Managing Uncertainty: Harnessing the Power of Scenario Planning

Abstract

Purpose This paper aims to provide an overview of the role that scenario planning can play in managing the uncertainty caused by changing and unpredictable competitive dynamics. Design/methodology/approach This viewpoint reflects both the practical experience of strategic planners, combined with an academic insight into the advantages of using scenario planning as a management tool. Findings Firms can develop corporate level strategy and gain long-term certainty in their strategic approach by using scenario planning to strategize in a way that allows them to prepare for multiple futures, with multiple strategies. Practical implications Firms can manage environmental uncertainty and turbulence by being “mentally prepared” to address the future by evaluating the critical uncertainties driving turbulence and the strategic options relevant to a number of possible future outcomes. Originality/value A unique combination of practical experience fused with academic knowledge on harnessing the power of scenario planning to manage uncertainty and develop organizational strategy.