The Role of Strategic Foresight and Scenario Planning in Enhancing Futures Thinking among SMEs: A Dynamic Capability Perspective

Abstract

Purpose: This study aims to examine how strategic foresight and scenario planning enhance futures thinking among small and medium-sized enterprises (SMEs) in Malaysia. Drawing upon the Dynamic Capability Theory (DCT), the research conceptualizes strategic foresight as a sensing capability, scenario planning as a seizing and transforming mechanism, and futures thinking as a higher-order strategic competency. The study seeks to explain how these interrelated capabilities help SMEs strengthen adaptability, resilience, and long-term preparedness in uncertain environments. Design/methodology/approach: A quantitative, cross-sectional design is adopted, supported by a preliminary qualitative study with SME leaders. Data will be collected through a structured questionnaire from decision-makers in manufacturing and services SMEs. Partial Least Squares Structural Equation Modelling (PLS-SEM) will test the hypothesized relationships. Findings: The study is expected to show that strategic foresight and scenario planning both positively influence futures thinking, while their interaction further strengthens this effect. SMEs that apply structured foresight and scenario planning are anticipated to demonstrate higher adaptability, preparedness, and resilience in uncertain environments. Research limitations/implications: The focus on Malaysian SMEs and the cross-sectional design may limit generalizability and causal inference. Future studies should adopt longitudinal approaches or extend the model across regions and industries. Practical implications: Findings will guide SME leaders and policymakers in embedding foresight and scenario planning into strategic processes to enhance competitiveness and readiness for future challenges. Originality/value: This study offers an integrated DCT-based framework linking foresight, scenario planning, and futures thinking, providing new insights into cognitive and strategic capabilities in SMEs.