Leaders everywhere are either paralysed by the uncertainty of future or moved to frantic activity that may further harm the situation. So far adequate explanations of why all this is happening has been lacking. One recent book, Business Planning For Turbulent Times, offers both explanation of why businesses have been experiencing increasing turbulent changes and practical advice on how to navigate in these turbulent times. Insights include: Anticipation of surprises and effective strategy require paying attention to how ones organisation co-evolves with its wider contexts; and explicitly surfacing assumptions about key linkages. It is not just what we think about the future but also how we think about the future that matters. Scenario work better engages the future than forecasting or modelling alone.
Scenario planning involves using multiple futures to understand unfolding complexity not predicting likely or probable futures, which is futile at present. This crisis concerns an environment in which decision makers have to rely on judgement and plausibility rather than forecasting accuracy. Turbulent environments can best be addressed by building common ground among stakeholders. Using scenario thinking and planning, leaders can explore options to calm turbulence, example by creating enclaves or setting standards.
The book deploys Causal Texture Theory to explain how scenario planning is used to address turbulence. Undoubtedly some Indian leaders are amongst those who have bought the first copies of this book. Others have contributed to the practical wisdom in the book. For example one chapter demonstrates how scenario planning has already been deployed to improve the robustness of the Indian agricultural system!
21st century challenges do not lend themselves to predict and plan approach to strategy or risk management. Instead, scenarios support judgment by enabling the deliberation; helping leaders avoid driving forward using only the rear view mirror view of the future, or becoming paralysed by the headlights of oncoming changes. In an interdependent world we need to attend to the causality and fragility of new and less visible linkages. The sub-prime crisis stemmed, in part, from a blindness to such linkages and their causality: the new connections forged by financial organisations through innovative mortgage products eventually undermined the whole financial system.
The leaders job is to help people address the possibility that the future they have assumed in making their plans and policies does not materialise. Scenario planning helps them do so.
As told to Garima Pant