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1.0 2.0 3.0 4.0 5.0 6.0 7.0 Introduction The EIBE Assignment Task 1: Examples and Explanatory Notes Task 1: Blank Pro-forma Sheets Task 2: Notes from The Learning Manager A One-Day Scenario Development Timetable Conducting Research in Scenario Projects
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June 2011 (The EIBE Team)
Exploring the International Business Environment
"My interest is in the future because I am going to spend the rest of my life there."
Charles F. Kettering
What is Scenario Planning and why is it included on the MBA
There have been a number of periods in history during which society and its foundations have undergone profound and discontinuous mutations, often described as ‘revolutions’. According to many popular writers we are currently in the midst of another mutation which Daniell Bell describes as the ‘Post-Industrial Revolution’, an age of uncertainty and paradox in which our world is being transformed at an exponential rate. The causes of the current mutation are many and complex and include the advent of globalisation and global competition, the unprecedented speed of technological innovations, cultural and societal value shifts, and changing demographics. At the same time a new generation of research is leading to an awareness of the fact that every thing in life is part of a wider, non-linear, self-organising and interconnected milieu; seemingly discrete activities and happenings are in fact all part of interacting systems which combine to form complex global systems. As we have learnt from the sequencing of the human genome, and more recently from the global economic crisis, complexity arises not from the inherent complexity of the individual systems themselves, they can be relatively simple, nor from the number of systems, there are usually a limited number of these, confounding and intractable complexity arises from the unpredictable patterns of interactions between the systems. The consequence of the above is that governments, companies and communities have to deal with larger scale, more complex, systematically interwoven and confusing problems today, than at any time in the past. Uncertainty and ambiguity are the hall marks of such an environment and are the main challenges faced by every organization. This being the case the solution is not to ignore or attempt to avoid uncertainty appealing as this may be, but to accept it, strive to understand it and make it part of your reasoning. The problem is that humans are intrinsically uncomfortable with uncertainty and ambiguity; it causes us anxiety even in relatively simple situations. Thus when confronted by uncertainty we act to dispense with it by seeking single-track answers through the application of so-called ‘experienced based recipes’ habitually applied within a singular frame of reference. Although there is an important element of practicality which comes from experience, hindsight oriented mental models invariably foster strategic thinking based on ex-post analysis and extrapolation of past trends. This was perhaps not an issue in the past 30 years through to the 1980s when by today's standards, there was relatively little change in the contextual environment and the nature of the change affected the level of activity of the individual firm, but did not materially alter the structure of the business environment. However, in a world of larger systems with many more causal loops and linkages resulting in structural and discontinuous change in the environment, past experiences and patterns are not a reliable guide to the future. Planning models based on the notion that the past is a dependable predictor of the future are dangerous because they fail to anticipate trend breaks and major shifts in the business environment which render organizational strategies obsolete. Increasing the sophistication of forecasting models is not the solution either, as comparative forecasting studies have shown that even the most complex forecasting models generally produce no better forecasting results than more simpler models in turbulent environments.
©2011 – University of Strathclyde Business School
Exploring the International Business Environment
After more than 50 years, theories of business strategy are reasonably well developed and widely disseminated through MBA programmes at Business Schools, along with a plethora of books, academic and practitioner journals, magazines and websites devoted to the subject. Yet the business world is littered with examples of failed strategies. How does this situation arise? There are many factors which have contributed to it, but central to the issue is the fact that the templates for developing strategy which evolved from the pioneering work of Ansoff, Chandler and Sloan in the 1960s and were subsequently popularized at the Harvard Business School, presuppose that the contextual business environment is relatively stable and that humans are rational economic decision makers. The contextual environment is of course, far from stable as we have already seen, we are witnessing the biggest changes on the planet in 200 years suggests Tom Peters. It comes as no surprise that as the business environment mutates and business conditions become increasingly confusing and difficult, the response from companies is to batten down the hatches, curtail investments, slash operating costs, rein in discretionary expenditures and finally, to cut prices, as is much in evidence at this moment in business. These after all are the recipes that have worked in the past. However as Abraham Lincoln observed in the midst of the American Revolution, “the dogmas of the quiet past will not work in the turbulent future. As our cause is new, so we must think and act anew”. Cost control and management are of course essential, but alone are insufficient for businesses to survive and prosper in the current revolution; they may at best slow the hemorrhage, but will not lead to new ideas, new business opportunities, new revenue streams. Required is a forward looking, open ended, and creative approach to strategic thinking which adopts a pluralistic view of the future business environment rather than presupposing it to be well established, and which challenges the inertia and pitfalls of traditional business-as-usual thinking by opening up the strategic conversation within the organization. This is the essence of ‘Sixth Sense’ and the vehicle advocated to move in this direction is scenario planning/thinking. Similarly to the term 'strategic', the term 'scenario planning' is used with various meaning but in its broadest sense, it is a tool for disciplined thinking about the future. Although not founded on axiom based theory, it is a well-developed strategic planning technique in both the public and business sectors. The significant departure of scenario planning from conventional long term planning models is that the scenario methodology assumes that it is neither useful nor possible to forecast the future and therefore it does not attempt to present the future as a single point estimate, but as a range of plausible and bounded alternatives. Whereas conventional strategic planning models are essentially analytical and focus predominantly on analysis and extrapolation of quantitative, historic data, scenario planning is largely intuitive taking as its starting point that the future is not likely to be a linear extension of the past, but an amalgam of numerous forces past, present and future, the causal relationships of which need to be understood. Undertaking a scenario planning exercise on the MBA is about equipping students with the skills for long-term survival and success in the world by learning to comprehend, anticipate and react to uncertainty and ambiguity rather than being paralysed by it. As Ged Davis, a former head of Scenario Planning in Shell International notes, “the use of scenarios does not require us to be absolutely right – we just have to be less surprised than those who are doing none of this thinking … ideally, to be able to interpret as normal human affairs what others see as crises”.
The EIBE Workbook
The EIBE course is primarily concerned with process rather than product. More specifically it is about scenario development as a process of making sense of the external environment in
©2011 – University of Strathclyde Business School
Exploring the International Business Environment
which the organization operates. The EIBE Workbook is designed as an aid to the clarification of the scenario development process and to provide a framework for the presentation of the scenarios developed, and should be read and used in conjunction with material on the EIBE intranet site and the course textbook, The Sixth Sense: Accelerating organizational learning with scenarios. The Workbook is structured as follows: Section 2.0 provides an introduction to the EIBE Assignment which comprises 2 ‘Tasks’. Whereas Task I is a group exercise in which the group progresses through a scenario development process, Task 2 is an individual ‘reflection’ assignment. The actual assignment itself is not included in the Workbook and should have been given to all students at the point when the course materials were distributed. A copy of the assignment is also available on the EIBE intranet site. Section 3.0 details the scenario development process and provides examples of the record sheets to be completed in undertaking Task 1 of the EIBE assignment, with explanatory notes on how the sheets should be completed by the groups. Section 4.0 provides blank copies of the record sheets for the Task 1 assignment in order of use. The Task 1 assignment calls for two iterations of the scenario development process; the 1st Iteration is a ‘one-day’ scenario planning exercise designed specifically to familiarize the groups with the scenario development methodology. The 2nd Iteration follows the identical process but applies the experience of the group’s learning and research findings in undertaking the 1st Iteration, in developing a new set of scenarios for the same client. The expectation is that 2nd Iteration will result in a demonstrably higher level of thinking and analysis in the scenario process outputs. Blank copies of the record sheets for both iterations are included in this section. Section 5.0 provides notes from The Learning Manager workshop which are intended as an aid to assist with managing group dynamics in undertaking the Task 1 group process, and with self-assessment of individual learning for completing the individual Task 2 assignment. Section 6.0 details a 10 step timed task process template which can be used for completing the 1st scenario iteration in a 6 hour period. The note provides guidance on the progression of steps to be taken in the scenario development process, and the timings involved in each step of the process. Section 7.0 articulating good research questions is the key to iterative scenario investigation and this section comprises an article by Professor Kees van der Heijden (who developed the EIBE course on the MBA programme), which provides guidance on the fundamental role of research in scenario development, and includes some ‘tips for researchers’. Scenario development is a lengthy, demanding process; as Ansoff has noted, “Construction of scenarios is difficult and time-consuming … and the final result is at best, laden with uncertainties and imprecision.” At the same time, the EIBE course is unique and almost certainly unlike any other you have experienced; while “thinking about the future’ may not be to everyone’s taste, the EIBE team hope that you find the course challenging and interesting, and that it will provide you with a useful tool for managing your life and career.
