Scenario Planning and Agility: The Case for Scenarios In an Uncertain World
Scenario planning and agility. Too often, managers and leaders focus on how to control the near-term. They don’t take the time to consider if what they prioritize as important today, will be useful, valuable, or applicable to some future state of the organization. As soon as the future comes up in conversation, people typically take one of two positions:
- they dismiss the future as something beyond them, or
- they engage in the discussion haphazardly, with great confidence in their own prognostications.
Both create dangers when attempting to navigating the future. The first ignores it, hoping that its arrival will be slow and its implications nonconsequential. Rarely is that the case. The second asserts assumptions that may put the organization on the wrong trajectory, perhaps one it cannot adjust in time to meet the real needs of a future market. Both lock people and the organization into a set of assumptions about the future that may not be documented. Plans rub up against the unfolding future creating friction rather than fulfillment.
Scenario planning’s “uncertainties” are best captured using STEEP, which stands for Social, Technological, Economic, Environmental and Political. These categories help prompt thinking that goes beyond most participants day-to-day areas of influence. The uncertainties should be explored from the outside-in. This means that the global and higher-order market uncertainties should be gathered rather than those related directly to the company, or to its immediate market and competitors. When a competitor will ship a new product is a much more near-term issue than the shape of the regulatory framework for an area in ten or twenty years.
Scenario planning offers a third approach, a more rational path that incorporates both fear and forecast. Scenarios begin by documenting all of the forces and factors for which no one can possibly know the value they will hold in the future. These forces and factors must be critical to the organization and its business, or its sphere of influence in the case of NGOs and governments. By purposefully documenting uncertainty, scenarios help people and organizations confront what they can’t know.
Although individuals may fear the future, at least the components of that fear have a name. Scenario planning taken to its conclusion develops a range of possible ways those uncertainties might play out. This can help managers and individuals consciously navigate the future more effectively by providing sign-posts to monitor and contingencies to evoke. Scenarios will likely not predict the future, but they may well influence outcomes.
Scenarios help organizations innovate and see possibilities because they undermine the single myth about the future and replace it with a range of possible futures. The prediction evolves into forecasting. The false certainty of an asserted future transforms into a qualified statement that reveals different paths depending on how groups of uncertainties play out against each other.
Scenarios offer organizations a wide range of strategic value, including:
- Helping identify how they might need to adapt to future circumstances
- Identifying emergent opportunities
- Avoiding surprises
- Testing and challenging prevailing assumptions
- Understanding the implications for different possible futures on strategies, goals, and objectives
- Creating an early warning system so they can better anticipate change
Perhaps the most important impact of scenario planning comes in the recalibration of the minds of those associated with the project. No longer can a person exposed to scenario planning be complacent. The future is no longer abstract. It becomes fluid as assumptions fall away to expose the raw core of history unfolding.
Scenarios present stories of the future. Those who help develop the stories want to know, often passionately, how they turn out. And unlike other stories, their lives, their careers, and their very futures are bound into the scenario narratives.
Scenario planning and agility
As organizations look for ways to engage their employees, to help them find passions that align with their work, they could do worse than giving their leaders and managers a robust framework for facing their fears, and a tool for co-creating and navigating the future. Scenario planning drives agility. Many organizations provide employees incentives to innovate, but they often withhold permission to actively engage in possibilities. Scenarios offer permission to explore, and with that permission comes innovation, engagement, and agility.
Additional insight into the scenario process can be found here:
- HBR – CIOs: Scenario Planning Can Save Your Job
- Scenario Planning and Agility: The Case for Scenarios In an Uncertain World
- Scenario Planning: How to Test Scenarios
- What are the ‘scenarios’ in scenario planning?
- How to write a good scenario planning focal question
- How to Think About Voting For Uncertainties in a Scenario Planning Project
Learn more on the Serious Insights agility workshops.