State the focal issue or decision facing the enterprise.
planning works best when it proceeds from the "inside out"
rather than the "outside in". The best way is to
begin with the important decisions that must be made and then
progress outward to the environment. This will keep the
process focused and prevent it from degenerating into purposeless
speculation about infinite futures.
the key factors that influence this decision.
the things that will determine the success or failure of the
decision under consideration. This includes the assumptions that
provide the logic for this decision.
What do you need to know to make this decision or resolve
What will you consider success or failure?
What conditions or events will determine success or
What critical assumptions define the logic for these
3. List the driving forces that influence these key factors.
the driving forces in the macro-environment that drive the key
factors you listed. These
driving forces can originate in the following areas.
Society and its
structure including demographic, economic and political factors,
and public opinion.
capabilities and core competencies.
those forces that are highly predictable or predetermined (i.e.
demographics) from those which are uncertain (i.e. public
opinion). Plausible plot development requires knowing what is
inevitable and what is uncertain and open to choice.
knowledge or research is may be required to identify these driving
forces. Systems thinking is needed to understand the
structural dynamics creating them.
4. Rank the key factors and driving forces by importance and
purpose of this step is to identify the key factors and forces that
are the most important and most uncertain. This
ranking is based on two criteria.
The degree of importance for the success of the decision or issue
The degree of uncertainty surrounding these factors and forces.
objective of this ranking is to identify the two or three factors or
trends that are most important and most uncertain.
The predictable and
predetermined factors are the same in all scenarios and will not be
a differentiating feature.
ranking will identify the factors and forces that will comprise
the characters and settings for the set of scenarios that will be developed.
5. Compose plots for alternate futures that could impact the
is the most creative and most important part of this process.
The object is to develop a range of plausible scenarios whose differences
all have a bearing on the decision under consideration.
characters in these plots are either driving forces or
institutions. The scenarios describe how these driving forces or
institutions might behave under different plots or
combinations of plots.
occurring plots that should be considered for every set of scenarios.
and losers- a zero sum plotline where the strong survive and the
weak get weaker.
and response- an adventure story of overcoming obstacles and being
transformed in the process.
slow change in growth or decline in response to environmental
thinking is essential for plausible plot development because it
looks for structural relationships that create behavior.
6. Evaluate the decision in each of the postulated scenarios.
scenario is simulated as if it were actually occurring. Examine how the
decision looks in each scenario. If it is good in all
scenarios it is a
low risk decision but if it looks good in some but not in others it presents a
simulation exercise requires a suspension of belief to recognize that any of these
scenarios could happen. This is necessary to enable an
unbiased evaluation of the decision in each of these possible
7. Select indicators and signposts for each scenario.
indicators and signposts will provide advanced insight into which of
these scenarios is actually unfolding. This knowledge can
provide a significant competitive advantage from knowing what the
step is an important product of the scenario planning process
because it forces the recognition that the future is not fixed and
that many different scenarios are possible. It creates
heightened sensitivity to the events shaping the institution's
future and how to deal with them.
Sigma provides facilitation and coaching in this scenario planning
process. Contact TheCoach@ThreeSigma.com.