©2011 – University of Strathclyde Business School
and the significance of these implications to the client’s strategic plan. which includes an appropriate balance in the range of global. the end states for each scenario being differentiated by more than merely minor variations around a particular theme. there should be no discussion in the assignment with respect to the client’s strategic response to the implications. There are two separate assignments comprising the total EIBE assessment. However developing a set of plausible. these being: Task 1: Scenario Development Group Exercise Task 1 is a real-world scenario development exercise which students will undertake working in groups and using what is known as the ‘intuitive logics’ scenario process methodology outlined in chapter 7 of the EIBE textbook. a clearly defined end state for each scenario. In exceptional circumstances a student may be permitted to undertake the assignment on an individual basis. Once formed. contains instructions and guidance notes. the implications inherent in each scenario with particular respect to the client’s areas of interest. it is imperative for the developmental learning process that groups remain the same throughout the EIBE module. However the assignment must not enter into the arena of strategy development. Some important points to note about the Task 1 assignment: • • the assignment constitutes 80% of the total EIBE assessment.0 The EIBE Assignment The following are excerpts from the EIBE assignment. The Sixth Sense: Accelerating organizational learning with scenarios. a set of key events in each scenario representing crucial developments in the environment linked through causal reasoning and their temporal sequence. All scenario work generally involves a client in one form or another and the assignment provides details of the client and the client’s areas of interest which form the context of the scenarios to be developed. and includes templates of the sheets to be used to record the investigation process and analysis which culminate in the development of a scenario set. In undertaking this scenario development exercise the groups will progress through the EIBE Workbook which provides the framework for the assignment submission and details the process to be followed. regional and local environmental factors considered. to be of value to the client the scenario planning exercise must include: • evidence of substantial research (including interviews with ‘remarkable people’) and rigorous analysis underpinning the scenarios. the assignment is normally undertaken as a group assignment and the maximum group size is strictly limited 6 students. which define the path for each scenario from the current year through to the end state year. the objective being to determine the implications this will have with respect to organisational strategy development. • • • It should be noted that the EIBE course is strictly concerned with scenario planning as a tool for making sense of the contextual environment and factors that will ultimately shape its development in particular ways in the future. the lower limit group size is generally 4 students but may be less if circumstances warrant it.Exploring the International Business Environment 2. compelling scenario storylines alone is however insufficient. a copy of which should have been distributed to you along with the course materials. EIBE Workbook 5 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment • there is no designated word limit for the Task 1 assignment and the assignment submission should include completed pro-forma sheets to cover two iterations of the scenario development process. the assignment has a designated word limit and serious infractions of the limit will incur a penalty in the form of a reduction in the assignment mark. Do not however ‘bulk up’ your assignment submission by including copies of all of your research materials and data/descriptions of the scenario country. and a full list of references for all sources. You might find it helpful to also include photographs of the activities of your outputs from each iteration. the assignment is strictly an individual assignment and permission will not be granted for the assignment to be undertaken on a group basis. Some important points to note about this assignment: • • • the assignment constitutes 20% of the total EIBE assessment. each member of the group will be required to complete a ‘Peer Assessment’ form evaluating the contribution made by each of the other team member to the group work in undertaking this assignment. • Task 2: Self-reflection Assignment On completion of Task 1 students are required to submit an assignment reflecting on their individual learning from having undertaken the scenario planning exercise in Task 1. EIBE Workbook 6 ©2011 – University of Strathclyde Business School . summary notes on content of consultations with ‘remarkable people’. on completion of the assignment. learning from key published sources. The composite average peer assessment total for each student will then be applied to the group assignment mark. may result in each student in a group receiving a different mark. which depending on the totals.
government reaction) which then generates uncertainties (e. Sheet 1: Diary/Record of Investigation Day/Date 1.e. This is a brain-storming exercise which should be done initially on an individual basis.g. but also on your group/individual process and learning. Economics. not constraining. Environment. What do you not know. etc.Exploring the International Business Environment 3. reports. The following are guidance notes on each of the worksheets to be submitted in Task I. related to material from Section 5. As such. or movement (e. Politics. lack of knowledge or lack of support for current opinion in terms of the EIBE process and the country selected. ‘remarkable people’. What actions do you take to address 1 Actions A diary of thoughts. Technology. they are intended to be enabling and facilitating of your thinking. So you should feel free to adopt and/or adapt them as you think fit and necessary to support the group and individual learning.g. and following from this: • What are the key research questions identified during initial stage of investigation and analysis? • A record of decisions taken in order to seek answers to the process and factor research questions. not as prescriptive headings for the driving forces. Demographics. • by who and when? (for the group’s record purpose only) Points of critical reflection on the EIBE and group process: This section should include not only critical reflections on the EIBE process.0 on group dynamics. will there be a recession. and including • What are the key knowledge gaps the group has identified i. discussions and decisions to be maintained for the group as a whole. Sheet 2: Identification of Driving Forces Areas of investigation Useful investigative framework: STIRDEEPER – an acronym incorporating Society. Energy and Religion. The acronym STIRDEEPER is presented for guidance only. economic conditions) which leads to a change event (e. Driving Forces • A driving force is a dynamic action.g. but do need to know? 2. They are intended to facilitate recording of these processes in a manner that will enable you and your EIBE team to critically engage with them. and is an expansion of the conventional STEEP/PESTLED acronyms. and known as ‘Driving Force post-its’.) • Driving forces are recorded on post-it notes. Industry. Resources. will social unrest erupt etc. EIBE Workbook 7 ©2011 – University of Strathclyde Business School . trend.g. BIS. phenomena.0 Task 1: Scenario Development Group Exercise Examples and Explanatory Notes The sheets for recording Task 1 contained in this Workbook are intended to enable you and your group to structure your investigation and analysis of complexity and ambiguity in the external environment. • Sources of data identified e. covering both 1st and 2nd iterations.
think of 2 quite different yet equally plausible outcomes (events that could reasonably occur) emerging from the driving forces during the scenario time frame. Plausible Outcome B Identify a second polar opposite outcome for each driving force: 1b 2b 3b …… etc. • Note that numbering of the driving forces (1. EIBE Workbook 8 ©2011 – University of Strathclyde Business School .) and their associated outcomes (1a/1b. • In order to test each of the driving forces. or movement rather than being a static event.2a/2b …) makes for easier record keeping. • Record plausible outcomes on post-it notes. • The plausible outcomes for each driving force should be ‘polar opposites’ i. • The plausible Outcomes A and B are also referred to as ‘Event post-its’. • Ensure that group members share understanding of the meaning of each of the driving forces and their outcomes.Exploring the International Business Environment Sheet 3: Driving Force Plausible Alternative Outcomes Driving Forces Number each individual driving force: 1 2 3 …….3 …. at the extreme ends of a continuum.e. one per note (you will then have 2 event post-its for every driving force post-it). • Note that a driving force should indicate some form of dynamic action. trend. and will prove useful when it comes to notes in the Record of Investigation.2. • The driving force should not be an outcome but something (an action/trend/movement) which leads to an outcome. Plausible Outcome A Identify one plausible outcome for each driving force: 1a 2a 3a …… etc. etc.
