By: Gideon Malherbe, Founder, Virtual Consulting
Executive teams choose to do Scenario Planning in order to break the tendency to myopically restate yesterday’s problems, add today’s crises, and call it their ‘strategy.’
Scenario Planning asks the executive team to solve future challenges and identify new opportunities using future-centric frameworks. Macro changes have the ability to kill off cynical leaders pretty quickly because their default playbooks are deeply entrenched in historic experiences that may have very little relevance in the post-covid, hyper-connected, ultra-transparent, socially sensitive, algorithmic age.
Over that last several decades, the resources sector walked a super conservative path with challenges facing safety, diversity and environmental positioning. Remember when operations managers publicly stated that mining is like war and fatalities are part of the employment deal? This thoughtless position did evolve to implementing safety systems and awareness campaigns. However, the shift of safety to something adjacent to the core strategy really occurred when regulators made it prohibitively costly not to comply. The same evolution can be found with labor relations, diversity, community relations and environmental sustainability strategies. That world is history now. We are not challenging people’s sincerity and intent, we are focusing on pervasive world views.
Our annual surveys of over 500 companies show that the executives who embrace new business dimensions are in fact performing better because they dynamically develop the business competencies to handle the new complexities. Place this against their peers that deny the broader strategic perspectives, not because of a need to focus, but because of their unwillingness to efficiently manage externalities. As these new frameworks evolve and become mainstream, the laggards’ skills slip too far behind to be able to make the jump into the new business environment, and the company inevitably fails.
The risk of greenwashing, being a ‘follower’ with digital transformation, having a narrow view of diversity and ignoring the new capital market dynamics all are indicators of an executive team opting for traditional solutions that now have little chance of succeeding. In all possible future worlds, the development of competencies to outperform others on a playing field that has new rules, values and expectations is what Scenario Planning is all about. We must see tomorrow for what it is. And a clear vision for tomorrow requires a deep dive into Scenarios today.
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