IV. Departmental Practice Options in the Firm

Common Business Functions (Career Svcs, U. Kent)

To understand your practice options, it helps to know a little about each of the classic organizational departments, some foresight specialties commonly associated with them, and a few examples of exemplary foresight work that has been conducted in various departments to date. There is no definitive list of organizational departments, as they differ by industry, firm structure, and goals. Nevertheless, business texts usually introduce a common set, such as this set of fifteen (picture right) by the Career Services group at the University of Kent in the UK.

Below is our list of twelve departments, with names in red. These twelve are reasonably generic and comprehensive. Let me know if you disagree. Under each department we have also grouped one or more of the Twenty Specialties introduced in Chapter 1. While there are many other business specialties that help us generate foresight, these twenty are listed in gold to remind us that they are particularly useful to keeping the firm adaptive over the long term. We’ve tried to place each specialty into their most typical departmental homes, but this is just one possible arrangement. Organizations vary greatly in their use and management of foresight, and in practice, every department or team will use a number of these specialties for their work.

Team Product, and Market Fit
(Dave Kashen, Gigaom.com, 2012)

The twelve departments are also grouped into the classic Team, Product, and Market divisions, popularized by venture capitalist Don Valentine at Sequoia Capital in the 1970s. This is a useful meta-organizational strategy for any adaptive organization. When assessing the investment potential of an organization, many modern venture capitalists look at the “fit” of three key components: the Team/Leadership’s abilities and experience, the cost and quality of its Product or Service, and how well that product or service meets Market/Customer need. These three divisions thus offer a simple model of the firm. These three divisions of the firm exist in tension with each other, and compete for influence and resources. Think of management vs. product or service engineering vs. sales and marketing in a typical firm.

The use of each of the Twenty Specialties usually happens in different ways in all three divisions of the firm. For one example, consider Planning, one of the two subspecialties in Strategy & Planning. Most organizations benefit from, at minimum, a leadership-guided strategic plan, a product or service management plan, and a good marketing plan (Valentine’s team, product, market model). In practice, one or more of these plans is often neglected by top management. Also, team, product, or market plans are often far too elaborate, and produced far too infrequently, to matter to strategy.

How to balance foresight activities and resources among these three divisions is never obvious, and is more art than science. Seeing the different ways foresight works across the firm is the first step to better foresight management. Let’s look now at a departmental model for how these divisions, departments, and foresight specialties commonly associate in the modern firm.

An Organizational Foresight Model – Three Divisions, Twelve Departments, and Twenty Specialties 

1. General Management Division (Team)
   1. Top Management/Leadership/Admin/Strategy/Alliances/M&A/Change Mgmt/Entrepreneurship
      Management & Leadership,
      Alternatives & Scenarios,
      Auditing & Change Management,
      Entrepreneurship & Intrapreneurship,
      Facilitation & Gaming,
      Strategy & Planning.
   2. Metrics & Planning/Finance/Accounting/Reporting/Analysis/Budgeting
      Accounting & Intangibles,
      Analysis & Decision Support,
      Benchmarking & Quality,
      Data Science & ML,
      Forecasting & Prediction,
      Investing & Finance.
   3. Security & Risk Management/Health & Safety/Legal/Intellectual Property/Insurance
      Intelligence & Knowledge Management,
      Law & Security,
      Risk Management & Insurance.
   4. Human Resources/Hiring/Compensation/Performance Mgmt/Learning & Development
      HR & Performance Management,
      Learning & Development.
2. Product and Service Division (Product)
   5. Operations/Product, Service & Project Management/Engineering/Automation/Quality Assurance
      Product, Service, and Project Management (a Management & Leadership subspecialty),
      Quality (a Benchmarking & Quality subspecialty).
   6. Sourcing/Purchasing/Supply Chain/Contracting/Logistics/Inventory
      Purchasing Management (a Management & Leadership subspecialty).
   7. Information Technology/Hardware/Software/Social Networks
      IT Management (a Management & Leadership subspecialty).
   8. Research & Development/Innovation/Design
      Ideation & Design,
      Innovation & R&D.
3. Market Division (Market)
   9. Sales/Business Development
      Marketing & Sales – Sales.
   10. Marketing/Market Research
       Marketing & Sales – Marketing.
   11. Customer Service/Customer Relations Management/Customer Feedback
       Customer Service Management (a Management & Leadership subspecialty).
   12. Community Relations/Public Relations/Communications/Corporate Social Responsibility
       Community Relations Management (a Management & Leadership subspecialty).

Note that the Management division, in a typical firm, takes explicit or implicit responsibilty for fully seventeen of the Twenty Specialties. They take ultimate responsibility for the remaining three as well, but in practice, those specialties, and their divisions, often operate semi-autonomously, with their own culture. That is probably as it should be, given Valentine’s insight that there are three competing power sources in the modern firm (team, product, and market orientations).

This is a lot to be aware of, and many Top Management teams ignore, for example, their responsibility to do things like auditing, entrepreneurship, scenario generation, and strategy facilitation and gaming. Likewise, many Metrics and Planning teams ignore their duty do continual benchmarking, forecasting, prediction, and data science work. Security teams often neglect building strong competitive and collective intelligence platforms, including knowledge management, a responsibility of IT managers as well, as all the best KM platforms require the continual use of IT systems.

Note also that five of these twelve departments, operations, sourcing, IT & KM, customer service, and community relations, use subspecialties of management. They would not normally be expected to have direct foresight responsibility, but are instead supporting players. Leaving them out of strategy and foresight activities, however, is a big mistake commonly made, and the quality of firm strategy and action suffers as a result.

The top-heaviness of these functions is to be expected. As we’ve said before, foresight may arise and be initially championed by anyone in the firm, but it is top management that determines how much and where foresight is used in most organizations, especially over the long term. Without strong foresight capacity and commitment at the top, its survival at the departmental level will always be uncertain. Foresight consultants who understand this, and who do careful assessment of top management’s foresight culture, can strike at the root of foresight problems in many companies, rather than doing work that ends up being ignored, unimplemented, unnecessary, or otherwise a waste of effort.

As mentioned in Chapter 1, there is also often declining marginal value and growing marginal cost to the use of any particular foresight skill or method. Knowing when you’ve done enough is as important as knowing when and where to start. Top management must continually frame the foresight work to be done, decide whether marginal foresight is worth pursuing, and carefully assess its value after the fact.

Let’s explore each of the twelve departments a bit more now, and briefly discuss the Twenty Specialties and related foresight activities in their departmental contexts. We’ll return to the twenty specialties again in Chapter 5, when we consider them in the context of the Do Loop, our preferred skills-based model for adaptive foresight work.