The goal of scenario planning is to better prepare your organization for future shocks. Dr. Paul Schoemaker gives an example of a DSI client who’s 2004 scenario planning exercise included a future scenario that anticipated the type of financial market turmoil we are now experiencing.

The client was a building supply company. They labeled one of their scenarios “Return to the Great Depression”. Details of this future scenario included a widespread recession with high energy prices, crashing equity prices, a market flooded with foreclosures, and housing starts at a 50 year low.

At the time of the scenario creations, this client assigned a love probability to this scenario. However, by considering the possibility of this future, this company could become more aware of the early warning signs that this future was becoming more of a reality.

More about scenario planning:
Scenario Planning Executive Training
Scenario Planning articles and books