Would you like to know what’s over the horizon? The truth is, nobody can precisely predict the future but we can get an idea with a handy improvement tool called “future scenario planning.” You can use scenario planning personally, in a work group or for an entire organization.
A Great Tool
As an entrepreneur, you might want to explore if part or all of your current business approach will work longer term. As a boss, you could choose to use scenario planning to find out more about retention and morale. As a parent, you may be curious how your child-raising methods will work. Future scenario planning is a natural way to consider what might happen “out there” for these and many other possibilities.
None of us can predict the future with great accuracy. However, we can make general, high-probability forecasts with some certainty without highly specialized experience. For example, you and I could make a few general forecasts based on a scenario of steadily rising oil prices. We would probably miss several details but the main thoughts would be reasonably correct.
To maximize the value of future scenario planning, it is important to suspend limiting assumptions. For instance, if someone says, “That will never happen,” let the comment be a red flag. Some pretty crazy, unexpected things have happened in the last several years. In short don’t instantly accept or reject a possibility, examine it carefully first. But let’s step back a moment.
Brainstorm a List of Possible Future Scenarios
The first key question is “what if?” What if we continue ahead without any changes? What if we change this large variable or another? What if the market dries up? What if we start a R&D arm? You might think of this as worrying-with-a-purpose. The purpose is to consider the possibilities and then build a possible response. One caution is to not get too detailed as we are not predicting the future but simply working to consider likely scenarios. Another way to think of this exercise is like a set of computer if-then statements.
Another key part is to think long-term. You must decide what that means in you setting (days, months, years, etc.). The strength of scenario planning is to give the consequences time to emerge. The exercise can turn into fun as different ones suggest variable changes.
Shorten the List to the Few Most Likely
Look at each possibility and decide on pros and cons. If you don’t like the outcomes, play with the assumptions and see if you can improve the consequences. Now work on cutting the list.
There are several ways to do this. One simple approach is to first decide the criteria for choosing your favorite future options. Do you want use your personal or corporate values (or both)? Do you want to focus strictly on the outcomes? How do you want to tie into your personal or company purpose? Another way is to decide based on a balanced set of pros and cons. Maybe you want a hybrid of several requirements. The point is, choose what works best for you and your circumstances.
Just as too many options at the grocery store confuse some of us (my hand’s up), too many future alternatives may not help you or your organization. To bring clarity, fewer options are better. Theoretically, a person or company could have any number of scenarios but the time is better spent on boiling down all the possibilities and thoughts to a select few. I’ll explain why in a moment.
Include the Status Quo
There is a strong pull in any type of organization (or even for us as individuals) to stay with the comfortable, the status quo. Be sure and explore this possibility and what you expect as logical outcomes should the path continue unaltered. Otherwise, it will be tempting to fall for the siren song of sticking with the comfortable. In other words, the result of doing nothing differently should also be considered to make sure the choice at the end of the exercise is truly intentional.
Make a Choice
Remember the idea of worrying with a purpose? The purpose is to make changes now based on a scenario we intend to use. Notice I said “intend to use.” Other scenarios can stay on the shelf just in case but the intent is to make current changes to create more positive outcomes down the line. It’s very important to make a choice rather than be carried along with some mysterious current. As a fellow consultant says, “No decision is a decision.”
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