Part 2 — Exploring the environment.

Once you have set a scope (see the previous article), you have a clear picture of what the scenarios should and should not be about and how far ahead you are looking. The next step is to look at the external environment. Scenario planning is, after all, a method in which you look "outside-in", at important developments in the external world. At developments you cannot control yourself, but which raise the issues your organisation needs to anticipate. In the past we had to talk at length to convince organisations that external developments, whether certain megatrends or emerging game changers, could drastically change their playing field. With a dotcom bubble, two worldwide pandemics, a debt crisis, the Arab Spring, Trump in the White House, a nuclear disaster, Brexit, a refugee crisis and the war in Ukraine that marked the last two decades, this message has well and truly landed. And with new waves of international protectionism, conflicts over scarce means of production, disruptive technologies, climate challenges, growing social divides and twin ageing on the horizon, organisations can brace themselves for the future. It is therefore more important than ever to develop a good picture of what is happening in that complex, uncertain external world.

You can of course call on the help of ChatGPT for this, but it is above all valuable to do this together within an organisation, to learn from each other's perspectives. It can also help to involve people from outside (experts, contrarian thinkers, stakeholders). Together you see more and you can better assess the value of developments. Identifying relevant external developments is, after all, easier said than done. As humans we have a number of psychological limitations, or filters, that can distort our view of the external world.

Our filters distort our perception

Leventhal and March wrote the influential article "The myopia of learning". They give an overview of myopias (filters, as it were) that mean we do not always interpret information correctly. The most important are the temporal, spatial and hubris myopias. The temporal myopia says that when filtering information, the short term always takes priority over the long term. The spatial myopia explains why we often remain stuck in existing structures and find it very difficult to foresee that these will change. The hubris myopia says that we often see lessons and insights from the past as directional for the future.

If you want to start making scenarios, or only carry out a trend exploration, it is therefore important to be aware of these myopias and to keep each other sharp on tunnel vision.

The external environment

For a complete picture it is important to work systematically, peeling away the external environment like an onion. The outer ring is formed by the macro environment, the middle ring by the direct environment of the organisation. In our article we explain what these environments are and what useful tools you can use to explore them.

Want to know more about exploring the external environment? Download the article here.

---

Jeroen Toet is a senior strategist at Jester Strategy and co-author of the book Scenario planning in practice. For more than 10 years he has been helping organisations in the private and public sector make future-proof choices through a range of foresight methods, including scenario planning.

Questions about the article? Please contact Jeroen: j.toet@jester.nl or 06 11 451311.