A.) The cluster names should emerge from the driving forces. similar to the following:- Cluster Name Sheet 6: Predictability/Impact Ranking of Driving Force Clusters The task is to rank each of the cluster headings by determining their placement on a relative predictability/impact matrix – see diagram below. • Clusters should not contain more than 5-9 postits. Cluster B: post-its 4. 9 … etc. and should be short and descriptive. . B. Cluster A: post-its 2. 12 … etc.g. In either case it is required that the outcomes be recorded in the Workbook. Cluster C: post-its 3. Examine large clusters to ensure each cluster really does represent a single idea of interrelated concepts.. 7. .g.Exploring the International Business Environment Sheet 4: Driving Forces Clusters Driving Force Cluster Headings • Clusters are essentially a meta-conceptualisation of causally related driving forces and related uncertainties and should therefore indicate some form of dynamic action or movement. Contributory Driving Forces • The ‘contributory driving forces’ are the individual driving forces that comprise each cluster. Sheet 5: Driving Force Cluster Validation The objective of cluster validation is firstly. one for each cluster. • Assign each cluster a name and a reference (e. The clustering work may be done as a paper exercise which is then converted to simple Powerpoint diagrams. the clusters should emerge organically from the various groupings of driving forces. to identify the cause and effect. 5. to ensure that each cluster is integral in that the driving forces in it essentially represents a single idea of interrelated concepts. 6. • A particular driving force or different aspects of it may appear in more than one cluster. and chronology links of the driving forces within the cluster. 8. encapsulating the essence of what the cluster represents. “Impact” in this case relates to the impact of the driving force on the client’s areas of interest. 11. • Record each of the driving forces from the post-its comprising the individual clusters e. C . The result should be a series of diagrams. EIBE Workbook 9 ©2011 – University of Strathclyde Business School . • Avoid clustering by STEEP or other acronyms as these are often too limiting. and secondly. 20 … etc. or by using Decision Explorer® software.
Sheet 7: Framing and Scoping Scenario End States To create an initial scenario matrix. Having created the scenario matrix comprising 4 scenario spaces. and we then use the event post-its from Sheet 3 as the factors/material for developing scenario stories which explain how things moved from today. These then form the A and B dimensions of the scenario matrix. and develop high-level concept labels that encapsulate the essence of these dimensions (see example scenario end state parameters diagrams below) The final step in this stage is to define the end state of each of the scenarios by examining each of them in turn. Ensure that they are independent driving forces/factors rather than interdependent factors. Place some short phrases on post-its in each scenario box which characterize the end state of the world depicted in each scenario. relates to the driving force itself.e. the extreme ends) of both the dimensions A and B in the horizon year. EIBE Workbook 10 ©2011 – University of Strathclyde Business School . “High Predictability” means we are reasonably certain that the driving force will play out in ways that are fairly well understood. “Low predictability” means that we have no clear idea which of a number of ways it might go. It is these two that we then use to create a scenario matrix as the initial framework to develop a set of scenarios. and imagine what the world will look like in the horizon year (2025).Exploring the International Business Environment Predictability/impact ranking of driving force clusters High predictability Lower impact Higher impact Critical Uncertainties Low predictability Predictability meanwhile. select the 2 critical driving forces. to reach the end state. The 2 driving force cluster heading post-it’s at the bottom right corner of the matrix represent ‘critical driving forces’ as they are simultaneously the most unpredictable driving forces and have the highest impact on the client organization/its areas of interest. the next step is to establish the defining parameters of the end states by selecting plausible alternate outcomes (i. the question then is how did this scenario come about. and place them across each other to form a matrix.
Scenario end state parameters A1: Globally Integrated Scenario 1 (A1 + B1) World Economy Scenario 2 (A1 + B2) Scenario 4 (A2 + B1) Critical driving force A: B1: Individualistic/ Materialistic Critical driving force B: Value Systems B2:Traditional/ Collectivist Scenario 3 (A2 + B2) A2: Fractured and Divisive EIBE Workbook 11 ©2011 – University of Strathclyde Business School .Exploring the International Business Environment The scenario matrix High predictability Lower impact Higher impact Critical driving force 1 Low predictability Critical driving force 2 Scenario 4 Scenario 3 Scenario 1 Scenario 2 • select two “critical driving force” clusters to create a matrix. • determine the continuum and the polar outcomes of each driving force. • ensure that the critical driving forces are independent of each other and not interdependent.
and key implications of events over time on the client organization and client areas of interest described in the assignment. Here.Exploring the International Business Environment Sheets 8-9: Scenario Stories and Implications In the 1st Iteration you must develop at least 1 of the 4 scenarios on the matrix into a scenario storyline. a group of 5-6 students must produce 4 scenarios. Key descriptors of the present. whilst other events and happenings will need to be added in order to complete the story). and highlights the key implications for the client organization. The diagram below is one presentation format. a group of 3-4 must produce a minimum of 3. in terms of impact on their particular area of interest (Note: this must not involve the client’s responses to these). on its particular areas of interest. themed and evocative of the scenario story) Key events/happenings and their causal relationships over time. you must take the event post-it material in each quadrant and develop them into a scenario outline which: • tells the scenario story over the scenario time period. • • The format for presentation of the scenario stories is open to interpretation but should include the scenario name. key descriptors of the future end state. in particular events already happening and which may set the foundations of developments in the future Key descriptors of the future – what will the world look like in the end state horizon year? Present Future Key implications for the client organization of the impact of events over time. sets out the events that define the scenario story in terms of cause/effect reasoning and chronological order. and a group of less than 3 students must produce a minimum of 2 scenarios. Scenario Title (short. The number to be developed in the 2nd Iteration is dependent upon the group size i.e. EIBE Workbook 12 ©2011 – University of Strathclyde Business School . cause/effect and chronological linkages between events. from an outline of the current situation to descriptions of the end state (some of this material will come directly from the scenario scope in Sheet 7. key events over time. key descriptors of the present. (See Sheet 9 for details of alternative presentation formats).
