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This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
1
Corporate Foresight: Antecedents and Contributions
to Innovation Performance
Tymen Jissink*
Aarhus University, School of Business and Social Sciences,
Department of Business Administration, Bartholins Allé 10, 8000
Aarhus C, Denmark.
E-mail: tyji@asb.dk
Eelko K.R.E. Huizingh
Rijksuniversiteit Groningen, Faculty of Economics and Business,
Strategic Innovation Management, Netelbosje 2, 9747 AE Groningen,
the Netherlands.
E-mail: k.r.e.huizingh@rug.nl
René Rohrbeck
Aarhus University, School of Business and Social Sciences,
Department of Business Administration, Bartholins Allé 10, 8000
Aarhus C, Denmark.
E-mail: rrohr@asb.dk
* Corresponding author
Abstract: In this paper we explore the current understanding of corporate
foresight as a system for creating understandings of possible futures, factors
that drive the need and usage of corporate foresight as well as how corporate
foresight can contribute to a firm’s innovation performance. Drawing upon still
limited research on corporate foresight, we find that 1) there is still little
consensus on the concept of corporate foresight, 2) the need for corporate
foresight can originate from both internal and external factors, and 3)
innovation performance can be positively influenced by a number of factors
through corporate foresight. Resulting is a comprehensive theoretical
framework incorporating these findings. While research on corporate foresight
is still scarce, in particular quantitative research, we call for more quantitative
research for which our theoretical model may function as a basis.
Keywords: Corporate foresight; environmental uncertainty; environmental
complexity; environmental dynamism; strategic orientation; value contribution;
innovation performance; firm performance
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
2
Introduction
As futures are inherently uncertain, firms face difficulties in making strategic decisions to
ensure future firm performance. When an organization is faced with an external
environment that is highly uncertain and unanalysable, it may have to rely on
interpretations of this environment in order to survive (Daft and Weick 1984). Firms may
thus benefit from adopting corporate foresight that provides understandings of possible
futures to come, in order to support decision making and innovation in firms by (Alsan
and Oner 2003). Corporate foresight has been proven to be beneficial for competitiveness
and innovation, most notably in the case of Shell during the 1973 oil crisis (Wack 1985).
However, corporate foresight as a formalized practice in firms is still only employed to a
very limited extent (Rohrbeck and Schwarz 2013). This raises the question whether
organizations actually need corporate foresight or whether its contributions to
performance acknowledged. These questions can be related to both contextual factors of
the organization, as well as organizational characteristics. Scholars have put forward that
the need for corporate foresight arises from different contextual factors, such as
environmental uncertainty (Vecchiato 2012), and organizational factors such as strategic
orientations (Becker 2002).
However, the limited usage of corporate foresight by organizations may also be
related to the ill-understood and perceived value contribution by the organization and
prevents the adoption of corporate foresight by organizations (Rohrbeck and Schwarz
2013). Nevertheless, other studies, in particular case studies, have identified that insights
derived from corporate foresight led to organizational innovation and/or other
innovations (Costanzo 2004, Andriopoulos and Gotsi 2006). The study by Andriopoulos
and Gotsi (2006) found that organizations can use foresight as a way to stimulate
innovation; constantly monitoring the environment to discredit or validate potential
futures gives way for new innovation avenues. As the notion of innovation having a
positive influence on performance has generally been accepted in literature (Manu and
Sriram 1996), it would be interesting to posit corporate foresight as a system to improve
innovation performance, and by that ultimately firm performance.
As literature lacks a theoretical framework that includes both antecedents and
outcomes of corporate foresight, we aim to synthesize recent relevant findings in the field
of corporate foresight in a holistic theoretical framework, addressing the questions of 1)
in what kind of business environments is corporate foresight mostly needed? (i.e. the
context of the business environment), 2) what kind of firms tend to be engaged in
corporate foresight? (i.e. what are the organizational antecedents to corporate foresight),
and 3) how does corporate foresight influence innovation performance and firm
performance? (i.e. the outcomes of corporate foresight).
