A clear organizational vision is vital to moving your people in the same direction to meet strategic goals. Attaining a vision supposes a lot of things going right along your journey, or at least being somewhat in your control – but what happens when inconvenient realities make things go, well, differently?
Many of today’s leaders simply lack the time, bandwidth or vantage point to think beyond the near term. Yet never-ending change makes it increasingly important to examine macro forces that can impact your customers’ environments, and to prepare yourself for flexible decision-making in an unexpected future.
Scenario planning is a powerful but often overlooked tool in strategic planning. Scenarios don’t define the most likely future – they map uncertainties and explore alternative futures, so you are better prepared for both.
While employed by organizations as large as Royal Dutch Shell, the World Bank and the Military, even smaller to mid-sized businesses can incorporate at least some foundational work into their planning efforts.
The biggest premise in scenario planning is don’t assume the future will closely mirror the present. [Consider the unanticipated changes that resulted from the 1970s oil shock, the ripple effects of the 9/11 attacks or even the recent Target data breach.] Start outside-in. Invest in truly understanding your customer’s world – what are they planning for? What external forces must they anticipate or react to? Such forces can be the root of opportunities, surprises, or unforeseen crises.
Then shift to inside-out thinking to assess the implications of those external forces on your core business practices, organizational capacity, culture and current strategies. Develop a set of plausible ‘what if’ scenarios grounded in your customers’ contextual environment. Explore postures such as…
- Does our current [intended] strategy hold up in each scenario? What are our strengths and weaknesses in each situation?
- In 3 years, will there still be a fit between what we do and the customer environment?
- Who or what kind of businesses will be successful in each scenario?
- Can we be reasonably sure a certain change will occur? What could the outcome of that change be on our customers? And what then is truly uncertain? What should we do or not do in each scenario?
Brainstorm, be creative, and stretch your thinking. A recent customer of mine reacted to our example scenarios as “mind bending” for the entrenched organizational culture. Generate options and test them against your scenarios. You can use a variety of tools – from team brainstorming workshops to highly structured analytical modeling.
Remember this is about plausibility, not prediction. But with this more informed perspective, you can design a strategic roadmap with enough flexibility to navigate unexpected turns. Then go for it.
For further reading: http://hbr.org/2013/05/living-in-the-futures/ar/1