4 Reasons to Think in Scenarios

As many of you know I have the honor of sitting on the board for the Skills Society.  An honor because of what they do and who they support but also because I come in contact with some amazing people and ideas.  Recently we were asked to read What if? The Art of Scenario Thinking for NonProfits.  

Although scenario thinking has been around for decades, its recent use has become increasingly essential in our ever-changing context.  And if you’re hoping the tidal wave of change will soon pass, you will be disappointed. Most of the literature I have been reading (Inc.com, Harvard Business Review, McKinsey Quarterly, Twist Image) indicates the pace of change will only accelerate and consequently become more unpredictable.

As an Executive Director for a not-for-profit organization, how do you determine a strategic direction when the destination you choose today could disappear tomorrow?

Scenario thinking seems to offer a lifeline for our beleaguered Executive Directors because it forces us from the comfort of traditional strategic planning and broadens our thinking beyond the insular confines the status quo.  By encouraging us to think about the present through the prisms of multiple scenarios, it reveals previously unidentified threats and opportunities for the organization.

To be clear, we are not trying to predict the future. Predicting the future makes you a futurist not a strategist.  We are not trying to predict who will win the election, rather we are trying to plan for many possible winners and how it could impact the work being done by the organization.

“Ultimately, the point of scenario thinking is not to write stories of the future.  Rather, it is to arrive at a deeper understanding of the world in which your organization operates, and to use that understanding to inform your strategy and improve your ability to make better decisions today and in the future ” p.9

As a process, scenario planning is outside-in.  It begins by identifying driving forces of the broader environmental context external to the organization (technological, social, economic, political, environmental). At Skills we are constantly having conversations about the threats and opportunities inherent in shifts in the provincial economy.

Next, scenario thinking examines the working environment external to the organization (clients, stakeholders, partners, funders, constituents, customers, competitors, regulators).   One consideration Skills is tracking is the shifting demographics of the clients we serve and the threats and opportunities it could present for service delivery.

Finally, it moves to considering the internal organizational conditions. This means having conversations about ways in which external forces (broader environmental context and working conditions) could influence the organization and how it functions internally.  For Skills, this requires discussions about how the economic realities and client demographics could effect the way the organization delivers services to its clients.

Incidentally, scenario thinking can also be done in the same way for issues or complex problems.


Four Reasons to Think in Scenarios

Setting Strategic Direction: develops a strategic plan that accounts for possible changes in the environment outside the organization or tests your current strategic plan.

Catalyzing Bold Action: inspires and nudges the organization to take bold actions pushing beyond assumptions that reinforce the status quo by …rehearsing diverse and provocative future possibilities-both desirable scenarios you would like to help create and dark scenarios that generate a sense of urgency” p.16

Accelerate Collaborative Learning: uncovers otherwise inconceivable solutions by creating a space for the organization to learn from diverse perspectives.

Alignment and Visioning: forges new relationships by creating a shared understanding of the complexity of the problem resulting in new approaches.


Do your own Outside-in thinking:  

  1. To begin, think of an issue that you feel strongly about fixing but society has not successfully addressed (e.g. poverty, animal abuse, education for gifted students, mental health, addiction, ….)
  2. Draw a column on the left side of the page.  Identify the technological, social, economic, political, and environmental factors in the contextual environment that impact your issue (not meant to be an exhaustive list – just whatever comes to mind).
  3. Draw another column in the center of the page.  Identify the factors (clients, stakeholders, partners, funders, constituents, customers, competitors, regulators) in the working environment that impact your issue (again,  just whatever comes to mind).
  4. Draw a third column on the right and leave it blank.
  5. This is where the activity gets interesting!!  Find someone that has the same level of interest in the issue you have a chosen but you know their approach is quite different from yours. Have them fill in the first two columns for themselves.
  6. Go out for a coffee or a lunch with the other person and fill in the final column together.  Do not vet or debate the ideas- just fill them in together.
  7. Next, notice and discuss where your ideas converge and diverge.  The most important revelations will come from the conversations around where your ideas diverge the greatest.  
  8. Make note of any new ideas or approaches emerging from your conversation.

    Congratulations, you have just done outside-in thinking!!

One Activity for Developing Meaningful Strategy

Most strategic planning sessions in which I have participated always seemed to lack substance.  It was as though we all knew the results of the session would be meaningless but we participated anyway.  Strategy via compliance.

For strategy to be meaningful, it cannot be created in one session.  It requires time, openness, conversations and iterations.

Recently, my faith in strategic planning was restored when I participated in a session facilitated by Mark Cabaj for The Skills Society.  Here’s what we did.

We read Getting to Maybe.  A treatise packed with concepts, ideas and stories that provide insight into how social innovation can occur.  In particular,  we focused on the Adaptive Cycle (chapter three). Please read the book for a more complete explanation and an excellent illustrating example.  

Essentially, any initiative, program or activity needs to pass through the four stages of the Adaptive Cycle to ensure organizational resilience.  Organizations become vulnerable when they have too many initiatives ‘stuck’ in any given stage for too long. Stages of the Adaptive Cycle include:

  • Release:  organizations make the choice to end certain activities, initiatives or programs.  Inevitably, ending a program can cause strife but it also releases precious resources that can be re-allocated to new ideas or approaches.
  • Re-organization/Exploration:  organizations enter a highly creative stage generating many ideas all competing for the newly released yet finite resources.  Priorities emerge and the released resources converge on the ‘best’ ideas.
    • TRAP:    Failing to allocate the initial ‘investment’ of resources to give a ‘best’ ideas a chance at success.  ‘Everything gets funded but nothing gets accomplished’
  • Exploitation/Development:  organizations marshal additional necessary resources to move the idea from conception to reality. ‘Taking the implementation plunge!’
  • Conservation/Maturity:  organizations identify and codify best practices into polices or procedures.  All the hard work  to bring an innovative idea to life should be producing the change we were seeking.
    • TRAP:  Failing to identify when it is necessary to release resources so they may be reallocated.    ‘It’s the way we’ve always done it”

Then Mark lead us through an insightful activity in which we broke into small groups and plotted Skills Society programs, initiatives, and projects on the Adaptive Cycle. As a larger group we acknowledged this was the first conversation of many and nothing we did in the session would result in final decisions, freeing us from the obligation to have a polished strategic plan when we finished.  This allowed for a thorough exploration of divergent and convergent opinions.

Next, we plotted where we thought the same initiatives would be on the Adaptive Cycle in three years.  This conversation, when conducted with openness and generosity, is where thoughts and opinions about the future of the organization begin to organize into patterns and themes.  It is where fuzziness starts to give way to a clearer path forward.

I am looking forward to the next steps.