You are required to complete each of the sheets for both the 1st and the 2nd iterations of the scenario process.Exploring the International Business Environment 4. and are advised to keep individual copies for personal reference at a later date.0 Task 1: Scenario Exercise Blank Pro-forma Sheets Completion of Pro-forma Sheets This hard copy of this Workbook is provided for reference. The following pages provide blank pro-forma sheets for each of the required steps in the scenario development process to enable your recording of the actual process undertaken in your group. You/your group are required to make copies of the final documentation submitted for record purposes. EIBE Workbook 13 ©2011 – University of Strathclyde Business School . You should download a soft copy of the Workbook from the Department of Management’s Intranet/EIBE site for completion in word-processed format as the assignment submission for Task 1 of the EIBE assignment. all be it that you may modify the sheets as required. and for use as a ‘working copy’ on which to record the scenario development process as it unfolds in your group.
Exploring the International Business Environment Sheet 1: Diary/Record of Investigation Day/Date 1. Actions taken to address 1 Actions Points of critical reflection on EIBE and group processes: EIBE Workbook 14 ©2011 – University of Strathclyde Business School . What do we not know. but do need to know? What are the: • key knowledge gaps? • key research questions? 2.
Exploring the International Business Environment Sheet 2: Identification of Driving Forces Areas of investigation Driving Forces 1st Iteration STIRDEEPER factors EIBE Workbook 15 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 3: Driving Force Plausible Alternative Outcomes Driving Force Plausible Outcome A 1st Iteration Plausible Outcome B EIBE Workbook 16 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 4: Driving Force Clusters Driving Force Cluster Heading Contributory Driving Forces 1st Iteration EIBE Workbook 17 ©2011 – University of Strathclyde Business School .
(See the example in Sheet 5 under Task 1: Examples and Explanatory Notes) EIBE Workbook 18 ©2011 – University of Strathclyde Business School .Exploring the International Business Environment Sheet 5: Driving Force Cluster Validation 1st Iteration Insert diagrams of each cluster in appropriate format.
Exploring the International Business Environment Sheet 6: Predictability/Impact Ranking of Driving Force Clusters High predictability 1st Iteration Low impact High impact Low predictability EIBE Workbook 19 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 7: Framing and Scoping Scenario End States 1st Iteration Scenario 1 Scenario 2 Scenario 4 Scenario 3 EIBE Workbook 20 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 8: Implications within the Scenarios for the Client 1st Iteration Scenario 1: Implications for the Client Scenario 2: Implications for the Client Scenario 4: Implications for the Client Scenario 3: Implications for the Client EIBE Workbook 21 ©2011 – University of Strathclyde Business School .
key descriptors of the present. key events over time. each scenario can be presented in: • • • diagrammatic form overlaid with supporting text as shown in Sheet 8-9 under Task 1: Examples and Explanatory Notes. This includes: • • • • • • the scenario name. although you can if you wish. only 1 scenario need be developed and presented. events over time and the cause/effect and chronological linkages between the events. In this case there is generally no need for component headlines. except perhaps for the ‘implications’. simple bullet point text format with sub-headings for the various scenario components i. detailed narrative (story) format which tells the ‘story’ of the scenario from the present to the end state incorporating descriptors of the present. and key implications of events over time on the client organization and client issues described in the assignment. There are several ways this can be done. key descriptors of the present.Exploring the International Business Environment Sheet 9: Scenario Stories 1st Iteration Given that the 1st Iteration is about understanding the process. key descriptors of the future end state. EIBE Workbook 22 ©2011 – University of Strathclyde Business School . key events over time. and so on. and key descriptors of the end state. develop and present all 4 scenarios As a minimum the presentation of the scenario(s) should include the elements shown in Sheet 8-9 under Task 1: Examples and Explanatory Notes.e. cause/effect and chronological linkages between events.
Exploring the International Business Environment Sheet 2: Identification of Driving Forces Areas of investigation Driving Forces 2nd Iteration STIRDEEPER factors EIBE Workbook 23 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 3: Driving Force Plausible Alternative Outcomes Driving Force Plausible Outcome A 2nd Iteration Plausible Outcome B EIBE Workbook 24 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 4: Driving Force Clusters Cluster Headings Contributory Driving Forces 2nd Iteration EIBE Workbook 25 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 5: Driving Force Cluster Validation Insert diagrams in appropriate format. 2nd Iteration EIBE Workbook 26 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 6: Predictability/Impact Ranking of Driving Force Clusters High predictability 2nd Iteration Low impact High impact Low predictability EIBE Workbook 27 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 7: Framing and Scoping Scenario End States 2nd Iteration Scenario 1 Scenario 2 Scenario 4 Scenario 3 EIBE Workbook 28 ©2011 – University of Strathclyde Business School .
Exploring the International Business Environment Sheet 8: Implications within the Scenarios for the Client 2nd Iteration Scenario 1: Implications for the Client Scenario 2: Implications for the Client Scenario 4: Implications for the Client Scenario 3: Implications for the Client EIBE Workbook 29 ©2011 – University of Strathclyde Business School .
and enhance their plausibility and authenticity. 1st Iteration. It is expected that having understood the process in undertaking the 1st Iteration. or detailed narrative (story) format. the medium of presentation is important and can serve to make the scenarios more engaging and compelling. “The test of a good scenario exercise is not whether any of the scenarios developed was correct or not. and this should be evident in the scenario stories. the number of scenarios to be developed depends on the group size. key events over time. forcing us to clarify our thinking. As specified in the assignment: • • • a group of 5-6 students must produce 4 scenarios. Notes: 1. supported by rigorous research. While marks for Task 1 are awarded for content rather than presentation. while challenging our individual and organisational assumptions. The above being the case. as a minimum the presentation of the scenarios should include the following elements: • • • • • • the scenario name. a group of 3-4 students must produce a minimum of 3 scenarios. and key implications of events over time on the client organization and client issues described in the assignment. cause/effect and chronological linkages between events. And there are several ways this can be done. each scenario can be presented in: • • • diagrammatic form overlaid with supporting text. thereby providing a basis for the organisation to make better decisions in terms of their strategic plans. A scenario exercise is good if it better prepares us to make better decisions on a future that is inherently uncertain”. key descriptors of the future end state. and getting us to ask the right questions and face the hard choices required to adapt ourselves and our organisations to manage future change. stimulating and structuring difficult discussions. EIBE Workbook 30 ©2011 – University of Strathclyde Business School . bullet point text format with sub-headings for the various scenario components. key descriptors of the present. As indicated in Sheet 9. 2. and highlight the implications inherent in each scenario. and a group of less than 3 students must produce a minimum of 2 scenarios. As Pierre Wack. the so-called father of modern day business scenario planning noted.Exploring the International Business Environment Sheet 9: Scenario Stories 2nd Iteration In the 2nd Iteration. the 2nd Iteration will then demonstrate a much higher level of thinking. it is imperative that the 2nd Iteration scenarios bring some new thinking and insights to the client organisation. but whether the scenarios illuminated the unknown.
