Scenario Planning

What is Scenario Planning

Scenario planning is a technique for exploring the future by creating several plausible but challenging alternative futures rather than making a single prediction. It has been used by commercial companies since the 1970s after Shell was the only oil company prepared for the oil shocks of that decade as a result of its use.

Why use Scenario Planning?

A prediction is (almost) never right. The unexpected always happens and the assumptions, conscious and unconscious, that we can apply today may not apply tomorrow.  For example, at the end of the last century, London could see no solution to the ever increasing amounts of horse manure on the roads when along came the motor car, This highlights the difficulty with using forecasts: they simply carry forward current trends, problems and constraints on the assumption that they will still apply in the future.

Scenarios are versatile. Scenarios can be used not only to prepare plans for the future, but to check existing plans for robustness.  Will a plan work in more than one scenario or will if fail if any of the underlying assumptions change? If we can develop flexible plans that will work with multiple scenarios, then, when the unexpected does happen, there is a better chance that the plan can be adapted to the new circumstances.

It is difficult to get consensus for a prediction.  You can either agree or disagree with other people’s predictions – and the tendency is to disagree.  Scenario planning is about building plausible futures, a much less contentious task because we only need to agree that a scenario is possible to be able to use it. We don’t even have to agree that it is likely.

Good scenarios challenge one’s thinking and stimulate discussion.  The human species has spent most of its history telling stories rather than looking at graphs and spreadsheets. As a result, the implications of a rich story about the future can be more easily understood by most people.  It is surprising how much information a scenario can convey in a few words.  For example, the following classified advertisement can tell us a lot about what the future might be like under a particular scenario:

For Sale: 4×4 with axle suitable for conversion to wind turbine.  

Or the more long winded version: Increases in the price of transport fuel have meant that vehicles with high fuel consumption are no longer in demand and it is becoming difficult to sell these vehicles.  However, with increasing prices of home electricity, there is a boom in DIY windmills.  A component of these windmills is the back axle of a car.

Four scenarios, described below have been created, in consultation with a wide range of groups, and are used to deliver workshops and seminars which challenge accepted thinking and build consensus on how to move forward.  These workshops can be as short as 90 minutes or if a whole day is available, the participants can produce a strategy document or list of risks and opportunities by the end of the day.

We can provide speakers and facilitators and manage the event on behalf of business, NGOs or public service organisations.

The Scenarios

Energy Scenarios for Ireland were original produced in 2006/7 and while much of the original scenarios are still valid, the economic landscape has changed the starting point for the scenarios, so we felt it a good time to breath new life into them.  The characteristics and names of the scenarios have changed, but those who participated in the original scenarios will see much of what they contributed remains.

The two big uncertainties we focus on are the state of the world economy over the next 15 years and our ability to increase the proportion of energy we can generated for ourselves.  These give rise to four scenarios:

2025	Low Energy Security / Reactive	High Energy Security / Proactive
World Economy Returns to Growth	Celtic Kitten More (or less) of the same. Following the world recession of 2008-2010, the world economy starts to grow again, despite looming oil supply constraints and concerns over global warming.  Ireland is able to ride the wave of recovery and returns to a more modest growth rate than that of the celtic tiger days.	Celtic Phoenix Finding our Niche As the world recession is replaced by modest growth, Ireland plays to it’s strengths by offering an adaptable, agile, highly skilled workforce in a small country ideal as a hothouse for new businesses and ideas.  By including an infrastructure adapted to make best use of wind and marine energy – a high energy productivity, low cost environment, and great quality of life,  Ireland has become The place to be for young businesses.
World Economy remain in turmoil	Celtic Hedgehog It could be worse. Ireland fares worse than many other european countries as the world recession drags on.  Our young people and most entrepreneurs left Ireland in 2010-2012 to go to countries less badly hit, so Ireland has become a country of the old and the unemployable.  With few companies generating exports, imported goods in Ireland are rare and highly priced.  Most food is grown locally in labour intensive methods as the price of oil and fertizlisers is prohibitive.  The pace of change is slow and people have little hope of a brighter future.	Celtic Fox Making the best of it The modest recovery in 2010 is not sustained for long and shortages of oil hit companies as they try to grow.  Recognising our weak position we focus on developing domestic supplies of food and energy and supporting small businesses providing essential goods and services locally.  By 2025 the economic landscape is unrecognisable, with imports and exports dramatically reduced, however many people feel their quality of life has improved since the heady days before the crash.  Having rebuilt the domestic economy, Ireland is poised to take advantage of new opportunities as the world economy is rebuilt post peak oil, peak gas and peak many other primary resources.

 Typical Full Day Workshop

Groups from 12 to 120 arranged at tables in multiples of four.

9:00 – 9:30 Registration

9:30 – 9:45 Introduction and Overview of the Day

9:45-10:30 Scene Setting – Energy / Economic Talk.  The challenges we face and their implications.

10:30 – 11:00 Introduction to Scenario Planning

Tea/Coffee

11:30 – 11:50 Warm Up Exercise

Each table is allocated one of the scenarios.  It’s 2030, write an advert for a family home stressing the features that will be important in your scenario.  Each table presents their scenario at the end.

11:50 – 12:30 Talk appropriate to needs of attendees

12:30 – 13:00 Exercise

It’s 2030 – task or tasks related to previous talk.

Lunch

14:00 – 14:40 Talk appropriate to needs of attendees

14:40 – 15:20 Exercise

15:20 – 16:20 World Cafe format to prepare output from the day.  Could be a policy document, plan or list of ideas.

16:20 – 16:30 Feedback and Farewell