When You Adopt Horizon Scanning, the Quality Of Your Strategy Improves

A Basic Guide to Horizon Scanning for Organizations

Horizon scanning is a structured process for identifying and making sense of emerging changes in the external environment.

It has been described as the effort to “continuously and objectively explore, monitor and assess current developments and their potential for the future.” (Rowe, Wright, and Derbyshire, 2017).

The first mentions of horizon scanning were in the 1960s. For many organizations, the external environment appeared to be growing more complex. Companies were expanding internationally; governments had to manage growing populations and advancing industrialization. Technologies like electronic computers and nuclear energy propelled society in new directions that were both exciting and dangerous. New management practices evolved to help companies prepare for a more volatile business environment.

Today, horizon scanning should be a vital aspect of planning in uncertain environments:

1. Horizon scanning asks you to pay conscious attention to change. It reminds you that the external environment is dynamic and can produce surprises.
2. You will focus on issues beyond the inevitably narrow scope of your mission and mitigate the chances for surprise developments.
3. It insists that you have a future focus in your decisions and strategies by producing what-ifs.

The Concept of Weak Signals In Horizon Scanning

The goal of horizon scanning is to anticipate relevant issues and opportunities before they have fully developed. These potential issues are often called “weak signals” by futurists.

 Igor Ansoff, a mathematician who worked as a military theorist before becoming a strategy professor, introduced “weak signals” into the strategic lexicon. 

Ansoff urged managers to seek early evidence of a changing environment. Weak signals are those that are not yet fully evolved or “strong” enough to be heard. He had a three-step process. First, identify and collect these signals of change. Then, evaluate their relevance and, finally, incorporate them into the firm’s strategic formulation. 

A weak signal is considered to be an event or a phenomenon that has occurred but is not typical or mainstream. It has not reached the stage of being an “issue” or a problem or even a recognizable trend. People use news media, social media, and specialized sources for information to unearth weak signals. Horizon scanning usually involves recording these signals in a database and then evaluating them to understand what they mean.

This evaluation, rather than the collection of information in itself, is the heart of the horizon scanning activity. How do you know if what you have found is meaningful? What if it is something you have never heard of but which is known to others? Can one weak signal by itself matter? 

The fact is that you can’t answer all of those questions at the time of collection. Accepting—even embracing—this ambiguity is essential in horizon scanning work. 

The Value of Looking at the Distant Horizon

However, the very act of seeking to identify what is currently on the distant horizon is a fruitful exercise. By conducting it, you are putting yourself in the advantageous position of potentially seeing, preparing, and acting on changes in the environment in a proactive way. 

Swiss anthropologist Pierre Rossel has suggested that weak signals are “perceptions of possible changes that are essentially “candidates” (or hypotheses) with a socially relevant and resonant knowledge building process.” In other words, a “signal” is evidence that seems to you to be meaningful in the context of your firm or organization. You think it should play a part in your effort to be building a picture or story of a potential future environment. (Early detection, warnings, weak signals and seeds of change: A turbulent domain of futures studies)

An Example of Horizon Scanning

In a 2020 article on horizon scanning in the journal Foresight, Yuichi Washida and Akhihisa Yahata explore future-focused scenarios’ predictive value when a horizon scanning process informs them. They are interested in the topic because the Japanese government has failed to project technological developments accurately using other techniques.

They offer an instructive example of what can be meant by “weak signals” and the process of analyzing, collating and drawing meaning from them. 

In 2014, as they report, one of the authors identified four different, unrelated items or “weak signals” through a horizon scanning process related to the spread of disease. They were:

• The danger of infected mosquitos
• A syphilis epidemic
• An item about prostitution and drug use in the European Union 
• The spread of tuberculosis in run-down areas in Japan

He also collected four items on the topic of China.

• There had been Chinese military activity close to Vietnam
• Economic competition between Japan, the US, and China was occurring
• Japanese corporations were withdrawing from China
• Chinese was being used increasingly in educational contexts

He drew two conclusions from these signals.