The paper is structured as follows. First, a small introduction to corporate foresight as
a system in an organization is given to explain the core concept. Second, contextual
factors and organizational factors are discussed in relation to corporate foresight and
propositions proposed for their relationship with corporate foresight. Third, the
relationship of corporate foresight with innovation performance is discussed and
relationships are proposed. Lastly, the practical and theoretical contributions are given, as
well as a conclusion and future research directions.
Corporate foresight as a system
Coates (1985, p. 30) defined foresight as the “overall process of creating an
understanding and appreciation of information generated by looking ahead”. More
specifically, we define corporate foresight as follows:
Corporate foresight refers to an organizational system that provides an organization
with understandings of possible and desirable long-term futures through the acquisition,
interpretation and diffusion of future-related information to facilitate organizational
responses towards those futures.
With our definition, we clearly separate corporate foresight from formal planning and
actions resulting from this planning. As such, corporate foresight is an input into strategy-
making which, in turn, directs strategic planning and action. This means that corporate
foresight only enriches the context in which strategic decisions are made (Voros 2003).
Furthermore, foresight is not about ‘getting the right prediction’ of a single future at a
single point in time, which is the underlying assumption of forecasting (Cuhls 2003), but
deals with the assumption that there are many different possible and desirable futures
(Martin 2010).
Literature has not accepted upon a single conceptualization of corporate foresight.
Rather, many different conceptualizations exist. Some scholars see corporate foresight
merely as a process of activities (Horton 1999, Becker 2002) while others see it as a
system of elements (Rohrbeck 2011, Paliokaitė and Pačėsa 2014). A well-developed and
comprehensive model on corporate foresight was introduced in the study by Rohrbeck
and Gemuenden (2008). In this study, they conceptualized corporate foresight as a system
of capabilities, each contributing differently to the creation of understandings of futures
and facilitation of organizational responses towards those futures.
In the systems-view on corporate foresight, the approach goes beyond merely
environmental scanning and intelligence gathering, or a set of methods and techniques to
create an understanding of possible futures. Rather, it seeks to connect itself to strategic
and innovation management as an anticipatory system to facilitate responses to insights
of possible futures (Battistella 2013). It can be understood as a holistic approach to
identify possible futures that are not narrow and/or shallow in the sense that it aims to
identify changes from related and unrelated environments to gain a broad understanding
of possible futures (Rohrbeck 2011). Such narrow or shallow views of the future are
usually acquired by merely interpreting simple trends (Voros 2003). Corporate foresight
can thus be considered a futures orientation of the organization; strong foresight
capabilities aiding in organizational anticipation, or even to an organizational "way of
life" (Hines 2002, p. 343).
While the systems view on corporate foresight is shared by other authors as well
(Ratcliffe 2006, von der Gracht et al. 2010, Battistella 2013), no consensus is reached on
its exact conceptualization. A well-developed conceptualization of corporate foresight as
a system by Rohrbeck (2011) is based on qualitative studies of industry’s best practices
with foresight in firms. This framework has also been used in subsequent (quantitative)
studies (Rohrbeck et al. 2009, Rohrbeck and Schwarz 2013). In this framework, corporate
foresight consists of the capabilities information usage, method sophistication, people &
networks, organization, and culture. This framework does not focus on foresight
methods, techniques or activities, but rather on organizational capabilities. The
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
4
capabilities in the framework reflect an organization’s corporate foresight system’s
strength in identifying, interpreting, and formulating responses to change. More
specifically, information usage reflects the capability of sensing weak signals in the
external environment in a broad-range of information sources. Method sophistication
reflects the extent to which an organization uses structured ways (i.e. methods and
techniques) to process acquired information on relevant trends, issues, and opportunities.
People & networks reflects the extent to which people involved with corporate foresight
have specific characteristics beneficial for foresight, such as having a broad knowledge
base, and strong internal and external networks. Organization refers to what extent an
organization has formal support and approaches in place to manage foresight and
informal approaches to support continuous foresight activities (e.g. continuous scanning
for change). Lastly, culture reflects whether the organizational culture is supportive of
corporate foresight; i.e. the cultural support for scanning, interpreting, and
communication activities. Overall, the five capabilities as identified by (Rohrbeck 2011)
highlight the main dimensions of corporate foresight, as such that an organization should
aim to fulfil the capabilities as best it can. However, all are essential for an effective
implementation of corporate foresight (Rohrbeck 2011).
