Posted in Marketing and Strategy Terms, Total Reads: 2535
Definition: Scenario Planning
Scenario Planning is essentially a process of establishing the possible consequences of a decision to be taken by the organisation by evaluating the various possible scenarios and factors affecting the decision.
It is essentially a strategic planning process that enables businesses to develop long term flexible plans.
In this process, firstly, the decision to be taken is identified and all the factors affecting it are listed. Further, the driving forces that influence the factors are also identified and ranked according to the importance levels as well as the degree of uncertainty involved.
Using this, multiple scenarios are then created and the possible consequences of the decision under each scenario are then evaluated. The indicators of all these scenarios are then recorded for future use for the purpose of identifying which situation actually unfolds after the decision making process.
Therefore, this makes the organisation highly flexible, sensitive and adaptable to future changes that may occur as a consequence of key decisions taken.