Assignment: Question to answer: How do managers perceive and implement scenario planning?

The question I wish to pose and answer involves implementation of scenario planning in an organizational context where managers are committed to traditional processes.

Wilson (1) notes some of the cultural challenges that may be encountered in the appearance of skepticism on the part of managers in the implementation of scenario planning. Managers traditionally pride themselves on their ability to develop a set of facts and analytically-based projections in which they and their superiors can place confidence. In fact, such processes are largely in keeping with typical teaching in business schools, focusing on rational and quantitative approaches toward creating a confident, single-point picture of the future:

So their initial reaction, when confronted with the apparent emphasis in scenarios on “multipoint forecasting,” may be one of confusion and disbelief, cwith the complaint that three (or four)  forecasts” are more confusing, and less helpful, than one. The fact that this is a misperception of the nature and role of scenarios does not in any way lessen the implementation problem (p. 24).

Making it clear from the outset that the purpose of the scenarios is to focus on concrete strategic planning elements is an important first step; strategic decisions can then be tested in relation to the various scenarios to determine their resilience in light of these potential vulnerabilities. This type of planning focus can help to bridge the culture gap between traditional linear, rational, single-point strategic planning and scenario planning. In this approach, each scenario is examined for opportunities and threats  individually and then in comparison to the others.  This process leads to determining what the company should and should not do in preparing for each of these scenarios. Contgrary to purer forms of scenario planning, one scenario is chosen as most plausible, and tested against the others . Vulnerabilities are identified and addressed, and strategic decisions are then made. In terms of change management in the face of skeptical managers,

…the approach can be justified as a useful intermediate step (between traditional and scenario planning) in weaning executives away from their reliance on single-point forecasting. It does not commit the ultimate sin of disregarding the other scenarios entirely; and, in its step-by-step process, it does address many of the key questions that scenario-based strategy should ask (p. 28).

Thus there may be variations in how scenario planning is conducted based on the management culture within the organization.

(1) Ian Wilson, From Scenario Thinking to Strategic Action, Technological Forecasting and Social Change, Volume 65, Issue 1, September 2000, Pages 23-29, ISSN 0040-1625, 10.1016/S0040-1625(99)00122-5.

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