Introduction

Scenario planning is a powerful tool that organisations use to anticipate and prepare for the future. By developing a range of plausible scenarios and exploring the potential impact of each one, groups can make better decisions and build more resilient strategies. To create effective scenarios, it's essential to identify the key drivers of change, develop multiple scenarios, and test and refine them to ensure they are robust and comprehensive.

There are several reasons why we use scenario planning. First, it helps us identify potential opportunities and threats that may arise in the future. We can develop more robust and adaptable strategies by considering different scenarios, enabling us to respond effectively to environmental changes.

Second, scenario planning promotes creativity and innovation within the organisation. It encourages leaders to think beyond their current assumptions and mental models, challenging them to consider broader possibilities.

Finally, scenario planning can improve communication and collaboration within the organization. By involving different stakeholders in the process, scenario planning can help build consensus and a shared understanding of the company's challenges.

This workshop aims to expose participants to new frameworks and methodologies that will be helpful when working with external groups, internal groups, or clients. These methodologies help stretch design scenarios into design responses to those scenarios.

Designing Scenarios

“No scenario is good or bad; they merely provide a set of drivers and/or constraints for teams to co-design a cogent response.” - Peter Durand

When designing these scenarios, the goal is to identify forces that push these scenarios or states of being forward and also constrain what is causing friction or limiting the process.

It is essential to avoid backcasting. Backcasting puts people in the future and works backward. With scenario planning, it is better to work in an open field and identify the drivers and constraints in a context for a group and use those to look at the future in different time horizons.

“The future is rational only in hindsight.”
- MG Taylor Axiom

It is always challenging to talk about the future. We either over or under-estimate the time frame in which something will happen.

An example of this can be seen through Peter’s work in the healthcare field. In 2018, he worked with a group of doctors that dealt with infectious diseases. One of the scenarios they proposed to a sponsor team was a global pandemic. The response was that they already had a plan and needed to focus on pressing issues. In May 2020, Peter checked in with one of the head doctors, and the plan was not working.

Backcasting is only rational in hindsight. Yes, we were able to see what could happen by looking backward, but we also want to expand into the big empty field of all the different possibilities.

Four Archetypes

When designing with sponsor teams, an important question is, “What is the big problem or big context in which you're trying to design within?”

Here are four different archetypes of the trajectory for how things could go for a specific problem:

Continued growth. Things are going great, and we must maintain and manage growth. For example, as a business increases, it needs to hire more people and develop incentives to keep them there. They need to attract and retain and keep productivity up. This is where many economies found themselves after the pandemic in 2021

Collapse. The system has become too big or tenuous. There are not enough resources and too much demand. Whatever the pressures were, the system collapsed.

Growth with discipline. This is the slow scaling, slow growth through the practice of a methodology that gets tweaked over time. An example of this can be seen through electric vehicles. They have been talked about for years, but Tesla has changed the game, and now every economy is making that transition to meet the high demand.

Total Transformation. This is a step-like change. A radical change from the current state creates a transformation—the entire system changes. This can be caused by birth, marriage, divorce, etc.

Stages of Enterprise

This MG Taylor model is helpful when working with a sponsor team to design scenarios.

This model has all four of the archetypes mentioned above embedded into it. The grey circle in the middle is called the entrepreneurial button.

This refers to the junction point you encounter while working with a group, where the direction of progress becomes uncertain. At these moments, significant driver constraints and challenges arise. The entrepreneurial button, however, allows you to explore possibilities and explore the question: what might that look like?

It is critical to give scenarios that talk about this transformation.

The Shell Method

In Peter Schwartz’s The Art of the Longview, he presents The Shell Method. This method entails a comprehensive approach that involves gathering data and resources, particularly in the macro forces, aggregating the facts around them to use, and crafting scenarios over time.

There are three primary stages:

Stage one asks, “What are those big driving forces?”

Stage two questions, “What are the predetermined elements of those forces vs. the critical uncertainties?”

The pre-determined elements are things that we know are happening. These are slow-changing phenomena such as population growth, constrained political situations, or national investments already in the pipeline.

Critical uncertainties are highly unpredictable events or phenomena such as oil prices, war, and economic or social disruptions.

Creative 2+ scenario narratives. These are stories about the future in which we “imagine the world.”

This is where you bring your participants into the future. You can create a seemingly impossible scenario and have the group design around this.

The 2 x 2 method

This is a simple framework. It works to draft and audit scenarios along 2-3 axes quickly.

So, how do you build this?

The initial step in this process entails establishing a framework that consists of two axes, which facilitates the creation of a 2 x 2 matric. This will help ensure that the design scenarios formulated do not have four different scenarios that address similar dynamics. It is crucial to encompass all four archetypes: slow growth, collapse, total transformation, and rapid transformation.

This method serves both as an audit and design tool and its effectiveness can be maximized by engaging the sponsor team so that they can map out and make sure they have all the bases covered.

5 Principles

The 5 Principles is a process that helps groups stretch and design scenarios leaning towards predictable surprises. There are five stages:

Help participants switch their perspectives. Give them a persona or scenario and force them to live in that. Give them two different drivers and a persona.

Push them further. Layer in other driving factors or constraints to move people out of what is right in front of them and have them look out further

Anticipating values. It is one thing to think about the macro changes happening around them but another thing to force people to predict how they will value life. What might be a value that is important today? What are the Value Shifts?

Find connections between values and drivers.

The goal is to identify predictable surprises that we might anticipate and begin to design our systems, products, and services around them.

These five principles are used to help build scenarios.

Working with scenarios

“The scenarios are not the point. It is not the endpoint. It is all about engaging people in a critical thinking exercise to build that capacity and that muscle memory for responding to these potential opportunities and threats and state changes etc.” - Peter Durand