Many studies to date have shown a focus on the methods and techniques as part of
corporate foresight, however, far less attention has been given to the organizational
aspects of corporate foresight (Battistella 2013). As the framework by Rohrbeck (2011) is
a well-developed and empirically derived and applied framework in literature, we have
opted to conceptualize corporate foresight in this paper according to this framework.
Figure 1 Conceptual framework of contextual and organizational factors, corporate
foresight, innovation performance, and firm performance
Context, organizational characteristics, and corporate foresight
While corporate foresight as an organizational phenomenon could be beneficial for any
type of organization, we address the questions of in what kind of business environments
corporate foresight would mostly be needed and what kind of firms tend to engage in
corporate foresight.
We build upon the findings of Becker's (2002) exploratory empirical study on
corporate foresight in European organizations. The study uncovered, amongst others,
both internal and external factors acting as antecedents to corporate foresight. We keep
the same dichotomy between external (context) and internal (organizational) antecedents
of corporate foresight. The conceptual framework of this paper is shown in figure 1.
Contextual
factors
Corporate
foresight
Organizational
factors
Innovation
performance
Firm
performance
Context and corporate foresight
Contextual factors aim to explain the need for corporate foresight being driven from
factors outside the organization’s boundaries and control. Only few studies have sought
to explore specifically the relationship between an organization’s environment and the
need for corporate foresight in detail.
The exploratory study by Becker (2002) found three contextual factors we included,
being 1) unpredictability of events in the external environment, 2) complexity of the
relation between technology and social/cultural context, and 3) uncertainty in the
environment as to what organizational responses to develop. Few other studies have seen
a specific focus on environmental factors and corporate foresight. For instance, Costanzo
(2004) studied specifically the need for corporate foresight in high-speed environments,
and uncertain environments by(Vecchiato 2012). While these studies have a more in-
depth focus on contextual variables and corporate foresight, many studies in the field of
corporate foresight commonly mention uncertainty and dynamism as typical drivers. We
seek to complement this by providing an in-depth review on the relationships between
contextual variables and corporate foresight.
Environmental dynamism has been argued to consist out of two environmental
characteristics: the rate-of-change (turbulence/velocity), and the unpredictability of
change (Miller and Friesen 1982). A more dynamic environment would imply a high rate
of unpredictable changes being brought about. A high rate-of-change thus implies a
continuous stream of changes in the environment. As such, changes arise quickly and
decisions to respond to these changes can be considered short-term. Costanzo (2004)
found that a high rate-of-change resulted in the need for corporate foresight to keep up
with this continuous stream of changes. However, Becker (2002) found that organizations
in low rate-of-change environments (i.e. chemicals industry) were more reliant on
corporate foresight than organizations in higher rate-of-change environments when paired
with long development cycles and high development costs. Corporate foresight can thus
be beneficial as an organizational system to gather insights from emerging developments
in the environment, irrespective of environmental rate-of-change. Based on the findings,
it is insufficient to propose that only environmental rate-of-change can act as a driver for
corporate foresight unless paired with the unpredictability of such changes. Only when a
changing environment becomes increasingly unpredictable, it calls for a more qualitative
and comprehensive approach to create an understanding of possible futures, rather than a
more quantitative forecasting or prediction approach (Becker 2002, Ratcliffe 2006). The
study by Becker (2002) found that organizations use corporate foresight as a way to
prepare for possible unpredictable events by providing future insights that could function
as an ‘early warning system’ to such events. In line with Vecchiato (2012), we would
propose that only environmental dynamism (as a function of rate of change and their
unpredictability) can drive the need for corporate foresight:
Proposition 1 Environmental dynamism has a positive effect on corporate foresight
Environmental complexity is related to difficulty of understanding the factors in an
organization’s environment that are related to decision-making (Duncan 1972). In this
sense, complexity is related to the extent of heterogeneity in the environment (i.e. having
many dissimilar actors and factors (Verdu et al. 2012), and the interdependence of these
factors between each other (Levinthal 1997). The heterogeneity and interdependencies
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
6
lead to futures becoming increasingly more difficult to understand, let alone predict, and
leads to difficulties for organizations in gathering sufficient information needed to
understand the complex interrelationships (Sia et al. 2004, Siggelkow and Rivkin 2005).
