Learning from the Future : Competitive Foresight Scenarios

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Summary: Resource for Futures Learning
Review: Fahey and Randall have brought together an excellent team of authors who have given numerous suggestions of what to do and what not to do in developing scenario learning in organizations and institutions. From making it unmistakable that top CEOs must be involved in the process, to offering an outline for a scenario learning workshop, suggestions for scenario learning team members and cautions about the pitfalls of using scenarios, the authors have given their insights and visions for successful futures planning for organizations.

The smart leader uses scenarios as an important tool in the executive toolkit. Just as good decision-making is not done in a vacuum, but rather is done in the light of a good deal of research and information gathering, so even scenario planning is prefaced by homework, preparation. Elements of history, traditions, branding, decision-making methodology, personnel, key decision factors and key external forces are all pieces of the background necessary for scenario planning. Scenario Learning is not just one more thing one must do because some higher up says it must be done. It is not just a task. All decision-making of any magnitude needs to cease until the scenario planning sheds light on the decision. This process is the best of strategic planning and should not be set aside while the company chooses its strategy. "Scenarios are most valuable when they are understood to be movies of an evolving story, not a snapshot of a specific point in time" (p. 12).

Several types of scenarios are offered. Scenario learning, in the context of Systems Thinking, is a powerful tool for moving into a changed reality. Systems thinking is the engine of dynamic scenario planning. In any system it must be understood that each element in a system acts or reacts to every other element in the system (elements such as events, patterns of behavior and contextual structure). Seeing the system rather than individual elements when making a decision means making decisions with a greater possibility of successful growth.

"Scenario Learning is a search for an understanding of how the future could change, and how an organization could thrive by adapting to a number of particular changed circumstances." Scenario learning identifies what the indicators of change are, and what decisions and actions must be taken today to be ready to survive and win tomorrow and in the years to come" (p. xi). What follows in the book does indeed make this clear.

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Summary: Conceptual Case Histories of How to Learn from Scenarios
Review: If you talk to someone about using scenarios to think about the future, chances are that the other person will nod her/his head in agreement with whatever you have to say. That surface agreement, however, will be misleading because the other person is probably thinking about a totally different kind of scenario thinking than you are.

Learning from the Future helps overcome that misunderstanding by explaining a large number of ways that scenarios can be used. The book contains 25 chapters which each look at a different aspect of scenario development and subsequent thinking.

Three chapters look at what scenario learning is. Seven chapters explore basic approaches to constructing scenarios. Eight chapters describe how to apply scenarios in different contexts, like competitor evaluations, technology investing, making public policy decisions, and considering customers. The final section looks at how to create the right organizational environment for making and using scenarios for learning.

You will benefit from reading the thoughts of many of the world's top experts and users of scenario learning including Peter Schwartz, Kees van der Keijden, Ian Wilson, Liam Fahey and Robert Randall. It is a great line-up, and what they have to say is good food for thought.

If you would like a good introduction to scenario learning, this is an excellent place to start because the perspectives that are captured are unusually broad and appropriate.

This book belongs in the business library of every business decision-maker. When an important question arises, you can use this book as a resource to think through how you might best use scenarios to create a better result. Enjoy!

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Summary: Back to the Future
Review: Learning From the Future, by Fahey and Randall, is a very comprehensive how-to manual for creating foresight scenarios and turning them into action. The use of scenarios to formulate a vision of the future and how best to be prepared for it has been a major strategy tool since the RAND Corporation, the military think tank, started using this methodology in the 50's to plan for "unthinkable" contingencies.

The collection of authors recounts the steps vital to a good scenario: identify key current forces affecting the organization, involve all levels of management (so they "own" the scenario results), assure the scenarios are linked to crucial decision processes, do not slip into trying to forecast the "most likely" future, tell a story, link the scenario elements logically (perhaps graphically) together. Chapter 4 is especially good at describing how to create matrices of outcomes with sliding scales of driving forces such as the price of gas or protectionist versus open markets. Both "future forward" (present day forward, or inductive) and "future backward" (working from the future backwards, deductive) scenario types are explored, as are computer-assisted methods.

Every conceivable element that could be factored into a scenario is covered and categorized in the book, including political trends, natural disasters, pricing and cultural trends, as well as the classic SWOT (strengths, weaknesses, opportunities, threats). If there is one fault to the book, it is that the case studies could be more poignant - instead of distinct organizations with palpable products and threats, these tend to be generic (e.g., a "high tech" company producing "electronics"); this exsanguination of content leads to some bland examples and occasional lapses into platitudes (e.g., "leave enough time for evaluation"). In contrast, another scenario book, The Sixth Sense, by van der Heijden, glows with colorful case studies. When I created and played in scenarios at RAND, we found that adding color and story helped the process immeasurably: we created posters and put them on the wall, we got into character like actors do, we generated future headlines and stories - not just generically, but for a specific date and paper (the Washington Post was a favorite) - to make the process seem more relevant and the results more richly detailed. The book could also have more precise examples of insights and corporate changes that resulted from scenarios as evidence for their worth - this text is clearly meant for the already converted. That said, the very extent and thoroughness of the material, its coverage of elements often left out of other texts, and its provision of checklists for novice scenario builders, make it a must-read. The use of scenarios has a long track record of success, even in decades past when the rate of change and pace of market forces was more leisurely. In this day and age, when markets can evolve every six months, the use of scenarios to enable an organization to be proactive rather than reactive is more important than ever, and this text is one of the most exhaustive that exists on this important topic.

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Summary: Forewarned is forearmed
Review: Many, if not most, corporations try to utilize scenario planning in their strategy process. All too frequently, these efforts become routine: what if we increase (decrease) marketing budgets by 10%? What if raw material prices go up (down)? It's all pretty warm beer given the pace of business change every company faces.

This book shows how to do it right. The editors have shaped the contributions of 24 experts iinto a thorough, rigorous book covering all the vital aspects of scenarios. The reader will find clear discussions of what scenarios should be and how organizations can use them to "learn from the future." There are chapters on tools and techniques (like simulation models), advice on implementation, and case studies from both the private and public sector. The last chapter, "Twenty Common Pitfalls in Scenario Planning" is especially valuable.

Forewarned is forearmed. Any manager who does not want to go into the future blind and defenseless must read this book.

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Summary: one of the very best works on scenario learning
Review: This book, written in 1997, is one of the very best works on scenario planning-or scenario learning, as the editors prefer. The 446-page book is a collection of 25 chapters by a variety of authors, each adding a perspective to the scenario learning process. Fahey and Randall explain how scenario learning builds on traditional scenario planning, then follow up with a chapter on integrating scenarios with strategy. Several essays explain basic approaches to constructing scenarios. The next section shows how to apply scenario learning in diverse contexts including industry scenarios, competitive positioning, technology investments, and anticipating new consumer products. The last section details the vital step of managing the organizational context for scenario learning. Included in this section is a contribution by Kees van der Heijden on the business idea, and Paul Schoemaker on common pitfalls in scenario planning. This book is an excellent resource on the practical use of scenarios in business strategy. It mostly avoids overcomplicating the process as some other books have done, and it focuses on practical strategic implementation, not scenarios for their own sake. At a time when the New Economy continually throws up surprises, looking ahead with scenario learning is more timely than ever.