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Japanese scenario planning expert on trends, uncertainties and priority actions
Scenarios are “stories about equally plausible future environments,” explained Michinari Nishimura, scenario planning expert and founder and president of Greenfield Consulting, to the Salzburg Global Fellows gathered in Kyoto for the joint Salzburg Global Seminar-Nippon Foundation session People, Peace and Planet in 2030: Shaping Inclusive and Sustainable Growth.
Scenario planning incorporates much more than just recognizing predictable trends; it is more concerned with the multiple possible uncertainties of the future than traditional forecasting.
Scenario planning has its history in military planning; planning attacks and taking into account possible counterattacks before thinking of how a final endgame can be achieved. It has since proven popular outside of the military, starting with energy giant Shell adapting this military way of thinking in the early 1970s. It was through this use of scenario planning that Shell began to realize there could be a looming oil price crisis. This came about in 1973, and it was thanks to their work in scenario planning that the corporation was better able to adjust and adapt to the crisis.
The methodology became popular in public policy spheres in the early 21st century. Following the Asian financial crisis, the dot-com bubble and 9/11, as well as a number of other significant shocks to the system, policy makers and businessmen alike were forced to realize they needed to be better prepared for multiple uncertainties.
“Scenario planning is so applicable to this Kyoto seminar because we are now operating in a very uncertain age,” explained Nishimura. This uncertainty means that it is becoming more and more difficult to forecast and plan future events.
“Forecasting is just based on trends, and to some extent that is OK, but it means you are not thinking about those uncertainties which should be really incorporated into the thinking. If you’re just doing the forecast or making predictions, you’re just counting on certain things and assuming that those things are pre-fixed, which is not good in this uncertain age.”
Scenario planning requires an “outside in” approach, considering the macro environment (society, economy, policy, technology and global environment) as well as the micro environment (different stakeholders), before looking inwards. It considers multiple possible futures instead of just focusing on a single pinpoint, and assumes that those uncertainties could play a role in each different future scenario. Scenario planning also allows for multiple perspectives and a broader view. Thinking about a world of continuous technological advancement requires us to consider much more than just what those advances might be, but also what impacts they might have on different aspects of public and private life, incorporating political, economic and societal changes, and what unintended knock-on effects they might produce. The reverse approach can lead to isolation and failure.
Whilst in business scenario planning, multiple scenarios can all present opportunities if the risk is sufficiently managed, public-sector scenarios often reveal a clear preference for a more desirable scenario. The determining factor in this case will be whether or not there is the will and commitment to overcome the uncertainties necessary to arrive at the desired scenario, explained Nishimura.
For the purpose of their group work, the Salzburg Global Fellows were mixed up to ensure a combination of multiple perspectives from academia, business, public policy, and non-governmental organizations, and from different countries, helping them construct broad and content-rich scenarios.
Led by Nishimura, with help from his associate Yuriko Nakamura, the Fellows considered what their ideal scenario for 2030 would be on the topics of regional cooperation; innovation and equity in aging societies; and energy and resource security, and what variables they might encounter and need to overcome to be able to reach those visions. By identifying what the “key driving forces” were, they were able to identify what the greatest uncertainties would be, which might lead to alternative scenarios, and thus what key actions would need to be taken to reach their ideal scenario.
Nishimura asked Fellows to imagine themselves in 2030, constructing a narrative of what they imagine the future to be so as to check the logic of their multiple perspectives.
According to Nishimura, there are three critical factors to successful scenario planning:
“The design of the workshop is pretty critical,” explained Nishimura.
The various scenarios from the Fellows’ working groups on the three themes are available in the session report on the session page: www.salzburgglobal.org/go/518
Detailed breakdowns of the framework and process used in the Salzburg Global session in Kyoto are only available from Greenfield Consulting.