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Analyzing the Success and Failure of Scenario Planning in Organizations

This study explores the dynamics of scenario planning interventions within organizations, pinpointing the causes of both success and failure. It highlights the concept of inertia in decision-making, detailing how commitment to existing strategies can hinder adaptability. The analysis includes case studies, such as the metaphor of a "giraffe in quicksand," illustrating organizations trapped in ineffective strategic directions. Successful interventions require vigilance, clarity in objectives, and a willingness to rethink current approaches to avoid procrastination and decision paralysis, leading to more effective organizational outcomes.

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Analyzing the Success and Failure of Scenario Planning in Organizations

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  1. Scenario planning interventions in organizations An analysis of the causes of success and failure George Wrighta, Kees van der Heijdenb, George Burtb, Ron Bradfieldb, George Cairns Carlos Eduardo Cunha ceac@cin.ufpe.br

  2. Index • Inertia • Giraffe in quicksand • Case of success • Conclusions • Questions?!

  3. Inertia • Commitment to current strategy will grow over time • Operational process become deeply embedded → mental model’s • Mental models: • prevent managers from sensing problems; • delay changes in strategy; • lead to action that is ineffective in a new environment. • In simpler, less turbulent environments, inertia may allow managers to focus on the most important issues

  4. Inertia

  5. Inertia • Vigilance • Careful search and use of information; • There is better solution, and time for debate and search. • Hypervigilance • May have better solution, but not enough time. • Defensive avoidance • There is no better solution than current course. • Procrastination, buck passing, and bolstering. • Unconflicted adherence • Do not change course. • Unconflicted change • Change current course to unthreatened.

  6. Inertia • Scenario Planning Intervention would be most appropriate after there is recognition that the threat current strategy is high, but before the psychological processes takes place

  7. Giraffe in quicksand • Major corporation • Senior management team • Interviews before scenario planning exercise • Interviewees active participants in exercise

  8. Giraffe in quicksand • Organization’s current strategic direction was failing; • Risks to be serious if the organization failed to change its current strategy • Risks to be serious if the organization did change its strategy

  9. Giraffe in quicksand • Procrastination, buck passing, and bolstering • ‘Rub salt into a wound’ • http://br.youtube.com/watch?v=jcdRT0Xv2RU

  10. Case of success • Operating in the ‘drinks’ industry • Parent company’s principal role is the marketing and branding of the group’s drinks products • Mission: • Provide a quality service in the blending, bottling and storage of scotch whisky and other spirits; • Co-operate with our customers in assisting them to develop their brands; • Provide a realistic return on the company’s assets’ • Long periods of small, incremental change, interrupted by much shorter periods of discontinuous, radical change.

  11. Case of success • Pre-intervention interviews • Workshops with an informed outsider (remarkable person) • Stimulated and Encouraged • Re-consider the purpose and objectives of the organization • Shifting responsibility (buck passing)

  12. Conclusions • Rethinking is an appropriate, vigilant, response to the ‘jolt’ of a scenario thinking intervention • Indicated lower procrastination, buck-passing, or bolstering behavior levels • Stresses engendered by a decision dilemma → decision avoidance → poor information search and contingency planning → disabled Scenario intervention

  13. Conclusions • However… • Team leadership • Team dynamics • Organizational Competence • Organizational Power • Organizational Architecture

  14. Questions?!

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