if you have assigned one (hint. Dominance Problem: An individual or pocket of individuals can easily dominate group-working environment. Common Problems in Group Working The Strathclyde MBA offers a series of challenging group working environments. intensify their influence attempts using their push strategy of dominance. Refer back to the notes on giving useful feedback in your Learning Manager handouts.either because of their skill. 1. It is intended to assist with critical engagement with group working during EIBE. The dominant individual(s) will sense the withdrawal of the group and often believe this is a result of them not capturing the attention of the group and so will intensify their attempts i. and with your own selfassessment of your learning. and these notes offer a recap of some of the common problems that can arise in group-working. Alternatively they may react defensively to the group’s withdrawal and retreat even further into their favourite behaviour – dominance.e. (2) cross cultural differences in terms of communications (e. Remember the lessons of assertiveness (aggression or submission) keep your message simple. 2. or the attitude and skill of the receiver . the context in which the message is being sent. fact based and if need be repeat it until it is clearly heard. Miscommunication Problem: Miscommunication occurs when the sender has a message they wish to convey and . So a spiral begins. and for reference by those who have not. and a few tips to help you overcome them.the message is misunderstood.Exploring the International Business Environment 5. can keep space for such issues to be discussed. the EIBE Workbook 31 ©2011 – University of Strathclyde Business School . Offer feedback to the dominant individual or individual(s). the nature of the message. miscommunication can occur as a result of (1) the complexity of the concepts being dealt with. Tip: This problem needs to be addressed early before resentment and emotional contagion build up. Here the Facilitator. Ensure that is it task focused and not about trying to fundamentally change their personality type.g. keep some process notes that you can draw on. To help you keep your feedback to task specific instances. In the EIBE group working environment. hint).0 Task 2: Notes from The Learning Manager This material is included here as an aide memoire to those who have already completed The Learning Manager workshop. Problems arise when other group members are unable to contribute their ideas and become resentful. Allocate time at the end of all of your meetings to process issues. speed of utterance. This is especially the case where there is no immediate restriction resulting from role or task boundaries.
piece of research. 4. the message has been received correctly. planning key stages. duplication of effort. will be forced to defend their rejection of the agreed goals. drawing models etc.Exploring the International Business Environment role and meaning of interruption and the use of metaphor and story based examples). Lack of clarity around process and the organization of the task can lead to confusion.e. Take time out in all sessions to be clear how each contribution (e. and can have a detrimental effect on the group’s ability to achieve their goal. putting presentations together.there will be members of your group who have a lot to say but may struggle saying it. This is poor use of time and is likely to impede the group’s ability to achieve their goal. EIBE Workbook 32 ©2011 – University of Strathclyde Business School . An important part of process clarity is goal clarity. Revisit the process plan. Revisiting the process plan ought to be part of your group’s process based discussion at the end of your meetings. groups can find themselves in difficulty if they are not following a clearly worked through and fully supported (everyone buys into it) rationale for how the group intends to go about their allocated task. Post-it® s. Tip: Before diving straight into ‘doing’ mode. ensure that your group spends time thinking about process. It is the facilitator’s role to ensure that the group remains patient when communication is difficult remembering to check out meanings: i. try to be honest about areas where you will need help and support in order to set appropriate expectations.g.g. in recently formed groups trust can be an issue. or struggle to say it in a way that is easily and quickly understandable to others. the facilitator can be used to help and support the message sender by clarifying. In sharing strengths and weaknesses. reduction in motivation. summarizing and checking out understanding. and (3) time pressure. typing up ideas. Tip: Forewarned is forearmed. Each group member should be aware of the group’s goal and the specific line of argument and exploration the group has agreed to follow. Be warned . Remember how useful its can be to use tools: white boards. Organization of the Task – Process Problem: Here. written section of a report) is working towards the group’s goal. they may be more suited to attending to the presentation of material e. Also. If there are complex messages that you or another group member is trying to offer to the rest of the group. It should not be seen as concrete and ought to be flexible as your group proceeds towards its goal. working out individual member’s strengths and weaknesses and allocating the right person to the right task. The fact that you are aware that this will undoubtedly be the case ought to help in setting your expectations and extending your patience. This manifests in a failure to allocate tasks to small sub-groups and results in the whole group doing everything together. For instance. one group member may not be good at researching and making sense of data. In this way any group members who for whatever reason are pursuing a different agenda.
Freeloading Problem: Here an individual or pocket of individuals. as with several other courses on the MBA. The objective of this peer assessment is to fairly recognize and reflect in the final group mark for each member in the group. Note: When it comes to so-called freeloading. but are skilled in undertaking desk-based research. then any freeloading activity becomes transparent. while others may have a particular strength in structuring and writing the scenarios. Tip: As with the dominance (and in fact all of these issues) early intervention is crucial. and in most cases feel intensely resentful of the unequal distribution of effort. or in fact are freeloading: that is. Some for example. The composite average peer assessment total for each student will then be applied to the group assignment mark. peer assessment should be used to identify and appropriately penalize freeloaders i. the EIBE course uses a “peer assessment” process whereby each group member is required to complete a ‘Peer Assessment’ form evaluating the contribution made by each of the other team member to the group work in undertaking the assignment. others may be relatively quiet in group meetings. withholding effort from the group’s endeavor. Thus properly applied. This learning outcome is fatal for both the group and the individual. The real problem arises when the freeloaders go unchallenged and simply experience positive re-enforcement of their behavior: i. In this situation other group members are carrying the workload of the freeloaders. may result in each student in a group receiving a different mark. As with issue 1. It should be recognized that not all group members will contribute equally in the same way. If the group has kept a clear note of task allocation and deadlines. the freeloading issue should be tackled within the group environment and feedback should be task focused.Exploring the International Business Environment 4. Rotating facilitation and time for process issues at the end of each group meeting is a useful mechanism to ensure that free loading can be addressed early. Ideally the group should attempt to work as a team with all contributing to the assignment equally albeit in different ways.e.e. group members will inevitably contribute in very different ways. may be good at organising and facilitating group discussions. appear to be. EIBE Workbook 33 ©2011 – University of Strathclyde Business School . it should not be used vindictively and maliciously to punish any individual simply because of differences in opinion and/or personality clashes. those individuals withholding effort from the group’s endeavor. the contribution of the individual members in completing the assignment. I don’t have to try as hard as the rest of the group in order to share in the overall success. which depending on the totals.
is this the economy of a particular country. rather complete the tasks and make sure you understand the whole process. Do not put down a single word as a driving force such as ‘economy’. Step 2: Brainstorming driving forces (Time allotted. in the country/region the group has selected. In undertaking this process. 15 minutes) This exercise is about the external business world or the ‘contextual’ environment. or perhaps economic stagnation? OUTPUT: A wide range of driving force post-its (Record on Sheet 2) EIBE Workbook 34 ©2011 – University of Strathclyde Business School .0 A One-Day Scenario Development Timetable What follows is a 10 step timed task process template which can be used for completing the 1st scenario iteration in a 6 hour period. group members should individually. Step 1: Getting organised (Time allotted. using blutack. or region? Do you mean economic downturn.Exploring the International Business Environment 6. and therefore do not spend more time than necessary at each stage of the process in quibbling and arguing points. In the 2nd Iteration there will be time for more in-depth discussion and debate. in order to complete the process in 6 hours. It is accepted that at this point group members will probably not have undertaken any research on the country/region selected. economic growth. to make one continuous display area. the group members should be encouraged to consider a wide range of factors based on what they see happening in the world around them. It is important to note that in developing scenarios. In this step the more ideas generated the better and the acronym STIRDEEPER can be a useful starting framework of areas to consider: • • • • • • • • • • Society Technology Industry Resources Demographics Economics Environment Politics Energy Religion Note: Use one post-it per driving force and identify each in no more than 5-6 words. be more specific about what you mean i. write in big. This is not important. the group should appoint a facilitator who keeps time and moves the group progressively through each step of the process within the allotted time.e. 15 minutes) Begin by creating a Post-it display area by attaching 6 flipchart pages to the wall. the task is to concentrate on the outside world and at no time should the client organization be part of the group’s thinking/discussion. legible characters on the post-its so that they can be read from a distance. Recall from the introduction that the 1st Iteration is about understanding and getting to grips with the scenario development process. masking tape or pins. write down on post-its the main driving forces (the forces “causing things to happen in the world”) they can think of that are likely to shape the issue areas as defined in the assignment. OUTPUT: Working area on the wall. Taking 15 minutes silent time.
