Corproate foresight in Bottom-of-the-Pyramid markets
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Corproate foresight in Bottom-of-the-Pyramid markets
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We examine to what extent successful business-development activities in uncertain environments can be classified as corporate foresight (CF) and to what extent they have been intentional and systematic. Beginning with identifying successful cases of new-business development in Bottom of the Pyramid markets, we use various data sources to reconstruct timelines and map CF activities. We selected the cases to maximise their heterogeneity in firm size, industry, nature of the product and ownership structure. Our findings suggest that the probing (experimental search) phase is particularly important in unknown and uncertain environments but that perceiving and prospecting (cognitive search) activities are necessary to find distant opportunities. In addition, we find that successful business-development activities rely on multiple iterations between perceiving, prospecting and probing. Our findings emphasise that CF should include activities that encompass both experimental and cognitive search elements.
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Corproate foresight in Bottom-of-the-Pyramid markets
- 1. JUNE 2017 PROFESSOR OF STRATEGY RENÉ ROHRBECK AARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT CORPORATE FORESIGHT FOR EXPLORING BOTTOM OF THE PYRAMID MARKETS JAKOB HØJLAND & RENÉ ROHRBECK
- 2. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT WE WERE WONDERING: How structured is business development (vs. chance encounters, trial-and-error learning, and unintended discoveries) when traced over time? How do firms (MNC, SMEs, Start-ups) succeed in creating new markets, where no market data is available, as in the Bottom of the Pyramid markets. Jakob Højland Aarhus BSS René Rohrbeck Aarhus BSS
- 3. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT WE USED THIS FRAMEWORK TO TRACE THE DIFFERENT BUSINESS DEVELOPMENT ACTIVITIES OVER TIME. BOP BUSINESS DEVELOPMENT PATHSCORPORATE FORESIGHT Building a Market Through Local Co-Creation and Deep Dialogue Creating a Sustainable Value and Distribution Chain Create Tailored Product Offerings Profitably Prospecting Perceiving Probing
- 4. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT CASE 1BOPBDCORPORATEFORESIGHT PERCEIVING PROSPECTING PROBING Increase of average stay duration in refugee camps Technology enables superior solution with only minor cost increase Build prototype and customer interaction TIME New prototype and customer interaction Building a Market Through Local Co-Creation and Deep Dialogue - not employed - Creating a Sustainable Value and Distribution Chain - employed - Create Tailored Product Offerings Profitably - employed - Co-financed field test PROSPECTING Privacy and security are unfulfilled needs 1 2 3 4 5 6 outcome outcome outcomeIntentional and systematic intentional unintentional
- 5. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT CASE 2BOPBDCORPORATEFORESIGHT PERCEIVING PROBING Lack of access to electricity triggers strong demand for smart solutions Adapting existing products to local needs TIME Proof-of-Concept with local customers Building a Market Through Local Co-Creation and Deep Dialogue - not employed - Creating a Sustainable Value and Distribution Chain - not employed - Create Tailored Product Offerings Profitably - employed - Acquiring needed certificates to sell in Africa outcome outcome outcomeIntentional and systematic intentional unintentional 1 2 4 5 PROSPECTING Managing the tipping point for smart metering in Africa 3
- 6. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT CASE 3BOPBDCORPORATEFORESIGHT PERCEIVING PROSPECTING PROBING Removal of subsidies for imported Milk Growing middle class in markets that are becoming more open TIME Official testing for market approval Building of a new strategy to circumvent an injunction Create the right value formula for the fat filled milk 1 2 4 5 6 outcome outcome outcomeIntentional and systematic intentional unintentional 3 Building a Market Through Local Co-Creation and Deep Dialogue - not employed - Creating a Sustainable Value and Distribution Chain - employed - Create Tailored Product Offerings Profitably - employed - PROSPECTING Identification of the ”fat-milk” solution
- 7. RENÉ ROHRBECK JUNE 2017 PROFESSOR OF STRATEGYAARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT WE FIND Trail-and-error learning (Probing) is particularly important in unknown and uncertain environments In addition, (i) continuous scanning for change drivers (Perceiving) and analyzing the interdependencies of change drivers with systems thinking (Prospecting) are necessary to find distant opportunities. i.e. opportunities that are markedly different from the current business. Firms succeed who stay persistent even when faced with early drawbacks. READ MORE Højland, J. & R. Rohrbeck 2017 The role of corporate foresight in exploring new markets: evidence from 3 case studies in the BOP markets. Technology Analysis & Strategic Management, forthcoming. (free pre-print version)
- 8. AARHUS UNIVERSITY DEPARTMENT OF MANAGEMENT