To understand such complexity, an organization needs to gain insight into its
environment by extensive wide-range search for information and generate knowledge on
what factors are key drivers of change and how these factors are interdependent;
something corporate foresight aims to do. Organizations that operate in simple
environments have less of a need to adopt a similar approach, and may even result in
resource wastage (Day and Schoemaker 2005). Corporate foresight thus has great
potential to raise awareness and generate knowledge about a complex environment by
ultimately coming up with reasonable interpretations of how the future may develop
(Becker 2002, Vecchiato and Roveda 2010, von der Gracht et al. 2010):
Proposition 2 Environmental complexity has a positive effect on corporate foresight
Environmental uncertainty has long been emphasized to be an issue in the process of
creating a successful future path for the organization by decision-makers (Vecchiato and
Roveda 2010). Environmental dynamism and complexity have been referred to as being
the two factors that create an uncertain environment (Duncan 1972, Verdu et al. 2012).
When an environment becomes increasingly uncertain (i.e. more dynamic and complex),
decision-making is reliant on beliefs and mental models to handle this uncertainty. Such
beliefs and mental models provide a frame of reference to base decision-making on
(Vecchiato and Roveda 2010). Corporate foresight can be considered a relevant means to
create and update organizational mental models of the environment and their way of
doing business in order to handle the high amounts of environmental uncertainty
(Vecchiato and Roveda 2010):
Proposition 3 Environmental uncertainty has a positive effect on corporate foresight
Organizational characteristics and corporate foresight
Organizational factors aim to explain the need for corporate foresight as being driven
from an organization’s characteristics. More specifically, we focus in this section on what
kind of organizations tend to engage in corporate foresight. In order to do so, we explore
the relationships of a variety of strategic orientations with corporate foresight. Some
studies mention certain strategic orientations in relation with corporate foresight (Becker
2002, Day and Schoemaker 2005, Rohrbeck 2011), however they use a variety of
descriptions for these strategic orientations. In this study, we adopt a range of well-
known strategic orientations from literature and examine their potential relationship with
corporate foresight.
The generic strategy typology by Miles et al. (1978) has emerged as one of the
dominant frameworks of strategic orientation (Slater et al. 2006), and provides a
generalizable view on what strategic orientations instigate the need for corporate
foresight. Also, this typology is highly suitable in our current research given its focus the
alignment between strategic orientation and the dynamics and uncertainty of the
environment (Miles et al. (1978). Next to this generic typology of strategic orientations
we included entrepreneurial orientation, market orientation, and technology orientation.
Research found that corporate foresight is very much embedded in entrepreneurial
activities, and still favours a focus on market and technology aspects (Becker 2002).
Miles and Snow generic strategies have not received specific focus in corporate
foresight literature, but can be applied nonetheless. Recent research identified strategic
orientations as antecedents to corporate foresight (Becker 2002, Day and Schoemaker
2005, Rohrbeck 2011). For instance, Becker (2002) refers to an ’innovation-leader’
strategy as a motive for corporate foresight, while Day and Schoemaker (2005) and
Rohrbeck (2011) refer to a strategy characterized by innovation and growth. Both
strategic orientations share many similarities with the ’prospector’ strategic orientation by
Miles and Snow. Prospectors aim to create future views beyond their own business area
to identify opportunities (Slater and Mohr 2006), and are more future oriented in their
decision making processes. Prospectors actively search for new opportunities and seek a
comprehensive approach to generate and evaluate a range of alternative opportunities
(Slater et al. 2006). Similar characteristics were found in the study by Andriopoulos and
Gotsi (2006) in which an organization used corporate foresight to identify new
opportunities, exploiting those opportunities, and consequently evaluated those newly
exploited opportunities using corporate foresight.
