Strategy
Envisioning future scenarios help in preparing for the uncertainty
Deciding about the future is shooting in the dark. Most predictions go wrong. Most post-pandemic predictions will be wrong.
Scenario building can help prepare for the uncertain future. Scenario planning is concerned not with what will happen but with what might. It expands thinking, uncovers inevitable future, protects against groupthink & allows conventional wisdom to be challenged. At the same time scenario building is not about thinking too much, mudding communication, narrow outcomes, ignoring risks.
Charles Roxburgh, a director at McKinsey’s writes, “Scenarios are a powerful tool in the strategist’s armory. They are particularly useful in developing strategies to navigate the kinds of extreme events we have recently seen in the world economy. Scenarios enable the strategist to steer a course between the false certainty of a single forecast and the confused paralysis that often strike in troubled times.”
He suggest developing four scenarios. Two is few, and three makes people pick the middle one. The scenario with the highest probability should be the base case. Give scenarios catchy names such as ‘Digital India’. Failures and mistakes should give insights for the future scenario building. Value contrarian voices. Discount for environmental changes.
Dig deeper: Scenario building 101 for small businesses Link