Scenario Planning is related to the exercise of making decisions today with an understanding of how they can be developed in the future…
Using scenarios is rehearsing the future. You navigate simulated events as if you were living in them. You train yourself to recognize the issues you might face. This helps you avoid unpleasant surprises, and know what to do if they do happen.
Peter Schwarz - The Art of the Long View
Scenarios - Mind Exercise Break
When it comes to thinking about the future, people tend to relate better to concrete narratives that are consistent and coherent. In other words, we need stories that describe and make as real as possible a world that is different from the present and that challenges our thinking. These are the scenarios: exercises for the mind, in which the decision-making processes are strongly conducted (coach), developed and tested with the clear objective of obtaining their robustness.
Scenario Planning - Scenario Planning
Scenario Planning can be seen as two different processes:
1. Generation of Scenarios
2. Thinking with Scenarios - Scenario Thinking
These two processes with totally different starting points involve different methods and different goals. These are often, but not necessarily, developed by different teams in the organization. For example, planners could develop scenarios and executives are challenged to think with them.
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Scenario Generation
Scenario Generation is a process of developing two or more stories that produce some internally consistent alternatives and paths into the future. This provides knowledge in uncertainty and helps to structure and understand it, but not simply by the grid of variables and the multiple results produced. The theme is to have a set of stories that make visible the forces that drive the system (driving forces), their interrelationships and critical uncertainties.
Developed stories can be supported by a great deal of fine detail projected by research and expert opinions and can reach a high level in the sophistication of the narrative. Ideally they can be a combination of facts - in the sense of highly probable trends and unavoidable upcoming events - with fiction, in the sense of creative jumps and discontinuities in present assumptions.
If a scenario is not puzzling and challenging, it is probably not worth considering. The same is true if it is not credible to people with experience in the domain or line of business.
Thinking with Scenarios - Scenario Thinking
This process involves executives and decision makers using previously generated scenarios as thinking and learning tools. The process involves the temporary adoption of variables from a story and the extension of the same by imagination and discussion to produce a coherent common perspective in the context of decision and key information. Participants must work together to simulate key decisions with the parameters of the given story.
Such decisions must be rationalized and justified in light of the history of the scenario and the entire strategic direction of the organization. This type of "what if?" It must be analyzed with time and dedication and it must be extensive in order to clarify which would be the best decision under the current assumptions.
Working through the process with more than one scenario, allows managers to become familiar with the decision frameworks projected in each scenario. In search of a decision option that is viable in each decision framework, managers can derive a robust decision option for implementation today.
This process of deriving robust options for examining alternate worlds, if repeatedly iterative, will allow a cybernetic approach to decision making and problem solving and can rapidly evolve an emergent strategy that may be independent of the outcome of any particular world history.
With the application of this discipline, we will be able to move from reactive thinking to proactive thinking and develop a strategy during decision making that will be imposed under the pressure of the unknown.
