Some interesting posts on the topic that came through my feed reader over the past few months...
Eyes Wide Open: Embracing Uncertainty through Scenario Planning - Knowledge@Wharton
As protests in Iran last month drew the world's attention, the top executives at a large global industrial goods company held a teleconference to consider their options. The meeting was hastily called, but the participants were not starting from scratch. In fact, the events unfolding in the country were strikingly similar to a scenario that they had developed, along with a handful others, in a 2008 offsite meeting focused on potential changes in their competitive environment.
The workshop, the output, and the eventual impact on decision making represents a perfect illustration of how so-called scenario planning techniques can be utilized to help managers navigate in complex and uncertain environments. In the meeting the industrial company held last year, executives had discussed each scenario they developed, the potential triggers for each of them, and how the company should respond to each of these situations if it were to arise. Pulling out the notes from these discussions, they already knew their options and had a view on how they would like to respond. In many ways, they were prepared -- and already one step ahead of some other companies.
Paul J. H. Schoemaker, research director of the Wharton School's Mack Center for Technological Innovation, says such examples illustrate a continuing shift in how companies think about the future. He observes that when managers are facing the profound uncertainties increasingly seen today, they tend to adopt one of three strategic postures.
Wired and Personal Scenario Planning: Be Cautious About Certainty - Windows Live
Peter Schwartz outlines personal scenario planning in the current Wired (Your Future in 5 Easy Steps: Wired Guide to Personal Scenario Planning). As a fellow scenario planner, though, I have to say readers should be cautious. One break I have from traditional scenario planning is any inclination to say that anything is certain. Especially something that isn’t built into the way the world works. I take pure demographics as pretty certain, but even these numbers can be subject to unexpected changes (Everything you know about demographics is wrong, Sam Kington). We need to be cautious about applying certainty.
The point of scenario planning, after all, is not to be right, which is such a human inclination that we find it hard to overcome—the point of scenario planning is to see the future from perspectives we would have a difficult time forcing ourselves to imagine because of our bias toward rightness, and therefore imagine new possibilities or see threats we might otherwise miss.
So my advice to would-be personal scenario planners is to listen to the future (see my book Listening to the Future), and, as Schwartz advices in a later book, that we look for “inevitable surprises.” The trick is to know we will always be wrong as we speculate about the future. We need to learn to be diligent in how we watch for signals, but perhaps more importantly, how we navigate uncertain terrain, never knowing what will turn up after the next event, be it global or personal.
Think anew, Act anew: Scenario Planning
Some time ago I outlined the basic principles of managing a complex system and promised to use them to explore a range of management issues. It's been longer than I intended, partly because it's starting to look as if each of these requires a minor essay, or possibly (dare I say it) a book chapter. My first subject is scenario planning, although I am thinking of that in a wider strategic context that the generation of a series of structured narratives about possible and credible futures. The conclusion of all of this will link back to the Seneca quote above; I will be arguing that we should be finding ways to better describe the current situation, in order to manage the emergent possibilities of the present; further that we need to find ways to create a process of thinking about scenarios that is highly dynamic, engages large populations in evaluation and speculation. In particular I want to talk about moving from anticipation to a state of anticipatory awareness.
Given the time since I first introduced this topic (I planned a couple of weeks, but its panned out as the best part of half a year) I'd suggest a quick read of the original post, which concluded with three necessary, although not necessarily sufficient conditions for any strategy based on complexity theory. The three were: (i) distributed cognition, (ii) using fine granularity objects and (iii) disintermediation (connecting decision makers with raw data in real time). A final warning before you read on - this posting has not been fully proof read and will be modified with additional material over the next week or so. Consider it an invitation to participate in a work in progress.