Future-proof your practice with Scenario Planning
From modern methods of construction (MMC) to artificial intelligence, from 3D printing to digitised construction, and from climate change to Brexit, the number of potential ‘disruptors’ to architecture as we know it is considerable. How can architects plan ahead for such an unpredictable future? Are there ways to avoid the threats and seize the opportunities?
One answer lies in Scenario Planning. It was first used as a tool for developing business strategies by Royal Dutch Shell in the 1970s. It proved its worth, as Shell navigated the decade’s oil market shocks better than any of its rivals. A structured method of investigating ‘what if’ scenarios of the future, Scenario Planning can help grow a business and safeguard against industry-threatening disruptors.
Duncan Campbell, partner of business strategy consultant Cognosis, recently led a workshop on Scenario Planning on the third day of this year's RIBA’s Future Leaders conference series, ‘Leading Change’. Campbell says the process will align a business with future market-drivers, instead of allowing it to be passively carried along by the economic tide.
Scenario Planning usually operates by brainstorming within a group. It begins by identifying the big drivers of likely change, often via a PESTEL analysis: deliberately scrutinising the political, economic, social, technical, environmental and legal sectors and asking what could be on the horizon.
Campbell suggests that the time scale we should be thinking of for commercial property or the changing face of architectural practice should be around seven years.
Two macro drivers – the biggest impacts – should be chosen. These might be, for instance, economic growth and an ageing population. These become the two axes (vertical and horizontal) of a Scenario Planning matrix that is drawn up, with stable/sluggish rate of change at one end and rapid/extreme at the other.
The second stage in drawing this matrix is to choose four ‘future worlds’ or plausible scenarios. One might be, for instance, a sudden near-universal adoption of modular housing. A useful selection approach is to choose two highly likely scenarios and two more left-field scenarios that could all turn out to become major market disruptors.
These future worlds become the four boxes of a classic Scenario Planning 2x2 matrix. Now the potential stories, or scenarios, for each of these worlds can be discussed and thought through by participants.
Of course, Scenario Planning cannot predict the future with any certitude, and accepting the limitations is an inherent part of the exercise. Keeping scenarios relatively simple is best, Campbell advises. Try not to over-complicate them.
The final step is to ascertain how the implications thrown up by the future scenarios might be addressed in the context of a business strategy.
"The results should always drive actions, even if they are small actions such as monitoring a situation closely or taking a potential risk more seriously," Campbell urges. "Two to five actions will be appropriate; never a long laundry list."
There will always come a point at which business as usual ends, whether this happens gradually or in a sudden shock. However, by identifying and tapping the drivers of change businesses can do more than just merely survive: they can flourish and grow.
"The economic environment should not be the only factor in your business planning," advises Campbell. "If you actively engage with the future and position your business with future trends in mind – whether they are policy driven, demand driven or technology driven – then you can achieve real growth, and really ignite growth if you get it right."
Thanks to Duncan Campbell, Partner, Cognosis.
Text by Neal Morris. This is a Professional Feature edited by the RIBA Practice team. Send us your feedback and ideas
RIBA Core Curriculum Topic: Business, clients and services.
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Posted on 15 August 2019.