In contrast, defenders are have less a need to create future views and are less future
oriented in their decision making, and only exert some amount of environmental scanning
and interpretation. Defenders only focus on a narrow market segment and have less a
need for a comprehensive approach to generate possible future alternatives than
prospectors do (Slater et al. 2006). However, they still incorporate a certain extent of
environmental analysis and interpretation to defend their narrow market. This is
furthermore in line with Hambrick (1982), who argued that while the extent to which
either prospectors or defenders scanned the environment was not significantly different,
the internal processes with which it was analysed and interpreted would differ
significantly. Research has typically considered the prospector and defender types as
being two extremes (Hambrick 2003).With regard to the other two strategic orientations;
the reactor is not associated with any form of consistent business, while the analyser is
considered a hybrid of both prospector and defender.
Contingency theory posits that each strategic orientation fits a certain set of
organizational characteristics to achieve the strategy and optimal performance (Slater et
al. 2006). Therefore, prospectors would show a more sophisticated approach to corporate
foresight in order to achieve its strategic goals and is expected to show the strongest need
for corporate foresight. While defenders are typically considered the extreme of
prospectors, they too can show signs of exhibiting corporate foresight, rather than being
negatively associated with it. We would thus expect that prospectors, analysers, and
defenders are positively associated with corporate foresight, with prospectors being most
strongly associated and defenders least strongly. As reactors have no intention of
incorporating future views into their decision making but rather react to changes as they
come their way, we would expect reactors to be negatively related to corporate foresight.
Proposition 4 Prospector, analyser, and defender strategic orientations have a
positive effect on corporate foresight
Proposition 5 Reactor strategic orientation has a negative effect on corporate
foresight
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
8
Entrepreneurial orientation reflects a collection of values and beliefs that are a
requisite for organizations to be entrepreneurial (Miller 1983). It reflects renewal of
market offerings, taking risks in trying out new products, and be more proactive than
competitors towards new market opportunities (Covin and Slevin 1991, Wiklund and
Shepherd 2005). An integral part of highly entrepreneurial firms is their proactive
behaviour to identify new opportunities and manage risk-taking (Covin and Miles 1999).
Furthermore, entrepreneurial organizations are more willing to commit to and engage in
creative processes and experimentation—in other words, they are more open to new ideas
and change (Lumpkin and Dess 1996, Rauch et al. 2009).
As Godet and Durance (2011) argue, two important attitudes are needed for corporate
foresight: 1) take risks as the future is inherently uncertain, and 2) as corporate foresight
is concerned with identifying probable and desirable futures, an entrepreneurial
organization can construct its own desired future through combining proactivity with
foresight. Research by Becker (2002) argued that corporate foresight seems inevitable for
entrepreneurial and innovation-oriented organizations, as their strategies force them to
constantly monitor for new opportunities and threats to pro-actively respond to these to
secure or strengthen future competitive positions:
Proposition 6 Entrepreneurial orientation has a positive effect on corporate foresight
Market orientation is an organizational orientation that fosters behaviour aimed at
efficiently and effectively creating superior value to customers (Narver and Slater 1990).
A market oriented firm is one that shows a commitment to a set of processes, values, and
beliefs that reflect the philosophy of basing decisions on customers and competitors.
These decisions are based on a deep understanding of customer’s preferences and
behaviour, and competitor’s abilities and intentions (Day 1994). This strategic orientation
can be considered externally focused and leads to a greater need for the search of new
opportunities and threats (Spanjol et al. 2011).
As market orientation aims to get a deep understanding of both customers and
competitors, corporate foresight can be needed to gain such deep understandings
(Rohrbeck 2008). Through analysing exogenous factors such as government regulation,
technology, and competitors through corporate foresight, a market oriented firm can
identify consumer’s future needs and preferences (Kohli and Jaworski 1990, Huston
2004, Ruff 2006). Firms risk losing the foresight of innovating creatively when they
solely focus on satisfying current needs from customers and may lead to short-
sightedness, as consumers are inherently short-sighted (Hamel and Prahalad 1994).
