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Benefits from Future Uncertainties
on October 28, 2000
If you liked Arie de Geus' book, The Living Company, or The Fifth Discipline by Peter Senge, you will find The Art of the Long View a related, helpful exploration of how to go beyond "forecasting" the future to "preparing" for it.
This book is about using future scenarios to make better current decisions. As Peter Schwartz alerts us, "Scenarios are not predictions." They represent instead, possible alternative dimensions of the future that reflect the driving forces of that future. This is particularly valuable now because unpredictability is growing. "Unpredictability in every field is the result of the conquest of the whole of the present world by scientific power."
You are encouraged to use these scenarios as simulations to help you think more concretely and accurately about what might come next. Then you choose decisions and actions that leave you better off than the alternatives, regardless of the future scenario that occurs. Such scenarios are like projected script plots for a movie, and help us develop "memories of the future" (as David Ingvar noted) that make thinking about the future more practical for us. Generally one scenario will be better than the current direction, one worse, and one different.
Perhaps the greatest benefit of these practices is that "scenarios are . . . the most powerful vehicles . . . for challenging our 'mental models' about the world and lifting the 'blinders' that limit our creativity and resourcefulness." So you can think of scenarios as a stallbusting technique for overcoming the miscommunication, misconception, and disbelief stalls, as well.
One of the book's great strengths is that it takes you through the process by which the author discovered these qualities about how to use scenarios. He begins with his exposure to the kind of scenarios that Herman Kahn was using for government policy development in the 1970s. You then meet Pierre Wack at Royal Dutch/Shell who used scenarios to help the company successfully prepare for the big price increases in oil during the Arab Oil Embargo. Mr. Schwartz later replace Mr. Wack in that job and describes his experiences with later scenarios. One example that I found particularly interesting was thinking about putting in a new natural gas field offshore from Norway. Whether it made sense or not depended on whether the U.S.S.R. would continue to be an enemy of Western Europe and not ship its own low-cost natural gas to that market. That work led to understanding that the U.S.S.R. probably would fall many years before that occurred.
Another powerful section was on the global culture of teenagers as a precursor to other changes.
You will get plenty of concepts in the book to use to create your own scenarios and to make better decisions. You can get ideas from looking at themes like revolution, cycles, winners and losers, challenge and response, infinite possibilities, and the perspective of your own generation.
He has three scenarios for the year 2005 to give you a sense of what scenarios can look like. These focus about a market-driven world, a world without progress, and new geographical political alignments.
There is a user's guide with eight requirements for holding strategic conversations built around these scenarios. That is followed by an appendix with an 8 step process for developing the scenarios to use.
I thought that his section on "Information-Hunting and -Gathering" was especially good in helping you to spot the early sources of new future directions. These can come from technology trends, music, fringe areas, perceptions shaping events, remarkable people, sources of existing surprises, filters (such as magazines), and new networks.
Although I have never seen anyone conduct scenario planning exercises, I felt confident that I could do so after reading this book. I think you can, too.
Mr. Schwartz is an open, likeable person, and you will enjoy his writing style. He knows how to tell a good story that will stimulate your imagination.
After you have finished understanding the book and applying it to your business, I suggest that you take a look at your personal life in the same way. What are you assuming about your family, your health, and your future work-related circumstances? What are an appropriate range of alternative scenarios? What decisions do you have to make that are affected by these scenarios? Which decisions leave you much better off? Asking and answering these questions will provide the greatest possible benefit from developing your new skills in this area.
Be more thoughtful and purposeful using scenarios . . . and more happy endings will follow in reality!