What is 'Scenario Planning'?
Scenario planning is a model for learning about the future in which a coporate strategy is formed by drawing a small number of scenarios, stories how the future may unfold, and how this may affect an issue that confronts the corporation.
This is really something I have done during my attactment period in Motorola's S&E Asia Networks Strategy and Business Development team. And one thing for sure I did was Competitive Intelligences (CI) every month for the team report to higher level meeting. Every morning when I reached the office and switch on the my desktop computer, I will spend the next 1 hour or so going through these CI emails, newsletters and alerts from varies big CI resource firms around the world on the latest updates in the market places as well as whats' up on our competition's movement in the industry.
This was something really interesting and keeping me busy throughout the whole attachment period to collect CI informations for the team. And seriously speaking, I really enjoy every moment of it to the later stage where I was call upon to do strategic planning and business development.
Okay, I am really eager to elaborate farther to you guys more on my experience in the attachment job scope and stuffs. However, due to the sensitivity level of my work and our team in Motorola, I could not provide more to full up the gaps here. However, I would said my experience and learning opportunity there is second to none I have experienced so far. And its so challenging in Strategic planning and CI data collection work that you will get hook on to your work so much that you fall in Love with it. Hahah... Maybe because I am a person who enjoy challenges, if you do so this could be an area of job scope you can consider joining. Who knows we maybe one day competing against each other in the real world. Sound interesting to me...
Okay, Prof Gilbert go on to give us a very detail seminar on how to go about using scenario planning to help in our forecast of competitors' strategies. We look at building Multiple scenarios on a particular subject, a robust tool for exploring the likely consequences of current decisions in alternative futures.
One great example brought up by Prof Gilbert in the discussion was the use of a table to represent the Structural Dimension and Scenarios. The need to identify the structural factors to aids in the decision making is rather important. Looking for at least 3-4 factors will be best as 2 is too little to provide any insights and too many may form contradicting answers. The important of picking the best and worst case scenarios with a few other inbetween scenarios to illustrate the possible outcome of a certain decision making is the last step to complete the example.
With the multiple cases present in the table its time to perform Scenarios Analysis to scan and monitor external changes, prioritize large-scale reseach activities, game competitive responses and create or extend a learning organization.
To summarize the scenario planning and analysis work, here is the 'Ten Steps' to help you get it right:
• Develop CI planning & analysis premises
• Define Time Horizons and Decision Space
• Historical Review: search for structure
• Identify Common & Conflicting Assumptions
• Determine Indicators of Structural Shifts
• Build Draft Scenarios to fill Decision Space
• Develop Strategies for all Competitors
• Map Strategies against Scenarios
• Validate Alternative Strategies
• Select or Adapt Most Robust Strategy
• Define Time Horizons and Decision Space
• Historical Review: search for structure
• Identify Common & Conflicting Assumptions
• Determine Indicators of Structural Shifts
• Build Draft Scenarios to fill Decision Space
• Develop Strategies for all Competitors
• Map Strategies against Scenarios
• Validate Alternative Strategies
• Select or Adapt Most Robust Strategy
Some traps to avoid in a Scenario Planning:
1. Treating scenarios as forecasts
2. Constructing scenarios based on too simplistic a difference, such as optimistic and pessimistic
3. Failling to make scenario global enough in scope
4. Failing to focus scenarios in areas of potential impact on the business
5. Treating scenarios as an informational or instructional tool rather that for participative/strategy formation
6. Not having an adequate process for engaging executive teams in the scenario planning process
7. Failing to put enough imaginative stimulus into the scenario design
8. Not using an experienced facilitator
Wanna learn more on Scenario Planning? Check these few sites out, which I thought are quite good with lots of insights:
Cheers!
3 comments:
Good summary and insights on the use of scenarios. Personally, don't much believe in "worst case" scenarios, but find it useful to frame the others.
Another thought- apply scenario planning to your working life- 1st identify the external structures that will shape your career, then work out which ones may change (the shift from analog to digital hit some people hard), etc.
Yes, why not? I will be graduating soon this year. It will be interesting how I can use scenario planning to help in planning my career and working life.
Thanks for the thoughts and advises, Prof Gilbert. You have given me much insights and comments which helps me alot in my thinking process since.
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