Big thanks to Mary Schmidt for pointing us to the Harvard Business Review's "Scanning For Threats and Opportunities." Basically, the concept, in Mary's words, is this:

"In market scanning, it’s easy to get into the habit of reading the same industry pubs, talking to the same analysts, tracking the same competitors, etc. All the usual suspects. However, to really be prepared (and spot new opportunities) it’s necessary, as the article points out, to ask questions such as, “What changes could make our product obsolete?” We also have to look at things outside our own industry. What’s going on in our society? legislation? The economy? Demographics? Weather patterns? (Got a critical supplier in a hurricane zone? ruh-roh.)"

Sure, it sounds like common sense, but all too often, successful companies get into a task management mode that makes active scanning all but impossible. I don't want to use the term "routine" here, but when you are trying to balance the day's projects and campaigns and impossibly crowded "to do" list, active scanning tends to take a back seat. Unfortunately, not doing this kind of work (or rather, putting it off, as it were) eventually leads to stagnation and stunted innovation... which always comes back to bite you in the proverbial butt.

The degree to which the lack of active scanning can be detrimental to a company's progress tends to be environment-specific. As the article points out:

"Active, open-ended scans are particularly important in turbulent environments where unexpected, outlying data might become more important. In complex environments, the scanning must be hypothesis driven but also open-minded. In stable environments passive scans might suffice, while in slowly changing environments a passive, open-ended approach could work. But, ideally, your organization uses both approaches as needed."

- This and all other exerpts from George S. Day and Paul J. H. Schoemaker's Peripheral Vision: Detecting the Weak Signals that Will Make or Break Your Company.

All this is fine and good, but here's the beef:

"The active scanning process can start with the insights locked inside the company. In many organizations, this internal knowledge is not well connected to decision makers. For example, a CEO at one company was collecting information about a tangential competitor. At a senior management team meeting, the VP for manufacturing casually mentioned that this same rival had been buying equipment similar to their own, a sign that it intended to compete head-on. This competitive intelligence was within the firm, but until this meeting the VP didn't understand the strategic issues well enough to know that it was valuable. The scale and scope of organizations create problems of uncoordinated, distributed intelligence. Literally, the organization doesn't know what it knows and cannot bring the collective insights to the surface and coalesce them meaningfully. "The larger the company, the more points of contact it will have with the periphery. Salespeople are in constant touch with customers, development teams hear gossip at trade shows, retail sales clerks register complaints and requests for new items, and finance people are aware of competitors' capital needs. Each point of contact has the potential to be a valuable listening post. For example, most companies have call centers, but many treat these call centers as costs to be minimized rather than as useful listening posts. Often, these contact people lack the expertise to recognize and interpret the weak signals appropriately.

"To improve the ability to capture the peripheral insights within the organization, there must be (1) appropriate and visible channels for sharing information, (2) wide knowledge of the questions guiding the scan, and (3) incentives for actually sharing useful information. People must engage in frequent and free dialogue for the necessary connections to occur spontaneously. This, in turn, requires a culture of trust, respect, and curiosity, plus the recognition that information sharing is crucial. Too many companies still operate in a mode where information is shared on a "need-to-know" basis only."

How do you spell "Chief Intelligence Officer" again? Hmmmm...

The larger your organization, the more likely you are to need someone to help you create and manage this type of infrastructure for you. Just imagine what a talented CMO paired with an intuitive CIO could do for your company.

Food for thought.