Similarly, corporate foresight may be very beneficial to create a deep understanding
of competitors (Brenner 1996). Corporate foresight allows to create an understanding of
competitors’ market-oriented performance and what its future moves may be. Indeed,
research by Becker (2002) found that corporate foresight is widely used as a means to
gain market-related information and understandings. Therefore, it is expected that market
orientation is positively related to corporate foresight:
Proposition 7 Market orientation has a positive effect on corporate foresight
Technology orientation refers to an emphasis to employ state-of-the-art technologies,
as those who are technology oriented are driven by the philosophy of consumers
preferring technologically superior products/services (Gatignon and Xuereb 1997, Zhou
et al. 2005). Therefore, a technology oriented firm opts to use the latest technologies in its
products/services, and as such is committed to R&D and acquisition of new technologies
(Gatignon and Xuereb 1997). Technology-oriented organization can generally be
considered internally focused using existing knowledge and expertise to create new
technological solutions (Spanjol et al. 2011).
However, the internal focus does not necessarily lead to neglecting any external focus
on emerging opportunities and threats in the market (Gatignon and Xuereb 1997). As
technologies can be both seen as drivers of and driven by change in social and economic
areas, corporate foresight can provide valuable input into decision-making about future
R&D activities (Becker 2002). While firms can pursue both a focus on market- and
technology oriented strategies, it is generally the case that a firm’s set of resources and
capabilities lead to favouring one strategic orientation or the other (Spanjol et al. 2011).
In the case of technology-oriented firms, we would expect to see that their increased
focus on technologies leads to a decreased external focus and thus the need for corporate
foresight:
Proposition 8 Technology orientation has a negative effect on corporate foresight
Corporate foresight and innovation performance
Despite all interest for corporate foresight, it is not easy to identify corporate foresight’s
influence on performance. A key factor that limits our research abilities on the
relationship between corporate foresight and performance is that the effects are only
measurable or observable in the long-term (Horton 1999, Daheim and Uerz 2006).
Nevertheless, several studies have sought to uncover potential value contributions of
corporate foresight in a wide variety of fields (Becker 2002, Rollwagen et al. 2008,
Rohrbeck 2012, Rohrbeck and Schwarz 2013). Potential value contributions of corporate
foresight generally revolve around reducing uncertainty and identifying new
opportunities and threats.
We look into how corporate foresight can contribute to innovation performance which
is defined as the degree of success an organization attains by achieving goals related to
new products or services (Montoya-Weiss and Calantone 1994). The importance of
innovations for organizational performance has long been emphasized since Schumpeter
(1934) presented his theory on economic development. However, the study of Rohrbeck
and Schwarz (2013) finds that the few organizations that do employ corporate foresight
have limited knowledge on- or are unable to explain how it has contributed to their
innovation performance, and thus perceive very limited value contributed by corporate
foresight – only 32% of the top performing firms reported positive corporate foresight
contributions in the field of innovation management, making this a worthwhile research
avenue.
Innovation performance is argued to be linked to an organization’s corporate foresight
capability (von der Gracht et al. 2010, Rohrbeck and Gemünden 2011, Paliokaitė and
Pačėsa 2014). The study by Rohrbeck and Gemünden (2011) provides insight in how
corporate foresight can take on three distinct roles that translate future insights for the
innovation process to consequently improve innovation performance. These roles are the
1) initiator– triggering new innovation initiatives, 2) strategist – providing guidance and
alignment of innovation activities with strategy, and 3) opponent – challenging
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
10
innovation projects to ensure innovativeness. More specifically, corporate foresight as
initiator ensures that an innovation portfolio is fed with information about and ideas for
new customer needs, emerging technical trends, and new concepts introduced by
competitors and ensures innovation novelty and ability to compete in the marketplace.
