Page 62 - BA1 Integrated Workbook STUDENT 2018

Chapter 6

Scenario planning

5.1 The process of scenario planning

Scenario planning involves the creation of detailed possible futures that
the organisation may encounter, allowing for the creation of contingency
plans.

The stages of scenario planning are:

 identify high-impact, high-uncertainty factors in the environment
(this often uses PEST analysis as a starting point)

 for each factor, identify possible futures

 cluster together different factors to identify various consistent future
scenarios

 write scenarios (typically limited to around three), identifying
financial and strategic implications and their associated probabilities

 for each scenario, assess and identify possible courses of action
for the firm

 monitor reality to see which scenarios (if any) are unfolding

 revise (‘redeploy’) scenarios and strategic options as needed.

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