In the following piece, we explore horizon scanning and consider various approaches for thinking about the future – and the uncertainties that come with it. It is for audit leaders and auditors alike. We look at why it is important and walk through four practical methodologies.
Future thinking can be analytical, observational and goal oriented. It can also be creative and intuitive.
All attributes you would associate with a good internal auditor.
Skip ahead to 5 takeaways on future scanning.
Why is this important to me?
There are four forms of ‘sight’: oversight, insight, hindsight and foresight.
They are all important aspects of being a great internal auditor.
We focus here on foresight, engaging in critical thinking about long-term developments; being a futurologist!
Foresight is about exploring and modelling possible future outcomes. Some organisations will have specialist teams dedicated to futurology, others will do it ad hoc as part of strategy and risk management exercises.
Internal audit may get involved in running workshops, participating in stress tests or providing assurance over how they are carried out. While predicting the future is unlikely to be accurate, working through potential risks (threats and opportunities) in a safe environment is better than waiting for surprises in the real world.
To look ahead is to:
- explore future developments
- anticipate risks - threats and opportunities
- considers factors for and against change
- analyse data, trends and expert information
- prepare and take action.
Foresight is important for risk-based auditing. Providing assurance that risk is being managed within a defined risk appetite also requires understanding of how that risk and the environment in which it sits might evolve. Facilitating a future-orientated workshop may form part of an audit or support risk management activities.
Foresight is also important when developing the internal audit strategy, for example matching future…