may well be different than in usual foresight.

7.3 More Weak Signals

By engaging a wider, global audience, more views are brought into the mix from more countries and a wide range of experiences, ages, and backgrounds. As such, the broader mix inherently means more data, and within this data, there are many more smaller views than traditional approaches uncover. If these views are identified as additional weak signals that sit alongside the high probability foresight, and used as such, they provide a useful additional layer.

7.4 Stimulating Higher Levels of Innovation

Through accessing a wider audience on a broader range of issues, many see that open foresight approaches provide greater opportunity for the clashing of views, interaction between sectors, stimulus of new ideas, and as a consequence, the potential for higher levels of innovation.

8 Conclusion

In a study of 19 multinational companies, Gemunden and Rohrbeck highlighted that the “…practice of linking people to pass on foresight insights to the ones that can start new innovation initiatives has also proven to be an effective method to enhance the innovation capacity of a firm” (Rohrbeck and Gemunden 2011).

The Technology Futures program did exactly that for Shell in several areas. For example, the program drew attention to the potential of marine algae as a production source for biofuels. As a result in 2007, it commenced a joint venture in Hawaii with HR Biopetroleum and made a considerable investment in the construction of a demonstration facility to grow marine algae and produce vegetable oil for conversion into biofuel.

As the pace of technology changes increases, the standard strategic planning approach leaves organizations vulnerable to risks and unable to take advantage of opportunities. The best not only understand the linkages between foresight, strategy, and innovation, they also position themselves to leverage the knowledge that is developed from this understanding.

Organizations no longer need deep pockets and global reach to run their equivalent of the Shell Technology Futures program or the IBM Global Innovation Outlook initiative. Open source futures programs, such as Future Agenda provide the insights.

However, while this removes some barriers, this knowledge alone is not enough to provide advantage. To fully leverage an open source foresight program requires a sharp strategy team that can direct a strong innovation group toward opportunities that are ripe for disruption.

And that is where the fun begins.

9 Resources

A PDF version of the book from Shell’s 2007 Technology Futures program can be downloaded from:

The Future Agenda Web site is at http://www.futureagenda.org, and the eBook can be downloaded from http://www.futureagenda.org/pg/cx/view/450?view=acs.