The Scenario Planning Process

4.2 The Scenario Planning Process

Conventional scenario planning is generally company-centric. There is always a risk is that a company’s pre-existing thinking and priorities so dominate the scenario planning process that the "what if” intent of scenario planning gets lost. Following a scenario planning methodology can reduce this risk by forcing you to think about important questions as you work through the process, including:

• Am I thinking about technology developments in the right way?
• Will I win or lose in a carbon-constrained world?
• What are the risks of acting too early or too late?
• Will I be regulated? When? What for? How much will compliance cost?
• Do I understand my mitigation options and abatement cost curves?
• Do I face brand, customer, or other stakeholder risk?
• How much risk do I face via long-term capital deployment?
• Could I be competitively disadvantaged through a climate strategy?
• Can I create competitive advantage for my company through a climate strategy?

This part of Chapter 4 walks you through the scenario planning process, points you to a large volume of scenario planning information and resources, and helps you navigate the challenges of climate scenario planning. The section is structured as follows:

1. Identify Your Objectives, Goals, and Governance
2. Consider Existing Scenarios and Sectoral Resources
3. Select Your External Scenario Variables
4. Select Your Internal Scenario Variables
5. Carry Out the Scenario Planning Exercise
6. Assess, Refine, and Report the Results

1. Identify Your Objectives, Goals, and Governance
2. Make Sure You're Ready for Climate Change SP
3. Consider Existing Scenarios and Sectoral Resources
4. Engage the Right Internal Interests and Constituencies
5. Identify the Internal Objectives and Goals for Your SP
6. Select External Scenario Variables
7. Review Relevant Impacts Work
8. Select Internal Scenario Variables
9. Carry Out the Scenario Planning Exercise
10. Review Relevant SP Work
11. Assess, Refine, and Report the Results
12. Frame Out the Scopes and Analytics of Your Scenarios
13. Select Internal SP Variables
14. Select External SP Variables
15. Build the Appropriate Scenario(s)
16. Carry Out the SP, Evaluate Results and Refine
17. Report Results Internally, Decide on Next Steps
18. Develop an Update Process for Business-Critical Variables