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Here be Dragons webinar: organisations using scenarios

May 9, 2012

This blog explores some of the questions about scenarios in more detail.

 

How to bring in top management into scenario development?  This is clearly important since the purpose of scenarios is to underpin decision-making. We have found that the best results are obtained if senior management are involved both singly and as a group:

  • Briefing to the management team before the project starts, describing the process and timescale and their involvement
  • Interviews using a set of questions such as the SAMI 7 Questions, which allow the interviewee to think wider than their current in-tray
  • Involvement of the team in the workshop to create the scenario outlines
  • Involvement of the team in a workshop to use the scenarios to  “wind-tunnel” the current strategy and new options.

Sample agendas for the workshops are given in Here be Dragons, or Scenario Planning[1]. There are several ways of capturing the information on the drivers of change found through horizon scanning – some people use cards, one per driver – this allows the group to accept or reject drivers – or a presentation of the drivers and pre-circulation of the material, which supports a discussion “what have we missed?” – this is excellent for surfacing the concerns of the organisation, in a way that cards do not seem to.

While top management are likely to be briefed on the scenario process if not involved, what are the practicalities of bringing in operational staff along?  We discussed what operational staff are likely to be asked to do, in connection with scenarios. Some ask just to be given their budgets, resources and tasks; others ask “how are the scenarios developed – why these?” and others are essential to the success of implementation. The methods of communication of scenarios to operating managers is discussed in Here be Dragons – it differs according to the discipline (eg engineers, accountants). And we have found that if staff need to be aware of the scenarios, this is accomplished by working with them to identify  “early indicators” of each, which are newspaper headline level events relevant to their domain which would signal the evolution of a particular scenario. They are then asked to flag when these are seen, hence bringing them into the (virtual)  team.

How should an organisation decide how broadly to plan for the future?  The questioner pointed out that innovating for multiple scenarios is inherently inefficient because not all scenarios will happen; the resulting organisation will be resilient to the future but less competitive in the present. The panel discussed this from two directions:

  • Is a lack of efficiency necessarily bad?
  • What are the practicalities of preparing for more than one scenario?

In terms of the desirability of efficiency, what we can learn from biological systems is that the systems most highly tuned to a particular environment are those which are likely to disappear if the environment changes. What this suggests is that organisations need to dedicate a small part of their attention to exploring changes in the environment in order to be able to survive. In Beyond Crisis[2], we distinguish between 99% organisations and 95% organisations – flat organisations like retailers probably need to dedicate less than 1% to anticipation, more complex organisations maybe as much as 5%.

Preparing for more than one scenario will involve mostly thinking time – as in the early indicators just mentioned – and is thought by Shell to allow them to make decisions up to six months earlier than the competition. In other organisations the preparation may involve prototyping, or talking to customers about their needs under each scenario (as in Here be Dragons). We have found very few organisations that have developed full  strategic plans for each scenario: the effort is instead put into identifying decision points and constructing options robust across all scenarios.

 


[1] Gill Ringland, Scenario Planning, John Wiley, 2006

[2] Gill Ringland, Oliver Sparrow and Patricia Lustig, Beyond Crisis, John Wiley, 2010

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