Integrate scenario learning with decision making

Strategy & Leadership

ISSN: 1087-8572

Article publication date: 1 April 2003


Randall, R.M. (2003), "Integrate scenario learning with decision making", Strategy & Leadership, Vol. 31 No. 2.



Emerald Group Publishing Limited

Copyright © 2003, MCB UP Limited

Integrate scenario learning with decision making

This issue is the second in a two-part series looking at what's new about scenario planning and development. The first part (Vol. 31 No. 1) was devoted to innovative scenario methodologies for managing discontinuity in the near term, a concept practiced by only a few leading firms. The thrust of this approach: make scenario planning more relevant to operations managers by focusing on highly significant business issues of great uncertainty that they must face today.

This issue looks at the more traditional approach of learning from scenarios. We start with Liam Fahey's article, "How corporations learn from scenarios" which examines scenario learning as a process of analyzing scenarios for their insights into the opportunities that may take your firm in unexpected strategic directions or lurking threats that could derail your current strategy. Some of the key goals of such projects are:

  • develop scenarios that are relevant to a firm's key business issues;

  • focus them on addressing critical decisions and their ramifications;

  • discern the general characteristics of distinctly different potential futures so that it's easier to monitor which of them is actually evolving;

  • understand the implications of current decisions in terms of a number of possible and distinctly different futures;

  • align operating plans with strategies that would be effective in a number of likely alternative futures;

  • identify which future trends need to be constantly monitored; and

  • prepare operating plans that take advantage of discontinuities in the external environment.

Other articles in this issue consider how your firm could enhance its learning from scenario projects. Battelle's Stephen Millet explores "The future of scenarios: challenges and opportunities". He finds that corporate and institutional managers still don't get the full return on investment in scenarios that they should, nor do they employ scenarios on the full range of corporate issues suited to this methodology. David Mason advises organizations on "Tailoring scenario planning to the company culture". And in "The art and strategy of scenario writing" the long-time editor of Shell International's scenarios, Betty S. Flowers, says the true payoff is not what happens in the scenario story, but what happens in the mind of the managers.

On the theory that scenario learning should never be passive, we have constructed a think project for readers. The last article "High-tech 2005: the horizontal, hypercompetitive future" by Vivek Kapur, John Peters and Saul Berman, provides the trends and background needed for developing a set of scenarios about the outlook for this industry. The authors assert that the basis of competition in this sector is evolving and the time is ripe for a fundamental rethinking of high-tech business models. Your assignment, if you choose to accept it: pick two major external defining forces and prepare four scenarios for the future of high tech. (Hint: you could choose a combination of the US economy and technology innovation rate-the extreme resulting conditions being boom or depression, and rapid or slow emergence of breakthrough technology.)

As a reasonable topic to pair with scenario learning, the issue also includes two timely discourses on the subject of knowledge management – an interview with Harvard Business Review editor Thomas Stewart and a book review by IT guru Tom Davenport.

Robert M. RandallEditor