Lately, we talked a lot about horizon scanning, strategic foresight, and future exploration. This blog post series generated many interesting conversations on the private calls. And as we discovered there are still many questions to answer. We will create a few more posts about it. Yay! In today’s post, we will talk about identifying future market needs and their potential value.
Business innovation can be described as a new and original solution to a market need. The market need is something that can be created or emerge. It may be based on changes in the demographics, technology or the regulations (just to name a few). Strategic foresight can support anticipation of customers’ future behaviours, expectations, values and needs that are not yet in the mainstream. Also, what many business owners forgot is, foresight can help in identifying markets that do not yet exist. Just as with customers, strategic foresight can bring insights into the values, expectations, and needs of the relevant stakeholders.
And aside from anticipating future market needs and driving impact, managers often utilize foresight for building and managing innovation portfolios, in risk management to identify potential threats, and overall, to challenge the status quo before the competition will. The payback of it is obvious, for the firms that identify and solve market needs earlier than others, it creates a huge competitive advantage and gives the ability to stay ahead of the game. Isn’t it what we (business owners) all want?
There are various foresight tools – horizon scanning, trend identification, maps etc. These are extra help for identifying future market needs and potential solutions across the three horizons.
In horizon 1, managers utilize foresight to constantly innovate on a company’s existing business model and its core capabilities. In this case market needs and innovations are usually visible, largely understood, and include issues to which companies are already responding.
In horizon 2, companies seek new market needs and innovations with the foresight to extend a brand’s business model and core capabilities. At this point the market needs and innovations are usually less characterized and often less urgent: companies may prefer to wait and see, and grow the existing business even though they are aware of the horizon 2 opportunities.
In horizon 3, managers use foresight to build complitly new business and capabilities to take or respond to disruptive opportunities or counter disruption.
And not so long ago, a delivery time has been assigned to these horizons, but now, things changed. We see that the companies often are spreading their innovation investments across the three horizons. That creates pressure on the market because new disruptive ideas can be created along with smaller initiatives.
What you can do today to improve tomorrow?
Define the “the future of” you want to learn about and why. And remember to adapt a wide enough lens and go beyond the strong signals. Knowing megatrends is good but they don’t generate privileged insights for managers who want to create profitable innovation here and now.
Also, brainstorm the future of your market together with employees and partners. Talking about the future with a bigger audience, preferably also with outside of your organization members. That helps test and enrich the interpretations and implications of foresight. And to make a discussion even more valuable, let participants familiarize themselves with the interpretations and scenario descriptions beforehand.
And there’s one more thing, we know that many leaders are familiar with customer research, but not everyone is conscious of the foresight research importance. Identification of future market needs and innovation opportunities utilizes both customer and foresight research methods. Customer research will answer the question how people behave now, what they need today, what do they prefer. On the other hand, foresight research help to understand the dynamic of change of those aspects in the future. These two methods complement each other perfectly. So while doing the first, don’t forget about the other.
Do you want to see how those two methods can create growth in your business? We are happy to discuss ideas with you. Leave your email address below. Our consultant will reach out to you to arrange a private call at time that suits you best.