Scenario Planning

It’s a truism to say that the only certainty about the future is its unpredictability. Add to that the interconnectedness of today’s systems and peoples which make our world increasingly unpredictable within ever shorter time-spans. Second-guessing the future has become no matter for oracles, but a mind-baffling process often wildly out of kilter with new realities.

Planning, however, is necessary in the making of sustainable organisations and communities. Thus we need thinking tools to help us glimpse the dynamics that are driving current events and forces, register significant changes when they’re happening rather than with hindsight, so enabling us to steer what’s going on now to enable longevity and success.

Scenario planning is one such tool.

Scenarios are a set of distinct stories about alternative possible futures, focused on external uncertainties. They can be particularly useful under conditions of high complexity when little can be foreseen, or when there is a paucity of reliable information about the external environment. They are a good way of challenging, stretching or simply updating our mental models of an organisation or society, and its external environment.

Scenario planning was developed by Shell from the late 1960s onwards. The scenarios they created enabled them to respond far more rapidly than their competitors to the huge oil price rise after the Yom Kippur war. Since then scenario planning has been used by organisations and governments alike. As well as Shell (who still publish future scenarios on a regular basis), examples include the the Mont Fleur scenarios in South Africa in the early 1990s and the World Economic Forum Scenarios to 2025.

“The purpose of scenario thinking is not to identify the most likely future, but to create a map of uncertainty – to acknowledge and examine the visible and hidden forces that are driving us toward the unknown future.” (from “Why Scenarios”, Global Business Network.)

Scenarios, in essence, present us with options. Options are assets — and options that are effective across and range of futures are the most valuable.

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We are grateful for the support and practical help of Professor Frances O’Brien (Warwick Business School) working with Maureen Meadows (Open University) in creating the initial scenario planning models and frameworks for the first New Optimists Forum series.

Very many thank are also due to Dr Rafael Ramirez, Director of the Oxford Scenarios Programme at the Oxford Martin School for his challenging questions and good advice when I got intellectually stuck more frequently than I ever thought I would — and to the Change Leadership Network at Said Business School and Cite Universitaire in Paris who generously invited me into their group and encouraged me along the way.

 

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