The future scorecard: combining external and internal scenarios to create strategic foresight

TLDR

Scenarios traditionally describe alternative future developments in the external environment to inform strategy, but with a shift toward a resource‑based view they can also map internal development paths. The paper aims to create a future scorecard that merges external market‑based scenarios with internal resource‑based scenarios to provide a systematic strategic foresight tool. The authors build on literature and multiple case examples to systematically develop and combine external and internal scenarios into a future scorecard, forming a strategic early warning system. The study shows that merging external and internal scenarios yields a strategic early warning system and highlights the importance of integrating future perspectives into performance measurement and scenario thinking for internal resource development.

Abstract

Purpose The purpose of this paper is to provide a new and systematic approach towards strategic foresight by combining traditional external scenarios (market‐based approach) with internal scenarios (resource‐based approach) into a future scorecard, which can be used to describe alternative internal development paths for an organization. Design/methodology/approach The paper builds on the existing literature as well as on multiple case examples to illustrate the application of the future scorecard. Findings The findings of this paper are that it is possible to combine the external (market‐based) and internal (resource‐based) view to create a strategic early warning system. Practical implications The implications for practitioners are twofold, first, the paper outlines the importance of integrating a future perspective into performance measurement systems, second, it demonstrates the applicability of scenario thinking for the internal resource‐based view of the firm. Originality/value The paper combines thinking of the market‐based and the resource‐based view of the firm in order to provide a new tool to supplement most static measurement approaches with a tool that monitors the future developments – externally and internally. Scenarios are traditionally used to describe possible alternative future developments in the external environment, which then inform current strategy assessment and future strategy development. However, with a shift in focus away from the market‐based paradigm and towards a resource‐based view of strategy, scenarios can also be used to describe alternative internal development paths for an organization. These two types of scenarios can then be systematically developed and combined to form a significant element of a strategic early warning system – the future scorecard.