xii Providing the theoretical foundations for the scenario method for the first time through this book is
important and essential for advancing practices... Theory can be defined as "a scholarly description of what works
best and why."
xv The most valuable advantage of creating and using scenarios is the recognition that uncertainty
is a basic feature of organizational environments.
xvi Scenario planning is a tool for helping decision makers reperceive the potential future in alternative
ways. Having these alternative ways of seeing helps decision makers avoid surprises and prepare for a variety of plausible
futures.
xvi The purpose of this book is to provide a complete approach to scenario planning that includes
key pieces missing from existing literature. These missing pieces are the theoretical foundations of scenario planning,
a detailed guide to using scenarios once they have been developed, and a structure for assessing the impact of scenario projects.
xviii What continues to fascinate me about scenario planning is its potential application
to almost any context, problem, issue, or situation, and its evolving nature... As the world's problems evolve in
their complexity, there is only increasing utility for scenario planning.
xix This is a book for people who want to improve the way their organizations prepare for the future.
xix Wack (1984) may have put it best when he wrote, "In out times of rapid change and discontinuity, crises
of perception - the inability to see a novel reality emerging by being locked inside obsolete assumptions - have become the
main cause of strategic failures" (p.95). Scenario planning is a way to avoid such crises of perception by
learning how to see the environment differently and perhaps a little more completely.
p.3 This book describes a method for including the realities of uncertainty in the planning process. Uncertainty
and ambiguity are basic structural features of today's business environment. They can best be managed by
including them in planning activities as standard features that must be considered in any significant decision.
p.3 Scenario planning is a tool for surfacing assumptions so that changes can be made in how decision makers
see the environment.
p.5 the elements of volatility, uncertainty, complexity and ambiguity are undeniably present in
the operating environment of any organization - the only question is the degree to which each element may be in play...
to overcome volatility, one must use vision; to address uncertainty, one must develop understanding; complexity
yields to clarity; and ambiguity can be addressed with agility.
p.17-18 Learning used to mean... learning the answer... This definition of learning leads to organizational
and stakeholder rigidification. But in the current and anticipated conditions of dramatic unpredictability, learning
must be a continuous process involving:
- Learning to re-perceive or re-interpret a situation,
- Learning how to apply that re-perception to the formulation of policy and the specification of action...
- Learning how to implement those policies and intended actions, and
- Learning how to keep these three earlier requirements alive and open to continual revision.
p.27 When truly uncertain forces have been isolated, energy can be spent trying to understand those forces
and how they might play out across a range of possible futures.
p.29 theories help us make sense of incoming information. -Mintzberg (2005, p.249)
p.29 This chapter argues [JLJ - can a chapter argue?] that scenario planning should remain artful, but it
also must evolve into a theoretically and scientifically grounded art.
p.35 In the context of scenario planning, learning is defined specifically as a process of gaining
knowledge about the internal and external environments and how they interact.
p.36 De Geus viewed the organization as a living entity. "Like all organisms, the living company exists
primarily for its own survival and improvement: to fulfill its own potential and to become as great as it can be" (1997, p.4).
p.48 Originally introduced by Forrester (1961), mental models are the lenses through which we see
the world. They incorporate our experiences, learning, biases, values, and beliefs about how the world works. These
models embody how individuals see the world, how individuals know and think about the world, and how individuals act in the
world.
p.48 Allee (1997) stated that mental models are "important cornerstones for building knowledge and defining
some of the cognitive processes that support change and learning" (p.11).
p.48-49 Senge (1990) defined mental models as "deeply ingrained assumptions, generalizations
or even pictures or images that influence how we understand the world and how we take action. Very often,
we are not consciously aware of our mental models or the effects they have on our behavior" (p.8).
p.49 Weick (1979, 1985, 1990) has argued consistently that mental models guide, shape,
and provide the basis on which individuals interpret and make sense of organizational life.
p.49 Representations refer to the way humans build "stand-ins" for reality in
their minds "One of the functions of representations is to stand in for things outside the system: once a system has
representations, it can operate on them and not need the world" (Bechtel, 1998, p.297).
