Scenario Planning: Preparing Your Business for Alternative Futures

The value of considering future trajectories

Scenario planning can play an important role in helping an organisation understand the implications of various future trajectories. Future developments, triggered by political, security and economic factors, can have a range of implications – including potential adverse impacts – on an organisation’s people, assets and data.

While most businesses have perfected the forecast of factors that are within their control, such as budgets or products, this is not always the case when it comes to geopolitical or security developments. Yet major geopolitical movements, elections, or conflicts can have just as much impact on profits and reputations.

A clear methodology

Even in highly uncertain environments, it is possible to gain significant insights by developing and interrogating just three to five distinct scenarios. Being able to understand why and when different scenarios might unfold helps organisations plan and prepare better, reducing risk and uncertainty. In addition, a robust scenario methodology will ensure that planning is not skewed by the most recent or most visible events and fully considers all risk drivers.

The infographic below summarises our approach to scenario planning, which considers not only what alternative futures might look like, but also how likely they are to manifest and what their implications on our clients will be.

Scenario Planning Process

Case in point

We recently worked with a large food and beverages client to develop a set of scenarios around Brexit. Our team mapped the key triggers and drivers of each scenario: Trade Deal; No Deal; and More Delays. We outlined the likely outcomes and developments in each scenario, helping our client to better understand the risks and to plan actions amid ongoing uncertainty regarding trade deal talks between the UK and EU.

Value ADDED

Scenarios can be a powerful tool for business leaders. They can support business planning, risk management and organisational transformation. Insight into how future developments might shape an organisation’s ability to succeed provides a critical advantage in building a resilient and successful organisation.