Scenario Planning 


 Forecasting is predicting the outcome of a future event that has not been analyzed yet. Forecasting can be done in any science or social experiment—for instance, forecasts in economics, weather, education, and economics, etc. The forecast can also be qualitative or quantitative, depending on the scenario. Surveys or interviews are used to make qualitative forecasts, whereas quantitative forecasts are used for statistical analysis. However, with the frequent changes in the market due to globalization changes, it is hard to predict the future based on past or current trends based on facts. The traditional technique failed to incorporate such changes that are coming due to frequent market changes. 

 

When it comes to scenario planning, strategic planning helps the organization make a flexible future that addresses traditional forecasting issues.  Scenario planning is also called scenario thinking. KaufmanHall(2016) stated scenario planning is used in military planning.  Global(2008) described that scenario-planning differs from prediction techniques but a technique that incorporates various views that assist in managing risks and seizing market opportunities.

 

Traditional forecasting uses mathematical techniques or qualitative analysis to find the future results of a projected event. For instance, regression analysis and interviews. Whereas scenario planning uses matrix approaches with quadrants and other strategic planning techniques. Second, the expected outcome in traditional forecasting is more fixed and not expected to change; however, the outcomes in the scenario planning are flexible and can be adjusted depending on the uncertainties and risks associated with the planning(Amer, Daim, & Jetter,  2013). 

 

Moreover, traditional forecasts help find a direct or one dimension or a two-dimensional forecast value. Still, scenario planning helps find alternative solutions that can be characterized by 3D dimensions. The advantages of traditional forecasting are more of non-human involvement as it uses mathematical projections or qualitative research methods. However, scenario planning is less flexible in finding alternative solutions to adjust the projection results based on current environmental changes. Moreover, if the projection is based on historical data, it fails to incorporate current and future. However, the advantage of scenario planning is that we can adjust the projection results based on current changes in circumstances. 

 

References 

 

Amer, M., Daim, T.U., & Jetter, A. (2013). A review of scenario planning. Futures, 46, 23-40.

 

Global(2008). Introduction to scenario planning. Retrieved May 2, 2016 from

            https://www.mwcog.org/uploads/committee-documents/aV5eWFtX20080731094534.pdf

 

KaufmanHall (2016). Scenario planning. Retrieved May 2, 2016 from

        http://www.axiomepm.com/solutions/core/budgeting/scenario-planning?gclid=CjwKEAjw9Zu5BRCS_OuVibujhQ0SJAD7t4KrtylNeDnd_IB5syWMOeRBDl2QziIjc99IxeUyEQWyqRoCUt3w_wcB

 

 

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