using strategic frontiers as a
forecasting tool — and how we’ve
used it at pDMa
Robert E. Johnston Jr.
Robert e. Johnston Jr., pDMa president & chair, and principal, The Vistera
Group ( bjohnstonjr@yahoo.com)
In the second part of this series on foresight, PDMA President and Chair Bob Johnston describes the concept of strategic frontier, why
it is such a vaulable forecasting tool and how it has been used by PDMA.
My last column in Visions invited you to examine your orga-nization’s opportunities on a 10-year horizon as one way to assess the strength of your firm’s foresight capability. If
your company routinely tracks emerging trends as a way to identify
and support new long-term growth opportunities, you should be
encouraged about the organization’s future. However, if there is no
capacity or experience for spotting and evaluating the positive or
negative consequences of future forces, be concerned.
Peering a decade into an uncertain future is no easy task.
Foresight tools and language are limited. How does an organiza-tion comfortably and efficiently discover innovative new growth
opportunities that are not yet on the visible horizon? How might
leadership be aligned on a common future focus? With limited
resources to compete in today’s markets, how do you justify an
allocation of resources for identifying tomorrow’s opportunities?
And, finally, how might you harness the imagination of the whole
organization in creating future growth for your company?
One proven way for an organization to identify and align its
NPD goals is to use a tool called the “strategic frontier.” A
strategic frontier is an unexplored area of opportunity beyond the
periphery of today’s business. Prior examples, although they may
not have been called frontiers at the time, might include Pet Care
for P&G, Banking for Fidelity Investments, Pharmaceuticals for
3M, Services for IBM…you get the idea.
When leadership identifies a list of all the possible strategic
frontiers and then aligns on one, it creates a powerful future focus
across the organization.
Marketing, R&D, manufacturing, sales, distribution—all these
functional areas—have a point of alignment for the future and
can begin to explore the current and emerging trends that might
impact the delivery of new “value” into the marketplace from
their functional perspective. What’s more, the company now
benefits from the learning curve of everyone who is engaged in
the frontier’s exploration—24/7.
As new language, a strategic frontier defines space unexplored
by the organization for innovative growth. A quick Google search
suggests that “frontier,” as a descriptive term, is most often ap-
plied to the Wild West of the United States in the 19th century,
space exploration (as in the Apollo mission or Star Trek’s “final
frontier”), or to help lead nations in new directions (as in U.S.
President John Kennedy’s “New Frontier”).
Linguistically, strategic frontier invites the curious mind to explore
the newly defined territory. Often, those exploring the frontier have
the same sense of adventure as early cartographers in an unmapped
territory. Teams charged with identifing growth opportunities on a
strategic frontier form tight, long-lasting bonds, having charted new
growth opportunities for their organizations. Other terms I have heard
used to describe where a company might look for future growth op-
portunities are “domain” and “bucket.” The term “Blue Ocean” prob-
ably comes closest to the spirit and intent of a strategic frontier.
Many, if not most, companies have a vision and a one-to-three-
year business plan. Often, a void of strategic thinking exists
between these two points of organizational alignment and clarity.
Think of a strategic frontier as being the “bridge” between the
two. It will ensure that
the firm is moving in a
direction consistent with
the vision and provide an
important “future influ-
ence” on today’s busi-
ness decisions in the
process. Companies will
experience an increased
future orientation throughout all disciplines. A greater influence
of foresight can be observed in business plans, budgets, and daily
operations.
In the 1990s, the 3M Company achieved these foresight benefits
when the senior vice president of global technology, William Coyne,
assembled a foresight group. This hand-picked team met regularly
to identify and then track current and emerging trends that could
foreshadow new territory for 3M’s innovative growth.
As often happens, the board’s alignment on a strategic frontier
enabled the organization to focus limited resources on exploring and
realizing opportunities on that frontier. This year a Globalization
Initiative will tap the talent of international affiliates and the board
will create a PDMA globalization roadmap to 2020.
Strategic frontiers can also, of course, be missed. Microsoft
missed the Internet. IBM missed personal computing. Most super-market chains missed the stampede toward natural whole foods.
Which companies in 2020 will have benefited from paying at-tention to such frontiers as social media, nano-technology, “green”
energy, mobile computing, 2 billion new middle-class consumers,
and the privatization of space back in 2010? Every organization
has multiple strategic frontiers to be explored for new growth
opportunities. What are yours? I would like to hear from you at
bjohnstonjr@yahoo.com.
“A strategic frontier is an unexplored area of opportunity
beyond the periphery of today’s
business.”
