From JISC infoNet, a JISC Advance Service

What could America’s companies have done to fare better in the economic downturn?

Scenario Planning – a strategic method for preparing responses to imagined changes in conditions. 

 The art of scenario planning is making a comeback from its early days as a military tool, to a popular management practice in the 1970s.  Addressing different scenarios as part of the annual planning process enables companies to be ready with identified action steps before a crisis or opportunity hits. 

It is credited with many seemingly prescient decisions – including the New York Board of Trade’s 1990s decision to build a second trading floor outside of the World Trade Center.

This year, companies that saw the warning signs early and prepared in advance fared better, some even continuing to generate cash despite double-digit sales declines.  Those that are suffering lament that they made changes later than they should have. 

Regardless of how well they weathered the storm, many companies are now reporting increased productivity, despite fewer employees, with a relatively low percentage planning to re-hire anytime soon.  That’s a negative for the unemployed, but a positive for the companies.  It means they’ve found ways to work smarter not harder (a silver lining?).

How Well Do You Plan For the Good, the Bad and the Ugly?

Scenario planning is a world unto its own, with complicated methodologies and potential dangers (such as constructing scenarios based on too simplistic a difference, i.e. optimistic and pessimistic, according to this Scenario Planning Corporate Strategy Model*.  

Having survived 2009, you may decide to do more future thinking.  Here are some quick questions you’re likely already asking:

• What’s working, and not working, as a result of any changes made this year?

• What should be continued?

• What could use further improvement?

• What wasn’t looked at, that should be?

• How about new opportunities or market trends on the horizon?  Can your company get ahead of the New Year with aggressive effort now?

Planning of any kind takes time and focus.  Planning for multiple scenarios, even more.  But this is planning season.  Whether the business climate improves as predicted, tanks further or stays the same, prepare to act quickly!

* For more detailed reading on the subject, see:

How scenario planning can significantly reduce strategic risks and boost value in the innovation value chain

Future-Proof Your Organization, CEO Journal, Oct. 2008

The Secrets of Successful Scenario Planning, Forbes Aug. 2009

www.scenariothinking.org

“Judge a man by his questions, not his answers.”
- Voltaire

Silver Bullet thinking goes down the slippery slope of making assumptions.  Like so many experienced marketing and PR people, we don’t like to assume anything.

When we engage prospects, we ask questions, about their marketing, about their business, about their industry.  You name it.  Ask the right kinds of questions and you’ll begin to sense that what a client needs isn’t necessarily what they want.

This is the first of several posts about the kinds of questions we ask, starting with strategy and planning:

• Do you have a marketing vision?
• Do you have a marketing strategy and plan for next year?
• What issues are having an impact on your business, e.g. external influences that could change your business, both positively and negatively?
• How are your sales, service, delivery and operational managers involved in marketing plan development and execution?
• If you could measure only one economic driver at your company, what would it be?  Does this driver matter to your customers?
• If you have multiple marketing groups (i.e. your company is organized by product and channel, or marketing functions such as research, promotions, web marketing, and communications), how do you align individual programs so that the customer is not confused?
• Would you consider your strategic planning process to be customer centric?

What kinds of strategic planning questions do you ask?