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Foresight: understanding the methodology

The scenario method: an aid to strategic planning

Benjamin Cabanes, Lecturer at Mines Paris - PSL & at the MIE department of École Polytechnique (IP Paris), Orso Roger, Research Engineer at Institut des Hautes Etudes pour l'Innovation et l'Entrepreneuriat (IHEIE/PSL) and Liliana Doganova, Researcher at Centre de Sociologie de l'Innovation at Ecole des Mines de Paris
On October 25th, 2023 |
5 min reading time
Benjamin Cabanes
Lecturer at Mines Paris - PSL & at the MIE department of École Polytechnique (IP Paris)
Orso Roger
Orso Roger
Research Engineer at Institut des Hautes Etudes pour l'Innovation et l'Entrepreneuriat (IHEIE/PSL)
Liliana Doganova
Liliana Doganova
Researcher at Centre de Sociologie de l'Innovation at Ecole des Mines de Paris
Key takeaways
  • The scenario method is a planning tool that can be used to design long-term objectives while the future remains undecided and uncertain.
  • There are three main categories of scenario: predictive scenarios, exploratory scenarios, and normative scenarios.
  • Scenario design is based on four distinct stages: construction of the basis, development of images of future situations, verification of the quality of the scenarios produced, and study of the consequences of these scenarios.
  • There are three main scenario methods: Intuitive Logics, Probabilistic Modified Trends and Foresight.

Strate­gic plan­ning con­sists of deter­min­ing the set of deci­sions that will enable us to access the activ­i­ties con­sid­ered to be the most sig­nif­i­cant. In the imme­di­ate post-war peri­od, plan­ning was based on busi­ness fore­cast­ing meth­ods that made it pos­si­ble to eval­u­ate the future on the basis of sim­ple, rea­soned extrap­o­la­tions of past trends1. Essen­tial­ly pro­jec­tive, plan­ning began with an inven­to­ry of ini­tial resources and means and end­ed, a pos­te­ri­ori, with the deter­mi­na­tion of short- and medi­um-term objec­tives. In the 50s and 60s, the emer­gence of fore­sight led to a renew­al of plan­ning approach­es, par­tic­u­lar­ly in terms of devis­ing long-term objec­tives while the future remained unde­cid­ed and uncer­tain. Unlike tra­di­tion­al plan­ning, fore­sight plan­ning focus­es on long-term objec­tives and goals, and then pro­gres­sive­ly looks at goals, strate­gies, and resources in rela­tion to an increas­ing­ly dis­tant time hori­zon. For­ward plan­ning is based on a range of het­ero­ge­neous tools and prac­tices2, the best known of which is the sce­nario method.

Scenario-based forward planning

Sce­nario-based for­ward plan­ning involves pro­ject­ing into the future changes in issues, rules of the game, strate­gies and capac­i­ties, as well as dis­tor­tions in the behav­iour of stake­hold­ers and in the polit­i­cal, eco­nom­ic and soci­etal con­text3. This method of plan­ning keeps stake­hold­ers in a state of per­ma­nent dis­com­fort, as it con­stant­ly requires them to rethink objec­tives, strate­gies, organ­i­sa­tions and resources in an ever-chang­ing envi­ron­ment where the future remains unpre­dictable4. The aim is not to pre­dict the future to bet­ter antic­i­pate it. Rather, the aim is to imag­ine a pos­si­ble future, or to use Her­man Kah­n’s phrase, to “think the unthink­able”5. For Her­man Kahn6, sce­nar­ios are an “aid to the imag­i­na­tion” and con­sist of a list of hypo­thet­i­cal events designed to encour­age reflec­tion on their caus­es and the con­di­tions for their realisation.

More gen­er­al­ly, sce­nar­ios can be defined as spe­cif­ic rep­re­sen­ta­tions of the future that stim­u­late reflec­tion on the pos­si­ble con­se­quences of dif­fer­ent events and facil­i­tate the design of action plans. How­ev­er, this image of the future may be more or less prob­a­ble, plau­si­ble, pos­si­ble or even desir­able. For exam­ple, the Inter­gov­ern­men­tal Pan­el on Cli­mate Change (IPCC) has defined a sce­nario as “a plau­si­ble and often sim­pli­fied descrip­tion of how the future might evolve, based on a coher­ent and inter­nal­ly con­sis­tent set of assump­tions about key dri­ving forces and rela­tion­ships”7. In con­trast, ADE­ME’s sce­nar­ios8 of a car­bon-neu­tral France in 20509 are spec­u­la­tive descrip­tions of sev­er­al pos­si­ble futures, which may be more or less desir­able depend­ing on the indi­vid­ual (Fig­ure 1).