Regarding the first set, there was the potential for a dangerous epidemic. The second, related to the second set, was that China would soon test its capacity to be a global leader. In the authors’ view, when you looked at each of these clusters of weak signals together, you could see the possibility of a significant “non-linear” social change on the horizon. They were “non-linear” because they could not be extrapolated from past trends. The only way to find them was through the process of analyzing weak signals in a disciplined and imaginative way.

In the 2020 article, the authors point to the COVID-19 pandemic, and China’s important role in it, as expressions of these signals. By seeing them in 2014, they had time to prepare for them.

Questions to Answer as You Set up a Horizon Scanning System

Horizon scanning is best as a systematic activity. Through repetition and continuous looking, you can begin to get a sense of change over time. With that said, if this is a new practice in your organization, you may want to dip into the activity with a specific project or question. 

Experienced futurists have posed important questions for those considering how to incorporate scanning into their strategic practice. 

Key questions include deciding:

• How broadly or narrowly you want to define the scope of your scanning
• Whether your time horizon is near-term or longer-term: Do you want to understand what is emerging that will matter in 3 years or thirty?
• How do you want to analyze what you do?
• How do you want to generate this analysis as an input into strategy?

Once you have decided to develop a systematic foresight process, you can take the further step of choosing what to collect. Recognize that looking outside of your area of expertise is vital.

Figure Out Where You Will Need to Focus Attention: What Don’t You Know About?

First, identify and label what you already scan because it is part of your mission. You do not have to retread this ground. A national security organization such as an army or ministry of defense already monitors the geopolitical environment. Imagine now what a defense organization might find while looking around consumer behavior in local markets. Do these perhaps reflect the availability of resources to them? These could be the tail edge of issues that one day will be meaningful to the defense organization. 

In contrast, consider the head of a global clothing retailer. They already follow market trends: what people are wearing, cultural habits around clothing, and fabric supply chains. Their horizon scanning system might benefit from seeking signals around global geopolitics. They could, for example, see early signs of emerging trade disputes that could later affect their supply chains.

Now, where do you want to look for evidence?  Common areas include desk research, experts from particular fields, conferences, social media, and surveys.

Four Best Practices

Rossel suggests four more important practices around the collection of signals.

(1) Do not consider signals on their own but in collections or clusters. One sign or event is unlikely to be the sole cause of a complex change. Instead, analyze signals in connection with others and in the context of a hypothesis about the future environment.

(2) Recognize that you are always a biased observer and probe your choice of any given signal. Does it reflect or confirm your worldview? How does your point of view help to color what you have identified?

(3) Horizon scanning should be a collaborative activity. It is essential to hear what other stakeholders think about your selections. They should hold different views from yours—the more diverse the group that performs horizon scanning, the better.

(4) When you decide with a group to include a particular signal in your expectations of the future environment, you should continue to follow the phenomenon and appraise it in light of what happens later. This rigor will help sharpen your understanding of how change occurs and when it is relevant for you.

A Final Point: Organizational Culture is More Important than Gathering a Lot of Signals

Directions and explanations of horizon scanning often focus especially on the collection of information and weak signals. This is a function of its history. Horizon scanning evolved in an information-poor environment. People had to go to public libraries and government offices to collect data. A conference or a meeting with an expert offered a rare opportunity for insight into an otherwise closed environment. 

Today is different. We are drowning not only in information but in intelligently curated collections of new, emergent innovations, ideas, and practices that come from many channels. This fact makes the entire concept of a “weak” signal less important. It places more pressure on the people collecting information to openly and thoughtfully select and evaluate their findings. Fostering an organizational culture that can take in information that may counter its dominant view of the future and is open to creative analysis is critical.  Without a strong, open culture around information, it does not matter how much information is collected because your organization will not be able to make good use of it.

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Side Note on the Value of a Wide Aperture in Scanning: