Scenario Planning and Backcasting
“Consider a broad range of possibilities for how the future might unfold to help guide long-term planning and preparation…. The reason why we do reconnaissance is because we are uncertain. We don’t (and likely can’t) know how often things will turn out a certain way with exact precision…. By at least trying to assign probabilities, we will naturally move away from the default of 0% or 100%, away from being sure it will turn out one way and not another.” – Annie Duke, Thinking In Bets
I was giving this book a few days to digest before coming back to this concept of scenario planning Duke writes about. To me this is the heart of her book (the title does give it away). I’m not a poker player, but I do think in future probabilities in my career, and found this concept helpful in how I’m looking at 2020 and beyond. This goes beyond the usual weighing the probability percentage on an opportunity you’re forecasting to close, and looking at the bigger picture. Will this tactic work on this project? Maybe. Will it hold up as sustainable for the next five years? Harder to determine. How will changes in the economy impact the probability of this outlook? Does living in the same house for the next ten years increase or decrease the likelihood of retiring with a big enough nest egg?
These are the predictive exercises that clarify a vision for your future. When you combine it with another tool in your belt you can begin to identify actionable steps to get you there. Duke doubles down in covering the concept of backcasting, or working backwards from a positive future:
“Identify the reasons they got there, what events occurred, what decisions were made, what went their way to get the enterprise to capture that market share. This enables the company to better identify strategies, tactics, and actions that need to be implemented to get to the goal.” – Annie Duke, Thinking In Bets
The timing of this book was good for me as I map out the year ahead. I’m familiar with both techniques, but I’m not proficient at either. That’s something to work on as I refine my business plan for the year, and equally important for the other objectives in my life. A call to action, if you will, to clarify the vision and the steps needed to reach that outcome.