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After many years of scenario planning, this paper takes a moment to reflect on its use within, and value to, organizations. The author states that ultimately the benefit of scenario planning must result from ‘changed and more skilful action by the organization within its business environment.’ Navigating through the business environment is discussed as taking on two forms, that of strategising and learning where the former is dominated by ‘knowing by gaining control’ and the latter by ‘knowing by participation’ and reflection. Taking this logic a step further, van der Heijden sees the purpose of scenario planning as being categorisable along two dimensions content/process and thinking/action producing a matrix of four categories of purpose. Although he sees these four reasons for using scenario planning as harbouring different degrees of difficulty and likelihood of success, he advocates above all that organizations think carefully about which category is appropriate for them and ensure that the process of scenario planning is designed to support this goal.

Why would internally developed alternative futures contribute anything to survival and success of an organisation? Reshuffling internal data sounds like bootstrapping nothing into something. However, scenario planning is enjoying a boom period (for general reference see [1] and [2]. There is a rapidly spreading community of scenario practice producing an ongoing stream of publications on case-based success stories. We are also hearing an increasing number of reports of failure. In Strathclyde’s Centre for Scenario Planning and Future Studies we monitor these developments, in an attempt to work out how to understand success or failure. A surprising finding is that scenario planning is overwhelmingly perceived as a highly specific tool for strategy development and planning. For example the consultants Bain and Co published statistics of the use of the ‘scenario tool’ relative to other well-known strategy tools, such as benchmarking and balanced scorecard [3]. However, our research shows that such comparisons are not valid as they do not compare like with like. The scenario approach is not one tool but a toolbox, containing many tools under an umbrella-philosophy on organisational survival and success. In fact many of the tools that Bain compare scenarios with would often be part of the scenario approach. These include competitor analysis, customer analysis, core competencies, Five Forces analysis, groupware, mass customisation, mission and vision statements, portfolio analysis, simulation models, technology forecasting, and so on. In the light of this confusion it seems worthwhile to spend some time thinking about the purpose of scenario planning. The ‘tool’ assumption makes reasons for introducing scenarios often seem superficial, such as “forecasting didn’t work, let’s try this tool” or vague, with an aura around scenario planning of a new and sophisticated tool that ‘planning professionals’ know how to work. In addition if there is one thing we can all agree upon it must be that the future is uncertain. That implies that there is more than one possible future. From that point of view scenario planning seems self-evident as a thinking style. As a result there does not seem to be a great felt need for further thinking into purpose beyond the general and vague notion of improving ‘foresight’. We believe that this confusion causes an increasing number of reports of failure related to poorly defined objectives and expectations. Scenario approaches have many degrees of freedom, varying from adopting a thinking style to detailed methodology, and from half-a-day exercises to projects spreading over a year-and-a-half with many diverse activities. Without clarity on what is to be achieved the process cannot be purposefully designed, and it is not altogether surprising that problems occur leading to disappointment. We believe that scenario planning would benefit considerably from being approached in a more purposeful way. In this paper we present a categorisation of purposes that can be pursued through scenario planning. Ultimately all benefits have to come from changed and more skilful action by the organisation in the business environment. This paper therefore first deals with how organisations navigate through and adapt to the business environment, and how this can be affected by interventions such as the introduction of scenario planning.

In conclusion this article makes the following argument: The aim of management is to use human knowledge and experience to navigate an organisation over time through its business environment towards the high ground of survival and success. Human knowledge can take the form of either explicit and testable propositions in a limited domain (knowing by gaining control), or tacit—but actionable—experience (knowing by participation). Strategising on the basis of knowing by gaining control leads to rationalistic strategy design, in search of the best possible solution. Managing on the basis of knowing by participation leads to an ongoing process of action-based organisational learning (OL). In times of flux action-based OL becomes more effective than grand strategy design. Scenarios have a role to play in both strategising and learning. In the strategy design mode the scenario method has shown itself to be effective in analysing puzzles in the business environment through a more effective integration of fragmented disciplinary knowledge and viewpoints. In OL mode the scenario method makes use of multiple futures as alternative and potentially more relevant perspectives on the business situation. These enrich the “portfolio of possible strategic initiatives”, leading to action and new experience, that, in turn, leads to new understanding of the business environment and new and up to date scenarios and success formulae. Scenario projects aiming at one-time development of “a good strategy” often fail, suggesting that successful strategy cannot be based on explicit testable knowledge alone.