Scenario Planning (My thesis)

These days I am busy working on my thesis ,that's about Scenario planning ...

What is Scenario PlanningBefore defining scenario planning, it is necessary to give definition of scenario to make a better understanding of the term. According to Lynch (2003, p. 93-94), scenario are detailed and plausible views of how the business environment of an organization might develop in the future based on grouping of important environment influences and drivers of change about which there is a high level of uncertainty. For example, pub industry in the UK has changed during the past decade. Started from non-smoking area and now the pubs are facing new regulation in which pubs and nightclubs have to turn themselves into non-smoking pubs by 2008. Obviously, it is not possible to forecast precisely over the period of 10 years time that the government will write this regulation. However, pubs can imagine this happening if they look at the non-smoking area policy. Accordingly, it is a need for a pub industry to view business environment of five years or more. Scenario planning does not make an effort to predict or forecast the unpredictable future business environment. Therefore, it considers multiple and equally plausible futures (Ringland 2003, p. 22-28). For instance, Wetherspoon starts adopting the new regulation of pub policy by turning some of its outlets into non-smoking free-house. Wetherspoon’ scenario planning may see that non-smoking policy will make a decrease in numbers of customers as most of customers are smokers, so it might be better for them to adopt pioneer strategy by starting the policy before competitors. Scenarios planners also have to observe and monitors the changes till year of policy. If their idea is proven right by 2008, scenario planners build two options to solve the problems. The first option is to produce nicotine-contained drink and another alternative is to build the smoking room in Wetherspoon’ outlets. A scenario planning consists of developing possible representations of a firm’s potential future that make different assumptions about forces driving the market and include different uncertainties (Kotler 2003, p. 69-70). Both private and public organizations face the business environment, which is diversity. Companies have to be prepared to cope with these changes. Marketers must be able to see future plausible changes in the business environment. They may consider a question such as ‘What will we do if it happen?’ Marketers have to adopt one scenario as the most possible and observe as the time passes to confirm and disconfirm such scenario. By viewing the possible future scenarios, companies will be able to develop business strategies (Kippenberger 1999, p. 32-33). Take the recent UK airport bomb plot 10/8 as an example. The new security at the airport is stricter. The new security affects the operation of low-cost carrier as they rely on flight frequency and extra charge of luggage restriction. With the new rule, they have to permit customers to exceed 20 kilograms restriction as passengers are allowed only necessary items on board. The extra security causes delay of scheduled flights. Low-cost airlines such as EasyJet and Ryanair have to ask themselves ‘What will they do if the BAA does not remove the tough security?’ For instance, the scenario planners of Low-cost airline may develop new luggage restriction rule by increasing 20 kilograms to 30 kilograms instead. They can also charge £5-£10 extra money back guarantee for the on time performance instead of increasing the price to put burden on passengers. .....