p.49 Freyd (1987) suggested that mental representations are also dynamic: "perceivers
are sensitive to implicit dynamic information even when they are not able to observe real-time changes (p.427). The
significance of Freyd's research is its suggestion that the human mind is itself anticipatory in its perception and construction
of events. That is, the human mind naturally anticipates possible future sequences of actions based on immediate perceptions.
p.69 This environment [in which the organization operates] is highly turbulent,
volatile, uncertain, complex, and ambiguous. Because of this context, traditional approaches to planning
are not adequate because they assume the environment is relatively stable and predictable.
p.83 Increasingly, decision makers are overwhelmed by volatility, complexity, and uncertainty... A
key overarching purpose of scenario planning is to develop a variety of alternatives so that decision makers will be more
prepared for anything that might come to pass.
p.83 Four distinct purposes for engaging in scenario planning...
- Making sense
- Optimal strategy
- Anticipation
- Adaptive learning
A scenario planning project can focus on one or more of these purposes.
p.96 The literature suggests that scenario planning can benefit organizations in several ways. Outcomes
commonly associated with scenario planning include the following:
- Individual and organizational learning
- Improved decision making
- Stronger communication systems
- Shared mental models of the internal and external environments
- Heightened organizational performance
- Greater organizational agility
- Stronger ability to fit with the environment
- Deeper anticipatory capacity
- Increased strategic insights
p.127 Predetermined elements are predictable elements that do not depend on a particular chain of events
(Schwartz, 1991). Predictable elements are divided into four categories: slow-changing phenomena, constrained situations,
in the pipeline, and inevitable conclusions.
p.128 "Critical uncertainties are intimately related to pre-determined elements. You find them by questioning
your assumptions about pre-determined elements" (Schwartz, 1991, p.115)... Many of the errors in judgment observed at Shell
were cases in which predetermined elements and critical uncertainties became mixed up. Thus, a hallmark of scenario
planning is in separating what is predictable (predetermined) from what is truly open to change (uncertain).
Understanding these forces is the basis of the scenario development phase
p.129 consider the official future, which is usually a forecast, and then ask,
"Where might our forecast be wrong?" The official future is a surprise-free, status quo, growth-as-usual scenario.
p.169 Common general objectives [for constructing scenarios] are to provoke strategic insights, expand the
assumptions of decision makers, and develop the capacity to see major discontinuities before it's too late.
p.171 Each scenario planning project is a customized learning project... Scenarios must be presented to
participants in ways that provoke learning that leads to strategic insight.
p.172 turbulence is an environmental characteristic that puts stress on the object in question... organizational
decision makers... are forced to think about how to build an organization that can withstand the stresses imposed on it.
Scenarios are tools for building such a resilient organization.
Scenarios create a way to analyze the organization in a variety of conditions. Remember that a
basic premise of scenario planning is that the environment changes too rapidly for most strategic planning models to be useful.
p.183 the scenarios should be used to explore. The more creatively they are used, the further
the thinking inside the organization can potentially be shifted.
p.184 the scenario immersion activity described in this chapter asked participants to identify strategies
that work in all scenarios. The purpose of this [activity] is to build a strategy that can handle the stresses of
all the scenarios - a robust strategy... the purpose [of scenario planning] is to pose a variety of alternatives
to decision makers such that they will be more prepared for anything that might come to pass.
p.184 Resilience can be defined as "the ability to recover readily from illness, depression, adversity,
or the like"... Some of the purposes of scenario planning are to learn about the possible futures, prepare for them, and avoid
catastrophe, but equally important is the ability to recover quickly from challenging situations.
p.221-222 The world in general features the same characteristics (e.g., volatility, uncertainty,
complexity, and ambiguity) as the business environment, and tools for thinking differently about the future can be applied
to problems related to global climate change, health care, water supply, ecology, and other natural resources.
p.222 In my experience, each [scenario development] project should use a minimum of two external experts.
p.271 Thomas J. Chermack has studied and practiced scenario planning for over 15 years. His initial interest
in scenario planning was due to his unique combination of analysis and creativity in exploring difficult and complex issues.
Tom [Chermack] is motivated to challenge status quo thinking and help people see things differently.
p.272 Applied disciplines like scenario planning require both reflection and action - reflection, for understanding
how scenario planning works and how it can be improved, and action, for putting new knowledge to use.
