What are the ‘Scenarios’ in Scenario Planning?

What are the scenarios in scenario planning?

Scenarios offer narratives about the future. Imagining the future counts as a uniquely human trait. Much of the time, however, we think about the future in the same way we live our lives, extrapolating from one event to the next.

Emerging technologies, social movements, environmental realizations, political legislation and economic market pressures shape the future in ways that often challenge linear thinking, but because people don’t have the tools to explore the future more deeply, they often wait to adapt to change until it impacts them personally, which may be too late for a business or an individual to leverage the opportunities in the change, or avoid its negative impacts.

Scenario narratives don’t fit every person’s approach to planning. Some people simply want to explore. They don’t care about the outcome, just the journey. Some people care so much about the outcome that they constantly cycle through predictions, always looking for the next piece of data to solidify the case. They get paralyzed by their own analysis (this is known as analysis paralysis).

Scenarios force these extremes to common ground. Scenarios curtail analysis by creating a set of plausible futures that both expand and constrain it. Since a person or organization’s pre-conceived notion of the future seldom exists in its entirety in the scenarios, those who want to over-analyze find themselves on unsure ground because the assumptions they built into their extrapolation analysis crumble in many of the futures.

For those who seek to wander, the scenarios certainly create an ample imaginative playground, but the process requires action. The point of scenario planning is to make decisions under uncertainty, not to simply define alternatives. Wanderers need to return to the strategic problem to be solved and use the scenarios as input to the solution. Ideally, scenario-driven strategic dialogue offers new alternatives and contingencies that organizations might miss in a strictly linear extrapolation analysis. Scenarios often lead to better-informed decisions and, at best, to better decisions.

Scenario narratives and multiple futures

Scenario narratives offer multiple plausible futures that help individuals and organizations explore a range of possibilities, each with its own internal logic. Scenario planners write deep stories about the future that force leaders to confront their own assumptions and start thinking about alternative paths for navigating it. In some futures, seemingly ridiculous contingencies often offer a viable solution, and in others, ideas held with firm conviction falter under the changing circumstances outlined in the narrative.

Scenarios receive a name that describes their core characteristic and a first-person or third-person narrative that includes the state of the principal uncertainties in the domain.

Beyond the narratives, scenarios usually end up as a set of presentation slides that offer high-level overviews that include their name, a single paragraph description, a table of uncertainty values for that future and a list of current events that can be thought of as “evidence” that the narrative remains plausible as the future unfolds.

The narrative power of stories ultimately provides the scenarios with their power. These myths about the future evoke language, characters, and situations that help people imagine it and connect with its underlying logic. Scenarios deliver an alternative structure of facts and relationships, a divergent self-contained truth.

All scenarios will happen, and none of them will happen. The actual future will be some amalgam of characteristics first viewed through the scenarios. The scenarios instill their narratives in a way that people can use them as a lens for watching the future unfold—rather than pre-constructing a future based on a single set of assumptions and extrapolations, scenarios offer a probability cloud. It is harder for those who imagine many possibilities to find themselves surprised—and it proves easier for them to adapt to the future; that is, when they abandon any future they think should be.

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Scenarios do not predict the future but serve as doorways into it. As the future unfolds, those doors exist increasingly in the past. Scenario narratives only deliver value as long as they remain far enough ahead of circumstances to suggest alternative perspectives. Eventually, the narratives will require new engagement and new grappling with the emergent uncertainties that will influence the next ten or twenty years.

Key Serious Insights research on scenario planning

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