Fig­ure 1: ADE­ME’s 4 sce­nar­ios for achiev­ing car­bon neu­tral­i­ty by 2050

Different categories of scenario

Because the pos­si­bil­i­ties for rep­re­sent­ing the future are so var­ied, fore­sight plan­ning can be based on a wide range of dif­fer­ent types of sce­nar­ios. Depend­ing on the com­plex­i­ty and uncer­tain­ty of the sub­ject to be explored, the time hori­zon cho­sen and the resources avail­able, the pro­duc­tion of sce­nar­ios can be based to a greater or less­er extent on fac­tu­al infor­ma­tion, weak sig­nals, major trends or spec­u­la­tive fic­tions. These choic­es will have a direct impact on the nature of the futures pro­duced, which may be more or less prob­a­ble, plau­si­ble or pos­si­ble (Fig­ure 2).

Fig­ure 2: Dif­fer­ent approach­es to design­ing sce­nar­ios10

There are gen­er­al­ly three main cat­e­gories of sce­nar­ios, which dif­fer accord­ing to the plan­ning objec­tives11:

  • pre­dic­tive sce­nar­ios, which use past and present knowl­edge to esti­mate prob­a­ble future situations;
  • explorato­ry sce­nar­ios, which use the real­i­ties, knowl­edge, and major trends of the present to esti­mate the plau­si­ble con­tin­u­a­tion of these trends in the future;
  • nor­ma­tive sce­nar­ios, which sketch out a par­tic­u­lar vision of the future, gen­er­al­ly desir­able, and then go back in time to iden­ti­fy the paths to fol­low to reach that future.

This clas­si­fi­ca­tion is not uni­ver­sal, how­ev­er, and it is pos­si­ble to spec­i­fy and refine cer­tain typolo­gies12. For exam­ple, two types of explorato­ry sce­nario can be dis­tin­guished: trend sce­nar­ios, which favour the con­tin­u­a­tion of major trends, and fram­ing sce­nar­ios, which aim to delim­it the space of pos­si­ble futures by rad­i­cal­ly vary­ing the hypothe­ses on the evo­lu­tion of present trends. Final­ly, the nor­ma­tive sce­nar­ios can be sit­u­at­ed more or less at the fron­tier of the space of possibilities.

Fig­ure 3: Four types of sce­nario13

Scenario design

The aca­d­e­m­ic lit­er­a­ture14 gen­er­al­ly dis­tin­guish­es three main class­es of sce­nario meth­ods in fore­sight: the “Intu­itive Log­ics” method15, ini­tial­ly devel­oped at the Rand Cor­po­ra­tion in the 1970s, then per­fect­ed by the Hud­son Insti­tute, Roy­al Dutch/Shell, the Stan­ford Research Insti­tute and the Glob­al Busi­ness Net­work; the “Probalilis­tic Mod­i­fied Trends” method16 also devel­oped at the Rand Cor­po­ra­tion in the 1970s; and final­ly, “La Prospec­tive”17 devel­oped by the French fore­sight school. Although dif­fer­ent in terms of objec­tives and tech­niques used, these three meth­ods essen­tial­ly share four main stages in sce­nario design.

If the present can be con­sid­ered as the start­ing point (explorato­ry sce­nar­ios) or the end point (nor­ma­tive sce­nar­ios), struc­tur­ing it always forms the basis of the sce­nario method. The first step is to describe the cur­rent sit­u­a­tion, i.e. to con­struct the basis18 by high­light­ing the vari­ables which char­ac­terise the phe­nom­e­non under study in its envi­ron­ment, and by iden­ti­fy­ing the play­ers involved, their rela­tion­ships and their moti­va­tions. This descrip­tion can be based on a wide range of tools and tech­niques. For exam­ple, the clas­sic tools of strate­gic analy­sis (PESTEL, SWOT, Porter’s 5 forces, etc.), the DELPHI method, or struc­tur­al analy­sis, which involves organ­is­ing a col­lec­tive dis­cus­sion to describe a sys­tem using a matrix of relationships.

