It is possible to plan but looking backward to 2019 or 2020 business results is not going to help. Strategic planning methods that encourage executives to look to future trends like scenario planning is one of the techniques that larger and small organizations are using since the pandemic hit. Scenario planning does not start with looking for past patterns of business operations and performance. The organization researches future trends, opportunities, risks and defines many paths forward to future results and outcomes. For example, Pitzer College, the small college I graduated from, developed fifteen scenarios for sustaining the college and planning for bringing back students to campus.
Small businesses and non-profits may not have heard of scenario planning or feel they have the resources to do it. Below is a three-step approach to scenario planning for small businesses and non-profits that we introduce to all our clients.
- Research future economic forecasts and social trends from reliable sources to create sketches of what experts expect conditions to look like in 12 months and 24 months
- Talk to customers, colleagues and professionals in your network and ask them what they think the future will look like and ask for the sources that led them to their vision of the future
- Create three scenarios of the future indicating the direction and level of improvement or decline in customer behavior, economic conditions and social trends
- Scenario Plan One describes the BEST-CASE conditions under three topics and the business results you think you may be able to generate
- Scenario Plan Two describes the WORST-CASE conditions under the three topics and the business results you must prepare for to generate sustainable business results
- Scenario Plan Three describes YOUR DESIRED CASE under the three topics somewhere between the BEST and WORST case that you want to aim for over the planning period
Benefits of this simplified approach to scenario planning:
When clients use this approach to planning we find that they frequently meet or exceed their desired case of business results because they:
- Invest less time worrying about achieving past results
- Invest more energy and time into clarifying and working toward a better future
- Learn more about business economics, local business trends so they can achieve their vision of the future
- Work toward range of sales and operating performance objectives in the coming months rather than stressing over hitting a narrow set of objectives
- Create backup plans to respond to changing conditions and trends that effect business results