For example. the central idea that embodies each cluster (avoid using just one word). is in fact quite a different one when the author of it explains what s/he means as clarified by the alternative outcomes. Each cluster should represent one central idea. the driving force “domestic political climate” in the UK could have as outcomes “Labour elected” or “Tories elected”. The facilitator places each post-it on the working area on the wall and invites the contributor(s) to clarify what s/he means by the driving force. There will inevitably be some duplication with one or more group members thinking of the same driving force. 15 minutes) Having arrived at a large number of driving forces and their plausible alternative outcomes. Note that it is permissible to have a cluster containing just one post-it. 30 minutes) The next step in the process is to test the logic of the clusters by drawing influence diagrams that link each of the elements in the cluster. The cluster name should be written on a (different coloured) post-it and attached to the clusters. 1 hour) The facilitator should collect the driving force post-its from each group member one by one. A second spare copy of the cluster names should be made on post-its and retained for use in the Step 6 of the process which follows. if there are. (Record on Sheet 4) Step 5: Validating and naming of driving force clusters (Time allotted. The group should gather in front of the working area containing all of the post-its and offer suggestions as what ideas they intuitively feel belong together. it is likely that there are 2 or more ideas in the cluster which need to be broken out into separate clusters. followed by recovery in 2xxx”. the next step is to cluster the driving force post-its. Or “UK domestic economic growth” could have the outcome on one hand as “recession in 2xxx. OUTPUT: Clusters of linked driving forces. However it is often the case that what may initially appear as the same idea as one already covered by someone else. asking each to contribute their most important ideas. if necessary the clusters can be rearranged if some elements do not seem to fit naturally. EIBE Workbook 35 ©2011 – University of Strathclyde Business School . by exchanging post-its between clusters. The two plausible alternative outcomes should be captured on post-its. by identifying two plausible alternative outcomes that illustrate the range of uncertainty with respect to the driving force – these should be polar extremes i. It is also acceptable to have one element which appears in two (or more) clusters. Several clustering attempts are usually necessary before everyone in the group agrees on each cluster. and the outcome on the other hand as “continued growth through 2xxx at X. Ideally there should be not more than 7 [+ or -] 2 post-its in a cluster. The post-its with the alternative outcomes of each of the driving forces are called the “event post-its” and these should be kept in a separate pile for later processing. The challenge is to ensure that there is no ambiguity in the driving forces post-its. that the intended meaning of each is understood by all group members. The facilitator should not allow elaborate debate on the validity of the statements. These should be drawn on A4 sheets of paper and done in parallel with each group member working on several clusters. extremes at either end of a continuum. The facilitator should go around the room until all ideas have been captured in this way.e. one diagram per cluster. Once the diagrams are completed the clusters should be named by identifying in 2 or 3 words.Exploring the International Business Environment Step 3: Clarifying driving forces and plausible outcomes (Time allotted.X % GDP growth pa”. normally stating the 2 alternative outcomes of the driving force is sufficient clarification of what is intended. OUTPUT: Understanding driving forces/their potential outcomes (Record on Sheet 3) Step 4: Clustering driving forces (Time allotted.
but should not allow an extended debate on the validity of the clusters or their names. Those that appear to be most “in the air” (causing the widest impact range) should be placed at the bottom of the vertical axis. depending on the degree to which their outcomes are predictable. thereby creating an initial framework for developing 4 scenarios. as far as possible the driving forces selected should be independent of each other. Although some debate is required until the group can accept the outcomes as a reasonable ranking of predictability and impact. The facilitator should ensure that the group members understand how the elements in each of the clusters are linked. use the full length of the vertical space available. (Record on Sheet 6) Step 7: Developing the scenario matrix and end states (Time allotted. Again. those driving force clusters which are the least predictable and also have the greatest impact. and a matrix drawn on it. the ranking is intuitive. and as such represent so-called “critical driving”. Although it may be argued that at some level almost everything is connected to everything else. this process is not an exact science and there is no ultimate truth. 1 hour) The post-its that are nearest to the bottom right-hand corner of the matrix denote driving forces that have the highest impact but also the lowest predictability. the predictability of the developments and their subsequent impact. Predictability in this context can be thought of in terms of the possible range of developments each variable can move. Select the two post-its that are at the bottom right hand corner of the predictability/impact matrix and place one on the horizontal axis. Note: In assessing the predictability/impact of the clusters. OUTPUT: Identifying the “critical driving forces” i. it is important that account be taken of the time frame as defined by the horizon year. Those with the highest impact will be placed on the right hand side of the axis. EIBE Workbook 36 ©2011 – University of Strathclyde Business School . avoid the tendency to place all of the clusters around the middle of the axis. At the same time. Note: It is essential to ensure that the two post-its selected are not interdependent driving forces. with the headings ‘high predictability’ on the top of the vertical axis. Another flipchart sheet should be attached to the wall and divided into four quadrants by drawing lines top to bottom and left to right through the middle (see Sheet 7). ‘low impact’ on the left (see Sheet 6). those deemed most likely to develop in a predictable way (causing a narrow impact range) are place at the top. ‘low predictability’ on the bottom. The facilitator should take each of the spare set of cluster-name post-its and ask the group where each post-it should be placed on the horizontal axis (the impact) in terms of its impact on the issue areas as defined in the assignment. and ‘high impact’ on the right of the horizontal axis. The second step in the process is to move the post-its up or down the vertical axis. those with the least impact on the left. 30 minutes) Another flipchart sheet should be attached on the wall. (Record on Sheet 5) Step 6: Ranking driving force clusters (Time allotted. if they are interdependent they will invariably move in unison and therefore essentially represent only one driving force. OUTPUT: Influences/links in clusters clarified & clusters named.Exploring the International Business Environment The cluster diagrams should be posted on the wall and the group should review them. the other on the vertical to form a matrix. as what may be largely predictable in 3-5 years. and will be used to develop the initial scenario matrix. may be highly unpredictable when considering a 10+ year time frame.e. the group members should not prevaricate.
