Planning

 When attempting to plan for the future, there are a few methods that can be used to make these plans. Organizations planning for future events in paramount to be able to successfully grow and expand (McKenzie & Sansone, 2019). In this discussion post, we will compare two different methods of planning. The first method is scenario planning and the second is traditional planning.

Scenario Planning

            The first method of future prediction is scenario planning. Scenario planning is a method of prediction that provides a flexible long-term plan (Chermack et al., 2001). The planning often includes a mix of qualitative and quantitative perspectives to make predictions (Chermack et al., 2001). The organization will observe both what is motivating the organization such as the economy or evolving technologies. Then the organization will identify uncertainties with these motivations and begin to identify uncertainties. From these uncertainties the organization will determine the plausible scenarios and their implications (Chermack et al., 2001).

Traditional Forecasting

            Traditional forecasting is attempting to predict future scenarios based on historical records (Klimberg et al., 2010). The organization will review their historical records, determine the trends, and plan for a similar future based on the findings. The best example of traditional forecasting is the Farmer’s Almanac (Klimberg et al., 2010). This almanac compares historical data of solar patterns and weather conditions to the current activity. While not perfect, the Farmer’s Almanac can predict weather with an accuracy of eighty percent (Klimberg et al., 2010).

Comparison

            There are benefits to both forecasting and scenario planning depending on the goal. Forecasting attempts to predict a single future while scenario planning seeks multiple goals based on uncertainties. Forecasting is good for short-term goals while scenario planning is good for long-term planning. Forecasting can typically be replicated, but scenario planning is mostly situational. When selecting a method of future planning, the organization will need to determine their goals.

References

Chermack, T. J., Lynham, S. A., & Ruona, W. E. (2001). A review of scenario planning literature. Futures research quarterly, 17(2), 7-32.

 

Klimberg, R. K., Sillup, G. P., Boyle, K. J., & Tavva, V. (2010). Forecasting performance measures–what are their practical meaning? In Advances in business and management forecasting (pp. 137-147). Emerald Group Publishing Limited.

 

McKenzie, D., & Sansone, D. (2019). Predicting entrepreneurial success is hard: Evidence from a business plan competition in Nigeria. Journal of Development Economics, 141, 102369.

 

Comments

Post a Comment

Popular posts from this blog

Forecasting and Innovation

  Infamous Prediction That Came True             The future is almost never certain. However, there are some methods that can be used in order to predict what the future may hold (Chermack et al., 2001) . Some of the predictions that were made in the past have come to fruition. One example of these predictions are the 15 advancements in technology that Bill Gate’s provided in 1999 (Gates, 1999) . While not the exact predictions, all 15 became commonplace in the current era. I won’t cover all of the predictions, but one of the most infamous can relate to his predictions on digital marketing. Summarization             The ninth prediction that Bill Gate made was "Devices will have smart advertising. They will know your purchasing trends, and will display advertisements that are tailored toward your preferences." (Gates, 1999) . Ever talk to someone about a certain produ...
Read more

Scenario Planning over Forecasting

Image
  There are moments in history where traditional forecasting methods have failed (Ademmer & Boysen-Hogrefe, 2022) . While it is not possible to completely what will occur in the future. Organizations can attempt to predict what may occur based on historical precedent and accumulated data (Klimberg et al., 2010) . While some errors do not have severe impacts, there are times in history where forecasting errors can have consequences. In this individual project, one of these forecasting errors will be discussed. Following the summary will be a discussion on how scenario-planning supports futuring and innovation. The forces that support scenario-planning will be identified as well. The project will conclude with the student considering how they will use scenario-planning for future innovation efforts. Forecast Failure: The Great Recession One of the more recent forecast errors that resulted in far reaching consequences was the economic crisis of 2007 – 2009 (Gadea Rivas &...
Read more