Scenario Based Planning
Scenario planning is a technique for exploring the future by creating several plausible but challenging alternative futures rather than making a single prediction. It has been used by commercial companies since the 1970s when Shell was the only oil company prepared for the oil shocks of that decade as a result of its use.
Why use Scenario Planning?
A prediction is (almost) never right. The unexpected always happens and the assumptions, conscious and unconscious, that apply today may not apply tomorrow. For example, at the end of the last century, London could see no solution to the ever increasing amounts of horse manure on the roads, then along came the motor car. This highlights the difficulty with using forecasts: they carry forward current trends, problems and constraints and do not allow for the unexpected.
Scenarios are versatile. Scenarios can be used not only to prepare plans for the future, but to check existing plans for robustness. Will a plan work in more than one scenario or will fail if any of the underlying assumptions change? If we can develop flexible plans that will work with multiple scenarios, then, when the unexpected does happen, there is a better chance that the plan can be adapted to the new circumstances.
It is difficult to get consensus for a prediction. You can either agree or disagree with other people's predictions - and the tendency is to disagree. Scenario planning is about building plausible futures, a much less contentious task because we only need to agree that a scenario is possible to be able to use it. We don't even have to agree that it is likely.
Good scenarios challenge one's thinking and stimulate discussion. The human species has spent most of its history telling stories rather than looking at graphs and spreadsheets. As a result, the implications of a rich story about the future can be more easily understood and used. It is surprising how much information a scenario can convey in a few words. For example, the following classified advertisement can tell us a lot about what the future might be like under a particular scenario:
This can be interpreted as: Increases in the price of transport fuel have meant that vehicles with high fuel consumption are no longer in demand and it is becoming difficult to sell these vehicles. However, with increasing prices of home electricity, there is a boom in DIY windmills. A component of these windmills is the back axle of a car.
The original Energy Scenarios Ireland, originally described in 2006/7 have been updated, though in a many ways they have not fundamentally changed.
Business As Usual has become Celtic Kitten - our focus is to get back to 'normal' but without a property boom to support the economy and a mountain of debt to support, it's a bit of a disappointment.
Enlightened Transition has become Celtic Phoenix - rather than emulate the ambitions of others, Ireland plays to the talents we have. A well educated work force, adaptable and creative, a small country with plentiful renewables - just what is needed to build and trial new products and services. Ireland markets itself as a big hothouse for new and growing young businesses.
Enforced Localisation has become Celtic Hedgehog - Back to the land and a life of frugal comfort. It takes decades for Ireland to re-emerge.
Fair Shares becomes Celtic Fox - In honor of Colin Campbell who used the Celtic Fox in his presentations. Ireland applies it's abilities to make the best of difficult times to adapt to a high cost economy. Times are tough but we are now well placed to build a stronger economy.
Further installments to follow, with particular focus on Celtic Phoenix.