Embracing Scenario Planning

The events of September 11, 2011 provided organizations with one clear understanding of strategic development: the future does not necessarily look like the past (Kennedy et al., 2003). The past may be a reasonable guide when growth is stable and factors within the environment do not change (Ramírez & Selin, 2014). People in general desire a predictable environment where even change can be foreseen, calculated for, and anticipated. This is why quantitative data is valued so highly within organizational decision making, giving leaders the perspective future trends can be foreseen and prepared for because they are based on information from past. Even change can be accounted for with quantitative data since present trends can be extrapolated reliably to account for emergence (Ramírez & Selin, 2014).

This reliance on quantitative data reveals why scenario planning is not used more often. Organizational leaders want quick answers that can be counted on, but scenario planning, by nature, has a degree of speculation since it deals with the future that is not guaranteed (Chermack, 2011). Another reason why organizational leaders are hesitant to embrace scenario planning is because it uses the creation of stories as a way to create future perspectives (Saunders, 2009), giving the feeling it is an exercise of the imagination rather than serious strategic development.

What organizational leaders fail to understand is that scenario planning is designed to account for the novel, unexpected, unforeseen, unique, and radical changes that no one sees coming, such as a terrorist attack that cripples a nation’s economy and shatters its sense of security (Ramírez et al., 2010). Scenario planning rigorously surfaces and analyzes responses to the unthinkable futures that can not be quantitatively accounted for, yet (Choo & Bontis, 2002).

References

Chermack, T. J. (2011). Scenario planning in organizations: how to create, use, and assess scenarios. San Francisco, CA: Berrett-Koehler.

Choo, C. W., & Bontis, N. (Eds.). (2002). The strategic management of intellectual capital and organizational knowledge. Oxford: Oxford Univ. Press.

Kennedy, P., Perrottet, C., & Thomas, C. (2003). Scenario planning after 9/11: managing the impact of a catastrophic event. Strategy & Leadership, 31(1), 4–13. http://doi.org/10.1108/10878570310455006

Ramírez, R., & Selin, C. (2014). Plausibility and probability in scenario planning. Foresight, 16(1), 54–74. http://doi.org/10.1108/FS-08-2012-0061

Ramírez, R., Selsky, J. W., & Van der Heijden, K. (Eds.). (2010). Business planning for turbulent times: new methods for applying scenarios (2nd ed). London ; Washington: Earthscan.

Saunders, S. G. (2009). Scenario planning: a collage construction approach. Foresight, 11(2), 19–28. http://doi.org/10.1108/14636680910950129

 


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