August 09, 2012

Scenario Planning: Mid-2012 FSG Round-Up

It’s been a busy summer for FSG scenario consulting, with several projects running at high-speed, another couple about to be launched, and a steadily building proposal pipeline.  Does this mean a new surge of interest in scenario planning?  Could be.

What’s clear is that there’s an impressive amount of uncertainty in the air, with a seemingly toss-up US presidential election, a still unresolved Euro debt situation, the unknowable but huge consequences of the Supreme Court’s health care decision, and the increasing risk of another recession if Congress and the administration cannot agree on a fiscal package to avert across-the-board tax increases and spending cuts.  For many firms and planning organizations, these short-term risks and uncertainties argue for a very near-term scenario planning horizon.

We agree, up to a point.  We understand that for a lot of firms just hanging on to market share in the next 18 to 36 months will be a cause for celebration.  And yet, monumental forces for change are building on the horizon that will have long-term consequence beyond the current and coming business cycles – to cite the most obvious, the Baby Boomer retirement factor, the ongoing burden of consumer and student debt, healthcare costs and regulations, workforce skills gaps, China’s now possibly shaky place in the global economy, and the cost of global energy and commodities (especially, this year, food).

At a minimum, your business needs to have a handle on these dynamics, at least in the background, while you wrestle with more obvious shorter-term challenges and issues.  Because, as those of us who spend a lot of time in alternative scenarios know, the future always seems to arrive ahead of schedule.  This is just one more thing to keep scenario consultants awake at night...