and place the post-its of end-state characteristics for the scenario at the right hand side of the flipchart at the end-state year. to create a coherent. The groups start by taking a flipchart sheet and in landscape style. In arranging the event post-its in temporal order. each group developing one scenario in the form of a storymap. The facilitator should call each event post-it in turn and the group determines in which scenario it fits most naturally. In placing the two independent driving forces across each other and labeling their outcomes. and themed where possible and should clearly call up the general image of the end states designed. (Record on Sheet 7) Step 8: Developing chronological scenario storylines (Time allotted. in a scenario box bounded by a ‘stagnant and moribund’ economy and an ‘ineffectual and corrupt government’. certain events will push and pull others over time and how these will then play-out in the storyline. 1 hour) This again is a two step process stage. the next step is to examine each driving force. Post-its that have been added at this story-telling stage can be identified later. ‘social unrest’. the groups will need to create new event post-its in order to pull and fit everything together to address these gaps. an initial 4 box scenario matrix is created. ‘decreasing FDI’. In the first step the group should revisit the event post-its. The task is for the groups to arrange the allocated event post-its over time between now and the world of the end-state of their particular scenario. This exercise requires a “trial and error” approach and it has proven to be more effective to quickly try out ideas and later reject them. if necessary. Annotate as such. draw a 15 year time line along the bottom of the sheet. taking into account those events which are already happening and are related to current reality. and so on. The second step is to then develop chronological scenario storylines. each of the boxes representing a distinct scenario (see Sheet 7). ‘voter apathy’. EIBE Workbook 37 ©2011 – University of Strathclyde Business School .Exploring the International Business Environment Having determined that they are largely independent of each other. The group should now move to developing the end state for each scenario. and ‘stagnant and moribund’ at the right. ‘brain-drain’. The final element of this step is to name the 4 scenarios. think about alternative outcomes for each within the horizon year and then develop high-level concept labels that encapsulate the essence of their dimensions and alternative outcomes as a continuum. For example one dimension or driving force on the horizontal axis could be ‘the state of the domestic economy’ in which case the alternative outcomes and thus the dimension headings might be ‘resilient and growing’ at the left end of the axis.e. plausible storyline. For example. The names should be short. and allocate each of these to one of the scenarios. in a way that creates a logical and coherent story. The groups then need to determine where along the time-line the event post-its should be placed in their scenario. This is essentially a causal thinking exercise and major gaps in the story will inevitably be identified. to move the world from the current situation to the situation depicted in the end state. This is done by looking at each of the 4 scenarios in turn and imagining what the world will look like in the scenario in the horizon year and then placing some words and/or short phrases on post-its in the scenario box which characterize the end state of the world depicted in that particular scenario. than to try to come up with the ultimate answer in one go. OUTPUT: Initial scenario matrix and scenario end-states. and those which will come into effect in later years on the time-line. From this point on the group should work in 4 sub-groups in parallel. it is important to think about the “pushes and play-outs” i. characteristics of such a scenario might include: ‘deteriorating infrastructure’.
and when the next group meeting to discuss the research findings will take place OUTPUT: Focused research agenda and allocation of research tasks. • Step 10: Sharing the storylines/developing the research agenda (Time 40 minutes) In the final process step. Step 9: Identifying Implications and knowledge gaps (Time allotted. Having done this. answering the question. what needs to be added to make it a more well-rounded story? These questions should be captured as they shape the research agenda for each scenario. The facilitator should consolidate the lists of questions which arise from this and step 9 into one list of areas for research that the group needs to tackle. the group should then discuss what they have to do to in order to convince a “devil’s advocate” of the veracity of their scenario story. gaps and plausibility issues with the scenario storylines/maps. Finally. relating how events unfold from the current date to the scenario horizon year. and apply the learning in the 2nd Iteration. Relevant issues at this point include questions such as: are there any issues of plausibility in the scenario. OUTPUT: A plausible chronological storyline and story map for each scenario.Exploring the International Business Environment If a group find they have in their scenario space an event post-it that is fundamentally at variance with the underlying scenario theme. where are the major gaps in the storyline? • does the group really understand the fundamentals underlying the storyline events and has it captured the main systemic relationships and associations? • has the group made the mistake of building the scenario entirely around only one factor or event. and which group members will be tasked with what areas to research. This concludes the 1st iteration Note: It often becomes apparent at the conclusion of the process that process errors have been made and/or that the thinking about driving forces. events. Do not go back and correct these. Before finishing their scenario each group should revisit the influence diagrams made for the driving force clusters (Step 5) as these may prove useful as inspiration to enrich and embellish the storyline. so what does this scenario mean for the client in terms of its future strategy? (Record on Sheet 9). they should pass this to one of the other groups dealing with a scenario that may more logically accommodate it. The audience groups should raise questions about the scenarios regarding inconsistencies. apparent contradictions. a group discussion is required to determine priorities. and the implications. each group should take 5 minutes to give the rest of the group a summary of the storyline for their scenario. could each of the events depicted in the scenario really happen? Why? Why not? • does the scenario storyline flow seamlessly? What seems to be missing from the story. and (2) document them in the diary as part of the learning. clusters and so on was superficial. OUTPUT: A set of research questions to address knowledge gaps. rather (1) learn from them. 35 minutes) Having completed the story map each group should review their scenarios and determine what are the implications inherent in the scenario for the EIBE client – in essence. EIBE Workbook 38 ©2011 – University of Strathclyde Business School .
The most important result of this is the discovery of what you know and what you don't know. which you need to answer by focused research and learning. ideas. you compare the effects of this with what you were expecting. Lewin suggested that the traditional positivist way of research does not work for very complex systems. You now know where to look to improve this understanding. which leads to some interesting insights that may. Iterating between intuition and analysis produces the quickest route to new insights. You have generated a good research question about the system. an organization’s understanding of the business environment is such a complex system. In the early stages of a generative scenario project research is. So the scenario approach can be compared with action research. which is where new arguments. Gaps between your expectation and what really happened indicate areas where your understanding of the system is lacking. Consider someone who does not know whether to take his umbrella or not. It is preferable to use the intuitive powers of the group and let the research programme emerge. There is no free lunch in scenarios. Finding the answer in scenario research involves mostly getting in touch with the relevant experts and ‘remarkable people’. to the edge of the plausibility area. Instead he suggested an approach that he called "action research". That opens up space for what we think of as 'learning' in the later stages.Exploring the International Business Environment 7. For Pierre scenarios is about doing a lot of detailed analysis and systemic research and in that way learning about the system driving the relevant business environment. In generative scenario planning articulating precise research questions is the purpose of the scenario exercise. But new understanding can only come from deep research. You intervene in an organization's strategy by challenging what the organization thinks about the environment. Prior research pins down the territory. Doing scenarios you push the thinking in the organization as far as possible from the business as usual mental model.0 Conducting Research in Scenario Projects When asked to explain what scenarios are all about Pierre Wack liked to refer to Kurt Lewin. after making a significant intervention in the system. Telling him that there are two scenarios. EIBE Workbook 39 ©2011 – University of Strathclyde Business School . at least in part. You then need to work hard at learning about the systemic structures that you have found you do not understand enough. is not very helpful. rain or shine. The reason why people engage in scenario work is to make the group step out of their limited thinking box. The crux is finding the precise question. The project needs to be an emerging "conversation" between intuition and analysis. such as a social system. social psychologist. The art of doing effective and cost-effective scenarios is to define the research question as precisely as possible. But thinking through the detailed scenario of how the weather might develop from now in order to lead to rain tomorrow causes you to look at weather fronts etc. not precede it. Therefore research should FOLLOW a scenario exercise. and the ultimate new insight come from. which in turn generates new and different questions. Once you know what you need to know 90% of the work has been done. about clearing away misconceptions . who introduced the concept of "action research". When you think you got the answers to these you integrate this new knowledge by developing the second generation. and so on until further generations run into diminishing returns. It is a mistake to expect to do all research before doing the scenarios. but which are actually wrong.things that people THINK they know. In essence. actually help in answering the question. This is why we talk about generations of scenarios. which generates the first set of research questions. For Pierre. with a bit of luck. You develop the first generation. What you have generated is the appropriate and relevant research agenda.
