Business Consulting 101 - Scenario Planning. Act now to foresee the future


Act now to foresee the future

Scenario planning enables organizations to rehearse the future, to stroll through the battlefield even before the war materializes so that they are better prepared to face it. Scenario planning is not about predicting future events but in helping businesses understand the forces that shape future developments.

Scenario planning challenges assumptions and enables leaders to manage uncertainty and risk. Scenarios help companies to understand the dynamics of the business environment, recognize new opportunities, assess strategic options, and take long-term decisions and by systematically imagining tomorrow, it promotes sophisticated responsive strategic thinking about the current situation to detect and understand changes.

• Scenarios are not predictions: They are used to understand the forces shaping the future. It is about understanding the general direction in which it is moving and why, and not about knowing exactly what the future will be.

• Plan and structure the scenario process. Define stakeholders by agreeing who will be involved.

• Discuss possible futures. Work back from a possible view of the future.

• Develop the scenarios in greater detail.

• Analyze the scenarios. Why they might occur, what you would do if they did.

• Use the scenarios to shape decisions and priorities.

Companies like Shell and Apple which have used scenario planning wisely have responded with great agility compared to their competitors while facing challenges that could have broken them and have grown multi-fold.