FYI Scenarios are replacing business plans

Business plans were how business owners documented plans and the proof banks wanted to secure a loan. They’ve been superseded, partly because accurately forecasting budgets and sales is just getting too hard.

Scenarios are replacing business plans.
This is relevant for designers because it’s relevant to our clients.

How business plans were used

All business owners were once coached to write a business plans to document future activities. Lately business plans have morphed into strategy documents; more active, less personal and designed to share.

Problem is, planning is often based on certainty. That’s a problem because it’s becoming less and less feasible to assume our future will look like our past.

…it’s becoming less and less feasible to assume our future will look like our past

Now, instead of trying to work with fixed budgets and financial forecasts, companies are embracing the what-if? of scenarios.

What are scenarios in this context?

Scenarios force managers and leaders to consider how they might respond to potential situations. It’s interesting and relevant to designers because working with scenarios forces ‘outside-the-square’ thinking and that’s what designers do well.

Scenarios are possible future outcomes devised to develop strategy

It’s not new thinking. Shell petroleum is credited with introducing scenarios. They came up with ‘alternative stories about the future to develop strategy’ in the 1960’s as a risk management device when dealing with potential oil leaks on huge drilling platforms.

Now companies like IKEA are using scenario planning to be more prepared, more flexible, and to anticipate and respond to (possible) change.

Closer to home, we’ve embraced scenarios as the basis of our Healthier, Happier Creative Business canvas workshops.

Takeaway

Scenarios are a proactive planning approach. They pose questions then explore options, considering possible strategies and solutions.

They could be as simple as a 15 minute deep think about possible outcomes; or as detailed as a half day structured pre-mortem. Posing a series of ‘what if’ scenarios with a team of subject matter experts before a large project is invaluable.

Scenarios work for everything from event planning to website updates.

 

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Want more?

Here’s more information on designers making change to stay head:
1 How scenario planning differs to pre-mortems
2 An article about Shell using scenarios
3 This end-of-month financial checklist works for end-of-year