Research Foresights: The Use of Strategic Foresight Methods for Ideation and Portfolio Management: PepsiCo Advanced Research Used a Customized Process That Incorporated Strategic Foresight Methods to Influence the Company's Strategic Research Agenda

By Farrington, Ted; Henson, Keith et al. | Research-Technology Management, March-April 2012 | Go to article overview

Research Foresights: The Use of Strategic Foresight Methods for Ideation and Portfolio Management: PepsiCo Advanced Research Used a Customized Process That Incorporated Strategic Foresight Methods to Influence the Company's Strategic Research Agenda


Farrington, Ted, Henson, Keith, Crews, Christian, Research-Technology Management


One of the challenges in starting new teams for breakthrough or radical innovation is the need to see beyond the business-unit time horizon to identify robust innovation challenges that will be relevant when the required technical solutions have been delivered. Fundamentally, the time required for meeting the challenges presented by breakthrough technical innovation often exceeds a company's time horizon for understanding consumer and customer desires. Foresight methods, which are commonly used by futurists to explore distinct alternative views of the future, can help bridge that gap.

Since 2008, PepsiCo has been exploring how foresight methods can be used to influence a company's research portfolio, offering a complementary approach to common portfolio management methods. In that year, the company formed two new research departments to pursue breakthrough innovations in the areas of ingredients, processing, and packaging for its global food and beverage businesses. These two new departments, PepsiCo Advanced Research (PAR) and Long Term Research (LTR), partnered with AndSpace Consulting to lead a yearlong program that used foresight methods to identify technical opportunities that would impact longer-range research agendas. This Research Foresights Initiative was designed to help researchers address a range of challenges commonly faced by long-term innovation programs inside large corporations, identified in previous research by the Industrial Research Institute and others (Leifer et al. 2000; O'Connor et al. 2008). These include:

* Learning about markets that don't yet exist,

* Finding breakthrough ideas,

* Transitioning innovation to operations,

* Embedding a portfolio orientation in project management for breakthrough innovation,

* Allowing for reciprocal influence between innovation and strategy, and

* Avoiding a stop-and-start approach to breakthrough innovation efforts.

The initiative clearly demonstrated that foresight methods can facilitate a productive approach to these challenges. Several components contributed to its success. At the design stage, appropriate foresight methods were chosen based on the outcomes required by the organization. These methods were combined into a process that moved the management team from their existing beliefs about the future toward a new understanding. Workshops at each stage engaged leaders and spawned champions for the content and for the initiative itself. Finally, the foresight results were explicitly linked to the goals of the research organization and incorporated into the company's regular planning exercise.

Project Commissioning and Design

To better understand how foresight methods might help address some of the challenges to longer-term research efforts, PAR and LTR partnered to commission a comprehensive white paper by AndSpace Consulting that reviewed foresight methods. This led to an executive workshop with leaders from research, marketing, and sales disciplines in attendance. Participants learned about selected methods; applying those methods, they then generated an initial understanding of future market developments that were of interest both to the research units and to the broader operational side of the company. Most importantly, the workshop emphasized that foresight methods were not stand-alone tools, but were best utilized as part of an ongoing, iterative process of learning about the future (Hines and Bishop 2007). PAR and LTR identified sponsors and a six-person working team and commissioned the Research Foresights Initiative to test a foresight process and survey some of the tools available. The team defined as their goal the development of "compelling perspectives based on future possibilities 5 to 10 years in the future that results in potential new product spaces and business models and identifies the technical breakthroughs required to enable these opportunities. …

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