Scenario Planning for Small Business
Business risk or uncertainty is natural in all businesses, big or small. As entrepreneurs, we must be on the lookout for new trends in customer behavior, technology, and market forces.
One of the best tools to manage uncertainties and spot opportunities in our business is scenario planning. Basically, it is like predicting the future based on different assumptions and trends. A classic case of poor scenario planning is the death of beepers or pagers. A powerful technology called SMS text messaging changed the business environment, making beepers obsolete. Their failure to anticipate and adapt to this trend resulted in their eventual death. Do not let the same thing happen to your small businesses.
Scenario planning can be done in these simple steps:
Develop Scenarios
Set a brainstorming session with your colleagues. Based on your knowledge about your competitors, new opportunities, changes in government regulations, emerging threats, and upcoming technological advancements, you create situations or predictions about the future of your industry. Do not discount even ridiculous scenarios for they might make sense later on.
Prioritize
In your pool of scenarios, identify which will likely happen soon and those that might happen in the long run. Your aim is to limit most possible scenarios where you can focus your efforts and resources
Craft Action Plans
Cover all your bases by planning your next moves if these situations happen in the future. You have different strategies for scenario A, B, and C. The bottom line, there will be no surprise in the future and you will always be a step ahead of competition.
If you want a more detailed scenario planning guide, go visit Small Business Information.
