The traditional way of looking at your business strategy has been turned on its head by fast-paced technological change and disruption occurring perpetually in almost every industry. It is no longer enough to assess your current strategy and predict your future in terms of the past and present; it is imperative to test it in the future. Business owners have a kit of great tools but a time machine is one of them … yet.
Today it is better to arm your business’ key capabilities in a way that it can respond to emerging opportunities and threats that emerging technology and industry disruption bring. It is still important to monitor and analyse what is happening in your business environment, to understand your strengths and weaknesses, and spot opportunities and threats. However, in most industries, the danger in seeing the past as an accurate predictor of the future can blind your businesses eye to the possibilities that have not yet occurred, the disrupting forces and opportunities, to threats that have emerged, and environmental forces unseen.
Today the rules have changed & so are the forces working on your business are changing. We need to recognise that technological innovation emerges to alter the importance of competitive factors or makes old factors irrelevant. It is important to analyse these driving forces to see which are at work and what impact the may have. In this way we can future proof our business. Firstly, identify those forces likely to exert the greatest influence over the next 1 – 3 years; usually no more than 3 or 4 factors will be real drivers. Secondly, assess the impact, what differences will they make, will it be favourable or unfavourable?
A key strategic tool to achieve this is Scenario Planning. You can assess the driving forces in 4 futures:
- Optimistic
- Pessimistic
- Likely
- Divergent (where disruption can occur)
What elements do we assess in this Scenario Visioning? The 5 Cs:
- Customers
- Competitors
- Company
- Collaborators
- Context
We can use a environmental analysis, competitor analysis factors, a SWOT, or the activity of collaborators and the behaviour of customers in existing and potential markets to give us a comprehensive vision of how change can effect your business in terms of all that is important for success.
Essentially, Scenario Planning is a Risk Management issue; it is about identifying possible futures and understanding the likelihood and implications of these possibilities and manage any unacceptable risks that the process raises.
If you want to see how this can work for you in your business, give us a call on 0414 362 557 or contact us via our website for a free consultation.