Corporate foresight as strategist aims to assess current innovations and their place in
future, keeping those innovations up-to-date with information about emerging
opportunities and threats, and ensures innovation projects are aligned with the
organization’s strategy. Corporate foresight as opponent aims to challenge current ideas,
assumptions, and innovations to ensure state of art R&D projects and assesses the
innovativeness of ongoing innovation projects in the future, and ensures that the
organization invests in the right innovations. It is therefore expected that all three roles
would see a positive contribution to innovation performance, and leads to the following
propositions:
Proposition 9 Corporate foresight as initiator role has a positive effect on innovation
performance
Proposition 10 Corporate foresight as strategist role has a positive effect on
innovation performance
Proposition 11 Corporate foresight as opponent role has a positive effect on
innovation performance
While these roles cover many aspects related to innovation performance, we found
that corporate foresight can contribute in other areas as well. Before the establishment of
an innovation, corporate foresight can provide an organization with lead time on
innovations (von der Gracht et al. 2010). By gaining important information on possible
future events, threats, and opportunities through corporate foresight before competitors
do, it can provide lead-time on possible innovation projects. Organizations that learn
quicker than its competitors can react quicker to future customer needs than those who do
not (Woodruff 1997). Many authors argue that lead time is the most powerful source of a
competitive advantage and with that the most effective tool to appropriate returns from
innovations (Stalk 1988, Kim and Mauborgne 1997):
Proposition 12 Corporate foresight as an ability to increase innovation lead time has
a positive effect on innovation performance
After the establishment of an innovation, corporate foresight can contribute to ongoing
assessments of an innovation’s future novelty and success in the marketplace by reducing
uncertainty of the innovation’s launching environment (i.e. market demands,
technological trends, competitor moves). Corporate foresight allows the organization to
spot relevant threats and opportunities and address them in an appropriate way
(Kuhlmann 2001). For instance, Grupp and Linstone (1999) view foresight as being
helpful in establishing feedback loops between expected future demand and present day
investments; investments related to the established innovation itself. Through this,
innovations can be adjusted or even terminated, and consequently leads to an increased
innovation performance:
Proposition 13 Corporate foresight as an ability to reduce uncertainty surrounding
an innovation and its launching environment has a positive effect on innovation
performance
The importance of innovation for firm performance is well recognized in the
innovation literature (Darroch 2005). In this paper we refer to firm performance as the
financial success of innovations of both services and products (Im and Workman Jr
2004). This positive relationship between innovation performance and firm performance
has been studied by several authors (Atuahene-Gima 1996, Han et al. 1998). They argue
that innovation is a crucial factor for firm performance, and we would consequently
propose similarly:
Proposition 14 Innovation performance has a positive effect on firm performance
Contributions, conclusion, and future research
Theoretical contributions
We have provided a clear definition and scope of corporate foresight for future research
to operate within, and posit it as an organizational system aimed at gaining insights about
possible futures that facilitate organizational responses towards those futures. Our
theoretical framework shows that corporate foresight can be seen as a function of both the
firm’s environment calling for corporate foresight in order to make sense of it, and
strategic orientations that may need corporate foresight to achieve its strategic goals.
Corporate foresight can also function system to gather insights from the environment, and
translate them into usable inputs for the innovation process to consequently improve a
firm’s innovation performance. Having put forward different ways of how corporate
foresight can contribute to innovation performance more explicitly, we have aimed to
complement the still ill-understood corporate foresight – innovation link (Rohrbeck and
Schwarz 2013).
Practical contributions
A first practical implication is that corporate foresight is affected by several
organizational and environmental factors. Managers must be aware of the factors in our
theoretical framework and should assess whether corporate foresight is needed and fits
with their context, both internally as part of the organization’s functioning, and externally
as part of the business environment. Otherwise, it may lead to wasting resources and
suffer from information overload (Day and Schoemaker 2005).
A second practical implication is that managers can gain insights into how corporate
foresight can contribute to innovation projects, either before, during, or after the
innovation process. This lack of insight has been a major factor in holding back
organization’s adoption of corporate foresight practices (Rohrbeck and Schwarz 2013).
This paper was presented at The XXV ISPIM Conference – Innovation for Sustainable Economy &
Society, Dublin, Ireland on 8-11 June 2014. The publication is available to ISPIM members at
www.ispim.org.
12
Conclusion and future research
In this paper we have identified both contextual and organizational factors that drive
the need for corporate foresight, as well as contributions of corporate foresight to
innovation performance, and ultimately firm performance. Together with proposed
directions of the relationships between the antecedents, corporate foresight, and the
outcomes, we hope that this framework may act as an instrument to guide further
research in the field of corporate foresight, and hopefully lead to more supporting
(quantitative) research on the matter.
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