Exploring strategic futures: the power of scenario planning

Envisioning future outcomes can help to shape a business’s strategy in the present.

One method is through scenario planning, a powerful approach used to explore volatility, uncertainty, and complexity, and develop plausible futures by mapping out possible issues.

It is a tool to empower leaders and organisations to navigate uncertainty, assess risks and identify future opportunities.

AIM WA+UWA Business School Executive Education Scenario Planning and Strategic Foresight Facilitator John Sykes AFAIM said scenario planning was an important strategic foresight tool used by major corporations, governments, militaries, non-governmental organisations (NGOs) and academia to tackle the biggest global issues. 

“Scenario planning uses a combination of techniques, such as horizon scanning, storytelling, collaboration and strategic planning, drawing from a variety of sources, both past and present, to map plausible futures which can be used to manage uncertainty and shape organisational strategy,” he said.

“Notable practitioners include Shell, Oxford University the World Economic Forum, BHP and CSIRO.”

The benefits of scenario planning

According to AIM WA+UWA Business School Executive Education Scenario Planning and Strategic Foresight Facilitator Georgia Mathieson, scenario planning works best as a collaborative tool, making it highly effective in building social capital within organisations. 

She said while the process could be uncomfortable, it should be fun and creative to challenge people to think outside the box and work together.

“Scenario planning benefits business strategy by helping organisations to anticipate and prepare for uncertainty, such as geo-political forces, market trends and technological shifts while identifying potential opportunities and risks within these scenarios that might not have otherwise been obvious,” she said. 

“It helps to stress-test and guide strategies that are adaptable across different scenarios. 

“The practice also benefits organisations through encouraging collaboration across different parts of the organisation by bringing people together to work outside of their usual teams and engage in creative thinking.”

Utilising this tool within an organisation is a way to embed flexibility and forward-thinking into planning sessions.

Mr Sykes said uncertainty in global trends and current affairs showcased the importance of scenario planning.

“Perception-changing events such as the COVID-19 pandemic or the Russian invasion of Ukraine, as well critical uncertainties surrounding contextual trends, including the promises and perils of artificial intelligence, all highlight the importance of strategic foresight – and scenario planning – for contemporary organisations,” he said.

Using scenario planning effectively

The Scenario Planning and Strategic Foresight program at AIM WA is a highly experiential five-day workshop focusing on the techniques of effective scenario planning.

“We use a combination of techniques such as horizon scanning, storytelling and analysis, conversation and collaboration, as well as strategic planning,” Mr Sykes said. 

The program also utilises the Oxford Scenario Planning Approach – a strategic tool used to navigate organisations through uncertainty by creating diverse, plausible future scenarios.

“The Oxford Scenario Planning Approach is applied through an active, iterative and interactive format combining lectures, videos, reading and research, individual and group exercises, plus group presentations,” Mr Sykes said.

“Participants will choose a real-world organisation upon which they will undertake scenario planning and strategic decision-making.”

The strategic benefits for organisations

Mr Sykes said participants could expect to learn numerous skills around scenario planning which would benefit anyone in a public or private sector organisation involved in management, strategy or policy.

“Participants will learn how to identify the sources of competitive advantage for private and public organisations which can be impacted by contextual change,” he said.

“This includes using horizon scanning to assess contextual change, including emerging trends, notable events, fringe knowledge and remarkable people.

“They’ll understand the true lessons of history on non-linear change for better strategic foresight and write compelling scenario stories which promote, persuade, inspire, inform, interest and entertain.”

During the program, participants learn how to collaborate with diverse and sometimes difficult stakeholders using strategic conversation, strategic collaboration and strategic ambiguity.

Mr Sykes said people would acquire knowledge on how to convert scenarios into bold, simple and focused strategic insights for rapid implementation and substantive impact, as well as embedding scenario planning processes as organisational habits to ensure the perpetuity of strategic foresight.

Where to from here?

Navigate uncertainty, drive strategic conversations, and implement bold insights for impactful organisational change with the Scenario Planning and Strategic Foresight program. Book now