The sec­ond stage con­sists of devel­op­ing sce­nar­ios. Based on the image of the present, the iden­ti­fi­ca­tion of trends, “weak sig­nals”19, “facts about the future” and the strate­gies of the play­ers, the objec­tive is to design sets of hypothe­ses in order to con­struct images of the future, i.e. sce­nar­ios. Depend­ing on the vari­ables select­ed and the set of hypothe­ses, it is pos­si­ble to obtain a wide range of sce­nar­ios. A selec­tion will then have to be made in order to pro­pose a rea­son­able num­ber of sce­nar­ios, gen­er­al­ly a ref­er­ence sce­nario and a few sce­nar­ios pre­sent­ing con­trast­ing images of the future. Depend­ing on the objec­tives, these images may be more or less plau­si­ble or pos­si­ble, explorato­ry or nor­ma­tive. This stage can also draw on a wide range of tools and tech­niques, for exam­ple, mor­pho­log­i­cal analy­sis20 (for “fore­sight”), the 2x2 matrix tech­nique21 (for “Intu­itive Log­ics”), cross-impact analy­sis22 or trend-impact analy­sis23 (for “Prob­a­bilis­tic Mod­i­fied Trends”).

The third step is to check the qual­i­ty of the sce­nar­ios pro­duced. The qual­i­ty of a sce­nario is mea­sured by its lev­el of coher­ence24.This means assess­ing the sequence of ele­ments link­ing the present sit­u­a­tion to images of the future, and vice ver­sa. This sequence must con­tain a cer­tain degree of log­i­cal and empir­i­cal cor­re­spon­dence. In addi­tion, all the ele­ments and hypothe­ses of a sce­nario must remain com­pat­i­ble with each oth­er. How­ev­er, such a quest for jus­ti­fi­ca­tion may tend to priv­i­lege the issues of plau­si­bil­i­ty and per­cep­tion of com­plex­i­ty to the detri­ment of the orig­i­nal­i­ty and vari­ety of the paths envis­aged25.

The final step is to study the con­se­quences of these sce­nar­ios for the prob­lem under study. This is a vital­ly impor­tant stage, as it involves deter­min­ing the devel­op­ment strate­gies, clar­i­fy­ing the action plan, and defin­ing and jus­ti­fy­ing the deci­sions to be tak­en. For this stage to be effec­tive, how­ev­er, the sce­nario method must not be con­fined to an episod­ic activ­i­ty26. On the con­trary, it must be inte­grat­ed into organ­i­sa­tion­al process­es and rou­tines such as strat­e­gy devel­op­ment, risk man­age­ment, inno­va­tion, and pub­lic affairs27.

