Scenario planning

Wednesday 19th of August 2009 09:11:01 PM

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Scenario planning overview

Scenario planning is technique or methodology that attempts to describe a group of both destinct and plausible futures. So, scenario planning is aimed at making sense of an uncertain future.

Scenario planning makes sense when you realize that all our knowledge is about and/or based on the past... but all our decisions are about the future. That is, most of what we need to know so as to be able to make a good decisions is outside our comprehension, that is, we don't even know it's there - we don't know what we don't know. Hence, scenario planning is about focusing on making better decisions.

Uncertainty and predictability - Scenario planning

Different type of futures

  • Possible, that is, it 'might' happen, basically future knowledge
  • Plausible, something that 'could' happen, and is based on current knowledge
  • Probable, something that is 'likely' to happen, that is current trends
  • Preferable, something that we 'want' to happen, and is the result of value judgements

That is, probable futures are a sub-set of plausible futures which are in turn a sub-set of the possible futures. Preferable futures, on the other hand could be a sub-set of the plausible set of futures but, just as likely, they don't actually have to be plausible at all (and should be considered a sub-set of the possible futures).

Types of futures - Scenario planning

It is important to understand that scenario planning is not a strategic planning process. It's about identifying plausible options, not defining actions - that comes later.

Scenario planning process

Identify the focal question or decision

Scenarios should address a specific aspect of the future. That aspect should be a major decision or issue that the organization is facing.

Assessing uncertainty and environmental analysis, both internal and external (PESTLE analysis)

Both identifying and ranking of drivers of change

Build the scenario matrix

Develop the resulting scenarios

Consider the strategic implications of each scenario

Scenario planning in combination with problem solving methodologies


Concepts for additional research

  • Systems thinking
  • Feedback loops
  • PESTLE analysis
  • Game Theory
  • Driving forces