I went looking for a crystal ball the other day to tell me what to expect this fall, next year and beyond. One of several on Amazon, priced at $17.98, promised to “bring harmony and balance into your life.” Another with a $29.91 price tag shown perched on a lovely wooden stand said it would “bring luck to you and your family.”
But alas, people, none of the several listed for sale promised to tell me what the future holds. And with COVID-19, a deep recession and racial unrest all washing up on our doorsteps, I was looking for more from a crystal ball.
I got a call the other day from an investor who funded a Houston business requiring several people to crowd in person into a work-out space. He started it a few months before COVID-19 forced closures. The space and programming offered a special kind of experience. High energy, heat, pulsating sounds. All very cool…and hot! Now, he said, the studio offers programming virtually, but so far, hasn’t been able to replicate the ambiance or the revenue. And rent is still due every month, and employees still must be paid.
He wanted to know what he should do. Absent a crystal ball, the reality is neither you nor I can predict the future. Not with any certainty. No one can. And yet the questions abound: What will the future of businesses and organizations be through 2030? How can your business or organization thrive in a significantly changed world? Where are the opportunities hidden in the devastation? How, specifically, will restaurants keep their doors open, law firms add new clients, office building owners fully lease space?
For answers, the next best thing is scenario planning. Of all the planning tools out there, scenarios top the list of useful approaches. Futurists rely on them as a critical tool. I love scenarios because they open the path to creativity and innovation. And I’ve used them several times over the years to help organizations see new ways to tackle hairball problems. Like now, when no one can tell you anything will be for sure.
What exactly are scenarios, and how are they useful in thinking through the questions above? Here’s how they contrast with traditional planning.
Traditional Planning vs. Scenarios
With traditional planning, participants start by taking stock of where a firm, company, or community currently is and then imagine out to a single point 10 to 15 years in the future. Finally, those doing the planning put together an implementation plan to reach that single point. The failing of traditional planning is that no one can really predict how it will turn out. Unanticipated events – budget cuts or changes in leadership, for example – knock the organization off-course so that the actual end point misses the mark, sometimes by a wide margin. Traditional planning is open to the criticism that participants don’t ask the tough, what-if questions. That they fail to imagine.
Scenarios, by contrast, like the ones below, help do the planning from the outside in. In a scenario project, planners create a number of different possible, plausible worlds in which their organizations might find themselves operating in the months and years ahead – some good, some bad, some in between. Then organizations use those worlds as tools to help figure strategy for thriving, no matter which world they end up doing business in. Truth be told, few scenarios come true in total; the more common outcome is for pieces of each to come true. Tracking signals over time proving or disproving one or another scenario adds value to scenario planning.
Whether they come true exactly as conceived is not the point. As a 2004 National Academy of Sciences paper points out, “the test of a good scenario is not whether it portrays the future accurately but whether it provides a mechanism for learning and adapting.” That is, whether it gets your imagination going.
Trends
I pulled from sources including the New York Times, the Dallas Morning News, the Palo Alto-based Institute for the Future and other media, to create the scenarios. I listed and analyzed dozens of trends to surface a list of critical uncertainties. Using the scenario process pioneered at Shell Oil in the 1970s and then refined over the years by the Global Business Network, now called Monitor Deloitte, I boiled down the list to two critical uncertainties: The U.S. economy growth and societal change.
I viewed the two as axes. At one end of the U.S. economy, the economy stays flat or worse. At the other end, the U.S. economy grows. At one end of the societal change axis, people embrace community, transparency and collaboration. At the other end, they prize individualism, go-it-alone action.
Matrix
I put the two axes together to form a matrix with four boxes. I created a scenario in each of the four boxes and gave them names consistent with the story they tell: Innovation Transforms, Capitalists Unfettered, Health Pods Rule and Culture Warfare.
Innovation Transforms
Innovation Transforms is the scenario with the most upside for the private sector, especially small businesses. It’s an environment where smart, nimble and creative entrepreneurs reap big rewards. They do so by overcoming the enormous twin challenges of securing customers’ health and becoming more sensitive to societal equality and equity. They learn how to take the latest technology to market, reconfigure how to serve customers and redo their business models. A strong economy pays for change. By 2030, this story of revolutionary change finds many, but not all, organizations capitalizing on the challenges.
Capitalists Unfettered
Capitalists Unfettered is the scenario most like the current conditions businesses, government and not-for-profits operate in. It could be the “official future,” the best guess of what the world will be like in 2030. It’s a world of cycles where customer and client need ebb and flow based on economic growth, containment of COVID-19 and little change to current society norms, including in areas of race. At the end of the day, modest changes to business models suffice.
Health Pods Rule
Health Pods Rule is a story of revolutionary change. It’s a world where citizens insist government at all levels take the lead to bring people together in community, to collaborate on solutions so everyone is safer from health threats, police department racism and other go-it-alone issues. By 2030, perspectives on power and wealth have changed in ways that benefit businesses, especially small businesses.
Culture Warfare
Culture Warfare is a dark depiction of the next 10 years. It’s a world where the economy stagnates, dealing with the pandemic is chaotic, unemployment remains high and social justice wounds go unhealed. A polarized nation descends into what amounts to civil war. General strikes, infrastructure deterioration and declining access to government services, including education and health care, become the norm. Meanwhile, some businesses are able to succeed by providing services to cope. Some governments retool their services so they become more effective and relevant. This is a story of evolutionary change driven by tough circumstances.
Caveat
As you think about the scenarios (ask me and I’ll send the full narratives to you), you’ll notice they all have something to say about both the U.S. and regional economies, including the Dallas-Fort Worth region, societal values, public health, population, private sector conditions, access to capital, workforce, governments, technology, education, innovation and city growth.
A caveat here: The scenarios and descriptions presented above are roughly constructed and intended to provide enough thought to get the conversation going about the future of your business or organization. You may find them too general. If so, we can work with you to create a scenarios set more specific to your industry and situation.
Next Steps
Interested in using these scenarios to plan your organization’s future? Here’s the process and how scenarios fit into your organization’s planning. I’ve guided others through it over the years and would welcome guiding you.
- Have a look at the detailed descriptions of the four different scenarios. Glad to send the full narratives for each scenario to you.
- For each scenario, list all the implications for you and your business. What ideas jump out at you? What’s out there you can’t live with? Do all the good implications added together lead to ideas, some directions.
- Map your current business model. It’s important to know what’s been working.
- Figure out how your current business model has changed given the events of the last few months. Is your business or organization still viable? Or must you make significant changes?
- Where you must change, start the creativity and innovation.
- Prototype, test and adjust your business model so you’re profitable going forward.
- Then, execute.
Scenarios Video
I’ve recorded a short video to augment the scenario planning process.
Have a Question?
To get the full 28-page scenarios report “What Will It Be by 2030?” write to me at bbancroft@conbrioconsulting.com. If you have any comments and questions feel free to reach out.
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