Staying ahead of the sustainability curve

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Staying ahead of the sustainability curve

How strategic foresight can strengthen organizational resilience

The uncertainty and complexity of a sustainability-driven future mean that companies must think holistically and look further ahead. The strategic foresight framework helps leaders shift their mindset, to reimagine business contexts and timeframes. Using AI alongside linguistic and quantitative analyses, it helps companies understand stakeholder and public sentiment, dynamically model scenarios, and stress-test the effects of potential actions.

Authors - Dr Florian Klein, Gordon Grundmann, Frederik Josten

Strategic thinking for a sustainability-driven future

Sustainability is an extraordinary disruptor, and adaptability is now essential. Businesses must develop a holistic strategic perspective across the complex diversity of connected elements, to anticipate trends and uncertainties. Such uncertainties make sustainability more a horizon than an end-state, and strategic thinking must look beyond customer, product and competition perspectives, to social, environmental and economic impacts.

Such overwhelming complexity can make it hard to isolate distinct strands for strategic thinking. Meanwhile, stakeholder influence is increasingly driving the commercial agenda, so simply doing business will not be enough, and companies will be expected to make a positive difference. Leaders must therefore gain an evidence-based view of what sustainability means for their organisation, internally and externally.

In this volatile, uncertain, complex and ambiguous world, business leaders face a choice between complying with minimal regulations, and strategically embedding sustainability at the heart of strategy, to be ready for a sustainability-driven future.

Shifting mindsets through strategic foresight

Major initiatives for the next 10–30 years, such as decarbonising whole sectors, will change the physical and commercial environment in ways that will need a different mindset from narrow strategic planning that considers 1–3 years ahead.

The ‘strategic foresight’ framework enables this shift in mindset. It helps develop valid, reasonable future outlooks from information on social, technological, economic, environmental, political, legal and security developments – and the underlying dynamics. The aim is not to predict the future, but to understand how it could emerge from currently nascent factors, and reimagine what developments should be considered, to avoid static thinking or tunnel vision.

The framework examines the external environment for relevant drivers of change, and develops perspectives on the emerging landscape with a logical model. While strategic foresight does not develop a strategy or roadmap, it identifies the strategic implications of divergent but plausible futures. Such perspectives might otherwise be overlooked in strategic planning, but reveal and challenge dangerous assumptions or expectations, as a foundation for mitigating risks or capturing opportunities.

Reframing strategic assumptions

Three broad types of method are used: sensing an environment’s underlying dynamics, modelling possible future directions, and acting on reasonable future perspectives.

Sensing methods use structured research, AI tools and linguistic analysis to understand current and future dynamics and clusters of uncertainty, to broaden a company’s perception of its environment and sphere of influence. Insights such as ecosystem maps can inform materiality assessments, while periodic sensing can help a company respond dynamically to market and regulatory shifts, or build stakeholder engagement.

Modelling, of the complex interactions between environmental elements, produces concrete, reasonable hypotheses about how the future might unfold. Scenario analysis gives a unified view across different outlooks to inform strategic decision-making, while tracking sentiment from news and social media allows scenarios to reflect ongoing changes. Uncertainty analysis helps develop further hypotheses on crucial but uncertain topics, by combining expert panels with big data analytics.

Action shifts the perspective away from considering the environment’s effects on a company, and toward understanding the external impact of internal business options. The methods ask questions of an imagined future, to align the strategic choices and avoid a bias toward current activities. Stress-testing helps identify which strategies could be robust in a sustainability-driven future, and which would bring risks, such as lagging behind competitors or accusations of greenwashing.

Strategic foresight is an ongoing process that helps develop relevant intelligence for a sustainability-driven future, in the face of volatility. It frees strategists from restrictive short-term thinking, and offers a way to embrace complexity and uncertainty, gain a holistic and unbiased perspective, and think beyond traditional tactical horizons.

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