Boardman LJT: “Creating strategy in uncertainty “
Boardman LJT discussed strategy creation in turbulent times at Aalto University. Jens Schmidt, Timo Vuori and Tuomo Harju introduced fresh perspectives on global developments and scenario work, and the event was moderated by Boardman LJT Chairman of the Board Kari Kasanen.
We know nothing yet
Is the world more uncertain than it was ten years ago, or are we as people more uncertain? If we think of uncertainty as the lack of knowledge of something that might be relevant, we can start contemplating what we can do about it.
We can ask experts, who are the ones who ought to know. But their recommendations and forecasts are often far off, especially in situations that call for strategic decisions. And it is not uncommon that experts have an overly optimistic view of their knowledge. Jens Schmidt emphasizes that humility is essential to anyone seeking to expand their view.
To be able to make a good decision there is no alternative to thinking for ourselves. A good decision is not one that has a good outcome but that is based on a high-quality process of decision-making. Productive disagreement, allowing different viewpoints, debates and disagreement, making explicit one’s assumptions, and considering alternative scenarios should lead to better decisions.
Scenarios aid in gaining perspective
It is impossible to consume all the information available, and the current algorithms narrow our attention even further. But instead of letting our daily routines dictate what we do, Timo Vuori suggests taking advantage of scenario tools to intentionally develop awareness of a wide variety of paths. A busy mind leads to a limited imagination, making it impossible to expand your thinking. In scenario work, everything stops, and you must think of radically different scenarios, enabling a wider perspective.
When contemplating options, all topics and ideas ought to be up for discussion. Bad ideas are important, as implementable plans often form after 20 or 25 other suggestions once the atmosphere is relaxed and creative. It is important to note that executive should also think the scenarios through themselves, not only delegate the work to consultants, even if the latter can help facilitate the process. Furthermore, best decisions are often made in real time, whereas scenario exercises help one to prepare for real-time decision making–The relevant developments are often perceivable via an extensive set of different alternatives.
There are no bad ideas
Developing several scenarios simultaneously has proved to be an effective process in mapping out the best alternative for company development. At August, no idea was too bad to not be thoroughly thought through. In the evaluation phase the alternatives were eliminated into two directions, which were then developed on a company level. Tuomo Harju says that the debates for and against different scenarios before evaluation and decision making ensured that they were making the best decision possible.
Scenarios provide the means to observe the business environment outside company strategy. Once a company has recognized a set of potential options, it can consider which potential environmental developments would favour which alternative. This makes environmental scanning more meaningfulness than the typical general reviews of the business environment.
Scenario work enables growth and learning, but only if the environment allows creativity and all ideas to be heard. Scenario work takes a great deal of time, and decision-making might even take longer, but with high-quality results.