Three Lessons for Sustainable Scenario Planning

19 Jul 2010 Sandeep Mehta

I have always been a fan of scenario planning.  It really does provide great insights into R&D strategy and allows organization to develop robust R&D plans.  The article Six Lessons for Sustainable Scenario Planning talks about how interest in scenario planning is increasing because of the turbulent economy:

One business discipline that generated a huge amount of interest during the recession was scenario planning. We wrote about it for Bloomberg Businessweek and advised many companies on it. The Corporate Strategy Board (CSB) ran a series of meetings around the globe on scenario planning where clients exchanged ideas and talked about how to implement the most successful practices we saw in our client networks. These discussions led to the six lessons below.

I will make it a bit simpler than the six lessons in the article – three points to keep in mind while setting up or maintaining a scenario-based planning process.  I had trouble with Scenario Planning at one of the organizations.  These three are my lessons learned from the experience.:

  1. Formalize Scenario Planning: Have clear ownership / accountability for scenario planning. Ensure that the responsibility / authority are clearly defined and delineated from other ongoing efforts.  Finally, define and expect clear deliverables and results from the scenario planning exercise.
  2. Develop and use Actionable and Plausible Scenarios: It is not easy to devise scenarios that engender useful discussion and lead to robust plans.  On the other hand, one of the biggest benefits of scenario planning is the discussion around assumptions of different scenarios.  All scenarios are based on assumptions.  Organizations should make these assumptions known (explicitly) and allow some discussion on them.  However, the assumptions discussion should be managed effectively and stopped at some stage – otherwise the scenario-based planning discussion never actually happens.  The CIA actually publishes very good global geopolitical scenarios that can be used as a foundation.  However, scenarios that you would have to use will depend on the level at which you are doing strategic planning…
  3. Integrate Scenarios into overall planning and risk management: Once results of scenario analysis are know, use them to drive strategic planning and integrate them into risk management process.  Nothing drives implementation as much as results…

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