SCENARIO PLANNING

Phuoc D. Nguyen

Chermack (2011) stated scenario planning idea originated from Kahn’s (1967) suggestion to think about the future of researching new forms of weapons technology in the RAND Corporation. Kahn’s ‘future-now thinking’ technique combines detailed analyses with imagination and produces reports as though people might write them in the future. However, Kahn’s techniques did not mention which factors to analyze, his techniques were also based on the imagination, and these vague elements made it difficult to predict the future and look back at them.

Lindgren & Bandhold (2002) presented two primary scenario planning roots “The first is futurism, where scenario analysis early became an important method and scenarios an effective presentation format. The second is the strategy, where strategists and managers since the 1970s have searched for new and more relevant tools to work with complex issues. While the futurists used scenarios as a means to analyze, debate, and communicate the ‘big issues’, the strategists were interested in them as a powerful planning instrument. The questions were not primarily ‘what might happen?’, but ‘What should we do?’” (p. 33). Two of these roots coordinated with each other to create a platform that uses scenario planning in strategic foresight and strategic formulation today. The answer to the ‘What might happen?’ question is the output of the scenario planning process and the answer to the ‘What should we do?’ question is the input of the strategic formulation process. These two steps are next to each other, each step has its important role in strategic foresight and strategic planning.

“The French School approach is a structural analysis that is divided into three phases. Phase 1 begins the process by studying internal and external variables to create a system of interrelated elements… Phase 2 scans the range of possibilities and reduces uncertainty through the identification of key variables and strategies… Phase 3 is the development of the scenarios themselves.” (Chermack, 2011, Location Nos. 609-612). It is suggested integrate to scan the range of possibilities into phase 1 to combine environmental scan results into the analysis of internal and external variables to fix a database for scenario planning. Phase 2 includes uncertainty analysis and suggests solutions to prevent unforeseen, correct, and reduce uncertainty as much as possible. Additionally, integrate strategy formulation into phase 3 after the development of the scenarios.

Tellez (2014) analyzed “the French school’s advantages including process orientated and training effect; its disadvantages including difficulty to keep the scenario idea and integration with macro scenarios.” (p. 32). It is suggested this approach is focused on the scenario planning process, it should be re-engineered the process as the above mentioned. The process approach is convenient for futurist training, finding out non-conformities in the scenario planning process and controlling it to improve the process.

Scenario planning focuses on a future perspective. This is a way for businesses to generate ideas about possible future scenarios and how they can influence their strategic goals. However, it is difficult to make predictions, and this is why businesses need to build different perspectives that can happen in the future. This is the goal of scenario planning. This model allows businesses to develop strategies, products, and services and change these as needed in a constantly changing world. Scripting is about building different scenarios for different scenarios. By using these scenarios, businesses can make better decisions when problems or changes occur. They will know what to look for and what is the solution to their advantage.