Scenario planning

Scenario planning is a way of thinking about the future. It's not about predicting, but about imagining more effectively. The basic idea is this:

  • When we talk about "the future" we naturally imagine a linear extrapolation from the present.
  • This is a good way to be wrong. The world doesn't do linear. Change typically follows an exponential S-curve. Dramatic, unexpected breaks in continuity ("Black Swans") throw things off track.
  • You can't predict the future, but you can identify driving forces of change that are present in the present.
  • You can also identify what isn't changing. (See pace layers.)

By identifying what is changing, and what isn't, you have discovered a pivot point. You can start to think usefully about the space of plausable futures.

It's a simple process that produces surprising insights. My favorite thing about scenario planning is that I always come away thinking differently about the present.

The Process

  1. Question and time frame (e.g. "what will cancer research look like in 10 years?")
  2. Key factors influencing success or failure
  3. Driving forces of change ("DNA sequencing becoming cheaper, aging population...")
  4. Major stakeholders ("Medicare, GE Healthcare, ...")
  5. Uncertainties
  6. Draft Scenarios
  7. Identify signposts and leading indicators
  8. New questions we would like to answer

Collecting forces, factors, stakeholders

As you make a list of major stakeholders, driving forces and uncertainties, you'll start to think differently about the problem space you're exploring.

Where the surprises happen is in the unexpected lateral connections that surface between forces. These "nodal points" are where change is likely to happen in rapid and non-linear ways. Mini narrative scenarios are a great way to capture these confluences. Make note of:

  • Extremes
  • Timeframe
  • Likelyhood (is this a tail risk, or a likely event?)

Major stakeholders are important to identify, because incumbents will either resist or benefit from change. Disruption Theory points toward which response incumbents will have.

  • Will any stakeholders be thrown into disequilibrium?
  • How will they react?

Set a timeframe

Timeframe matters. You typically want a timeframe 8-10 years out — enough time for major shifts to occur.

Start by looking at the present and the past.

Cluster forces

As you collect driving forces, you'll start to see commonalities emerge. Try clustering related forces to get a better high-level view of the axes of change. To draw out the most pivotal forces, plot forces in a 2x2 (uncertain-predictable / unimportant-important).

Try different story arcs

When framing scenarios, it can be helpful to consider futures through the lens of several story arcs.

  • Collapse: a kind of future in which life as we know it is falling apart.
  • Grow: a kind of future in which everything keeps climbing: population, production, consumption…
  • Discipline: a kind of future in where things are carefully managed by concerted coordination.
  • Transform: a kind of future in which a profound historical transition has occurred (spiritual, technological, ...).

Plot scenarios

When drafting scenarios, it can help to identify the 2 most important clusters of forces. give these 2 clusters names, and then plot them in a 2x2, with the first on the X axis and the second on the Y axis. Try drafting scenarios in different quadrants of the 2x2.

Set signposts

Signposts are meaningful events to watch for. They are trail markers that hint at which scenario you might be moving toward.

For each scenario you draft, decide on a plausible event that might be associated with that particular future. Write it down. If the event happens, it's a cue that you should be paying closer attention to the scenario.

A few more tips

  • Include outside information and outside people.
  • The proccess is more important than the result. Just listing driving forces will change the way you think about a space.

Resources