good projects are measured in months. The team then continued in a second generation round. The scenario project had allowed the team to avoid wasting time on subjects of secondary importance and highlighted important aspects that needed further work. Initially the scenario group did not fill out the scenarios further. a sound process involves at least three iterations in this way. not days or weeks. as one of the four was considered inconsistent (accommodating a major airline hub within existing constraints). because in doing so you discover where you lack understanding of the underlying structure in the situation. even though the scenarios were not any longer valid. So. we then have to go and do focused research. just as just analysis doesn't get you there either. Discovering some systemic features in either or both of these areas constituted a major payout for the project. It is the combination. and whether one or more major airline(s) would use it as their main European hub. Most of the work is systems research. This produced three scenarios.Exploring the International Business Environment An example The research questions arise mostly while trying to connect the present reality with the endstates developed in the two-by-two matrix. In doing so two major elements emerged as unknowns requiring further study: • • to what extent will the trend towards concentration in the airline industry in Europe persist over the next 20 years? to what extent (and at what level) will the hub and spoke system be the most effective way for airlines to make money in the years to come? These aspects were then analysed thoroughly before going any further. The scenario group had chosen as their main dimensions: • • whether current political constraints. It was clear the stories had to be worked out over time. They found some predetermined elements lurking in this structure that needed to be uncovered to help in the design of strategy. That project was perceived as somewhat less than successful. Telling that story in some detail is crucially important. carried out in a few cycles. It is clear that the team at that stage looked at first generation scenarios (or rather end-states) only. having learned what we don't know. the results of the research must be incorporated in the next generation of scenarios. In doing so some underpinning structure emerged that allowed the team to understand better what might happen. just doing the scenarios. and then failing to carry that through to real new understanding by failing to take the time to do the research required? Just scenarios does not get you there. Is it not a pity that scenario planners so often stop half-way. summarising the discussion so far: • • • • • the purpose of scenarios is to give us an idea of what we don't know and therefore need to research. imposed by the government on the level of activity at this airport (located in a densely populated area) would persist. where analysis EIBE Workbook 40 ©2011 – University of Strathclyde Business School . For example consider a recent set of scenarios for a major European airport. maybe getting to the right questions. and used the three end-states as strategy test conditions. that can't fail to lead you to the small number of crucial questions.
EIBE Workbook 41 ©2011 – University of Strathclyde Business School . it is possible to 'see' the future. yes. Sceptics can play an important role in this. Then investigate why their reasons are not reflected in the scenarios. find the sensitive points of maximum leverage. Expectations in organisations are embedded in the going orthodoxy. discussion and contemplation.Exploring the International Business Environment gives you the key systemic insights. The team needs to process these by considering how they affect the systemic understanding reached so far. look at the current reality and the short-term as well as the longer term. The intervention is creating scenarios. Examples of questions that help in this analysis: • • • • • • • • what is considered as already “in the pipeline”? what seems static. e. during which disparate bits of learning are brought together and integrated in a few storylines. General points to be taken into account include: • • • • the Business Environment is a system. It needs a lot of time. each taking the future to the edge of plausibility. This is what is meant with 'predetermined elements'. The team should ask them why they think a scenario cannot happen. The research phase is always followed by a further scenario-building round. system goals. expressing “Business as Usual” thinking. pay particular attention to the predetermined elements. The art of raising research questions therefore involves the confrontations of the scenarios with the Business as Usual thinking. but is actually slowly changing? what trends are bound to break. But once you're there. in the form of many relatively unrelated ideas and observations. The purpose of research Let’s reiterate the main purpose of the research: to get into the deeper reaches of the 'systems iceberg': being able to identify the truly structural drivers in a given strategic context. Generating research questions The Lewin view is that research questions arise in principle through comparing the actual outcome of an intervention with expectation. Don’t rest until as many uncertainties as possible have been turned into predetermineds. the combinations of the multiple elements that are driving it. due to saturation? what seems really impossible? Why is that? The questions to the Remarkable People are also helpful here: what is happening that matters/could matter? what is the relevant system to study? what is the appropriate level of "granularity" (detail) of observation? what are other ways of looking at this? Research results Research results are initially scattered over a wide are. And it is ONLY those insights that will lead you to superior strategy.g. the 'rules of the game'. and is exactly what Donella Meadows confined to the higher reaches of her systemic ladder: worldviews. elements that determine the system's ability for self organisation. Look for interrelations in the system.
Keep everything that might be useful in this way. Good research really does require careful thought and minimal distraction. when you are working harder and harder to learn less and less new things). It is up to you to decide that it is done when you are hitting a clear point of diminishing returns (i. For example. "Visiting" these worlds (by reading or interviews) is one of the best ways to "see" the futures now. just make sure you can find what you need when you want it. if you are approaching an issue you know little about. Most aspects of your scenarios are already happening . Research is never done until you say it is.e. Talk with people who think differently than you do. you will want to do just enough reading and scanning in advance to make sure that you are asking good questions. Juggle. we merely need to know more than we did when we started about the topic at hand. You do need an elaborate filing system. Think like a detective. for graphics presentations. Keep looking at the question from different angles. • Use interviews as much as possible. one factor having an impact on the persuasiveness of a scenario is its richness of detail. Few people can do good research with the phone ringing and email a-chirping in the background. Even if just for an hour at a time. These include: • to increase the level of granularity of the story. Approach your research in the spirit of a journalist. The goal is not to reach the definitive answer to a question. This is the main purpose. Hitting upon the right anecdote. • Have fun! It's a great luxury to learn. Still. you may want to use newspaper headlines and magazine covers as illustration. learning as much as you can as fast as you can without being too concerned about whether you are "covering everything" or not. And the most important question in any interview is the last one: "who else should I be talking to about this?" • Focus on lead users/adopters. Remember that you are going to use this material in a variety of ways. Play with the material.somewhere. • Focus when doing research. has a few suggestions for scenario researchers that are worth considering: • Think like a journalist. Go for a walk or a run. • Don't forget the 80-20 rule. • Save every useful article. get rid of other tasks. Talking with very knowledgeable people is the most time-effective way to learn a lot about a topic. but to raise the level of understanding as best we can as fast as we can. But there are also a number of subsidiary objectives of the research related to improving the quality of the final scenarios presented to the client and beyond. EIBE Workbook 42 ©2011 – University of Strathclyde Business School . GBN’s top researcher.Exploring the International Business Environment Tips for researchers Chris Ertel. To succeed.
A final thought……………………….Exploring the International Business Environment • • the one compelling image is not trivial. to increase the depth and dimensionality of uncertainties. a key driver such as 'liberalisation' can be conceptualised in many different ways. Keep an open mind on all aspects of the study. The EIBE Team June 2011 EIBE Workbook 43 ©2011 – University of Strathclyde Business School . 2nd edition (2005). and enjoy. the dynamics of scenario narratives should delve into a fully plausible nexus of patterns and events. let alone to design in an intricate web of feedback loops that helps the client to understand his situation. The team needs to get beyond a rather vague idea of 'freeing up the markets'. spelling out exactly what we mean by them. For example. to identify more probable and worked out dynamics. published by John Wiley & Sons. the art of Strategic Conversation.. but often requires sifting significant volumes of data. The above is an extract from Kees van der Heijden’s book: Scenarios.
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