Scenario Planning tips
Scenario Planning, like Budgeting, can be leveraged in the right circumstances. It’s not uncommon for us to identify a large opportunity — a potential buyer, a large contract, an acquisition, a major change in corporate strategy, or some other major change — and conduct a “what if” type of analysis around what could happen.
In fact, it’s more of an “Opportunity Planning” process than a Scenario Planning process. The concept is still the same but with a longer time horizon.
Scenario Planning is a useful exercise to help companies and people look at what can happen and what would happen in a future situation.
In this case, we’re asking questions about the probable future scenarios. What would the impact be? What would it mean for our people and our business? What would the impact be on the rest of the industry? How would it impact the relationship we have with our major customers?
You’ll have to decide on your own if this is something you want to explore, or if you want to get more specific, with more specific questions and a more detailed exercise.
Few tips for Scenario Planning
▪️Understand you current position and the external environment.
▪️Set some parameters, some constraints, and some objectives.
▪️Consider the “what if” in a range of time and not just within a specific point in time.
▪️Be prepared for some wild scenarios, but understand what a wild scenario represents.
▪️Get a lot of feedback and build from this feedback.
▪️Always be ready to pivot.
