Re-using scenarios in strategy
“Scenarios are the most powerful vehicles I know for challenging our mental models about the world and lifting he blinkers that limit our creativity and resourcefulness” Peter Schwartz
The Strategic Foresight method that is most widely taught in Business and Management Schools is scenario planning or scenario thinking. In this module we explore when and how to build and use scenarios as part of a Strategic Foresight toolkit. It is largely self contained but assumes a knowledge of environmental/horizon scanning. It covers some of the well known examples of scenario thinking in action as well as many other examples. It is an extensively updated and extended version of a brief that appeared in “Business: the ultimate resource”, ISBN 978-1-4081-2811-4.
What is scenario thinking? Scenarios as models of future worlds
Scenario thinking creates possible future outcomes (scenarios) to improve the quality of decision-making. One of the best definitions of scenarios is by Michael Porter:
“an internally consistent view of what the future might be, not a forecast but one possible future outcome”.
At a time of volatility and change, managers need to be able to step out of their current framework and imagine future worlds – which may arrive sooner than expected.
But some organisations feel that they do not have the capability to develop scenarios, for instance because they are not sure what questions to ask, or because they do not feel confident of their expertise outside their operational domain. In these cases, using existing scenarios is really useful.
Why use existing scenarios?
Using pre-existing scenarios as a basis for work in an organisation makes a lot of sense under some circumstances. For example
- Where the external environment is a dominant factor, e.g. the economy, then using scenarios based on economic futures to frame a discussion of implications for different parts of the organisation can be helpful
- Where the intention is to introduce scenario thinking to a group of people for the first time, it is often useful to use external “reputable” scenarios to allay suspicion of the provenance
- Where an organisation has developed scenarios already – for instance with an internal task force – and business units or functions need to explore the implications for their functions and roles.
Sources of scenarios
There are many well-established global and national organisations that undertake scenario studies on a regular basis, for instance
- Shell – related to energy – shell.com
- World Economic Forum – global and regional scenarios – http://www3.weforum.org
- Chatham House – https://www.chathamhouse.org
The scenarios below have been used across industry sectors and geographies:
- UK 2020 scenarios (the framework is useful globally and beyond 2020, though long in the tooth, these have a useful structure and detail) samiconsulting.co.uk/7Foresight_Futures_2020.pdf
- In Safe Hands? FS to 2050, samiconsulting.co.uk/5insafehands.pdf
An up-to-date list and links are maintained on the Unlocking Foresight Know How web site, www.unlockingforesight.org.
How to use existing scenarios
Existing scenarios are best explored in workshop mode. They need to be briefed as “fairy stories” which have been useful to other groups in developing their thinking. It is important that these workshops are held off-site to signal “different”, and that the participants have the opportunity to think themselves into the scenarios through sharing among the group members. A two-day format is good to allow reflection and absorption time; so residential workshops work better than non-residential.
More can be found in our scenario primer, www.samiconsulting.co.uk/4scenario%20planning%20%20a%20primer.pdf
Written by Gill Ringland, SAMI Fellow and CEO.
The views expressed are those of the author and not necessarily of SAMI Consulting.