1Zagamé, P. (1993). Plan­i­fi­ca­tion stratégique : Quelques réflex­ions pour une trans­po­si­tion à la plan­i­fi­ca­tion nationale. Revue économique, 13–55
2Cabanes, B., Roger, O. & Dogano­va, L. (2023). Com­ment les démarch­es de prospec­tive per­me­t­tent-elle de penser le futur ? Poly­tech­nique Insights.
3Roube­lat, F. (2016). Mou­ve­ment, plan­i­fi­ca­tion par scé­nar­ios et capac­ités d’action Enjeux et propo­si­tions méthodologiques. Stratégique, 113, 169–188.
4Ramírez, R., & Selin, C. (2014). Plau­si­bil­i­ty and prob­a­bil­i­ty in sce­nario plan­ning. Fore­sight, 16(1), 54–74.
5Kahn, H. (1962). Think­ing about the Unthink­able. New York: Hori­zon Press.
6Physi­cien et futur­o­logue améri­cain de la Rand Cor­po­ra­tion et fon­da­teur du Hud­son Insti­tute, Her­man Kahn est con­sid­éré comme le père fon­da­teur de l’analyse par scé­nar­ios. Il est notam­ment l’auteur des ouvrages suiv­ants : On Ther­monu­clear War (1960), Think­ing about the Unthink­able (1962), The Year 2000: a frame­work for spec­u­la­tion on the next thir­ty-three years (1967), Things to come: think­ing about the sev­en­ties and eight­ies (1972), The next 200 years: a sce­nario for Amer­i­ca and the world (1976).
7Inter­gov­ern­men­tal Pan­el on Cli­mate Change (IPCC). (2007). Syn­the­sis Report. Con­tri­bu­tion of Work­ing Groups I, II and III to the Fourth Assess­ment Report of the Inter­gov­ern­men­tal Pan­el on Cli­mate Change. Gene­va: IPCC, p. 86.
8Agence de l’en­vi­ron­nement et de la maîtrise de l’én­ergie.
9ADEME. (2021). Transition(s) 2050. Choisir main­tenant. Agir pour le cli­mat. Col­lec­tion Hori­zon, ADEME. 650 p.
10D’après Wiebe, K., et al. (2018). Sce­nario devel­op­ment and fore­sight analy­sis: explor­ing options to inform choic­es. Annu­al Review of Envi­ron­ment and Resources, 43, 545–570.
11Bör­je­son, L., Höjer, M., Dreborg, K. H., Ekvall, T., & Finnve­den, G. (2006). Sce­nario types and tech­niques: towards a user’s guide. Futures, 38(7), 723–739.
12Ramírez, R., & Selin, C. (2014). Plau­si­bil­i­ty and prob­a­bil­i­ty in sce­nario plan­ning. Fore­sight, 16(1), 54–74.
13D’après Julien, P. A., Lam­onde, P., & Latouche, D. (1975). La méth­ode des scé­nar­ios en prospec­tive. L’Ac­tu­al­ité économique, 51(2), 253–281.
14Amer, M., Daim, T. U., & Jet­ter, A. (2013). A review of sce­nario plan­ning. Futures, 46, 23–40; Huss, W. R., & Hon­ton, E. J. (1987).
15Sce­nario planning—what style should you use?. Long range plan­ning, 20(4), 21–29.
16Brad­field, Ron, et al. « The ori­gins and evo­lu­tion of sce­nario tech­niques in long range busi­ness plan­ning. » Futures 37.8 (2005): 795–812
17MacK­ay, R. B., & McK­ier­nan, P. (2018). Sce­nario think­ing: A his­tor­i­cal evo­lu­tion of strate­gic fore­sight. Cam­bridge Uni­ver­si­ty Press;
18Godet, M. (1983). Méth­ode des scé­nar­ios. Futuri­bles, 71(110–120).
19Schoe­mak­er, P. J., Day, G. S., & Sny­der, S. A. (2013). Inte­grat­ing orga­ni­za­tion­al net­works, weak sig­nals, strate­gic radars and sce­nario plan­ning. Tech­no­log­i­cal Fore­cast­ing and Social Change, 80(4), 815–824.
20Feuil­lade, M. (2023). Quelles visions d’avenir pour la san­té visuelle ? Poly­tech­nique Insights.
21Span­iol, M. J., & Row­land, N. J. (2019). Defin­ing sce­nario. Futures & Fore­sight Sci­ence, 1(1), e3.
22Bañuls, V. A., & Tur­off, M. (2011). Sce­nario con­struc­tion via Del­phi and cross-impact analy­sis. Tech­no­log­i­cal Fore­cast­ing and Social Change, 78(9), 1579–1602.
23Aga­mi, N. M. E., Omran, A. M. A., Saleh, M. M., & El-Shishiny, H. E. E. D. (2008). An enhanced approach for trend impact analy­sis. Tech­no­log­i­cal fore­cast­ing and social change, 75(9), 1439–1450.
24Har­ries, C. (2003). Cor­re­spon­dence to what? Coher­ence to what? What is good sce­nario-based deci­sion mak­ing?. Tech­no­log­i­cal Fore­cast­ing and Social Change, 70(8), 797–817.
25Roger, O., Dogano­va, L., & Cabanes, B. (2023). Sce­nar­ios as instru­ments of future-mak­ing: A prac­tice-ori­ent­ed analy­sis of RAND Europe sce­nar­ios. 39th EGOS Col­lo­qui­um.
26Schoe­mak­er, P.J.H. and van der Hei­j­den, C.A.J.M. (1992). Inte­grat­ing sce­nar­ios into strate­gic plan­ning at Roy­al Dutch/Shell. Plan­ning Review, Vol. 20 No. 3, pp. 41–46.
27Cabanes, B., Roger, O. & Dogano­va, L. (2023). Com­ment l’entreprise Shell a‑t-elle anticipé le pre­mier choc pétroli­er de 1973 ? Poly­tech­nique Insights.

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