Tag Archives: Twist Image

4 Reasons to Think in Scenarios

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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!!

The Size of the Pie

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Douglas Rushkoff is a provocative writer and his book Throwing Rocks at the Google Bus challenges the most fundamental principles of our economic system by juxtaposing the disruptive potential of the digital economy to distribute value to everyone with the industrial economy designed to extract value for a few.

Rather than simply making my piece of the pie bigger (industrial economy) , I should make efforts to increase the size of the entire pie (distributed economy) .

Success in the industrial economy, argues Rushkoff, is too heavily weighted in favor of growth.  CEOs are rewarded for growth in market share, shareholder price and/or company size.   To grow they need to extract greater and greater amounts of value from customers (profits) or cut costs (slash expenses).  Companies that aren’t growing are thought to be in trouble and lack of growth is seen as the death knell for the company share price. So it becomes a zero-sum situation where companies are forced to grow at any cost – even if it means cannibalizing their own company to lower costs and inflate shareholder value.

Instead Rushkoff proposes companies think beyond the needs of the shareholder and look for avenues to create longer-term value in the lives of everyone (customers, employees and shareholders). It would mean companies would be choose to participate in the human-centric marketplace of a distributed economy.

What would a distributed economy look like?  Rushkoff dives into many ideas with numerous examples but the two I find most compelling are money and labour.

Money

Originally, money was invented by merchants in a local market to alleviate the cumbersome nature of bartering.  It became a local currency used to expedite transactions between producers and consumers within a local market. Later though, the King recognized the potential for garnering income from the market and introduced the King’s Coin creating a centralized treasury that issued the currency for any transactions in the market.  Any merchant opening a new enterprise(creating value) needed to borrow from the King’s treasury to be paid back later with interest(extracting value) – very similar to the system we use today.

Currency in the distributed economy would allow producers to create value outside of the centralized banking system. This would require us to suspend all we think we know about how an economy should function and pursue alternate platforms for organizing transactions.  One such platform is called the Blockchain (for a more thorough explanation of the blockchain).   Blockchain transactions are conducted using crypto-currency(bitcoins) and verified by the community.  Once verified they are posted to the global ledger that everyone in the community can see.  Authority in the system is distributed not centralized.

Take a minute and ponder the implications of this type of system.  How would it change the way we buy a car? a loaf of bread?

 

Work

Why do you have a job?  To earn money.  So you can participate in the economy by buying a house, a car, food, gadgets or eat in restaurants. What happens if you don’t have a job?  Debt.  Bankruptcy. And eventually you are unable to participate in the economy.

If you are able, I would ask that you suspend the rules for a minute and answer this question for yourself; imagine your participation in the economy is assured and your basic needs are met.  Would you change the job you currently occupy?  Would you do something completely different?  Would you work less and spend time with family?

Eventually we will need to come to terms with the demographics and pace of technological change and how it will impact the workplace.  Disruptive digital start-ups employ 1/10th the number people compared to the organizations in the industry it disrupts.  Amazon employs 1/10 the people compared to the bookstore industry. Couple that with global population growth and we will have less work for more people.  How do we distribute the work we need done?

I have merely plucked a couple of concepts from the book and would encourage you to read it (or listen as Mitch Joel conducts a fantastic interview with Rushkoff on the Twist Image podcast.)  Admittedly, I felt uncomfortable reading this book because his ideas challenge commonly held notions of how our economy should work.  But his words are inspiring because they create the possibility that things can be different – we just have to be intentional about choosing it.