15 May In this Period of Great Uncertainty – Is Your Offer Future Proof?
People cannot predict the future, but we are challenged to create products and brands that we hope will appeal to consumers for many years. Scenario planning—the process of learning about the future by studying the confluence of the most relevant trends in a contextual and meaningful way—can be a powerful tool for developing knowledge about the future. This knowledge can then be used to develop strategies for “future proof” offerings. Scenario planning is the process of creating a set of alternate plausible stories about the future to uncover cultural dynamics and customer needs, and create strategies that can succeed across a variety of potential future market states.
The RAND Corporation originally developed the “scenario learning” process in the 1950s as a contingency planning tool for the United States Air Force. Over the next two decades, General Electric and Shell Oil adopted the process to make key, long-term strategy decisions. Today, both large and small organizations use scenarios, predominately to resolve long-term strategic issues.
In The Art of the Long View, Peter Schwartz of Global Business Network, a pioneer and thought leader in the use of scenarios, describes several applications for scenarios. Schwartz explains how Royal Dutch Shell used the scenario process in making key decisions regarding the development of the North Sea oil fields. In 1971, Pierre Wack used scenario forecasting outside of academia and applied this methodology to practical usage for Royal Dutch Shell. It is due to this forward thinking and research that the company was prepared for the oil crisis a mere two years later.
Because we cannot predict the future, scenario planning uncovers multiple perspectives on the ways in which the world will pan out. This initiative is crucial to developing craft brand strategy, product specifications and business strategy to succeed in a variety of future environments.
The Scenario Planning Process Requires Five Essential Steps:
1) Frame the question: Define the key strategic questions that need to be answered to make your offer successful.
2) Build the Model: What trends and key market factors are relevant to impacting the questions in Step 1? – These trends are called driving forces.
3) Research and Refine: Research each driving force to understand how each may unfold. Some may be more predictable and certain, and others will be more uncertain. Scenario planning allows us to deal with these key uncertainties.
4) Develop a set of Scenarios: Because we cannot predict the future, we always develop multiple scenarios, each representing a plausible future. The scenarios are focused on the key strategic questions, allowing us to develop new products, brands and strategies based on research insight.
5) Implement and Deploy the Scenarios: Focus on each scenario in a workshop process to develop product and brand strategy and innovation opportunities. Scenarios can be used to war game competitive strategy, uncover threats and create new opportunities. Scenarios should be communicated broadly through the organization so managers are more aware of how daily decisions may impact the future.
Through our Future Scenario programs, our clients benefit in developing clear strategies for products and brands, as well as a contextual understanding of the future that improves decision making for years to come. We have used scenarios to create innovative new product offers, shape brand and marketing strategy, develop product features and benefits and make key decisions on high cost/impact programs, Our experts have conducted scenario related work for Royal Dutch Shell, BMW, Microsoft, Herman Miller, Johnson Controls and Agilent Technologies.