SCENARIO BUILDING: The Schwartz/GBN Approach

"maximizing focus"

approach described by Peter Schwartz, Global Business Network (GBN)
in The Art of the Long View, 1996.

STEP ONE.
Identify Focal Issue or Decision

what issues will your decision-makers be thinking hard about?
what decisions must be made that will have a long-term influence on the company's fortunes?
what is it that keeps you, or your company's decision-makers, awake at night?

Take a few minutes to jot down some of the critical decisions facing your company or organization. Review and discuss; choose one via straw poll to serve as the focal issue for your scenarios.


Focal Issue or Decision:

STEP TWO.
Key Factors in the Local Environment

What are the key factors that influence the success or failure of the decision in step one?

Spend fifteen minutes brainstorming to identify the components of the situation about which you are making a critical decision, e.g., who are the people involved, the stakeholders, clients, service providers; what raw materials or resources are required; what technologies are used; etc. Be as specific as possible in listing what might affect the specific decision you want to consider.

This is critical for providing an organization- or business-specific focus.


Key Local Factors:

STEP THREE.
Identify Driving Forces

What driving forces in the macro-environment will influence the key local forces you have just identified?

There are two possible approaches to this question.

One, identify and summarize major trends of change occurring in society, technology, the economy, the environment, and in politics -- a "STEEP" analysis. Many research institutes engage in this review as an ongoing process, so you would not necessarily have to do this in-house.

OR,

Two, take a few minutes and ask yourself what are the forces behind the micro-environmental forces you identified in Step Two? Based on your best knowledge, or a review of a STEEP analysis as mentioned above, what trends occurring today are affecting or producing the key local forces you identified?

Macro Forces Driving Change:

STEP FOUR.
Rank Driving Forces by Importance and Uncertainty

Review the driving forces you have just listed. Some of them, like demographics, will be highly determined. Others, like public opinion, will be highly uncertain. Taking them one by one, discuss their degree of importance for the success of the focal issue [identified in Step One]. Next discuss their relative degree of uncertainty.

Rank the driving forces for importance and uncertainty.
YOU ARE LOOKING FOR THE MOST IMPORTANT and
THE MOST UNCERTAIN.

There may only be one driving force that seems both critical and uncertain -- or there may be two or three. Choosing more than three for any one scenario building session gets cumbersome, but can be done [see Hawkins, Ogilvy, and Schwartz, Seven Tomorrows.]

STEP FIVE.

Selecting Scenario Logics

After identifying your "axes of crucial uncertainties," get out a largish piece of blank paper and arrange them on it, either as a spectrum or continuum [along one axis], a matrix [two axes], or a volume [three axes], in which different scenarios can be identified and then details filled in.

The scenario logic will be characterized by its location in the matrix.

You then can ask yourself how different plots might handle the same forces, e.g.:

Winners and Losers
Challenge and Response
Evolution
Revolution
Cycles
Infinite Possibility
The Lone Ranger
"My Generation"
etc.

STEP SIX.
Fleshing out the Scenarios

Give each key factor and trend some attention in the context of the plot you've chosen. Reveal connections and mutual implications: remember, everything is connected. Tell readers how the world gets from here to there. What events might be necessary to make the end point of the scenario plausible. Are there known individuals whose ascendancy in the public eye might facilitate or help to characterize a given scenario?

Details, timelines, characters:

STEP SEVEN.
Implications

How does the decision look in each scenario? Jot down your initial thoughts on the opportunities and threats each scenario presents your decision.

How would the stakeholders change under each scenario? your competitors? your customers? subsidiaries and service provicers?

Opportunities:

Allies:

Threats:

Competitors:

STEP EIGHT.
Selection of Leading Indicators and Signposts

what additional data do you need on the local environment, given the possibilities raised by these scenarios?
what additional data do you need on the macro-environment, given the possibilities raised by these scenarios?
what variables might make good indicators of the direction of change?

It is important to know which story most closely depicts history as it unfolds. Identify a few observable and measurable trends which you can monitor as bellwethers of critical change.



Additional local data:

Additional macro-environmental data:

Potential signposts/indicators: